Fiscal Year ended October 31, 2006

Summary of Company Financial Statements
December 8, 2006

Listed Company Name

Kanamoto Company, Ltd.

Company Code Number

9678

Listing Exchanges

Tokyo Stock Exchange, Sapporo Stock Exchange

Head Office Address

1-19, Odori Higashi 3-chome, Chuo-ku, Sapporo, Hokkaido Japan 060-0041(URL http://www.kanamoto.co.jp)
Representative

Kanchu Kanamoto

Inquiries

Nobuhito Utatsu

President

Director & Corporate Officer, Division Manager, Accounting Division
TEL 81-11-209-1600
Please send inquiries in English to takayama@kanamoto.co.jp.
Date of Report to the Board of Directors

December 8, 2006

Scheduled Dividend Payment Date

January 29, 2007

Regular General Meeting of the Shareholders

January 26, 2007

Has the Company adopted a Unit Stock System?

Yes (One unit equals 1,000 shares)

1. Operating Results for the Fiscal Year Ended October 31, 2006
(November 1, 2005–October 31, 2006)(1) Operating Results(Numbers less than one million yen have been rounded down)
Revenues

Ordinary Income

Millions of yen%

Millions of yen%

Millions of yen%

60,753

(6.2)

3,715

(143.4)

3,739(90.7)

57,202(-3.5)

1,526(-17.1)

1,960

(7.3)

Fiscal year ended
October 31, 2006
Fiscal year ended
October 31, 2005

Net Income

Fiscal year ended
October 31, 2006
Fiscal year ended
October 31, 2005

Operating Income

Net Income per
Share ofCommon StockNet Income per
Return on
Return on
Share of Common Shareholders’
Total Assets
Stock Fully Diluted
EquityOrdinary
IncomeMargin

Yen

Yen

%

%

%

1,720

(182.4)

56.67

－

4.8

4.6

6.1

609

(△48.7)

20.16

－

1.8

2.4

3.4

(Notes) 1. Average number of shares outstanding during the fiscal year
Fiscal Year ended October 31, 2006

30,357,093 sharesFiscal Year ended October 31, 2005

29,856,334 shares

2. Are there any changes in accounting method?

Yes

3. The percentages shown for revenues, operating income, ordinary income and net income are the percent
increase or decrease compared to the prior fiscal year

(2) Financial Position
Total Assets
Fiscal year ended
October 31, 2006
Fiscal year ended
October 31, 2005

Shareholders’ Equity

Shareholders’ Equity
Ratio

Shareholders’ Equity
per Share

Millions of yen

Millions of yen%

Yen

83,51438,37646.0

1,167.90

79,03733,90342.9

1,135.43

Summary of Company Financial Statements, FY Ended October 31, 2006
P.50

(Notes) 1. Number of shares issued and outstanding at fiscal year-end
Fiscal Year ended October 31, 2006

32,859,118 sharesFiscal Year ended October 31, 2005

29,853,076 shares

2. Number of shares of treasury stock at fiscal year-end
Fiscal year ended October 31, 2006

13,123 sharesFiscal year ended October 31, 2005

400,165 shares

2. Projected Operating Results for the Fiscal Year Ending October 31, 2007
(November 1, 2006 - October 31, 2007)
Operating
IncomeRevenues

Ordinary
IncomeNet Income

Millions of yen

Millions of yen

Millions of yen

Millions of yen

Interim period

32,010

2,610

2,700

1,770

Full year

61,540

3,900

4,000

2,410

Reference: Projected net income per share of common stock (Full year)¥73.34

3. Dividends
・Cash dividends

Fiscal year ended
October 31, 2005
Fiscal year ended
October 31, 2006
Fiscal year ended
October 31, 2007
(projected)

Annual Dividend per Share of Common
Stock

Total Dividends(Annual)Dividend Payout Dividends as a
Percentage of Net
Ratio
(%)
Assets (%)

InterimYear-end

Full-year

9.00

9.00

18.00

537

89.3

1.6

9.00

9.00

18.00

564

31.8

1.6

9.00

9.00

18.00

Note: The above projections were prepared based upon information available to the Company at the time the projections
were announced as well as various assumptions concerning the future economic and business environment. Actual
operating results may differ from the projected figures depending upon various factors in the future.

Summary of Company Financial Statements, FY Ended October 31, 2006
P.51

Company Financial StatementsV

1. Comparative Balance Sheets(Unit: Thousands of yen)
Prior Fiscal Year(As of October 31, 2005)
Classification

Notes

AmountPercent

Current Fiscal Year(As of October 31, 2006)
AmountPercent

Change fromprior year

（Assets）
I

Current Assets
13,230,849

17,461,345

4,230,495

2,583,873

2,876,924

293,051

10,665,107

10,734,102

68,994

4. Merchandise inventory

253,508259,2145,706

5. Construction equipment

1,207,108

968,243△238,864

6. Supplies

58,43961,6493,210

7. Prepaid expenses

227,935

243,706

15,771

8. Deferred tax assets

367,932

384,442

16,5109. Accrued consumption tax

28,532－△28,532

10. Loans to affiliatedcompanies

500,000

100,000△400,000

11. Other

543,018

350,702△192,315

Allowance for doubtful
accounts△1,001,255△456,245

545,010

Total Current Assets

28,665,048

1. Cash and deposits
2. Notes receivable, trade*7

3. Accounts receivable, tradeII

32,984,085

36.3

39.5

4,319,036

Fixed Assets(1) Tangible Fixed Assets
1. Rental equipment
Accumulated depreciation

26,562,165

2. Buildings

26,646,008

9,453,886

9,087,513△366,372

5,462,248

117,426

933,405

30,107

696,598△77,023

1,989

△349

246,249△29,447

25,869,082

25,634,236△234,845－

246,544

246,544

11,276,024

Accumulated depreciation

5,931,201

3. Structures

11,763,231
5,344,822

6,300,982
3,988,185

3,838,891

Accumulated depreciation
4. Machinery and equipment

2,935,593*2

Accumulated depreciation

36,286

6. Tools, furnishings andfixtures743,191*2

gible Fixed

773,6223,427,606
35,88833,8982,338

1,018,889

Accumulated depreciation

8. Construction in progress

4,124,204

38,625

Accumulated depreciation

7. Land3,054,780

903,297

4,080,135
3,306,513

5. Vehicles and delivery
equipment

Total Tan
Assets35,733,522

36,016,051

1,049,851
275,697

42,622,746

803,601

53.9

42,308,785

50.6△313,961

Summary of Company Financial Statements, FY Ended October 31, 2006
P.52

Prior Fiscal Year(As of October 31, 2005)
Classification

Notes

AmountCurrent Fiscal Year(As of October 31, 2006)

