Note: This is an excerpt translation of the “Yukashoken-Houkokusho” for the convenience of overseas
stakeholders. In cases where any differences occur between the English version and the original Japaneseversion, the Japanese version shall prevail. F-TECH INC. assumes no responsibility for this translation or for
direct, indirect or any other forms of damages arising from the translation.

Consolidated Financial Statements
March 31, 2021

F-TECH INC.
19, Showanuma, Shobu-cho, Kuki City, Saitama, JAPANConsolidated financial statements, etc.
(1) Consolidated financial statementsi)Consolidated balance sheets(Millions of yen)

AssetsCurrent assets
Cash and deposits
Notes and accounts receivable - trade
Merchandise and finished goods
Work in process
Raw materials and supplies
Other
Total current assets
Non-current assets
Property, plant and equipment
Buildings and structures, net
Machinery, equipment and vehicles, net
Dies and tools, net
Land
Leased assets, net
Construction in progress
Other, net
Total property, plant and equipment
Intangible assets
SoftwareRight of using facilities
Total intangible assets
Investments and other assets
Investment securities
Long-term loans receivable
Retirement benefit asset
Deferred tax assets
Other
Total investments and other assets
Total non-current assets
Total assets

As of March 31, 2020

As of March 31, 2021

8,879
27,955
6,389
4,026
8,677
3,027
58,956

3,708
31,578
6,547
4,351
8,743
2,744
57,673

16,20532,450
1,669
5,863
544
6,750
3,230
66,714

17,14732,880
1,726
5,859
238
9,034
3,125
70,012

*1

*1

330
32
363
*2

-1-

5,960
226
146
1,265
405
8,004
75,081
134,038

282
37
320
*2

6,995
231
75
1,025
380
8,708
79,041
136,714

(Millions of yen)
As of March 31, 2020
Liabilities
Current liabilities
Notes and accounts payable - trade
Short-term loans payable
Current portion of long-term loans payable
Lease obligations
Income taxes payable
Accounts payable - otherNotes payable - facilities
Provision for directors’ bonuses
Other
Total current liabilities
Non-current liabilities
Long-term loans payable
Lease obligations
Deferred tax liabilities
Provision for directors’ retirement benefits
Net defined benefit liability
Long-term accounts payable - other
Negative goodwill
Other
Total non-current liabilities
Total liabilities
Net assets
Shareholders’ equity
Capital stock
Capital surplus
Retained earnings
Treasury shares
Total shareholders’ equity
Accumulated other comprehensive income
Valuation difference on available-for-salesecurities
Foreign currency translation adjustment
Remeasurements of defined benefit plans
Total accumulated other comprehensive income
Non-controlling interests
Total net assets
Total liabilities and net assets

*3

-2-

17,427
20,395
9,740
572
500
2,515
74
77
4,108
55,412As of March 31, 2021

*3

19,772
20,872
9,884
472
658
3,425
44
31
4,241
59,401

19,146
1,331
2,448
126
1,050
2
50
175
24,33379,745

16,943
1,390
2,771
57
791
99
44
183
22,28081,682

6,790
7,230
27,912(18)
41,914

6,790
6,733
26,559(64)
40,019174

490(1,657)(295)(1,778)14,15654,292
134,038

(333)
128
286
14,72655,032
136,714

ii)

Consolidated statements of income and comprehensive income(Millions of yen)
Fiscal year ended
March 31, 2020

Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating profit
Non-operating income
Interest income
Dividend income
Share of profit of entities accounted for using equity
methodOther
Total non-operating income
Non-operating expenses
Interest expenses
Share of loss of entities accounted for using equity
methodForeign exchange losses
Other
Total non-operating expenses
Ordinary profit
Extraordinary income
Gain on sales of non-current assets
Gain on sales of investment securities
Gain on change in equity
Subsidy income
Other
Total extraordinary income
Extraordinary losses
Loss on sales of non-current assets
Loss on retirement of non-current assets
Loss attributable to the novel coronavirus
Total extraordinary losses
Profit before income taxes
Income taxes - current
Income taxes - deferred
Total income taxes
Profit (loss)
Profit (loss) attributable toProfit (loss) attributable to owners of parent
Profit attributable to non-controlling interests
Other comprehensive income
Valuation difference on available-for-sale securities
Foreign currency translation adjustment
Remeasurements of defined benefit plans, net of tax
Share of other comprehensive income of entities
accounted for using equity method
Total other comprehensive income
Comprehensive income
Comprehensive income attributable toComprehensive income attributable to owners of parent
Comprehensive income attributable to non-controlling interests*1*2, *3Fiscal year ended
March 31, 2021

218,712
198,665
20,047
15,9584,088*2, *3

183,647
166,616
17,03013,958
3,072

75
51

51
40

–

152

144
271

196
440

1,113

806

191

–

181
108
1,595
2,764

264
59
1,129
2,383

*4

23
–
314
–
6
344

*4

15
6
–
1,838
–
1,860

*5

3
63
–
66
3,042
1,424
687
2,112
930

*5

20
67
2,830
2,919
1,324
2,068
240
2,309
(984)

*6

*7

*6

328
601

(1,165)180(171)(1,869)
31

267
2,195
419

(183)

63

(2,193)(1,263)(1,168)
(95)

-3-

*1

*7

2,945
1,961
899
1,061

iii) Consolidated statements of changes in net assets
Fiscal year ended March 31, 2020
(Millions of yen)
Shareholders’ equity
Capital stock
Balance at beginning of current
periodCumulative effect of changes
in accounting policies
Restated balance

Capital surplus

Retained earnings

Treasury shares

7,222

28,133

(18)

6,790

Total shareholders’equity

(175)
6,790

7,222

42,127(175)

27,957(18)

41,951

Changes of items during period
Dividends of surplus

(374)

(374)

Profit (loss) attributable toowners of parent

328

328

Purchase of treasury shares–

Capital increase of
consolidated subsidiaries
Change in the parent
company’s ownershipinterest of subsidiaries due
to transactions with noncontrolling shareholders
Net changes of items otherthan shareholders’ equity
Total changes of items during
periodBalance at end of current
period

–

8

8

–

8

(45)

–

(37)

6,790

7,230

27,912(18)

41,914

Accumulated other comprehensive income

Balance at beginning of current
periodCumulative effect of changes
in accounting policies
Restated balance

Valuationdifference
on availablefor-salesecurities

Foreigncurrencytranslation
adjustment

467

(418)

Total
Remeasurements accumulatedof definedotherbenefit planscomprehensive
income
(331)

(281)

Non-controllinginterests

14,985

Total net assets

56,830
(175)

467

(418)

(331)

(281)

14,98556,655

Changes of items during period
Dividends of surplus(374)

Profit (loss) attributable toowners of parent

328

Purchase of treasury shares–

Capital increase of
consolidated subsidiaries–

Change in the parent
company’s ownershipinterest of subsidiaries due
to transactions with noncontrolling shareholders

8

Net changes of items otherthan shareholders’ equity(293)(1,239)35(1,496)(828)(2,325)

Total changes of items during
period(293)(1,239)35(1,496)(828)(2,362)

Balance at end of current period

174(1,657)(295)(1,778)14,15654,292-4-

Fiscal year ended March 31, 2021
(Millions of yen)
Shareholders’ equity

Balance at beginning of current
periodCumulative effect of changes
in accounting policies
Restated balance

Capital stock

Capital surplus

Retained earnings

Treasury shares

Total shareholders’equity

6,790

7,230

27,912(18)

41,914
–

6,790

7,230

27,912(18)

41,914

Changes of items during period
Dividends of surplus
Profit (loss) attributable toowners of parent

(187)

(187)

(1,165)(1,165)Purchase of treasury shares

(45)

(45)

Capital increase of
consolidated subsidiaries

(494)

(494)

Change in the parent
company’s ownershipinterest of subsidiaries due
to transactions with noncontrolling shareholders

(2)

(2)

Net changes of items otherthan shareholders’ equity
Total changes of items during
periodBalance at end of current
period–(497)(1,352)(45)(1,895)

6,790

6,733

26,559(64)

40,019

Accumulated other comprehensive income

Balance at beginning of current
periodCumulative effect of changes
in accounting policies
Restated balance

Valuationdifference
on availablefor-salesecurities

Foreigncurrencytranslation
adjustment

174(1,657)

Total
Non-controlling
Remeasurements accumulated
interestsof definedotherbenefit planscomprehensive
income(295)(1,778)14,156

Total net assets

54,292–174(1,657)(295)(1,778)14,15654,292

Changes of items during period
Dividends of surplus(187)

Profit (loss) attributable toowners of parent(1,165)Purchase of treasury shares(45)

Capital increase of
consolidated subsidiaries(494)

Change in the parent
company’s ownershipinterest of subsidiaries due
to transactions with noncontrolling shareholders(2)

Net changes of items otherthan shareholders’ equity

316

1,324

423

2,064

570

2,634

Total changes of items during
period

316

1,324

423

2,064

570

739

Balance at end of current period

490

(333)

128

286

14,72655,032-5-

iv)

Consolidated statements of cash flows(Millions of yen)
Fiscal year ended
March 31, 2020

Cash flows from operating activities
Profit before income taxes
Depreciation
Loss (gain) on change in equity
Amortization of goodwill
Loss (gain) on sales of investment securities
Increase (decrease) in assets and liabilities related toretirement benefits
Increase (decrease) in provision for directors’
retirement benefits
Increase (decrease) in provision for directors’
bonusesInterest and dividend income
Interest expenses
Foreign exchange losses (gains)Share of loss (profit) of entities accounted for using
equity method
Loss (gain) on sales of property, plant and equipment
Loss on retirement of property, plant and equipment
Decrease (increase) in notes and accounts receivable- tradeDecrease (increase) in inventories
Increase (decrease) in notes and accounts payable trade
Increase (decrease) in accounts payable - other
Other, net
SubtotalInterest and dividend income received
Interest expenses paid
Income taxes paid
Net cash provided by (used in) operating activities
Cash flows from investing activities
Purchase of property, plant and equipment
Proceeds from sales of property, plant and equipment
Purchase of intangible assets
Purchase of investment securities
Proceeds from sales of investment securities
Other, net
Net cash provided by (used in) investing activities-6-

Fiscal year ended
March 31, 2021

3,042
10,890
(314)
(5)
–

1,324
10,032
–
(5)
(6)

159

229

19

(69)

