Fund Corporation for the Overseas Developmentof Japan’s ICT and Postal Services Inc.
(Japan ICT Fund)

Financial Statements

For the 5th fiscal year
From April 1, 2019 to March 31, 2020

Crowe Toyo & Co.
Sumitomo Fudosan Kanda Bldg.,6F
Kandamitoshirocho7,
Chiyoda-ku, Tokyo101-0053
Japan
Main +81 (3)3295 1040
Fax +81 (3)3295 1993
www.crowe.com/jp/en-us

Independent Auditors’ Report(Translation)
May 27,2020
To the Board of Directors ofFund Corporation for the Overseas Development of Japan’s ICT and Postal Services Inc.
Crowe Toyo & Co.
Tokyo Office
Akihiro Tanaka
Designated Partner
Engagement PartnerCertified Public Accountant
Hiroaki Izawa
Designated Partner
Engagement Partner
Certified Public Accountant
OpinionPursuant to Article 436 (2) (i) of the Companies Act, we have audited the accompanying financial
statements, which comprise the balance sheet as of March 31, 2020, and the statement of income, thestatement of changes in net assets and the related notes, and the supplementary schedules (hereinafter
the “financial statements, etc.”) of Fund Corporation for the Overseas Development of Japan’s ICT andPostal Services Inc. (hereinafter the “Company”) for the 5th fiscal year from April 1, 2019 to March 31,2020.
In our opinion, the financial statements, etc. referred to above present fairly, in all material respects, thefinancial position and the results of operations of the Company for the period, for which the financialstatements, etc. were prepared, in accordance with accounting principles generally accepted in Japan.
Rationale for the Opinion
We conducted our audit in accordance with auditing standards generally accepted in Japan. Our
responsibility with respect to auditing standards is described in “Auditor’s Responsibility in Auditing theFinancial Statements, etc.” We are independent of the Company in accordance with the ethicalrequirements that are relevant to our audit of the financial statements, etc. in Japan, and we havefulfilled our ethical responsibilities in accordance with these requirements. We believe that the audit
evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
Management and the Company Auditor’s Responsibility for the Financial Statements, etc.
Management is responsible for the preparation and fair presentation of the financial statements, etc. inaccordance with accounting principles generally accepted in Japan, and for such internal control as
management determines is necessary to enable the preparation of the financial statements, etc. that are
free from material misstatements, whether due to fraud or error.
In preparing the financial statements, etc., management is responsible for assessing whether it isappropriate to prepare the financial statements, etc. with the assumption of a going concern, and inaccordance with accounting principles generally accepted in Japan, for disclosing, as necessary, mattersrelated to going concern.
The Company Auditor is responsible for overseeing the Directors’ performance of duties within themaintenance and operation of the financial reporting process.
Auditor’s Responsibility in Auditing the Financial Statement, etc.
Our responsibilities are to obtain reasonable assurance about whether the financial statements, etc. as awhole are free from material misstatement, whether due to fraud or error, and to express our opinion onthe financial statements, etc. in an auditor’s report based on our audit from an independent point of view.
Misstatements can arise from fraud or error and are considered material if, individually or in theaggregate, they could reasonably be expected to influence the decisions of users of these financialstatements, etc.
In accordance with auditing standards generally accepted in Japan, we exercise professional judgment andmaintain professional skepticism throughout the audit process to perform the following:
Identify and assess the risks of material misstatement, whether due to fraud or error, and design andperform audit procedures responsive to those risks. Selecting audit procedures to be applied is at thediscretion of the auditor. Obtain audit evidence that is sufficient and appropriate to provide a basis forour opinion.
In making those risk assessments, we consider internal control relevant to the audit in order to design
audit procedures that are appropriate in the circumstances, while the audit objective of the financial
statements, etc. is not for the purpose of expressing an opinion on the effectiveness of the entity’sinternal control.
Evaluate the appropriateness of accounting policies used by management and their method ofapplication, as well as the reasonableness of accounting estimates made by management and related
notes thereto.
Conclude on the appropriateness of preparing the financial statements, etc. with the assumption of agoing concern by management, and based on the audit evidence obtained, whether a materialuncertainty exists related to events or conditions that may cast significant doubt on the entity’s ability
to continue as a going concern. If we conclude that a material uncertainty exists, we are required todraw attention in our auditor’s report to the notes to the financial statements, etc. or, if the notes tothe financial statements, etc. on material uncertainty are inadequate, to express an opinion withexceptive items on the financial statements, etc. Our conclusions are based on the audit evidence
obtained up to the date of our auditor’s report. However, future events or conditions may cause theentity to cease to continue as a going concern.
Evaluate whether the presentation and disclosure of the financial statements, etc. are in accordancewith accounting principles generally accepted in Japan, the overall presentation, structure and content
of the financial statements, etc. including the disclosures, and whether the financial statements, etc.
represent the underlying transactions and events in a manner that achieves fair presentation.
We report to the Company Auditor regarding, among other matters, the planned scope and timing of theaudit and significant audit findings, including any significant deficiencies in internal control that we
identify during our audit process, and other matters required by auditing standards.
Conflict of Interest
Our firm or the engagement partners have no interest in the Company which should be disclosed pursuant
to the provisions of the Certified Public Accountants Act of Japan.