Percent

AmountPercent

Change fromprior year(2) Intangible Fixed Assets
1. Goodwill－

64,00064,0002. Goodwill

96,000－△96,000

3. Software

50,772

42,749△8,022

4. Telephone subscription
rights40,51240,512－

Total Intangible Fixed
Assets187,2840.2

147,2610.2△40,022(3) Investments and Other
5,684,987

6,115,087

430,100

979,307

1,029,332

50,025

7,647

8,107

460

－

500,000

500,000

5. Claims in bankruptcy,
claims in reorganizationand other similar claims

320,870

197,310△123,560

6. Long-term prepaid
expenses

49,63347,710△1,923

7. Deferred tax assets

479,224

50,933△428,291

8. Insurance reserve

55,01659,191

4,174－

998,388998,388787,944

19,418△768,526

Allowance for doubtful
accounts△321,855△385,941△64,085

Reserve for investment
losses△480,173△565,171△84,997

Total Investments andOther Assets

7,562,603

9.6

8,074,368

9.7

511,765

Total Fixed Assets

50,372,634

63.7

50,530,415

60.5

157,781

Total Assets

79,037,683

100.0

83,514,501

100.0

4,476,818

1. Investment securities
2. Stock of affiliatedcompanies
3. Advances
4. Long-term loan to affiliatedcompany

9. Long-term guaranty money
deposited
10. OtherSummary of Company Financial Statements, FY Ended October 31, 2006
P.53

Prior Fiscal Year(As of October 31, 2005)
Classification

Notes

AmountPercent

Current Fiscal Year(As of October 31, 2006)
AmountPercent

Change fromprior year

（Liabilities）
Ⅰ Current liabilities
1. Notes payable, trade*4

7,214,389

8,246,886

1,032,496

2. Accounts payable, trade*4

2,425,623

2,522,512

96,889

3. Long-term bank loans due
within one year

10,555,000

9,935,000△620,000

4. Accounts payable, other

2,389,330

2,562,743

173,413

5. Accrued expenses

227,269

236,233

8,964

6. Corporate taxes payable

530,934

1,291,556

760,622

7. Consumption and other
taxes

－

193,662

193,662

8. Deposits

30,57933,822

3,242

9. Accrued bonuses to
employees

448,076

437,693△10,383

－

5,500

5,500

11. Equipment notes payable

133,487

340,345

206,857

12. Other

127,434

428,603

301,168

10. Accrued bonuses todirectors and auditors

Total Current Liabilities
I

24,082,124

26,234,559

30.5

31.4

2,152,434

Long-term Liabilities
1. Long-term bank loans

17,590,000

15,120,000-2,470,000

2. Long-term accrued
expenses

1,876,971

2,030,031

153,059

3. Accrued employees
retirement benefits

1,506,210

1,663,537

157,326

4. Retirement allowance todirectors and auditors

79,121

90,261

11,140Total Long-term Liabilities

21,052,303

26.6

18,903,829

22.6△2,148,473

Total Liabilities

45,134,428

57.1

45,138,388

54.0

3,960

8,596,737

10.9

－

－

－

(Shareholders’ Equity)
I

Shareholders’ Equity

II

Common stock(1) Capital surplus
Additional paid-in capital*1

9,720,343－－
9,720,343

12.3

－

－

－

Summary of Company Financial Statements, FY Ended October 31, 2006
P.54

Prior Fiscal Year(As of October 31, 2005)
Classification
III

Notes

AmountCurrent Fiscal Year(As of October 31, 2006)

Percent

AmountPercent

Change fromprior year

Total capital surplus(1) Earned surplus

1,375,287－－

11,831,684－－

928,192－－(2) Legal earned surplus
1. General reserve（3）Unappropriated retained
earnings
Total earned surplus

14,135,164

17.9

－

－

－

IV

Valuation difference onother negotiable securities

1,637,603

2.0

－

－

－

V

Treasury stock△186,594

△0.2

－

－

－

Total Shareholders’ Equity

33,903,254

42.9

－

－

－

Total Liabilities andShareholders’ Equity

79,037,683

100.0

－

－

－

－

－

9,696,717

11.6

－

*3

(Net Assets)
I

Owners’ equity
1

Paid-in capital

2

Capital surplus(1) Capital legal reserve－

10,817,389－(2) Other capital surplus－

143,480－

Total capital surplus
3－10,960,869

－

13.1

－

Earned surplus－

1,375,287－－

19,601－

General reserve－

11,831,684－

Earned surplus brought
forward－2,084,192－(1) Earned legal reserve(2) Other earned surplus
Reserve for advanced
depreciation of fixed assets

Total earned surplus－－

15,310,766

18.4

－

4

Treasury－－△6,303△0.0－

Total owners’ equity－－

35,962,049

43.1

－

II

Valuation and translation
adjustments
1

Valuation difference onother investment securities
Total valuation andtranslation adjustments

2,414,062

－

－

－

－

2,414,062

2.9－

Total Net Assets－－

38,376,112

46.0

－

Total Liabilities and Net Assets－－

83,514,501

100.0

－

Summary of Company Financial Statements, FY Ended October 31, 2006
P.55

2. Comparative Statements of Income(Unit: Thousands of yen)
Prior fiscal year
（From November 1, 2004
To October 31, 2005）
Classification
I

Notes

AmountPercent

Current fiscal year
（From November 1, 2005
To October 31, 2006）
AmountChange fromprior year

Percent

Operating revenues
39,607,013

2. Sales

17,595,627 57,202,641

II

2,205,977

41,812,990

1. Rental revenues

100.0 18,940,955

60,753,945

100.0

1,345,327

Cost of revenues

1. Cost of rental revenues

30,482,810

29,975,696

507,114

2. Cost of goods sold
Balance of merchandise
inventory at beginning of
periodMerchandise inventory
purchases
Merchandise received fromother accounts
Total
Balance of merchandise
inventory at end of period