12

(46)

(127)
1,113
138

(92)
806
8

191

(152)

(20)
63

5
67

4,728

(2,477)(1,864)43(4,829)

1,667

507
(427)
13,276165(1,111)(1,790)10,5391,027(106)
12,256121(811)(1,609)
9,956(12,096)
111
(141)
(66)
–
231
(11,961)(10,225)
33
(73)
(477)
10
5
(10,726)

(Millions of yen)
Fiscal year ended
March 31, 2020
Cash flows from financing activities
Net increase (decrease) in short-term loans payable
Proceeds from long-term loans payable
Repayments of long-term loans payable
Purchase of treasury shares
Repayments of installment payables
Cash dividends paid
Repayments to non-controlling shareholders
Dividends paid to non-controlling interests
Repayments of lease obligations
Proceeds from sale and leaseback transactions
Net cash provided by (used in) financing activities
Effect of exchange rate change on cash and cash
equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period

*1

-7-

Fiscal year ended
March 31, 2021

7,951
10,029(12,931)
–
(312)
(374)
–
(699)
(796)
478
3,345

90
7,233
(9,778)
(45)
(143)
(187)
(83)
(815)
(633)
–
(4,363)

(236)

(37)

1,688
7,191
8,879

(5,170)
8,879
3,708

*1

Notes to consolidated financial statements
Basis of presentation and significant accounting policies for preparation of consolidated financial
statements
1. Basis of presentation of consolidated financial statements
The accompanying consolidated financial statements have been prepared in accordance with the provisions set
forth in the Japanese Financial Instruments and Exchange Act and its related accounting regulations, and inaccordance with accounting principles generally accepted in Japan (“Japanese GAAP”), which are different incertain respects as to the application and disclosure requirements of International Financial ReportingStandards (“IFRS”).
As permitted by the Japanese Financial Instruments and Exchange Act, amounts less than one million yen havebeen omitted. As a result, the totals shown in accompanying financial statements do not necessarily agree withthe sum of the individual amounts.
2.

Disclosure of scope of consolidation(1) Number of consolidated subsidiaries: Sixteen
F&P Mfg., Inc.
F&P America Mfg., Inc.
F.tech Philippines Mfg., Inc.
F.E.G. DE QUERETARO, S.A. DE C.V.
F.tech Zhongshan Inc.
F.tech R&D North America Inc.
F.tech Wuhan Inc.
Fukuda Engineering Co., Ltd.
Kyushu F.tech Inc.
F.tech Mfg. (Thailand) Ltd.
Reterra Co., Ltd.
F.tech R&D Philippines Inc.
F.tech R&D (Guangzhou) Inc.
F&P MFG.DE MEXICO S.A. DE C.V.
Yantai Fuyan Mould Co., Ltd.
PT. F.tech INDONESIA(2) Number of non-consolidated subsidiaries: Two
Laguna Greenland Corp.
F.tech Automotive Components Private Limited
Reason for exclusion from scope of consolidation
The non-consolidated subsidiaries are small in scale and the amounts of their total assets, net sales,
profit (loss) (for the Company’s equity interest), retained earnings (for the Company’s equity
interest) and other financial statement items do not have a significant impact on the Company’s
consolidated financial statements.

3.

Disclosure about application of equity method(1) Non-consolidated subsidiaries accounted for using the equity method
Not applicable.

-8-(2) Number of associates accounted for using the equity method: Five
Johnan Manufacturing Inc.
JOHNAN AMERICA, Inc.
JOHNAN F.TECH (THAILAND) LTD.
JOHNAN DE MEXICO, S.A. DE C.V.
VEEGEE Auto Components Private Limited
Change in scope of application of the equity method
VEEGEE Auto Components Private Limited was included in the scope of application of the equity
method from the current fiscal year as the Company acquired its shares.
(3) Number of non-consolidated subsidiaries not accounted for using the equity method: Two
Laguna Greenland Corp.
F.tech Automotive Components Private Limited
Number of associates not accounted for using the equity method: Six
Progressive Tools & Components Pvt Ltd.
JOHNAN UK LTD.
PT. JFD INDONESIA
JOHNAN WUHAN INC.
Johnan Kyushu Manufacturing Inc.
Johnan Foshan Inc.
Reason for exclusion from scope of equity method
The non-consolidated subsidiaries and associates that are not accounted for using the equity method
are excluded from the application of the equity method since such exclusion has no significant
impact on the Company’s consolidated financial statements in terms of profit (loss) (for theCompany’s equity interest), retained earnings (for the Company’s equity interest) and otherfinancial statement items, and overall they are of minor significance.
(4) The fiscal year ends of certain companies accounted for using the equity method are different from theconsolidated fiscal year end. In preparing the consolidated financial statements, the Company uses thefinancial statements of these companies as of their fiscal year end.
4.

Disclosure about fiscal years, etc. of consolidated subsidiaries
Among the consolidated subsidiaries, the fiscal year end of F.tech Philippines Mfg., Inc. and F.tech R&D
Philippines Inc. is January 31 and the fiscal year end of F.E.G. DE QUERETARO, S.A. DE C.V., F.tech
Zhongshan Inc., F.tech Wuhan Inc., Yantai Fuyan Mould Co., Ltd., F.tech R&D (Guangzhou) Inc., F&P
MFG.DE MEXICO S.A. DE C.V. and PT. F.tech INDONESIA is December 31.
In the preparation of the consolidated financial statements, the financial statements as of the fiscal year endsof the respective subsidiaries are used. However, for major transactions that occurred between these fiscal
year ends and the consolidated fiscal year end, necessary adjustments are made in the consolidated financial
statements.

-9-

5.

Disclosure of accounting policies(1) Accounting policy for measuring significant assetsi)Securities
Available-for-sale securities (other securities)
Securities with a fair value
Stated at fair value based on market prices on the closing date of the accounting period.
(Valuation difference is stated as a component of net assets in the consolidated balance sheets,the cost of securities sold is calculated applying the moving-average method.)
Securities without a fair value
Stated at cost determined by the moving-average method.
ii) Derivatives
Stated at fair value.
iii) Inventories
Inventories of the Company and its domestic consolidated subsidiaries are stated at cost determinedby the average cost method (balance sheet amounts are determined based on the method of writing
down book value in accordance with decreased profitability). Inventories of foreign consolidated
subsidiaries are stated at the lower of cost or market, determined by the first-in, first-out method.
(2) Accounting policy for depreciation of significant assetsi)
Property, plant and equipment (excluding leased assets)
Depreciated by the straight-line method.
ii) Intangible assets (excluding leased assets)
Amortized by the straight-line method.
Software (for internal use) is amortized by the straight-line method over the usable period in the
Company (5 years).
iii) Leased assets
Leased assets relating to finance lease transactions that do not transfer ownership are depreciated by
the straight-line method assuming the lease periods as useful lives without residual value.
Right-of-use assets are depreciated by the straight-line method over the shorter of the useful life of theasset or lease term.
(3) Accounting policy for significant provisionsi)
Allowance for doubtful accounts
To prepare for losses from bad debts, an estimated uncollectible amount is provided either by making
an estimation using the historical rate of credit loss in the case of general receivables, or based on
individual consideration of collectability in the case of specific receivables such as highly doubtfulreceivables.
ii) Provision for directors’ retirement benefits
At some subsidiaries, to prepare for the payment of directors’ retirement benefits, the amount to be
paid at the fiscal year end, based on the internal rules for directors’ retirement benefits, is provided.
iii) Provision for directors’ bonuses
To prepare for the payment of directors’ bonuses, the amount expected to be paid at the current fiscal
year end is provided.
(4) Accounting method of retirement benefitsi)Methods of attributing estimated retirement benefits to accounting periods
When calculating retirement benefit obligations, the benefit formula method is used to attribute
estimated benefit amounts to periods of service until the fiscal year end.
- 10 -

ii)

Amortization of actuarial gains and losses
Actuarial gains and losses are amortized beginning in the following fiscal years by the straight-line
method over a period which is equal to or less than the average remaining service period of employees(mainly 5 years) at the time of occurrence.
iii) Application of simplified method for small businesses
In calculating net defined benefit liability, certain consolidated subsidiaries apply the simplified
method in which the net defined benefit liability and retirement benefit costs are deemed to be theamount of retirement benefits to be paid in cases where all eligible employees retired on a voluntarybasis at the fiscal year-end date.
(5) Translation basis of significant assets and liabilities denominated in foreign currencies
Receivables and payables denominated in foreign currencies are translated into Japanese yen at the spot
exchange rates prevailing at the consolidated fiscal year end, and the translation adjustment is recognizedin the consolidated statements of income. Assets and liabilities of foreign consolidated subsidiaries aretranslated into Japanese yen at the spot exchange rates as of the fiscal year end, and revenues and expenses
of foreign consolidated subsidiaries are translated into Japanese yen at the average exchange rates.
Translation adjustments are included in foreign currency translation adjustment and non-controllinginterests in net assets in the consolidated balance sheets.
(6) Accounting policy for goodwill
All goodwill and the portion of negative goodwill that was recognized on or before March 31, 2010, havebeen amortized by the straight-line method over periods not exceeding 20 years based on the estimatedperiod during which their effect will be recognized for each investment.
(7) Scope of cash and cash equivalents in consolidated statements of cash flows
Cash and cash equivalents consist of cash on hand, demand deposits, and short-term investments that arereadily convertible to known amounts of cash and subject to insignificant risk of change in value and due
within three months from the date of acquisition.
(8) Other significant matters for preparing consolidated financial statements
Accounting policy for consumption taxes
Tax exclusive method is adopted.

- 11 -

Significant accounting estimates
The Company calculates reasonable monetary amounts for significant accounting estimates based on theinformation available at the time of preparing the consolidated financial statements. Of the amounts reported
as accounting estimates in the consolidated financial statements for the current fiscal year, the following items
have the risk of having a significant impact on the consolidated financial statements for the following fiscal
year:
1.