The above represents a translation, for convenience only, of the original report issued in the Japaneselanguage.

Balance Sheet(As of March 31, 2020)（Thousands of yen）
AssetsLiabilities and net assets( Assets )Current assets:( Liabilities )32,608,992

Current liabilities:

232,034

Cash and deposits

8,745,106

Accounts payable-Other

33,769Operational investment securities

18,921,870

Income taxes payable

165,830

Operating loans

4,878,985

Provision for bonuses

23,380

Other

9,053

Other
Non-current assets:
Property and equipment:

63,0301,567,557

Total liabilities

232,034

20,988 ( Net assets )Buildings

22,775Tools, furniture and fixtures

32,594

Capital stock

19,313,500

Accumulated depreciation△ 34,381

Capital surplus:

19,313,500

Intangible assets:

4,582

Software

3,381

Other

1,200

Investments and other assets:
Investments in capital of subsidiaries andassociates
Lease deposits
Other
Total assets
Amounts of less than 1 thousand yen are rounded off.

Shareholders' equity:

Legal capital surplus
Retained earnings:

34,812,065

19,313,500△ 3,814,934

Other retained earnings:△ 3,814,934

1,541,987

Retained earnings brought forward△ 3,814,934

1,520,699

Valuation and translation adjustments:△ 867,550

20,996

Valuation difference on available-for-salesecurities△ 867,550

291
34,176,549

Total net assets

33,944,515

Total liabilities and net assets

34,176,550

Statement of Operations(From April 1, 2019 to March 31, 2020)（Thousands of yen）
Net sales

284,171

Gross profit

284,171

Selling, general and administrative expenses

794,433

Operating loss

510,262

Non-operating income
Interest income

94

Miscellaneous income

47141

Non-operating expenses
Interest expenses

1,616

Share issuance costs

78,647Foreign exchange losses

68,443

Miscellaneous loss

1,176

149,883

Ordinary loss

660,005

Loss before income taxes

660,005

Income taxes
Net lossAmounts of less than 1 thousand yen are rounded off.

1,210
661,215

Statement of Changes in Equity(From April 1, 2019 to March 31, 2020)（Thousands of yen）
Valuation andtranslation
adjustments

Shareholders' equity

Capital surplus

Retained earnings
Total net assets
Other retainedearnings

Capital stock

Total shareholders'equityValuation difference
on available-for-salesecurities

Legal capital surplus
Retained earnings
brought forward
8,078,500

8,078,500△ 3,153,719

13,003,280△ 97,530

12,905,750

11,235,000

11,235,000-

22,470,000-

22,470,000

Net loss--△ 661,215△ 661,215-△ 661,215

Net changes of items other than shareholders' equity

--

-

-

△ 770,020△ 770,020

Total changes of items during period

11,235,000

11,235,000△ 661,215

21,808,784△ 770,020

21,038,764

Balance at March 31, 2020

19,313,500

19,313,500△ 3,814,934

34,812,065△ 867,550

33,944,515

Balance at April 1, 2019
Changes of items during period
Issuance of common stock

Amounts of less than 1 thousand yen are rounded off.

Notes to Financial Statements
Amounts of less than 1 thousand yen are rounded off.

1. Significant Accounting Policies(1) Basis and method of valuation of securities① Available-for-sale securities (including operational investment securities)
Securities without market quotations:
Stated at cost determined by the moving-average method② Investments in capital of subsidiaries and associates
Securities without market quotations:
Stated at cost determined by the moving-average method(2) Depreciation method of non-current assets① Property and equipment (excluding leased assets)
Depreciation is provided by the declining-balance method, except for the buildings, building
facilities and acquired on or after April 1, 2016, which are depreciated using the straight-line
method.
The useful lives adopted for major assets are as follows:
Buildings (Building facilities):

8-20 years

Tools, furniture and fixtures:

3-15 years② Intangible assets (excluding leased assets)
Intangible assets are amortized using the straight-line method.
The useful lives adopted for major assets are as follows:
Trademark right:

10 yearsComputer software for internal use:

5 years(3) Amortization method of deferred assets
Share issuance costs are processed as expenses in full amount when incurred.
(4) Accounting for provisions
Provision for bonuses
For payment of employees’ bonuses, provision is provided for the portion of the total anticipatedbonuses that is attributable to the fiscal year.