III

*2

284,707

253,508△31,198

13,307,926

13,889,685

581,758

474,698

538,040

63,342

14,067,332

14,681,234

613,902

253,508 13,813,823

259,214

14,422,020

5,706

Total cost of revenues

43,789,520

76.5

44,904,830

73.9

1,115,310

Gross profit

13,413,121

23.5

15,849,115

26.1

2,435,993

Selling, general andadministrative expenses

1. Freight-out

57,62058,9861,366

2. Vehicle fuel expense

121,408

139,812

18,403

95,511

136,688

41,177

183,671－△183,671

71,527

77,535

6,008

4,494,439

4,766,693

272,253

768,535

917,503148,968

448,076

437,693△10,383

－

5,500

5,500

7,579

11,1403,561

483,661

285,223△198,437

213,104

239,287

26,182

62,13670,5168,380

3.Advertising and public
relations expense
4. Transfer to allowance for
doubtful accounts
5. Director compensation
6. Salary allowance
7. Bonuses
8. Transfer to accrued
bonuses to employees
9. Transfer to accrued
bonuses to directors andauditors
10.Transfer to retirement
allowances to directors
and auditors
11. Employees retirement
benefit expense
12. Travel and transportation
expenses
13. Entertainment expenses

Summary of Company Financial Statements, FY Ended October 31, 2006
P.56

14. Insurance premiums

101,490

98,504△2,986

Summary of Company Financial Statements, FY Ended October 31, 2006
P.57

Current fiscal year
（From November 1, 2005
To October 31, 2006）

Prior fiscal year
（From November 1, 2004
To October 31, 2005）
Classification

Notes

AmountPercent

AmountChange fromprior year

Percent

15. Communications expense

337,403

336,030△1,373

16. Maintenance and repairs

93,383

100,981

7,597

17. Consumables expense

269,484

301,152

31,668

18. Utilities

230,104

245,702

15,598

19. Taxes and public charge

400,680

366,944△33,736

20. Welfare expenses

733,143795,018

61,874

21. Depreciation andamortization expense

806,604

729,618△76,985

1,456,211

1,519,994

63,783

22. Rent
23. Other expenses

450,832 11,886,610

20.8

492,786 12,133,316

20.0

41,953Operating income

1,526,510

2.7

3,715,798

6.1

2,189,288

IV

Non-operating revenues

1. Interest revenue

8,402

9,272

870

2. Dividend income

58,37338,486△19,887

3. Gain on sale of investment
securities

359,093

24,883△334,210

244,052

250,919

6,867

47,70940,910△6,799

4. Rents received*1

5. Insurance benefits
6. OtherV*1

206,311

923,943

1.6

196,908561,380

0.9△9,403Non-operating expenses

1. Interest expense
2. Stock issuance expense
3. OtherOrdinary income

317,034

326,636

9,601－

14,762

14,762

172,555

489,5900.9

1,960,863

3.4

196,528

537,926

0.9

23,972

3,739,252

6.1

1,778,389

Summary of Company Financial Statements, FY Ended October 31, 2006
P.58

Current fiscal year
（From November 1, 2005
To October 31, 2006）

Prior fiscal year
（From November 1, 2004
To October 31, 2005）
Classification
VI

Notes

AmountPercent

AmountChange fromprior year

Percent

Extraordinary profits

1. Gain on disposal of fixed
assets*3

57,43350,018△7,414

10,8498,515△2,334

3. Reversal of allowance for
doubtful accounts－

32,14232,142

4. Compensation received－

255,500

255,500

2. Valuation gain on
investment enterprisepartnership

5. Other
VII

1,164

69,4470.1

14,175360,351

0.6

13,011

Extraordinary losses

1. Loss on sale or disposal
fixed assets*4

120,158

49,845△70,312

2. Impairment loss

*5－594,568

594,568

3. Valuation loss on
investment securities

29,589－△29,589

4. Loss on valuation ofaffiliated company stock

55,000－△55,000

5. Transfer to reserve forinvestment losses

200,173

84,997△115,176

6. Transfer to reserve for
doubtful accounts foraffiliated company stock

407,149

17,786△389,363

7. Other

25,275

Income before taxes andadjustments
Corporate, local andbusiness taxes
Adjustment for corporate
and other taxes

837,348

1.4

1,192,962

2.1

833,579

62,518809,716

1.3

37,242

3,289,887

5.4

2,096,925

1,684,230

850,650

583,744

1.0

Net income

609,217

1.1

Profit carry-forward fromprior period

587,686－－

Interim cash dividends

268,711－－

Unappropriated retained
earnings

928,192－－△249,835△114,543

1,569,686

2.6

135,291

1,720,201

2.8

1,110,983

Summary of Company Financial Statements, FY Ended October 31, 2006

P.59

Detailed Statement of Cost of Rental Revenues(Unit: Thousands of yen)
Prior fiscal year
（From November 1, 2004
To October 31, 2005）
Classification

Notes

AmountPercent

Current fiscal year
（From November 1, 2005
To October 31, 2006）
AmountPercent

Changefrom prior
year

Rent

16,784,998

56.0

16,908,191

55.5

123,192

Repair expense

2,580,883

8.6

2,640,970

8.7

60,086

Freight charges

4,963,842

16.6

5,158,322

16.9

194,479

4,054,814

13.5

3,785,558

12.4△269,255

578,899

1.9

943,399

3.1

364,500

1,012,256

3.4

1,046,368

3.4

34,111

29,975,696

100.0

30,482,810

100.0

507,114

Depreciation expense*2

Consumables expense
Other costs

*3

Total

Note 1

Cost of rental revenues is the
direct cost incurred to receive
revenues from the rental of
construction equipment and othergoods.

Same as at left

Note *2

The Company posted rental
equipment asset depreciation
expense of ¥3,735,380 andconstruction
equipment
depreciation
expenseof¥319,434,000.

The Company posted rental
equipment asset depreciation
expense of ¥3,533,016,000 andconstruction
equipment
depreciation
expenseof¥252,542,000.

Note *3

Other costs consisted mainly oftaxes and public charges of¥397,338,000,
insurance
premiums of ¥542,878,000 andinterest of ¥55,531,000 related to
installment payment purchases ofrental equipment assets.

Other costs consisted mainly oftaxes and public charges of¥420,603,000,
insurance
premiums of ¥571,332,000 andinterest of ¥34,522,000 related to
installment payment purchases ofrental equipment assets.