Impairment test of non-current assets at F&P America Mfg., Inc.’s Ohio factory(1) Amount recorded in the consolidated financial statements for the current fiscal year
Given that the Ohio factory of F&P America Mfg., Inc. (“F&P America”), the Company’s consolidated
subsidiary in the North America segment, continued to post operating losses for reasons, such as theimpact of COVID-19, the Company determined that there was an indication of impairment. Accordingly,
after examining whether to recognize an impairment loss, an impairment loss was not recognized since
the fair value of the asset group exceeded the carrying amount of non-current assets (9,428 million yen).
(2) Other information that helps users of the consolidated financial statements better understand the detailsof the accounting estimates
In principle, the Group’s business assets are grouped by the categories for management accounting.
F&P America applies US GAAP and non-current assets are grouped by factory as the smallest cashgenerating unit. If an indication of impairment is identified and the total estimated undiscounted cash
flows from an asset group are expected to fall below its carrying amount and the fair value is expected to
be lower than its carrying amount, the difference between the carrying amount and fair value is recognized
as an impairment loss.
As an indication of impairment was identified at F&P America’s Ohio factory in the current fiscal year,
the Company compared the asset group’s fair value to its carrying amount. The market approach is mainly
used in calculating the fair value of the asset. If the fair value fluctuates, it may significantly affect thedetermination of whether to recognize an impairment loss and the amount thereof.

2.

Impairment test of non-current assets at F.tech Mfg. (Thailand) Ltd.
(1) Amount recorded in the consolidated financial statements for the current fiscal year
As F.tech Mfg. (Thailand) Ltd. (“FMTL”), the Company’s consolidated subsidiary in the Asia segment,
saw earnings decline significantly more than expected for reasons, such as the impact of COVID-19, theCompany determined that there was an indication of impairment. Accordingly, after examining whether
to recognize an impairment loss, an impairment loss was not recognized since the present value of the
future cash flows expected to be derived from the cash-generating unit (“value in use”) exceeded thecarrying amount of non-current assets (2,755 million yen).
(2) Other information that helps users of the consolidated financial statements better understand the detailsof the accounting estimates
In principle, the Group’s business assets are grouped by the categories for management accounting.
FMTL applies IFRS and deems its factory as a whole as the smallest cash-generating unit. If an indicationof impairment is identified and the cash-generating unit’s recoverable amount is expected to fall below
its carrying amount, the difference between the two is recognized as an impairment loss.
As an indication of impairment was identified at FMTL, the Company compared the cash-generating
unit’s recoverable amount to its carrying amount. The recoverable amount is based on the value in use,which is estimated as the present value of future cash flows expected to be derived from the cashgenerating unit, calculated by applying a pre-tax discount rate to estimated cash flows based on budgets
and business plans approved by the board of directors. The management’s judgment concerning these
may have a significant impact on estimated future cash flows.

- 12 -

3.

Recoverability of deferred tax assets at F-TECH INC.
(1) Amount recorded in the consolidated financial statements for the current fiscal year
After offsetting deferred tax assets of 235 million yen recorded as a recoverable component for deductible
temporary differences with deferred tax liabilities of 199 million yen for taxable temporary differences,a net of 35 million yen was recorded in the consolidated balance sheets. Further, a valuation allowanceof 3,077 million yen was deducted from deferred tax assets totaling 3,312 million yen for deductible
temporary differences and tax loss carried forward.
(2) Other information that helps users of the consolidated financial statements better understand the detailsof the accounting estimates
Deferred tax assets are recognized for all deductible temporary differences and tax loss carried forward
to the extent that taxable profit will be available against which the deductible temporary differences canbe utilized. In determining the recoverability of deferred tax assets, the amount of deferred tax assets tobe recorded is calculated according to the company classification specified in “Implementation Guidanceon Recoverability of Deferred Tax Assets” (ASBJ Guidance No. 26).
Future taxable income to be used in determining the recoverability of deferred tax assets is estimatedbased on the Company’s medium-term management plan. In estimating the amount, the Company took
into account external factors, including the business environment, as well as the Company’s expected
future volume of sales to its main customers and their downward risk, after collecting information on the
expected future volume of sales at its main customers. The management’s judgment concerning these
may have a significant impact on the recoverability of deferred tax assets.

New accounting standards to be applied
1. The Company and its domestic consolidated subsidiaries
 “Accounting Standard for Revenue Recognition” (ASBJ Statement No. 29, issued on March 31, 2020)
 “Implementation Guidance on Accounting Standard for Revenue Recognition” (ASBJ Implementation
Guidance No. 30, issued on March 26, 2021)(1) Overview
These are comprehensive revenue recognition standards. Revenue is recognized based on the following
five steps:
Step 1: Identify the contract with a customer
Step 2: Identify the performance obligations in the contract
Step 3: Determine the transaction price
Step 4: Allocate the transaction price to the performance obligations in the contract
Step 5: Recognize revenue when or as performance obligations are satisfied(2) Scheduled date of application
These ASBJ statement and guidance will be applied at the start of the ending March 31, 2022.
(3) Effects of application of the accounting standard, etc.
The impact of the application of the Accounting Standard for Revenue Recognition on the consolidated
financial statements is currently under evaluation.
 “Accounting Standard for Fair Value Measurement” (ASBJ Statement No. 30, issued by the AccountingStandards Board of Japan on July 4, 2019)
 “Implementation Guidance on Accounting Standard for Fair Value Measurement” (ASBJ Guidance No. 31,
issued by the Accounting Standards Board of Japan on July 4, 2019) “Accounting Standard for Measurement of Inventories” (ASBJ Statement No. 9, issued by the AccountingStandards Board of Japan on July 4, 2019) “Accounting Standard for Financial Instruments” (ASBJ Statement No. 10, issued by the AccountingStandards Board of Japan on July 4, 2019)
 “Implementation Guidance on Disclosures about Fair Value of Financial Instruments” (ASBJ Guidance No.
19, issued by the Accounting Standards Board of Japan on March 31, 2020)- 13 -

(1) Overview
To improve comparability with international accounting standards, “Accounting Standard for Fair Value
Measurement” and “Implementation Guidance on Accounting Standard for Fair Value Measurement”(hereinafter, “Accounting Standard for Fair Value Measurement, etc.”) have been developed as guidanceon how to measure fair value. “Accounting Standard for Fair Value Measurement, etc.” will be appliedin determining the fair value of the following items.
 Financial instruments set forth in “Accounting Standard for Financial Instruments”
 Inventories held for trading purposes set forth in “Accounting Standard for Measurement of
Inventories”
In addition, with the revised “Implementation Guidance on Disclosures about Fair Value of Financial
Instruments,” notes to the breakdown by the level of fair value of financial instruments, etc. were provided.
(2) Scheduled date of application
These ASBJ statements and guidance will be applied at the start of the fiscal year ending March 31, 2022.
(3) Effects of application of the accounting standard, etc.
The impact of the application of the Accounting Standard for Fair Value Measurement and otheraccounting standards on the consolidated financial statements is currently under evaluation.
2. Foreign consolidated subsidiaries“Leases” (US GAAP ASU 2016-02)(1) Overview
This accounting standard requires a lessee to recognize assets and liabilities for all leases in principle,
and so forth.
(2) Scheduled date of application
The accounting standard will be applied at the start of the ending March 31, 2023.
(3) Effects of application of the accounting standard, etc.
The impact on the consolidated financial statements is currently under evaluation.
Changes in presentation
Application of “Accounting Standard for Disclosure of Accounting Estimates”“Accounting Standard for Disclosure of Accounting Estimates” (ASBJ Statement No. 31, issued by the
Accounting Standards Board of Japan on March 31, 2020) have been applied to the consolidated financial
statements from the current fiscal year end, and notes regarding significant accounting estimates have been
provided in the consolidated financial statements.
In accordance with the transitional measure specified in the proviso of Paragraph 11 of the said accounting
standard, the content pertaining to the previous fiscal year is not provided.
Additional information
Due to the extended impact of COVID-19, it is difficult to accurately predict to what extent the disease will
spread going forward or when the pandemic will end, but given that its impact on the Group’s operating resultsin the latter half of the current fiscal year was limited, the accounting estimates were made, assuming that the
future impact will be limited.
Because the impact of COVID-19 is highly uncertain, however, any changes in the assumptions above may
have an impact on the Group’s financial position, operating results and cash flows in the fiscal year ending
March 31, 2022.
In connection with the COVID-19 pandemic, the Group posted 1,838 million yen as subsidy income from thegovernment under extraordinary income and 2,830 million yen as extraordinary loss, including fixed costs
incurred as operations were fully or partially suspended due to a government order, in the current fiscal year.

- 14 -

Notes to consolidated balance sheets*1. Accumulated depreciation of property, plant and equipment is as follows:(Millions of yen)
As of March 31, 2020

As of March 31, 2021

116,766

127,026*2. Investment securities relating to non-consolidated subsidiaries and associates are as follows:(Millions of yen)
As of March 31, 2020

As of March 31, 2021

4,548

5,172

Investment securities (stocks)*3. The Group has entered into overdraft agreements and loan commitment agreements with 14 banks toefficiently raise working capital. Balance of unexecuted borrowings at end of period under these
agreements is shown below:(Millions of yen)
As of March 31, 2020

As of March 31, 2021

Total amount of overdraft facility limit and loan
commitment

46,902

55,349Balance of borrowings outstanding

20,39520,872

26,50634,476Unexecuted balance- 15 -

Notes to consolidated statements of income and comprehensive income*1. The ending balance of inventories represents the amount after write-down of the book value in accordancewith the decline in profitability and the following loss (reversal) on valuation of inventories is included
in cost of sales.
(Millions of yen)
Fiscal year ended
March 31, 2020

Fiscal year ended
March 31, 2021

176

89

*2. The major items of selling, general and administrative expenses are as follows:(Millions of yen)
Fiscal year ended
March 31, 2020

Fiscal year ended
March 31, 2021

Haulage expenses

2,162

1,931

Salaries, allowance and bonuses

4,577

4,341

Retirement benefit costs

203

231

Provision for directors’ bonuses

75

28

Provision for directors’ retirement benefits

21

14

Depreciation

534

555

2,878

2,253

Research and development expenses*3. The total research and development expenses included in general and administrative expenses are as
follows:(Millions of yen)
Fiscal year ended
March 31, 2020

Fiscal year ended
March 31, 2021

2,878

2,253

*4. The breakdown of gain on sales of non-current assets is as follows:(Millions of yen)
Fiscal year ended
March 31, 2020

Fiscal year ended
March 31, 2021

Buildings and structures

13

0

Machinery, equipment and vehicles

9

14

Other

0

0

23

15

Total

*5. The breakdown of loss on sales of non-current assets is as follows:(Millions of yen)
Fiscal year ended
March 31, 2020