(5) Accounting for income and expenses
Net sales and cost of sales
Commission income and interest income, etc. are recorded in net sales.
(6) Other significant matters which constitute the basis for preparation of the financial statements
Accounting for consumption taxes
Consumption taxes are excluded from transaction amounts.
2. Changes in Accounting Policies
There are no items to be disclosed.
3. Notes to change in presentation
There are no items to be disclosed.
4. Notes to balance sheet
There are no items to be disclosed.
5. Notes to statement of operations
There are no items to be disclosed.
6. Notes to statement of changes in equity
Class and number of shares at the end of the fiscal year:
Common stock

772,540 shares7. Notes to taxes effect accounting
Main sources of deferred tax assets:
Deferred tax assets:
Operational investment securities

265,643 thousand yen

Operating loans

9,252 thousand yen

Accrued enterprise taxes

50,406 thousand yen

Provision for bonuses

7,159 thousand yen

Loss carryforwards

1,096,133 thousand yen

Other2,701 thousand yen

Subtotal

1,431,294 thousand yen

Valuation allowance for net operating
losses carryforward△ 1,096,133 thousand yen

Valuation allowance for total deductible
temporary difference, etc.

△ 335,161 thousand yen

Subtotal of valuation allowance△ 1,431,294 thousand yen

Total－thousand yen

8. Notes to financial instruments(1) States of financial instruments① Management policy on financial instruments
The Company conducts investment activities based on the standards stipulated in the Act on Fund
Corporation for the Overseas Development of Japan’s ICT and Postal Services. To conduct investment
activities, the Company raises the necessary funds by equity capital and issuance of GovernmentGuaranteed Bonds, etc.
Regarding fund management, the Company invests only in short-term deposits and investment
securities (certificates of deposit) to secure liquidity and safety of funds.
② Features and risks of financial instruments
Operating loans are exposed to customer credit risk.
Operational investment securities are mainly unlisted stocks and are exposed to credit risk of theinvestees.
Operating loans, operational investment securities and investment in capital of subsidiaries andassociates which are denominated in foreign currencies are exposed to the risk of exchange
fluctuations.

③ Risk management of financial instrumentsⅰ) Management of credit risk
With regard to operating loans, the Company timely and regularly monitors the business conditions ofthe investees and seeks to promptly identify and reduce concerns over the collection due to thedeterioration in their financial positions, etc.
With regard to operational investment securities, the Company timely and regularly monitors thebusiness conditions of the investees and makes efforts to promptly identify deterioration of theirfinancial conditions and deviation from their business plan, etc.
ⅱ) Management of liquidity risk relating to financing
The Company controls liquidity risks by monitoring deposits and payments, and preparing thestatement of cash positions regularly.
ⅲ) Management of exchange fluctuation risk to operating loans, operational investment securities
and investment in capital of subsidiaries and associates which are denominated in foreign currencies.
The Company controls exchange fluctuation risks regarding operating loans, operational investment
securities and investment in capital of subsidiaries and associates which are denominated in foreign
currencies by continuously monitoring exchange rate fluctuations.
④ Supplementary explanation regarding the fair value of financial instruments
The fair value of financial instruments is based on market prices or reasonable calculations in the absenceof market prices.
(2) Fair value of financial instruments
Book value, fair value and the difference between them as of March 31, 2020 are as follows. Financial
instruments of which the fair value is extremely difficult to measure are not included below.
(Thousands of yen)Book value

Fair value

Difference

Cash and deposits

8,745,106

8,745,106－

Operating loans

4,878,985

4,878,985－(Note 1) Fair value measurement of financial instruments① Cash and deposits:
The book value approximates fair value due to the short term settlements.

② Operating loans
The fair value of operating loans is calculated by discounting the sum of its principal and interest
at an interest rate at which a similar new loan transaction is assumed to be made.
(Note 2) Financial instruments of which the fair value is extremely difficult to measure are as follows:(Thousands of yen)Book value
Operational investment securities

18,921,870

Investments in capital of subsidiaries andassociates

1,520,699(Note 3) Future redemption of financial assets with maturities are as follows:(Thousands of yen)

Within one year
Cash and deposits

8,745,106

Operating loans

341,421

Due after oneyear
through fiveyears－

Due after fiveyears
through tenyears－

4,537,564

Due after tenyears－－－

9. Notes to related party transactions
The Company directors and principal shareholders, etc.
（Thousands of yen）
Attribution

Name

Percentage

Relationshipof votingNature ofTransaction

Accounting

Year-endtransactions

amountsclassification

balance

22,470,000－－

rights ,etc.
Principal

Minister ofOwned

Investments

Investments

shareholder

Finance

directly

in capitalin capital

93.83%(Note)

Business conditions and policy for determining the business conditions:(Note) Minister of Finance acquired shares issued by the Company in the amount of ¥50 thousand pershare.
10. Notes to per share information
Net assets per share¥43,938.85

Net loss per share¥1,023.65

(Note)The basis for calculation of net loss per share is as follows:
Net lossAmount not attributable to ordinary shareholders

661,215 thousand yen－Net loss relating to common stock

661,215 thousand yen

Average number of shares of common stock during the period

645,937 shares

11. Notes to significant subsequent events
There are no items to be disclosed.