Summary of Company Financial Statements, FY Ended October 31, 2006

P.60

3. Appropriation of Retained Earnings
Prior fiscal year
General Meeting of the
Shareholders Approval Date
(January 27, 2006)
Classification

Notes

Thousands of yen

Ⅰ Unappropriated retained
earnings

928,192

II Appropriated as follows
1. Dividends
2. Directors and auditors
bonuses(Auditors bonuses)

268,677
7,300(1,800)3. Voluntary reserves
Reserve for advanced
depreciation of fixed
assets
III Net income carriedforward to the next
period

19,601

295,579

632,613

Summary of Company Financial Statements, FY Ended October 31, 2006

P.61

4. Statement of Changes in Net Assets
Statement of Changes in Net Assets
Current Fiscal Year (From November 1, 2005 to October 31, 2006)(Unit: Thousands of yen)
Owners’ equity
Capital surplus

Earned surplus
Other earned surplus

Paid-in
capitalCapital legal
reserve

October 31, 2005 balance

8,596,737

9,720,343

1,099,980

1,097,046

Othercapitalsurplus

Total capital Earned legal Fixed assets
surplusreserve
Reserve foradvanceddepreciation－

9,720,343

1,375,287－

EarnedGeneralreserve

surplusbrought
forward

11,831,684

928,192

Total earned
surplus14,135,164

Changes of items during the fiscal
year
Issuance of new shares

1,097,046

Transfer to reserve for advanced
depreciation of fixed assets－

Transfer to general reserve－－
19,601△19,601－

Dividends from surplus－△268,677△268,677

Dividends from surplus (interim
dividends)－△268,622△268,622

Directors and auditors bonuses
from appropriation of earnings－△7,300△7,300Net income－

1,720,201

1,720,201

Purchase of treasury stock－－

143,480

143,480－

Disposal of treasury stock－

Net changes of items other thanowners’ equity during the fiscal
year－

Total changes of items during the
fiscal year

1,099,980

1,097,046

143,480

1,240,526－

19,601－

1,155,999

1,175,601

October 31, 2006 balance

9,696,717

10,817,389

143,480

10,960,869

1,375,287

19,601

11,831,684

2,084,192

15,310,766

Valuation and translation
adjustments

Owners’ equity

Total net assets

Total owners’ equity

Valuation differenceon other investment
securities

Total valuation andtranslation
adjustments

32,265,650

1,637,603

1,637,603

33,903,254

2,197,026－

2,197,026

Transfer to reserve for advanced
depreciation of fixed assets

－

－

－

Transfer to general reserve

－

－

－

Dividends from surplus△268,677－△268,677

Dividends from surplus (interim
dividends)△268,622－△268,622

Directors and auditors bonuses
from appropriation of earnings△7,300－△7,300Treasury stock
October 31, 2005 balance△186,594

Changes of items during the fiscal
year
Issuance of new shares

1,720,201

Net income

1,720,201

Purchase of treasury stock△11,781△11,781－△11,781

Disposal of treasury stock

192,072

335,552－

335,552

776,458

776,458

776,458

776,458

776,458

4,472,857

Net changes of items other thanowners’ equity during the fiscal
year
Total changes of items during the
fiscal year

180,290

3,696,399

Summary of Company Financial Statements, FY Ended October 31, 2006

P.62

October 31, 2006 balance△6,30335,962,049

2,414,062

2,414,062

38,376,112

Significant accounting policies
Item
1. Valuation standards andvaluation methods fornegotiable securities

2. Appraisal standards andappraisal method forconstruction equipment

3. Appraisal standards andappraisal method formerchandise inventories

Prior fiscal year
From November 1, 2004
To October 31, 2005
Common stock of subsidiaries andaffiliated companies
The Company has adopted the cost
method based upon the moving
average method
Other negotiable securities

Current fiscal year
From November 1, 2005
To October 31, 2006
Common stock of subsidiaries andaffiliated companies
Same as at left

Other negotiable securities

Negotiable securities with a market on
a securities exchange
The Company has adopted themarket value method (the full amountof the valuation difference is charged
to equity using the direct transfer tocapital method, with the disposal cost
determined by the moving averagemethod) based on the market price on
the fiscal year closing date or similar
prices

Negotiable securities with a market on
a securities exchange
The Company has adopted the

Other negotiable securities without amarket price
The Company has adopted the cost
method based upon the moving
average method

Other negotiable securities without amarket priceAmount after deduction of depreciation
expense calculated according to thedeclining-balance method from theoriginal prices, by separate fiscal year ofpurchase

Same as at left

(1) Merchandise inventories

market value method (the full amountof the valuation difference is charged
to net assets using the direct transfer
to capital method, with the disposal
cost

determined

by

the

movingaverage method) based on the market
price on the fiscal year closing date orsimilar prices

Same as at left

(1) Merchandise inventories

Lower of cost or market based on thelast-in, first-out method

Same as at left

and supplies(2) Supplies(2) Supplies

The Latest purchase cost method
4. Depreciation method for
fixed assets(1) Tangible fixed assets
The Company has adopted thedeclining-balance method. Buildings
on land that is leased under afixed-term land lease agreement,
however, are depreciated using thestraight-line
methodusing
theremaining period of the fixed-termlease as the depreciable life and zero
residual value.
The depreciable lives mainly used by
the Company are as follows.

Same as at left
(1) Tangible fixed assets
Same as at left

Rental assets 5-10 years
Buildings
31-34 years(2) Intangible fixed assets
Software for use within the
Company is depreciated using thestraight-line method based on theassumed useful life for internal use (5years).
(3) Long-term prepaid expenses(2) Intangible fixed assets
Same as at left

(3) Long-term prepaid expenses

Summary of Company Financial Statements, FY Ended October 31, 2006

P.63

The
Companyhasstraight-line depreciation.
5. Deferred assets

6. Accounting standards for

adopted──────

(1) Allowance for doubtful accounts

Same as at left
(1) Stock issuance expense
The full amount is accounted for as
an expense when the funds are
expended.
(1) Allowance for doubtful accounts

allowances and reserves
To provide for losses on doubtful
accounts such as accounts receivable,
the Company charges to income anamountbasedonactualloss
experience for normal accounts, plusanamountfor
projected
unrecoverable amounts based on
assessments of individual accounts.
(2) Accrued bonuses to employees
To fully provide for expenditures ofbonuses the Company will pay toemployees, an amount is appropriatedto the reserve during the fiscal year
based upon a salary estimate amount.
──────

Same as at left

(2) Accrued bonuses to employees
Same as at left

(3) Accrued bonuses to directors andauditors
To fully provide for expenditures ofbonuses the Company will pay to
directors and auditors, an amount isappropriated to the reserve at fiscal
year-end to provide for the liability
recognized during the period.
(Change in accounting policy)
In prior years, the Company
accounted for directors and auditors
bonusesasadecreaseinunappropriated earnings based on
approvalofresolution
forappropriation of retained earnings at
theGeneralMeetingoftheShareholders. Beginning in the current
fiscal year, however, the Company willaccount for such bonuses as an
expense of the accounting period inwhich such bonuses are accrued,
based on the Accounting Standard for
Directors’
Bonus(AccountingStandards Board of Japan AccountingStandard Statement No. 4). As a resultof this change, operating income,ordinary income and income before
taxes
and
adjustments
were¥5,500,000 less, respectively, thanthey otherwise would have been had
the accounting standard used in priorfiscal years been applied.