Fiscal year ended
March 31, 2021

Machinery, equipment and vehicles

3

20

Other

0

0

3

20

Total

- 16 -

*6. The breakdown of loss on retirement of non-current assets is as follows:(Millions of yen)
Fiscal year ended
March 31, 2020

Fiscal year ended
March 31, 2021

Buildings and structures22

2

Machinery, equipment and vehicles

33

60

Other

6

4

63

67

Total

*7. Notes regarding reclassification adjustments and tax effects relating to other comprehensive income(Millions of yen)
Fiscal year ended
March 31, 2020

Fiscal year ended
March 31, 2021

Valuation difference on available-for-sale securities
Increase (decrease) during the period

(243)

381

Pre-adjustment of tax effect

(243)

381

72

(113)

(171)

267

(1,869)2,195(1,869)2,195

Increase (decrease) during the period

(120)

164

Reclassification adjustments

151

256

Pre-adjustment of tax effect

31

420

Tax effect amount－(1)

Remeasurements of defined benefit plans, net of tax

31

419

(183)

63

(183)

63

(2,193)

2,945

Tax effect amount
Valuation difference on available-for-sale securities
Foreign currency translation adjustment
Increase (decrease) during the period
Foreign currency translation adjustment
Remeasurements of defined benefit plans, net of tax

Share of other comprehensive income of entities
accounted for using equity method
Increase (decrease) during the period
Share of other comprehensive income of entities
accounted for using equity method
Total other comprehensive income- 17 -

Notes to consolidated statements of changes in net assets
Fiscal year ended March 31, 2020
1. Class and total number of issued shares and class and number of treasury shares(Thousands of shares)
Number of shares asof beginning ofcurrent fiscal year

Number of shares
increased in current
fiscal year

Number of shares
decreased in current
fiscal year

Number of shares asof end of current
fiscal year

Common shares

18,712––

18,712

Total

18,712––

18,712

Common shares

33

–

–

33

Total

33

–

–

33

Issued shares

Treasury shares

2.

Dividends(1) Cash dividends paid

Resolution

Class of shares

Total cash
dividend(Millions of yen)

Source ofdividends

Dividend pershare (Yen)Record date

Effective date

Annual General
Meeting of
Shareholders heldon June 26, 2019

Common shares

187

Retained earnings

10

March 31, 2019

June 27, 2019

Board of Directors’
meeting held on
November 7, 2019

Common shares

187

Retained earnings

10

September 30,
2019

December 3, 2019(2) Dividends whose record dates are in the current fiscal year but whose effective dates fall in the next
fiscal year
Resolution

Class of shares

Total cash
dividend(Millions of yen)

Annual General
Meeting of
Shareholders heldon June 25, 2020

Common shares

187

Source ofdividends

Retained earnings- 18 -

Dividend pershare (Yen)10

Record date

Effective date

March 31, 2020

June 26, 2020

Fiscal year ended March 31, 2021
1. Class and total number of issued shares and class and number of treasury shares(Thousands of shares)
Number of shares asof beginning ofcurrent fiscal year

Number of shares
increased in current
fiscal year

Number of shares
decreased in current
fiscal year

Number of shares asof end of current
fiscal year

Common shares

18,712––

18,712

Total

18,712––

18,712

Common shares

33

95

–

128

Total

33

95

–

128

Issued shares

Treasury shares

Summary of reasons for change:
An increase of 95 thousand shares due to the purchase of treasury shares for providing stock-based compensation to directors
and operating officers.

2.

Dividends(1) Cash dividends paid

Resolution

Class of shares

Total cash
dividend(Millions of yen)

Annual General
Meeting of
Shareholders heldon June 25, 2020

Common shares

187

Source ofdividends

Retained earnings

Dividend pershare (Yen)10

Record date

Effective date

March 31, 2020

June 26, 2020

(2) Dividends whose record dates are in the current fiscal year but whose effective dates fall in the next
fiscal year
Resolution

Class of shares

Total cash
dividend(Millions of yen)

Annual General
Meeting of
Shareholders heldon June 24, 2021

Common shares

149

Source ofdividends

Retained earnings- 19 -

Dividend pershare (Yen)8

Record date

Effective date

March 31, 2021

June 25, 2021

Notes to consolidated statements of cash flows*1. Reconciliation of ending balance of cash and cash equivalents with account balances per balance sheet(Millions of yen)
Fiscal year ended
March 31, 2020

Fiscal year ended
March 31, 2021

Cash and deposits

8,879

3,708

Cash and cash equivalents

8,879

3,708

2.

Description of significant transactions not requiring use of cash or cash equivalents
Assets and liabilities associated with lease transactions newly recorded are as follows:(Millions of yen)
Fiscal year ended
March 31, 2020

Lease assets

Fiscal year ended
March 31, 2021

525

36

Right-of-use assets

2,016

452

Lease obligations

1,858

488

(Note) Right-of-use assets and lease obligations for the fiscal year ended March 31, 2020 include 1,646 million yen and 963
million yen, respectively, which are the amounts that increased due to the initial application of IFRS 16 “Leases.”

Notes on leases
As lessee
1. Finance lease transactions
Finance lease transactions that do not transfer ownershipi) Leased assets
Property, plant and equipment
Production facilities:
Machinery and equipmentii) Depreciation of leased assets
Depreciation of leased assets is as stated in “5. Disclosure of accounting policies, (2) Accounting policy
for depreciation of significant assets” under “Basis of presentation and significant accounting policies
for preparation of consolidated financial statements.”
2.

Operating lease transactions
Future lease payments under non-cancellable leases of operating lease transactions(Millions of yen)
As of March 31, 2020

As of March 31, 2021

Due within one year

236

243

Due over one year

324

263

Total

560

506

- 20 -

Notes on financial instruments
1. Overview of financial instruments(1) Policy on treatment of financial instruments
The Group raises necessary funds (mainly loans from banks and issuance of corporate bonds) according
to the capital expenditure plan to conduct the auto parts related business consisting of the manufactureand sale of auto parts and dies, equipment, tools, etc. for these parts. The Group utilizes derivatives tohedge its exposure to risks described below and adheres to a policy of not conducting derivativetransactions for speculative purposes.
(2) Financial instruments and related risks
Notes and accounts receivable - trade that are operating receivables are exposed to the credit risk ofcustomers. Although operating receivables denominated in foreign currencies, which arise fromintercompany transactions due to the globally developed businesses, are exposed to the risk offluctuations in exchange rates, forward exchange contracts are used to hedge this risk. Investment
securities are principally stocks related to business activities or capital alliances with business partners
and exposed to the risk of fluctuations in market prices. Long-term loans receivable are intercompany
loans and exposed to the credit risk of the borrowers.
Notes and accounts payable - trade that are operating payable and accounts payable - other are due within
one year. Some of these payables are denominated in foreign currencies due to import of materials, etc.
and exposed to the risk of fluctuations in exchange rates, however they are within the range of the balanceof accounts receivable - trade denominated in the same foreign currency on a permanent basis. Loanspayable, long-term accounts payable - other and lease obligations on finance leases and operating leases
are principally for procuring funds needed for capital expenditure and due for repayment within up to 24
years after the fiscal year end.
Derivative transaction is forward exchange contracts to hedge the foreign currency risk on operatingreceivables arising from intercompany transactions.
(3) Risk management system for financial instrumentsi)Management of credit risk (customers’ default risk)
For operating receivables, the Company conducts maturity management and balance management by
counterparty through periodical monitoring of major business partners’ status in the operation divisionand the management division of each department in accordance with the internal rules on sales
management, and endeavors to quickly determine and mitigate any concern on the collection ofreceivables due to deteriorated financial conditions. Consolidated subsidiaries also manage operatingreceivables in the same manner in accordance with the Company’s internal rules on sales management.
For long-term loans receivable, the Company periodically monitors the status of borrowers to quickly
determine and mitigate any concern on the collection of loans due to their deteriorated financial
condition and other factors.
ii) Management of market risk (fluctuation risk of foreign currency exchange and interest rates, etc.)
The Company and some consolidated subsidiaries utilize forward exchange contracts in principle tohedge the foreign currency exchange rate fluctuation risk by currency on a monthly basis for operatingreceivables arising from intercompany transactions. Depending on the status of foreign exchange rates,
forward exchange contracts are entered into for a maximum of 12 months in relation to operatingreceivables denominated in foreign currencies that are certainly expected to arise from forecast royaltytransactions.
For investment securities, the Company periodically assesses market value and financial conditions ofissuers (business partners).
For derivative transactions, the Company assesses the positions to conduct hedge transactions on amonthly basis under the hedge policy of the funds and foreign exchange conference, in accordancewith the internal rules on foreign exchange risks which stipulate transaction authority, limit amounts
and other matters. Based on this assessment, the accounting department conducts transactions, andrecords information on the transaction and checks balances with counterparties.
- 21 -

iii) Management of liquidity risk associated with fund raising (risk of inability to pay on due date)
The Company’s accounting department prepares and updates financial plans annually and monthly
based on reports from each department.
(4) Supplementary explanation concerning fair values of financial instruments
Fair values of financial instruments comprise of values based on market prices and reasonably measured
values where market prices are unavailable. As several variable factors are incorporated in calculating
the relevant fair value, the resulting amount may vary depending on the different preconditions employed.
In addition, contract/notional amounts related to derivative transactions in “Notes on derivatives” do notin themselves indicate the market risk of derivative transactions.
(5) Concentration of credit risks
As of March 31, 2021, 68.4% of operating receivables were associated with the major customers.

- 22 -

2.

Fair values of financial instruments
Carrying amounts on the consolidated balance sheets, fair values and differences therebetween of thefinancial instruments are shown below. However, financial instruments whose fair values are deemed to be
extremely difficult to determine are not included therein (Please refer to Note 2 below).
As of March 31, 2020
(Millions of yen)
Carrying amount on
the consolidatedbalance sheet

Fair value

Difference(1) Cash and deposits

8,879

8,879

––

(2) Notes and accounts receivable - trade27,95527,955

––

1,032

1,032

––

226

226

––

38,09438,094––(5) Notes and accounts payable - trade17,427

17,427––(6) Accounts payable - other

2,371

2,371

––

(7) Short-term loans payable

20,395

20,395––(8) Long-term loans payable (*1)

28,88629,027140(9) Lease obligations (*2)

1,904

2,035

131

(10) Long-term accounts payable - other (installment) (*3)

147

149

2

Total liabilities

71,132

71,406

273

(28)

(28)

––

(3) Investment securities
Available-for-sale securities (other securities)(4) Long-term loans receivable
Total assets(11) Derivatives (*4)(*1) Current portion of long-term loans payable in current liabilities is included.
(*2) The total amount of lease obligations in current liabilities and lease obligations in non-current liabilities is presented.
(*3) The total amount of current portion of long-term accounts payable - other (installment) included in accounts payable other in current liabilities is presented.
(*4) Claims and obligations arising from derivative transactions are presented on a net basis.

- 23 -

As of March 31, 2021
(Millions of yen)
Carrying amount on
the consolidatedbalance sheet

Fair value

Difference(1) Cash and deposits

3,708

3,708

––

(2) Notes and accounts receivable - trade

31,57831,578

––

1,444

1,444

––

231

231

(0)

36,96336,963(0)(5) Notes and accounts payable - trade

19,772

19,772––(6) Accounts payable - other

3,422

3,422

––

(7) Short-term loans payable

20,872

20,872––(8) Long-term loans payable (*1)

26,82826,87345(9) Lease obligations (*2)

1,862

1,677

(184)

2

2

(0)

72,76072,621

(139)

(16)

(16)

––

(3) Investment securities
Available-for-sale securities (other securities)(4) Long-term loans receivable
Total assets(10) Long-term accounts payable - other (installment) (*3)
Total liabilities(11) Derivatives (*4)(*1) Current portion of long-term loans payable in current liabilities is included.
(*2) The total amount of lease obligations in current liabilities and lease obligations in non-current liabilities is presented.
(*3) Only the current portion of long-term accounts payable - other (installment) included in accounts payable - other in current
liabilities is presented.
(*4) Claims and obligations arising from derivative transactions are presented on a net basis.
(Notes) 1. Measurement method of fair values of financial instruments and matters concerning securities and derivatives(1) Cash and deposits and (2) Notes and accounts receivable - trade
The fair value of these assets is based on the book value, given that the fair value is almost the same as the bookvalue, as they are settled in a short period.
(3) Investment securities
The fair value of stocks with fair value is based on the quoted market price.
(4) Long-term loans receivable
The fair value of long-term loans receivable is calculated based on the present value of future cash flows (principal
and interest) discounted using the assumed interest rate of similar new borrowings.
(5) Notes and accounts payable - trade, (6) Accounts payable - other and (7) Short-term loans payable
The fair value of these liabilities is based on the book value, given that the fair value is almost the same as thebook value, as they are settled in a short period.
(8) Long-term loans payable, (9) Lease obligations and (10) Long-term accounts payable - other (installment)
The fair values of long-term loans payable with fixed interest rates, lease obligations and long-term accounts
payable - other (installment) are calculated by discounting the total amount of principal and interest at theassumed interest rate of similar new borrowings, lease contracts and installment payment contracts. Since longterm loans payable with floating interest rates reflect market interest rates within a short period, the fair value isapproximately the same as the book value and thus presented at the book value.
(11) Derivatives
The fair value of derivatives is based on the prices presented by the financial institution with which the contract
has been made. These derivatives are forward exchange contracts to hedge the exchange rate fluctuation risk on
operating receivables denominated in foreign currencies.

- 24 -

2. Financial instruments whose fair values are deemed to be extremely difficult to determine(Millions of yen)Classification

As of March 31, 2020

As of March 31, 2021

4,548

5,172

378

379

––

99

4,927

5,650

Non-listed shares (*5)
Shares of subsidiaries and associates
Other
Long-term accounts payable - other (*6)
Total(*5) The above are not included in “(3) Investment securities” above because their market prices are not available
and the future cash flows cannot be estimated reliably, and thus their fair values are deemed extremely difficult
to determine.
(*6) Long-term accounts payable - other are obligations related to the payment of retirement benefits for directors
and other officers due to the discontinuation of the retirement benefit system. As the time of retirement of therelevant directors and other officers is not specified and it is extremely difficult to determine the fair values,
they are not included in “(10) Long-term accounts payable – other (installment).”
3. Redemption schedule for monetary receivables after the fiscal year end
As of March 31, 2020
(Millions of yen)
Due within one
year

Due after one
Due after five
year through five years through ten
years
years

Due over ten
years

Cash and deposits

8,879

––

––

––

Notes and accounts receivable - trade27,955

––

––

––

––

165

61

––

36,835

165

61

––

Long-term loans receivable
Total
As of March 31, 2021

(Millions of yen)
Due within one
year

Due after one
Due after five
year through five years through ten
years
years

Due over ten
years

Cash and deposits

3,708

––

––

––

Notes and accounts receivable - trade

31,578

––

––

––

––

169

62

––

35,286

169

62

––

Long-term loans receivable
Total

4. Repayment schedule for long-term loans payable, lease obligations and other interest-bearing debts
As of March 31, 2020
(Millions of yen)
Due within one
year

Due after one
Due after five
year through five years through ten
years
years

Due over ten
years

Short-term loans payable

20,395––––––Long-term loans payable

9,740

19,144

2––

Lease obligations

572

1,331

––

––

Long-term accounts payable - other(installment)

144

2

––

––

Total

30,853

20,4782––- 25 -

As of March 31, 2021
(Millions of yen)
Due within one
year

Due after one
Due after five
year through five years through ten
years
years

Due over ten
years

Short-term loans payable

20,872––––––Long-term loans payable

9,884

16,904

39

––

472

504

388

496

2

––

––

––

31,231

17,408428

496

Lease obligations
Long-term accounts payable - other(installment)
Total- 26 -

Notes on securities
1. Available-for-sale securities (other securities)
As of March 31, 2020
(Millions of yen)Type

Items whose carrying
amount on the consolidatedbalance sheet exceeds
original purchase price
Items whose carrying
amount on the consolidatedbalance sheet does notexceed original purchase
price

Carrying amount on
the consolidatedbalance sheet

Difference(1) Shares

1,003

717

285

(2) Bonds

––

––

––

(3) Other

––

––

––

1,003

717

285

(1) Shares

29

38

(8)

(2) Bonds

––

––

––

(3) Other

––

––

––

29

38

(8)

1,032

755

277

Subtotal

Subtotal

Total(Note)

Original purchasepriceNon-listed shares (carrying amount on the consolidated balance sheet: 378 million yen) are not included in “Availablefor-sale securities (other securities)” above because their market prices are not available and their fair values are deemed
extremely difficult to determine.

As of March 31, 2021
(Millions of yen)Type

Items whose carrying
amount on the consolidatedbalance sheet exceeds
original purchase price
Items whose carrying
amount on the consolidatedbalance sheet does notexceed original purchase
price

Carrying amount on
the consolidatedbalance sheet

Difference(1) Shares

1,429

767

662

(2) Bonds

––

––

––

(3) Other

––

––

––

1,429

767

662

(1) Shares

14

18

(3)

(2) Bonds

––

––

––

(3) Other

––

––

––

14

18

(3)

1,444

785

658

Subtotal

Subtotal

Total(Note)

Original purchasepriceNon-listed shares (carrying amount on the consolidated balance sheet: 379 million yen) are not included in “Availablefor-sale securities (other securities)” above because their market prices are not available and their fair values are deemed
extremely difficult to determine.

- 27 -

2.

Available-for-sale securities (other securities) soldFiscal year ended March 31, 2020
Not applicable.
Fiscal year ended March 31, 2021
(Millions of yen)Type

Sales amount

Total gain on sale

Total loss on sale(1) Shares

10

6

––

(2) Bonds

––

––

––

(3) Other

––

––

––

10

6

––

Total

- 28 -

Notes on derivatives
1. Derivative transactions to which hedge accounting is not applied(1) Foreign currency
As of March 31, 2020
(Millions of yen)
As of March 31, 2020
Classification

Type of transaction

Contract/notionalamountPortion ofcontract/notionalamount over one
year

Fair value

Valuation gain
(loss)

Forward exchange
contracts
Transactions otherthan market
transactions

Sell
U.S. dollar

1,141

－

(30)

(30)

Thai Baht

41

－

1

1

1,182

－

(28)

(28)

Total

(Note) Measurement method for fair values
Fair values are calculated based on price presented by counterparty financial institutions, etc.

As of March 31, 2021
(Millions of yen)
As of March 31, 2021
Classification

Transactions otherthan market
transactions

Type of transaction

Portion ofcontract/notionalamount over one
year

Fair value

Valuation gain
(loss)

Forward exchange
contracts
Sell
U.S. dollar

790

––

(16)

(16)

Thai Baht

14

––

(0)

(0)

804

––

(16)

(16)

Total
(Note)

Contract/notionalamountMeasurement method for fair values
Fair values are calculated based on price presented by counterparty financial institutions, etc.

(2) Interest rate
As of March 31, 2020
Not applicable.
As of March 31, 2021
Not applicable.

- 29 -

2.

Derivative transactions to which hedge accounting is applied(1) Foreign currency
As of March 31, 2020
Not applicable.
As of March 31, 2021
Not applicable.
(2) Interest rate
As of March 31, 2020
Not applicable.
As of March 31, 2021
Not applicable.

- 30 -

Notes on retirement benefits
1. Summary of retirement benefit plans adopted
The Company has established a constitution-based defined benefit corporate pension plan. Somedomestic consolidated subsidiaries have established constitution-based defined benefit corporate pension
plans and lump-sum retirement benefit plans. Some foreign consolidated subsidiaries have establisheddefined benefit plans or the defined contribution plans.
Because the Company has participated in JMSA Welfare Pension Fund (multi-employer contributory
pension plan) and cannot reasonably calculate the amount of plan assets in terms of its contributions forthe plan, retirement benefit obligations for the plan are accounted for in the same manner as a defined
contribution plan.
2.