Summary of Company Financial Statements, FY Ended October 31, 2006

P.64

Item

Prior fiscal year
From November 1, 2004
To October 31, 2005
(4) Accrued employees retirement
benefits
The Company provides for accrued
employees retirement benefits based
upon the projected amounts of theliabilityforaccruedemployees
retirement benefits and the value ofpension assets at the end of the fiscal
year. At the end of each fiscal year, theCompany appropriates an amount to
the reserve to provide for the liability
recognized during the period. Past
years’ service liabilities are fully
written off in the year incurred.
The difference based on an actuarial
calculation is charged to income
beginning in the fiscal year following
the year in which incurred, with theamounts allocated proportionately
using the straight-line method, basedon a specified number of years (10years) that is less than the averageremaining period of employment for
employees at the time the difference
arises.
(5) Retirement allowances to directors
and auditors
The
Company
providesfor
retirement allowances to directors andauditors based upon pertinent rules
and appropriated to the account at theend of the fiscal year proportionately
based upon length of service.
(6) Reserve for investment losses

Current fiscal year
From November 1, 2005
To October 31, 2006
(4) Accrued employees retirement
benefits
Same as at left

(5) Retirement allowances to directors
and auditors
Same as at left

(6) Reserve for investment losses

The Company provides for losses
from the decline in real prices of assets
such as the stock of subsidiarycompanies that are subject to asset
impairment accounting by applying
internally established standards thattake into consideration subsidiarycompany operating results and asset
quality.

Same as at left

7. Lease transactions

For finance lease transactions except
for leases that transfer ownership of theproperty to the lessee, rent expenses arecharged to income as payments are
made.

Same as at left

8. Hedge transactions(1) Hedge transactions
The Company accounts for hedgetransactions using allocations basedon accounting standards for foreign
currency-denominated transactions,and special rule accounting based on
accounting standards for financial
products.

(1) Hedge transactions
Same as at left

Summary of Company Financial Statements, FY Ended October 31, 2006

P.65

Item

Prior fiscal year
From November 1, 2004
To October 31, 2005
(2) Hedge methods and hedgedtransactions
The Company uses currency swaps
and forward transactions in order toavoid the currency fluctuation risk
related to the Company’s foreign
currency-denominated straight bonds
and liabilities for import payments.
The Company also uses interest swaps
to avoid interest rate fluctuation risk
related to interest on bank borrowing.
(3) Hedging policies
The Company’s use of derivativetransactions is limited to hedging risk
within the scope of the Company’s
assets and liabilities subject to market
fluctuation risk.
(4) Method for evaluating theeffectiveness of hedges
The Company does not evaluate theeffectiveness of its hedge transactions
because it can assume that its
currency swap transactions andforward transactions will completely
offset market fluctuations or changes
in cash flow from the time the hedge
begins until it is terminated. In
addition, the Company’s interest swap
transactions fulfill the requirements
for special rule accounting, and theCompany has elected to use this inplace of an evaluation of effectiveness.

9. Other significant mattersfor preparation of the fiscal
year financial statements

Current fiscal year
From November 1, 2005
To October 31, 2006
(2) Hedge methods and hedgedtransactions
Same as at left

(3) Hedging policies
Same as at left

(4) Method for evaluating theeffectiveness of hedges
Same as at left

(1) Accounting treatment of consumptiontax(1) Accounting treatment of consumption
tax

Consumption tax is taken out of all
Statement of Income items andBalance Sheet items, except mainly forreceivables and payables.

Same as at left

Summary of Company Financial Statements, FY Ended October 31, 2006

P.66

Changes in Important Matters Used as the Basis for Preparation of the Company Financial
Statements
Prior fiscal year
From November 1, 2004
To October 31, 2005──────

Current fiscal year
From November 1, 2005
To October 31, 2006
(Accounting Standard for Impairment of Fixed Assets)
Beginning from this fiscal year, the Company has
adopted the Accounting Standard for Impairment of
Fixed Assets (“Opinion Concerning Establishment of
Accounting Standard for Impairment of Fixed Assets”(Business Accounting Council, August 9, 2002) and“Implementation Guidance for the Accounting Standard
for Impairment of Fixed Assets” (Accounting Standards
Board of Japan, October 31, 2003, Financial AccountingStandard Implementation Guidance No. 6).
As a result, income before taxes and adjustments
decreased by ¥594,568,000.
The total amount of the impairment loss is deducted
directly from the balance for each asset based on therevised standards for preparation of company financial
statements and other rules.

──────

(Accounting Standard for Presentation of Net Assets in the
Balance Sheet)
Beginning from this fiscal year, the Company has
adopted the “Accounting Standard for Presentation of
Net Assets in the Balance Sheet” (AccountingStandards Board of Japan Statement No. 5 dated
December 9, 2005) and the “Guidance on AccountingStandard for Presentation of Net Assets in the Balance
Sheet” (Accounting Standards Board of Japan Guidance
No. 8 dated December 9, 2005).
The amount corresponding to the total ofshareholders’ equity based on the past accounting
standard is ¥38,376,112,000.
The net asset section of the balance sheet for the
fiscal year under review was prepared based on therevised financial statements rules.

Summary of Company Financial Statements, FY Ended October 31, 2006

P.67

Change in Presentation Method
Prior fiscal year
From November 1, 2004
To October 31, 2005

Current fiscal year
From November 1, 2005
To October 31, 2006

(Company Balance Sheets)(Company Balance Sheets)

1. Following promulgation of the Law to Partially Amend
the Securities and Exchange Law Etc. (Law No. 97 of
2004) on June 9, 2004 and its application on December
1, 2004, and the revision of the Practical Guidelines for
Accounting for Financial Instruments (Accounting
Committee Report No. 14) on February 15, 2005, theCompany changed its reporting method to disclose
investments in venture capital investment limited
partnerships and similar associations (investments
regarded as negotiable securities under Article 2paragraph 2 of the Securities and Exchange Law) as“investment securities” beginning from the fiscal year
under review.
The amount of a such investments included ininvestment securities for the fiscal year under review is¥96,201,000, and the amount of such investments
included in “Other” under Investments and Other
Assets in the prior fiscal year was ¥92,556,000.

1.

2.

──────

3.