Defined benefit plans(1) Reconciliation between the balance at beginning of period and the balance at end of period ofretirement benefit obligations (excluding plans to which the simplified method was applied)(Millions of yen)
Fiscal year ended
March 31, 2020

Fiscal year ended
March 31, 2021

6,828

7,156

Service cost

455

474

Interest cost

34

39

Actuarial loss (gain)

(30)

(23)

Benefits paid

(132)

(285)

Amortization of past service cost

––

3

Other

0

(44)

7,156

7,320

Balance at beginning of period

Balance at end of period(2) Reconciliation between the balance at beginning of period and the balance at end of period of plan
assets (excluding plans to which the simplified method was applied)(Millions of yen)
Fiscal year ended
March 31, 2020

Fiscal year ended
March 31, 2021

6,132

6,347

Expected return on plan assets

118

136

Actuarial loss (gain)

(150)

118

Contributions paid by the employer

351

376

Benefits paid

(110)

(284)

5

3

6,347

6,698

Balance at beginning of period

Other
Balance at end of period- 31 -

(3) Reconciliation between the balance at beginning of period and the balance at end of period of net
defined benefit liability for plans to which the simplified method was applied(Millions of yen)
Fiscal year ended
March 31, 2020

Fiscal year ended
March 31, 2021

89

95

Benefit costs

29

30

Benefits paid

(2)

(17)

Contributions paid by the employer

(19)

(14)

95

94

Balance at beginning of period

Balance at end of period(4) Reconciliation between the balances at end of period of retirement benefit obligations and plan
assets, and net defined benefit liability and net defined benefit asset recorded in the consolidatedbalance sheet(Millions of yen)
As of March 31, 2020

As of March 31, 2021

Funded retirement benefit obligations

7,035

7,168

Plan assets(6,497)(6,863)

538

304

Unfunded retirement benefit obligations

366

411

Total net liability (asset) for retirement benefits

904

716

Net defined benefit liability

1,050

791

Net defined benefit asset

(146)

(75)

Total net liability (asset) for retirement benefits

904

716

Fiscal year ended
March 31, 2020

Fiscal year ended
March 31, 2021

Service cost

455

474

Interest cost

34

39

Expected return on plan assets

(118)

(136)

Net actuarial loss amortization

151

277

Amortization of past service cost––3

Retirement benefit costs calculated using simplified
methods

29

30

553

688

(Note)

Includes plans to which simplified methods were applied.

(5) Retirement benefit costs(Millions of yen)Total

- 32 -

(6) Remeasurements of defined benefit plans, net of tax
The breakdown of the items recorded in remeasurements of defined benefit plans, net of tax (before
deducting tax effect) in the consolidated statement of income and comprehensive income is as follows:(Millions of yen)
Fiscal year ended
March 31, 2020

Fiscal year ended
March 31, 2021

31

420

31

420

Actuarial gains and losses
Total(7) Remeasurements of defined benefit plans
The breakdown of the items recorded in remeasurements of defined benefit plans (before deducting
tax effect) in accumulated other comprehensive income in the consolidated balance sheet is as follows:(Millions of yen)
Fiscal year ended
March 31, 2020

Fiscal year ended
March 31, 2021

(292)

126

(292)

126

Actuarial gains and losses that are yet to be recognized
Total(8) Plan assetsi)
Breakdown of major categories of plan assets
The ratio of major categories to total plan assets is as follows:
As of March 31, 2020
Bonds

11.2%

12.5%

Equity securities

12.3

12.0

Cash and deposits

57.0

56.2

Other

19.5

19.3

100.0

100.0

Total

ii)

As of March 31, 2021

Method to determine rate of expected long-term return
The rate of expected long-term return is determined in consideration of the present and expectedasset mix and the present and expected long-term return rate on the various assets that comprise theplan assets.

(9) Actuarial assumptions
Major bases for actuarial calculations at end of period
As of March 31, 2020

3.

As of March 31, 2021

Discount rate

0.1%

0.1%

Long-term expected rate of return

1.7%

1.7%

Expected rate of salary increase

3.0%

3.0%

Defined contribution plan
The required contribution amount to defined contribution plans (including employees’ pension fund planin multi-employer contributory pension plans which is accounted for in the same manner) was 449 million
yen in the previous fiscal year and 432 million yen in the current fiscal year.

- 33 -

4.

Multi-employer contributory pension plans
The required contribution amount to the multi-employer contributory pension plan-type defined benefit
plans, which is accounted for in the same manner as a defined contribution plan, was 51 million yen in
the previous fiscal year and 50 million yen in the current fiscal year.
(1) Latest funding position of the multi-employer contributory pension plans
JMSA Welfare Pension Fund(Millions of yen)Previous fiscal year
Current fiscal year
(As of March 31, 2020) (As of March 31, 2021)
Amount of plan assets

1,421

2,055

Amount of reserve for the purpose of pension financing
calculation

1,276

1,542

145

513

Difference(2) Ratio of the Group’s members to the entire plan
JMSA Welfare Pension FundPrevious fiscal year
18.0% (As of March 31, 2020)
Current fiscal year
18.3% (As of March 31, 2021)(3) Supplementary explanation
The main reason for the difference in (1) above, is 269 million yen of past service liabilities for the
purpose of pension financing calculation.
Under the JMSA Welfare Pension Fund, past service liabilities are amortized over two years and eightmonths using the equal repayment method.
The ratio in (2) above is different from the ratio of the Group’s actual contributions.
Notes on share options, etc.
Not applicable.

- 34 -

Notes on tax effect accounting
1. Breakdown of deferred tax assets and deferred tax liabilities by major component(Millions of yen)
As of March 31, 2021

As of March 31, 2020
Deferred tax assets
Tax loss carry forwards (Note 2)

2,567

3,067

Excess depreciation

1,020

846

Elimination of unrealized gains on non-current assets

593

798

Impairment loss

399

367

Net defined benefit liability

180

283

Accrued bonuses

310

270

Loss on valuation of inventories

212

176

Other

657

775

5,940

6,585

Valuation allowance for tax loss carry forwards (Note 2)(1,814)(2,502)

Valuation allowance for the total of deductible temporary
difference, etc.

(1,751)(1,842)

Valuation allowance subtotal (Note 1)(3,565)(4,345)

Total deferred tax assets

2,374

2,239

Depreciation (foreign consolidated subsidiaries)(3,242)(3,562)

Valuation difference on available-for-sale securities

(86)

(199)

Net defined benefit asset

(14)

(17)

Other

(215)

(206)

Total deferred tax liabilities(3,557)(3,985)Net deferred tax assets (liabilities)(1,183)(1,745)

Deferred tax assets subtotal

Deferred tax liabilities(Notes) 1. Valuation allowance increased by 779 million yen. This increase is mainly due to an increase in valuation
allowance for deductible temporary difference as a result of a decrease in taxable income at the Company andsome consolidated subsidiaries.
2. Amounts of tax loss carry forwards and related deferred tax assets by expiration of carry forwards
As of March 31, 2020

(Millions of yen)
Within one
year

Over one
Over twoOver threeyear andyears andyears andwithin two within three within four
years
years
years

Over four
years andwithin five
years

Over five
years

Total

Tax loss carry forwards
(a)

117

427

676

281

6

1,058

2,567

Valuation allowance

(117)

(427)

(651)

(275)

–

(343)

(1,814)

Deferred tax assets

–

–

24

5

6

715

(b) 752(a)Tax loss carry forwards represent the amount multiplied by the statutory income tax rate.

(b)

For tax loss carry forwards of 2,567 million yen (amount multiplied by the statutory income tax rate), deferred tax
assets of 752 million yen were recorded. The deferred tax assets of 752 million yen were recognized principally in
relation to the balance of tax loss carry forwards for F&P America Mfg., Inc. of 938 million yen (amount after
multiplying the statutory income tax rate). Tax loss carry forwards for which these deferred tax assets were recorded
arose due mainly to the recording of loss before income taxes in the fiscal year ended March 31, 2019, and the- 35 -

fiscal year ended March 31, 2020. The Company has determined, based on expected future taxable income, etc.,that the deferred tax assets related to the tax loss carry forwards are determined to be recoverable.
As of March 31, 2021

(Millions of yen)
Within one
year

2.

Over one
Over twoOver threeyear andyears andyears andwithin two within three within four
years
years
years

Over four
years andwithin five
years

Over five
years

Total

Tax loss carry forwards
(a)

424

676

281

23

187

1,473

3,067

Valuation allowance

(424)

(676)

(281)

(23)

(12)

(1,084)(2,502)

Deferred tax assets

––

––

––

––

175

389

(b)564(a)Tax loss carry forwards represent the amount multiplied by the statutory income tax rate.

(b)

For tax loss carry forwards of 3,067 million yen (amount multiplied by the statutory income tax rate), deferred tax
assets of 564 million yen were recorded. The deferred tax assets of 564 million yen were recognized principally in
relation to the balance of tax loss carry forwards for F&P America Mfg., Inc. of 1,366 million yen (amount after
multiplying the statutory income tax rate) and that for F.tech Mfg. (Thailand) Ltd. of 175 million yen (amount after
multiplying the statutory income tax rate). Tax loss carry forwards for which these deferred tax assets were recorded
arose due mainly to the recording of loss before income taxes in the fiscal year ended March 31, 2021. The Company
has determined, based on expected future taxable income, etc., that the deferred tax assets related to the tax loss
carry forwards are determined to be recoverable.

Reconciliation of significant difference between statutory income tax rate and effective income tax rate
after application of tax effect accounting
As of March 31, 2020

As of March 31, 2021

30.1%

30.1%

Change in valuation allowance

17.3

53.5

Foreign tax credit

16.8

33.7

Tax rate differences in foreign consolidated subsidiaries

0.2

12.7

Expenses not deductible permanently such as entertainment
expenses

3.2

5.5

Inhabitant per capita tax

0.5

1.2

Share of profit (loss) of entities accounted for using equity
method

1.9(3.5)

Elimination of dividend income in consolidation

1.5

3.9

Income taxes for prior periods

(4.8)

22.6

Other

2.5

14.6

Effective income tax rate after application of tax effectaccounting

69.4

174.4

Statutory income tax rate
(Adjustments)

Changes in presentation:“Elimination of dividend income in consolidation” and “Income taxes for prior periods,” which were included in “Other”
under “2. Reconciliation of significant difference between statutory income tax rate and effective income tax rate after
application of tax effect accounting” in the previous fiscal year have been presented separately from the current fiscal year
due to an increase in their importance.
To reflect this change in presentation, the notes in the previous fiscal year were reclassified.
As a result, (0.7)% presented in “Other” in the previous fiscal year was reclassified into “Elimination of dividend income
in consolidation” of 1.5%, “Income taxes for prior periods” of (4.8)% and “Other” of 2.5%.