──────

2. Beginning from this fiscal year, the Company willreport “goodwill” as “goodwill,” based on based on therevised financial statements rules.
2. Until the prior fiscal year, “long-term guaranty money
deposited” was reported as an item in “Other” under
Investments and Other. For this fiscal year, theCompany has reported this item under a separate
classification because the amount exceeds 1% of total
assets.
The amount of “long-term guaranty money
deposited” at the end of the prior fiscal year was¥768,406,000.

──────

(Company Statements of Income)(Company Statements of Income)1. The Company has reported cash bonus received(¥2,905,000 for the fiscal year under review), which
was reported as a separate category until the priorfiscal year, in “Other” under non-operating revenues
because the amount remains less than 10% of total
non-operating revenues.
2. In prior fiscal years, the Company reported the loss on
valuation of affiliated company stock in “Other” under
extraordinary losses, but for the fiscal year underreview this item is reported separately because theamount exceeded 10% of the total amount of
extraordinary losses.
The amount of the loss on valuation of affiliatedcompany stock at the end of the prior fiscal year was¥646,000.

1.

──────

2.

──────

Summary of Company Financial Statements, FY Ended October 31, 2006

P.68

Supplemental Information
Prior fiscal year
From November 1, 2004
To October 31, 2005
Following promulgation of the Law to Partially Amend
the Local Tax Law (Law No. 9 of 2003) on March 31,
2003 and the introduction of a corporate size-based tax
system in the corporate fiscal year beginning after April
1, 2004, the Company will report the added value
portion and capital portion of corporate taxes in selling,
general and administrative expenses from the fiscal
year under review in accordance with the Practical
Solution on Presentation for Corporate Size-BasedPortion of Corporate Business Tax on the Income
Statement (Accounting Standards Board of Japan,
Corporate Accounting Standards Committee Report
No. 12 dated February 13, 2004).
As a result, selling, general and administrative
expenses increased by ¥75,654,000, and operating
income, ordinary income and income before taxes andadjustments decreased by ¥75,654,000.

Current fiscal year
From November 1, 2005
To October 31, 2006──────

Summary of Company Financial Statements, FY Ended October 31, 2006

P.69

Notes to the Financial Statements(Notes to the Balance Sheets)
Prior Fiscal Year(As of October 31, 2005)

Current Fiscal Year(As of October 31, 2006)*1. Total shares issued and number of shares outstanding.

*1.

──────

Shares issued
Common stock

66,000,000 shares

Number of shares outstanding
Common stock

30,253,241 shares*2. Reduction to book value*2. Reduction to book value
Amounts for assets acquired for which accumulated

Amounts for assets acquired for which accumulated

book values were reduced by government subsidies

book values were reduced by government subsidies

Machinery and equipment

5,044,000

Machinery and equipment

5,044,000

Land

3,569,000

Land

3,569,000

Total*3. Treasury stock
Common stockTotal

8,613,000*3.

8,613,000──────

400,165 shares*4. Affiliated companies*4. Affiliated companies

Amounts classified as liabilities owed to affiliates

Amounts classified as liabilities owed to affiliates

Current liabilities

Current liabilities

Notes and accounts payable,
trade

Notes and accounts payable,

804,369,000

5. Contingent liabilities

trade
5. Contingent liabilities

Joint and several guarantee of bankloans to employees (Bank of

Joint and several guarantee of bank
30,779,000

loans to employees (Bank ofTokyo-Mitsubishi, other)
Guarantee of consolidated subsidiarydebt (Daiichi Kikai Co., Ltd.)
Guarantee of consolidated subsidiarydebt (Assist Co., Ltd.)
Guarantee of consolidated subsidiarydebt (Kanki Corporation)

567,668,000

27,162,000

Tokyo-Mitsubishi, other)
Guarantee of consolidated subsidiary

190,000,000

debt (Assist Co., Ltd.)
Guarantee of consolidated subsidiary

85,187,000

debt (Kanatech Co., Ltd).
Guarantee of consolidated subsidiary

1,134,000,000

debt (Kanki Corporation)
Guarantee of consolidated subsidiarydebt (Flowtechno Corporation)
6.

6. Limitation on dividends

10,000,000
200,000,000
1,008,000,000
100,000,000──────

The amount of the increase in net assets fromapplying a market price to assets as by provided
Article 124 paragraph 3 of the Commercial Code
Enforcement Regulations is ¥1,637,603,000.
*7. Liquidation of receivables based on receivables*7. Liquidation of receivables based on receivablestransfer facility

transfer facility
The Company liquidates receivables based on areceivables transfer facility.

receivables transfer facility.
Notes receivable, trade

The Company liquidates receivables based on a

5,348,993,000

Liquidated claims bearing a right of recourse to theNotes receivable, trade

5,734,296,000

Liquidated claims bearing a right of recourse to theCompany and included in the balance of notes

Company and included in the balance of notes

receivable, trade transferred total ¥1,152,352,000.

receivable, trade transferred total ¥1,244,278,000.

Summary of Company Financial Statements, FY Ended October 31, 2006

P.70

(Notes to the Statements of Income)Prior fiscal year
(From November 1, 2004
To October 31, 2005)

Current fiscal year
(From November 1, 2005
To October 31, 2006)*1. Transactions with affiliates*1. Transactions with affiliates

Seconded employees’ salaries

105,532,000

Seconded employees’ salaries

110,824,000

Rent receipts

154,325,000

Rent receipts

160,017,000*2. Balance in other accounts transferred to cost ofrentalequipment

assetsandconstruction*2. Balance in other accounts transferred to cost ofrentalequipment

assetsandconstruction

equipment soldequipment sold
Rental equipment assets

468,870,000

Rental equipment assets

531,732,000

Construction equipment

5,827,000

Construction equipment

6,308,000

Total

474,698,000*3. Gain on sale or retirement of fixed assets

Total*3. Gain on sale or retirement of fixed assets

Land

50,776,000

Land

Buildings

3,122,000

Buildings

Machinery and equipment

3,528,000

Tools, furnishings and fixtures

Tools, furnishings and fixtures
Total

6,000

Buildings
Tools, furnishings and fixtures
Structures

110,000
3,000
50,018,000*4. Loss on sale or retirement of fixed assets(Loss on sale of fixed assets)(Loss on sale of fixed assets)
Machinery and equipment

Total

49,905,000

57,433,000*4. Loss on sale or retirement of fixed assets

Land

538,040,000

1,915,000
605,000
58,008,000

Land
Buildings

2,428,000
108,000(Loss on retirement of fixed assets)

53,000Rental equipment assets

21,854,000

108,000

Buildings

16,225,000(Loss on retirement of fixed assets)

Structures

5,036,000

Rental equipment assets

23,585,000

Machinery and equipment

2,327,000

Buildings

1,047,000

Tools, furnishings and fixtures

1,680,000

Structures

2,213,000

Vehicle transport equipment

136,000

Machinery and equipment

1,651,000

Others

48,000Tools, furnishings and fixtures

1,502,000

Total

49,845,000

Vehicle transport equipment
Other
Total

24,00029,442,000
120,158,000

Summary of Company Financial Statements, FY Ended October 31, 2006

P.71

*5.

Prior fiscal year
(From November 1, 2004
To October 31, 2005)──────

Current fiscal year
(From November 1, 2005
To October 31, 2006)*5. Impairment loss
During this fiscal year the Kanamoto Group incurred
an impairment loss on the following asset groups.
Location

Use

Kamakura City, Kanagawa
Prefecture
Kanazawa City, Ishikawa
Prefecture
Muroran City, Hokkaido
Five other locations

Dormant
assets

Asset

Land

Asset groupings used by the Kanamoto Group to
apply asset impairment accounting are based on theblock classified as the smallest segment for which
profitability

can

be

determined

regularlybybusiness. Specifically, dormant assets are grouped
as units that generate independent cash flow.
For certain dormant assets for which the asset
value was less than book value, the Company
reduced book value to the recoverable value, andaccounted for the reduction as an impairment loss(¥594,568,000) under extraordinary losses. This
¥594,568,000 was for land.
The recoverable value for this asset group ismeasured according to net sales price, and the landis evaluated using the inheritance tax assessment
value based on the land tax assessment value orother amount as a base.

(Statements of Changes in Net Assets)
Current fiscal year (From November 1, 2005 to October 31, 2006)
Class of treasury stock and number of shares(Thousands of shares)
Decrease in
Increase in
Number of shares
Number of shares
number of shares number of sharesat end of theat end of priorduring the current during the current
current fiscal year
fiscal year
fiscal year
fiscal year
Treasury stock
Common stock

Notes 1, 2

Total

400

12

400

13

400

12

400

13

(Notes) 1. The number of treasury stock shares of common stock increased by 12,000 shares throughpurchases of shares comprising less than one investment unit.
2. The number of treasury stock shares of common stock decreased by 400,000 shares throughdisposals of treasury stock.

Summary of Company Financial Statements, FY Ended October 31, 2006

P.72

(Notes to Leasing Transactions)

Prior fiscal year
(From November 1, 2004
To October 31, 2005)
1. Finance lease transactions except for leases that

Current fiscal year
(From November 1, 2005
To October 31, 2006)
1. Finance lease transactions except for leases thattransfer ownership of the property to the lessee.

transfer ownership of the property to the lessee.

(1)

(1)

Amounts

corresponding

to

lease

property

Amounts

corresponding

to

lease

propertyacquisition price, accumulated depreciation andacquisition price, accumulated depreciation andoutstanding balances at the end of the fiscal year

outstanding balances at the end of the fiscal year

Acquisition
price(¥’000)

Accumulated Outstanding
depreciation
balance(¥’000)(¥’000)Rental assets

34,441,263

13,278,651

21,162,612

Other assets

307,584

174,410133,173

34,748,848

13,453,062

21,295,785

Total(2) Outstanding balance of future lease payments at
the end of the fiscal year

Acquisition
price(¥’000)

Accumulated Outstanding
depreciation
balance(¥’000)(¥’000)Rental assets

36,236,228

16,177,904

20,058,323

Other assets

275,184

184,247

90,93636,511,412

16,362,152

20,149,260

Total(2) Outstanding balance of future lease payments at
the end of the fiscal year

Within one year

5,326,336,000

Within one year

5,815,719,000

After one year

15,327,278,000

After one year

13,838,896,000

Total

20,653,615,000(3) Amount of lease payments, depreciation expense
and interest expense

19,654,616,000

Total(3) Amount of lease payments, depreciation expense
and interest expense

Lease payments

6,030,861,000

Lease payments

5,812,109,000

Depreciation expense

5,475,320,000

Depreciation expense

5,344,449,000Interest expense

709,565,000(4) Accounting method for amount equivalent todepreciation expense

Interest expense

595,986,000(4) Accounting method for amount equivalent todepreciation expense

Straight-line depreciation using the lease term as

Same as at left

the depreciable life and zero residual value.
(5) Accounting method for amount equivalent tointerest expense(5) Accounting method for amount equivalent tointerest expense
Same as at left

Interest method using the difference between totallease payments and the acquisition price of thelease property, allocated to each year.
2. Operating leases

2. Operating leases

Future lease payments

Future lease payments

Within one year

1,476,233,000

Within one year

1,938,033,000

After one year

3,376,419,000

After one year

4,808,904,000

Total

4,852,653,000

Total

6,746,938,000

Summary of Company Financial Statements, FY Ended October 31, 2006

P.73

（Negotiable Securities）
For the prior fiscal year (as of October 31, 2005) and this fiscal year (as of October 31, 2006), the stockof the Company’s subsidiary companies and affiliated companies did not have a market price.
(Notes Related to Tax Effect Accounting)Prior fiscal year
(As of October 31, 2005)

Current fiscal year
(As of October 31, 2006)

1. Major factors creating deferred tax assets and deferred

1. Major factors creating deferred tax assets and deferred

tax liabilities

tax liabilities

Deferred tax assets
Amount in excess of limit forinclusion
Disallowance of deferred business
taxes
Excess accrued employees
retirement benefit
Amount in excess of limit for inclusion
in retirement allowance to directors
and auditors
Amount in excess of limit forinclusion in accrued bonuses to
employees
Disallowance of excess depreciation
Disallowance of reserve forinvestment losses

203,734,000
52,019,000
599,817,000
31,964,000
181,022,000

311,670,000
193,990,000
382,989,000

Other
Total deferred tax assets

1,957,210,000

Deferred tax liability
Valuation difference on negotiablesecurities

1,110,053,000

Net deferred tax assets

Deferred tax assets
Amount in excess of limit forinclusion
Disallowance of deferred business
taxes
Excess accrued employees
retirement benefit
Amount in excess of limit forinclusion in retirement allowance todirectors and auditors
Amount in excess of limit forinclusion in accrued bonuses to
employees
Disallowance of excess
depreciation
Impairment loss
Disallowance of reserve forinvestment losses
Other
Subtotal - deferred tax assets

847,156,000

Valuation reserve

102,760,000
663,311,000
36,465,000
179,049,000

274,669,000
240,205,000
228,329,000
371,722,000
2,210,898,000
139,144,000

Total deferred tax assets
Deferred tax liability
Valuationdifference
negotiable securities

2,071,754,000on

Net deferred tax assets
Disclosure classifications:

114,383,000

1,636,377,000
435,376,000

Disclosure classifications:
Current assets

367,932,000

Property and equipment

479,224,000

Current assets

384,442,000

Property and equipment

50,933,000

2. Causes of principal differences between the statutory

2. Causes of principal differences between the statutory

tax rate and burden ratio for corporate and other taxes

tax rate and burden ratio for corporate and other taxes

following application of tax effect accounting by major

following application of tax effect accounting by major

category.

category.