- 36 -

Notes on asset retirement obligations
Not applicable.
Notes on real estate for lease, etc.
The Company and a consolidated subsidiary own rental properties and idle properties in Saitama Prefecture
and other areas.
In the fiscal year ended March 31, 2020, net rental revenue from the rental properties amounted to 23 million
yen (rental revenue was recorded in non-operating income).
In the fiscal year ended March 31, 2021, net rental revenue from the rental properties amounted to 23 million
yen (rental revenue was recorded in non-operating income).
Carrying amount on the consolidated balance sheet, increase (decrease) in the current fiscal year and fairvalue of these real estate properties for lease, etc. are as follows:(Millions of yen)
Fiscal year ended
March 31, 2020

Fiscal year ended
March 31, 2021

Carrying amount on the consolidatedbalance sheet
Balance at beginning of period

696

681

Increase (decrease) during period

(15)

20

Balance at end of period

681

701

974

1,004

Fair value at end of period(Notes) 1. Carrying amount on the consolidated balance sheet is calculated by subtracting accumulated depreciation andimpairment loss from acquisition cost.
2. The increase (decrease) during the fiscal year ended March 31, 2021, includes an increase due to foreign currencytranslation difference of 20 million yen.
3. Fair values at end of period are based on certain appraisal value and indicators that are considered toappropriately reflect market prices.

- 37 -

Segment information, etc.
Segment information
1. Description of reportable segments
The reportable segments of the Company are components for which discrete financial information isavailable and whose operating results are regularly reviewed by the Board of Directors to make decisions
about resource allocation and assess their performance.
The Company is engaged in the manufacture and sale of auto parts. As of the end of the current fiscal
year, four companies including the Company in Japan as well as five local corporations in North America
and eight local corporations in Asia each conduct the business operations. These local corporations, which
are independent management units, formulate comprehensive strategies and develop business activities
in each area.
For this reason, the Company consists of regional segments based on the manufacturing and sales systems
and has three reportable segments, namely Japan, North America and Asia.
2.

Explanation of measurements of net sales, profit (loss), assets, liabilities, and other items for eachreportable segment
The accounting procedures for reportable segments are consistent with those stated in “Basis ofpresentation and significant accounting policies for preparation of consolidated financial statements.”
Profit of reportable segments is based on operating profit (before amortization of goodwill).
Transactions with other segments are based on prevailing market prices.

3.

Disclosure of net sales, profit (loss), assets, liabilities, and other items for each reportable segment
Fiscal year ended March 31, 2020
(Millions of yen)
Reportable segments
Japan

North America

Total

Asia

Net sales
Net sales to external customers

26,126

133,454

59,132

218,712

Transactions with other segments

12,825

1,634

2,738

17,199Total

38,951135,089

61,870235,911

(683)

367

4,365

4,050

61,044

64,12638,882

164,053

Depreciation

2,511

5,288

3,347

11,147

Investments in entities accounted forusing equity method

4,413

––

––

4,413

Increase in property, plant andequipment and intangible assets

2,772

7,475

2,312

12,561

Segment profit (loss)
Segment assets
Other items- 38 -

Fiscal year ended March 31, 2021
(Millions of yen)
Reportable segments
Japan

North America

Total

Asia

Net sales
Net sales to external customers

19,692

110,405

53,549183,647

Transactions with other segments

15,097

1,324

2,747

19,169Total

34,789111,72956,297

202,816

299

(686)

3,993

3,606

64,681

67,97642,193

174,852

Depreciation

2,093

5,210

3,000

10,305Investments in entities accounted forusing equity method

5,036

––

––

5,036

Increase in property, plant andequipment and intangible assets

1,784

6,764

2,322

10,870

Segment profit (loss)
Segment assets
Other items

4.

Differences between total amounts for reportable segments and amounts in the consolidated financial
statements and main details of these differences (matters relating to difference adjustments)(Millions of yen)
Fiscal year ended
March 31, 2020

Net sales

Fiscal year ended
March 31, 2021

Reportable segments total

235,911

202,816

Elimination of intersegment transactions(17,199)(19,169)

Net sales in the consolidated financial statements

218,712

183,647(Millions of yen)

Fiscal year ended
March 31, 2020

ProfitReportable segments total
Elimination of intersegment transactions
Operating profit in the consolidated financial statements

Fiscal year ended
March 31, 2021

4,050

3,606

37

(534)

4,088

3,072
(Millions of yen)

Fiscal year ended
March 31, 2020

AssetsFiscal year ended
March 31, 2021

Reportable segments total

164,053

174,852

Elimination of intersegment transactions(30,005)(38,129)(9)(8)

134,038

136,714

Other adjustments
Total assets in the consolidated financial statements- 39 -

(Millions of yen)
Reportable segments total
Other items

Fiscal year
Fiscal year
ended March ended March
31, 2020
31, 2021

Amount recorded in the
consolidated balance sheet

Adjustments

Fiscal year
Fiscal year
Fiscal year
ended March ended March ended March
31, 2020
31, 2021
31, 2020

Fiscal year
ended March
31, 2021

Depreciation

11,147

10,305

(257)

(273)

10,89010,032

Investments in entities
accounted for using equity
method

4,413

5,036

––

––

4,413

5,036

Increase in property, plantand equipment andintangible assets

12,561

10,870

(322)

(860)

12,23810,010(Note)

Adjustments of increase in property, plant and equipment and intangible assets are the effect of intersegment
consolidation adjustments.

- 40 -

Information associated with reportable segments
Fiscal year ended March 31, 2020
1. Information by product or service
This information has been omitted as net sales to external customers in a single product or service
category account for more than 90% of net sales recorded in the consolidated statements of income.
2.

Information by geographical region(1) Net sales
Japan

U.S.A.

25,646(Note)(Millions of yen)Canada79,234

China

38,838Other

45,517

Total

29,477

218,712Net sales are segmented by country or region based on customer locations.

(2) Property, plant and equipment
Japan

U.S.A.

13,2193.

(Millions of yen)Canada13,588

China

16,577

Other

11,965

Total

11,362

66,714

Information for major customers(Millions of yen)Counterparty

Revenues

Relevant segment

Honda Motor Co., Ltd. and its group companies

153,004

All reportable segments

General Motors Company and its group companies

27,719All reportable segments

Fiscal year ended March 31, 2021
1. Information by product or service
This information has been omitted as net sales to external customers in a single product or service
category account for more than 90% of net sales recorded in the consolidated statements of income.
2.

Information by geographical region(1) Net sales
Japan

U.S.A.

19,294(Note)(Millions of yen)Canada68,298

China

30,524

Other

45,888

Total

19,640183,647

Net sales are segmented by country or region based on customer locations.

(2) Property, plant and equipment
Japan
11,677

3.

U.S.A.

(Millions of yen)Canada14,874

China

19,508Mexico11,714

7,404

Information for major customers

Other

Total

4,833

70,012(Millions of yen)Counterparty

Revenues

Relevant segment

Honda Motor Co., Ltd. and its group companies

132,053

All reportable segments

General Motors Company and its group companies

20,069All reportable segments- 41 -

Disclosure of impairment loss on non-current assets for each reportable segment
Fiscal year ended March 31, 2020
Not applicable.
Fiscal year ended March 31, 2021
Not applicable.
Amortization and unamortized balance of goodwill for each reportable segment
Fiscal year ended March 31, 2020
Not applicable.
Amortization and unamortized balance of negative goodwill that arose from business combinations
conducted before April 1, 2010, are as follows:(Millions of yen)Japan

North America

Unallocatedamounts andelimination

Asia

Total

Amortization during
period

1

0

3

––

5

Balance at end of
period

14

6

29

––

50

Fiscal year ended March 31, 2021
Not applicable.
Amortization and unamortized balance of negative goodwill that arose from business combinations
conducted before April 1, 2010 are as follows:(Millions of yen)Japan

North America

Unallocatedamounts andelimination

Asia

Total

Amortization during
period

1

0

3

––

5

Balance at end of
period

12

5

26

––

44

Information about gain on bargain purchase for each reportable segment
Fiscal year ended March 31, 2020
Not applicable.
Fiscal year ended March 31, 2021
Not applicable.

- 42 -

Related parties
Fiscal year ended March 31, 2020
1. Related-party transactions(1) Transactions between the company filing the consolidated financial statements and related partiesi)
The parent company and major shareholders (limited to companies) of the company filing theconsolidated financial statements
Type

Name

Honda
Motor Co.,
shareholder Ltd.
Major

LocationTransaction
Capital stock
Nature of Voting rights Relationship Description
amountor stakeholdingratiobusiness orwith theof(Millions of(Millionsofoccupation
related party transactions
(%)
yen)
yen)
Manufacture
Purchaser of Sale ofand sale ofproducts of finished
goods(Owned)motor
the Group
86,067
vehicles and Direct 13.64 and seller of Purchase ofpassengers
parts and raw raw
car bodies
materials
materials

Minato-ku,
TokyoLine item

Endingbalance(Millions ofyen)

19,143

Accounts
receivable trade

2,263

9,899

Accounts
payable trade

1,111(Notes) 1. Terms and conditions of transactions and policy on determination thereof(1) Selling prices are determined by making an estimate based on economic rationality in view of market prices
and the Company’s manufacturing technologies, submitting the estimate to the customer and then negotiatingon price.
(2) In purchases of raw materials, prices are determined through negotiations on price by reference to market prices.
2. In the above amounts, transaction amounts do not include consumption taxes while ending balances do.

ii)

Type

Officers and major individual shareholders (limited to individuals) of the company filing theconsolidated financial statements

Name

Capital stock
or stake
Location(Millions ofyen)

Officer andhis or her

Akihideclose family Fukuda
member(Note)––––Nature ofbusiness or
occupation

Transaction
Voting rights Relationship Description
amountholding ratio with theof(Millionsofrelated party transactions
(%)
yen)

Executive(Owned)SeniorAdvisor of the Direct 4.76
Company

Advisory

Advisory

contractfees30Line item––

Endingbalance(Millions of
yen)

––

Advisory fees are determined based on the contract entered into through consultation between both parties after
comprehensively taking into account past experience and others.

- 43 -

(2) Transactions between consolidated subsidiaries of the company filing the consolidated financial
statements and related partiesi)Companies which have the same parent company as the company filing the consolidated
financial statements and subsidiaries of other associates of the company filing theconsolidated financial statements
Type

Name

Subsidiary Honda ofof major
Americashareholder Mfg., Inc.

Location

Ohio, U.S.A.