Statutory corporate tax rate

40.4%

（Adjustment）
Local tax equalization
Items not included permanently in
losses such as expense accountReversal of corporate taxes payablefrom past fiscal years
Burden ratio for corporate andother taxes after application of tax
effect accounting

Statutory corporate tax rate

40.4%

（Adjustment）
7.3%
2.5%
△3.4%
46.8%

Local tax equalization
Items not included permanently in
losses such as expense accountAffect from application of asset
impairment accounting for fixed
assetsAffect from special deduction forincome such as expropriations
Burden ratio for corporate and othertaxes after application of tax effectaccounting

2.7%
1.0%
4.2%

△0.6%
47.7%

Summary of Company Financial Statements, FY Ended October 31, 2006

P.74

(Per Share Information)
Prior fiscal year
(From November 1, 2004
To October 31, 2005)
Net assets per share

Current fiscal year
(From November 1, 2005
To October 31, 2006)¥1,135.43

Net income per share of common stock
Net income per share of common stock
after adjustment for potential ordinary
shares¥20.16－¥1,167.90¥56.67

Net assets per share
Net income per share of common stock
Net income per share of common stock
after adjustment for potential ordinary
shares－The Company has not reported net income per share of

The Company has not reported net income per share ofcommon stock after adjustment for potential ordinarycommon stock after adjustment for potential ordinary

shares because it does not have any potential shares thatshares because it does not have any potential shares thatwould have a dilution effect.

would have a dilution effect.
(Supplemental Information)
Beginning from the current fiscal year, the Company has
adopted the revised Accounting Standard for Earnings Per
Share (Accounting Standards Board of Japan Statement
No. 2 dated January 31, 2006 (revised 2006) and the
Guidance on Accounting Standard for Earnings Per Share(ASBJ Guidance No. 4 dated January 31, 2006 (revised2006). There are no material items to report as a result of
this change.

Note: The basis for calculating net income per share and net income per share on a fully diluted basis is provided below.

Prior fiscal year
(From November 1, 2004
To October 31, 2005)(Unit: Thousands of yen)
Current fiscal year
(From November 1, 2005
To October 31, 2006)

Net income per share
Fiscal year net income
Amountnotattributableto609,217

1,720,201

7,300

－

601,917

1,720,201

29,856,334

30,357,093

major

shareholders
Fiscal year net income related to common
stock
Averagenumberofsharesoutstanding

during the fiscal year
Summary of latent common stock not──────

──────

included in the calculation of net income pershare on a fully diluted basis because it will
not have a dilution effect(Material events after the close of the fiscal year)
The Company had no material items to report.

Summary of Company Financial Statements, FY Ended October 31, 2006

P.75

VI Changes to Directors and Auditors

1. Changes to Representative Directors
There are no pertinent items.

2. Changes to Directors(1) Candidates for new appointments as Director
Name

Hiroyuki Isono

New position
Director and Corporate Officer
Division Manager, Administration
Division, General Manager, Secretarial
Office and Chairman, InternalManagement Project Team Committee
Director and Corporate Officer
Regional Manager, Construction
Equipment Rental Division, Hokkaido
RegionDirector and Corporate Officer
Regional Manager, Construction
Equipment Rental Division, Tohoku
RegionCurrent position
Corporate Officer
Division Manager, Administration
Division, General Manager, Secretarial
OfficeCorporate Officer
Regional Manager, Construction
Tatsuo Kanamoto
Equipment Rental Division, Hokkaido
RegionCorporate Officer
Regional Manager, Construction
Manabu Nagasaki
Equipment Rental Division, Tohoku
RegionORIX Corporation
General Manager, Hokkaido Block
Michiya Hakamada Director (part-time)
serving concurrently as General
Manager, Sapporo Branch
Note: Michiya Hakamada fulfills the requirements for Outside Director as stipulated in Article 2-15 of theCompany Law.
(2) Retiring Directors
Name

Current position

Hidemitsu Washida

Director and Advisor
Director and Corporate Officer
Manager in Charge of Administration
Division & Credit Analysis Section, Credit
Eichu Kanamoto
Management Division and Chairman,
Internal Management Project Team
Committee
Osamu Kawashima
Director (part-time)
Note: Osamu Kawashima is an Outside Director as stipulated in Article 2-15 of the Company Law.
(3) Candidates for new appointments as Corporate AuditorName

New position

Current position

Director and Corporate Officer
Manager in Charge of Administration
Division & Credit Analysis Section, Credit
Eichu Kanamoto
Auditor (Standing Corporate Auditor)
Management Division and Chairman,
Internal Management Project Team
Committee
North Pacific Bank, Ltd. Standing
Nobutomo Kuwata Auditor (part-time)
Corporate Auditor
Note: Nobutomo Kuwata fulfills the requirements for Outside Director as stipulated in Article 2-16 of theCompany Law.

Summary of Company Financial Statements, FY Ended October 31, 2006

P.76

(4) Candidates for new appointments as Corporate Officer
NameSatoru Toiya

Naoki Mukunashi

New position
Corporate Officer
Division Manager, Construction
Equipment Rental Division, Kanto &Shinetsu Region
Corporate Officer
Assistant General Manager, Business
Coordination Headquarters serving
concurrently as General Manager,
Overseas Business Office

Current position
Division Manager, Construction
Equipment Rental Division, Kanto &Shinetsu Region
Assistant General Manager, Business
Coordination Headquarters serving
concurrently as General Manager,
Overseas Business Office(5) Retiring Corporate Officers
Name

Current position

Eichu Kanamoto

Director and Corporate Officer
Manager in Charge of Administration
Division & Credit Analysis Section, Credit
Management Division and Chairman,
Internal Management Project Team
Committee

Summary of Company Financial Statements, FY Ended October 31, 2006

P.77