Transaction
Nature of Voting rights Relationship Description
amountCapital stockbusiness or holding ratio with theofor stake(Millionsofoccupation
related party transactions(%)
yen)
Manufactureand sale of
USD
motor
561,568
vehicles andthousandpassengers
car bodies

Honda
Subsidiary Manufacturi
Alabama,of major
ng of
U.S.A.
shareholder Alabama,
LLC

Manufactureand sale of
USD
motor
400,000
vehicles andthousandpassengers
car bodies

Subsidiary
Honda
Ontario,of major
Canada, Inc. Canada
shareholder

Manufactureand sale of
CAD
motor
226,090vehicles andthousandpassengers
car bodies

Honda
Subsidiary Automobile Ayutthaya,of majorshareholder (Thailand) Thailand
Co., Ltd.

Manufacture
THB and sale ofmotor
5,460,000
vehicles andthousand passengers
car bodies(Millions ofyen)

30,470Accounts
receivable trade

1,948

29,785

Accounts
payable trade

1,881

–

Purchaser of
products ofSale ofthe Groupfinished
and seller ofgoods
parts and raw
materials

22,266

Accounts
receivable trade

1,206

–

Purchaser of
products ofSale ofthe Groupfinished
and seller ofgoods
parts and raw
materials

29,584

Accounts
receivable trade

1,768

–

Purchaser of
products ofSale ofthe Groupfinished
and seller ofgoods
parts and raw
materials

7,888

Accounts
receivable trade

1,212

–

Purchaser of Sale ofproducts of finishedgoods
the Groupand seller of Purchase ofparts and raw raw
materials
materials

Line item

Endingbalance(Notes) 1. Terms and conditions of transactions and policy on determination thereof(1) Selling prices are determined by making an estimate based on economic rationality in view of market prices
and the Company’s manufacturing technologies, submitting the estimate to the customer and then negotiatingon price.
(2) In purchases of raw materials, prices are determined through negotiations on price by reference to market prices.
2. In the above amounts, transaction amounts do not include consumption taxes while ending balances do.

2.

Notes on the parent company or major associates
Not applicable.

- 44 -

Fiscal year ended March 31, 2021
1.

Related-party transactions(1) Transactions between the company filing the consolidated financial statements and relatedpartiesi)

Type

The parent company and major shareholders (limited to companies) of the company filingthe consolidated financial statements
Name

Honda
Major
Motor Co.,
shareholder
Ltd.

Location

Minato-ku,
Tokyo

Capital stock
or stakeTransaction
Nature of Voting rights Relationship Description
amountholdingratiobusiness orwith theof(Millions of occupation(Millionsofrelated party transactions
(%)
yen)
yen)
Manufacture
Purchaser of Sale ofand sale ofproducts of finished
goods(Owned)motor
the Group
86,067
vehicles and Direct 13.64 and seller of Purchase ofpassengers
parts and raw raw
car bodies
materials
materials

Line item

Endingbalance(Millions ofyen)

14,116

Accounts
receivable trade

1,795

7,122

Accounts
payable trade981(Notes) 1. Terms and conditions of transactions and policy on determination thereof(1) Selling prices are determined by making an estimate based on economic rationality in view of market prices
and the Company’s manufacturing technologies, submitting the estimate to the customer and then negotiatingon price.
(2) In purchases of raw materials, prices are determined through negotiations on price by reference to market prices.
2. In the above amounts, transaction amounts do not include consumption taxes while ending balances do.

ii)

Type

Name

Officer andhis or her
Akihideclose family Fukuda
member(Note)

Officers and major individual shareholders (limited to individuals) of the company filingthe consolidated financial statements
Location–

Capital stock
or stakeTransaction
Nature of Voting rights Relationship Description
amountbusiness or holding ratio with theof(Millions of(Millions ofoccupation
related party transactions
(%)
yen)
yen)

–

Executive(Owned)SeniorAdvisor of Direct 4.76
the Company

Advisory
contract

Advisoryfees28Line item

Endingbalance(Millions ofyen)–

Advisory fees are determined based on the contract entered into through consultation between both parties after
comprehensively taking into account past experience and others.

- 45 -–

(2) Transactions between consolidated subsidiaries of the company filing the consolidated financial
statements and related partiesi)Companies which have the same parent company as the company filing the consolidated
financial statements and subsidiaries of other associates of the company filing the consolidated
financial statements
Type

Name

LocationTransaction
Nature of Voting rights Relationship Description
amountCapital stockbusiness or holding ratio with theofor stake(Millions ofoccupation
relatedpartytransactions
(%)
yen)

Subsidiary Honda ofOhio,of major
America Mfg.,
U.S.A.
shareholder Inc.

Manufactureand sale of
USD
motor
561,568
vehicles andthousandpassengers
car bodies

Honda
Subsidiary
Manufacturing Alabama,of majorof Alabama,
U.S.A.
shareholder
LLC

Manufactureand sale of
USD
motor
400,000
vehicles andthousandpassengers
car bodies

Subsidiary
Honda Canada, Ontario,of major
Inc.
Canadashareholder

Manufactureand sale of
CAD
motor
226,090vehicles andthousandpassengers
car bodies

Honda
Subsidiary Automobileof majorshareholder (Thailand)Co., Ltd.

Manufacture
THB and sale ofmotor
5,460,000
vehicles andthousand passengers
car bodies

Ayutthaya,
ThailandEndingbalance(Millions ofyen)

26,184

Accounts
receivable trade

2,262

35,191

Accounts
payable trade

2,126

–

Purchaser of
products ofSale ofthe Groupfinished
and seller ofgoods
parts and raw
materials

17,496

Accounts
receivable trade

1,726

–

Purchaser of
products ofSale ofthe Groupfinished
and seller ofgoods
parts and raw
materials

24,691

Accounts
receivable trade

2,416

–

Purchaser of
products ofSale ofthe Groupfinished
and seller ofgoods
parts and raw
materials

4,009

Accounts
receivable trade974–

Purchaser of Sale ofproducts of finishedgoods
the Groupand seller of Purchase ofparts and raw raw
materials
materials

Line item(Notes) 1. Terms and conditions of transactions and policy on determination thereof(1) Selling prices are determined by making an estimate based on economic rationality in view of market prices
and the Company’s manufacturing technologies, submitting the estimate to the customer and then negotiatingon price.
(2) In purchases of raw materials, prices are determined through negotiations on price by reference to market prices.
2. In the above amounts, transaction amounts do not include consumption taxes while ending balances do.

2.

Notes on the parent company or major associates
Not applicable.

Notes on special purpose entities subject to disclosure
Not applicable.

- 46 -

Per share information(Yen)
Fiscal year ended
March 31, 2020
Net assets per share
Basic earnings (loss) per share

Fiscal year ended
March 31, 2021

2,148.80

2,168.91

17.58(62.58)(Notes) 1. Diluted basic earnings (loss) per share is not presented since no potential shares exist.
2. From the second quarter of the fiscal year ended March 31, 2021, the Company acquired the Company’s sharesthrough the “Officers’ Stock Benefit Trust,” and 60,458 shares of the Company held by the Officers’ Stock Benefit
Trust are included in the number of treasury shares deducted for the calculation of the average number of shares
during the period, to calculate basic earnings (loss) per share..
3. From the second quarter of the fiscal year ended March 31, 2021, the Company acquired the Company’s sharesthrough the “Officers’ Stock Benefit Trust,” and 95,100 shares of the Company held by the Officers’ Stock Benefit
Trust are included in the number of treasury shares deducted for the calculation of the total number of sharesissued at the end of period, to calculate net assets per share.
4. Basis for calculating basic earnings (loss) per share is as follows:
Fiscal year ended
March 31, 2020

Fiscal year ended
March 31, 2021

Basic earnings (loss) per share
Profit (loss) attributable to owners of parent (Millionsof yen)328(1,165)

Amounts not attributable to common shareholders(Millions of yen)––––

Profit (loss) attributable to owners of parent related tocommon shares (Millions of yen)328

(1,165)

18,67818,617

Average number of shares (Thousands of shares)

Significant subsequent event
The Group has been affected by matters such as the suspension of operations at some plants in conjunction
with the suspension of automobile production caused by the global shortage of semiconductors. Since it is
not possible to predict when the semiconductor supply shortage will be resolved, it is difficult at the present
time to reasonably calculate the impact on the financial position, operating results, and cash flows in thenext fiscal year and beyond.

- 47 -

v)

Annexed consolidated detailed schedules
Annexed detailed schedule of corporate bonds
Not applicable.
Annexed detailed schedule of borrowings
Balance atBalance at end Average interest
beginning ofof current periodratecurrent period(Millions of yen)(%)
(Millions of yen)Classification

Payment due

Short-term loans payable

20,39520,872

1.08––

Current portion of long-term loans payable

9,740

9,884

1.52

––

Current portion of lease obligations

572

472

0.33

––

Current portion of long-term accounts payable other (installment)

144

2

0.60

––

Long-term loans payable (excluding current portion)

19,146

16,943

1.49

2022–2031

Lease obligations (excluding current portion)

1,331

1,390

1.64

2022–2044

2

––

––

––

51,33449,565––––Long-term accounts payable - other (installment)(excluding current portion)
Total(Notes) 1. The average interest rate is calculated using the interest rate and balance at end of period.
2. Repayment of long-term loans payable and lease obligations (excluding current portion) above scheduled within five
years after the closing date of the accounting period are as follows:(Millions of yen)
Due after one year
through two years

Due after two years
through three years

7,563

5,422

3,432

486

329

60

56

58

Long-term loans payable
Lease obligations

Due after three years
through four years

Due after four years
through five years

Annexed detailed schedule of asset retirement obligations
Not applicable.
(2) Other information
Quarterly information for the fiscal year ended March 31, 2021
(Cumulative period)

Three months
ended June 30,
2020

Six months ended
September 30,
2020

Nine months
ended December
31, 2020

Fiscal year ended
March 31, 2021

Net sales (Millions of yen)

25,14173,605

130,701

183,647

Profit (loss) before income taxes (Millions ofyen)(3,060)(3,311)

(724)

1,324

Loss attributable to owners of parent(Millions of yen)

(2,678)(3,345)(2,090)(1,165)

Basic loss per share (Yen)(143.39)(179.38)(112.20)(62.58)First quarter

Second quarter

Third quarter

Fourth quarter(35.84)

67.58

49.78

(Three-month period)
Basic earnings (loss) per share (Yen)(143.39)- 48 -