2014

For the Year Ended March 31, 2014

Financial Highlights
Years ended March 31

Millions of yen
Consolidated

2010

Net sales

Operating income

Net income

Total assets¥364,578
9,725

4,144

289,518

Net assets

142,6922011¥362,302
13,997
6,510

288,592

140,5192012¥350,604
10,8302,566

276,436

139,7322013¥403,694
15,886
6,212

388,513

176,5582014¥498,871
23,086
7,134

393,965

185,430Yen

Per share data:
Net income Basic¥15.06

Net assets

474.85¥23.71473.44¥9.35

472.36

Net sales

Operating income
Net income

Capital stock2010¥211,345

2,544

5,476

39,971

Total assets

210,729

Net assets

122,7042011¥221,674
2,906

4,476

39,971

221,925

124,8882012¥224,933
3,226

2,421

39,971

226,188

125,273¥22.64549.42¥25.99576.502013¥233,686
2,557
3,901

39,971

244,368
127,4282014¥261,268
7,548
2,227

39,971

257,510
127,684

Yen

Per share data:
Net income -2014$4,847,173
224,31069,316

3,827,876

1,801,691
U.S.dollars

Millions of yen
Non-Consolidated

Thousands of
U.S.dollars$0.253
5.601

Thousands of
U.S.dollars

2014$2,538,554
73,33921,638388,370

2,502,040
1,240,614
U.S.dollars

Basic¥19.89¥16.30¥8.82¥14.22¥8.11$0.079Net assets

445.75455.03456.27463.99464.76

4.516

Cash dividends

5.00

7.00

7.00

8.00

8.00

0.078

The dollar amounts in this report represent translations of yen, for convenience only, at the rate of ¥102.92=US$1.00, the exchange rate
prevailing on March 31, 2014.

CONTENTS

Financial Highlights .................................................................................................................................1
Business Review ......................................................................................................................................2
Consolidated Balance Sheet ....................................................................................................................5
Consolidated Statement of Income ..........................................................................................................7
Consolidated Statement of Comprehensive Income.................................................................................8
Consolidated Statement of Changes in Net Assets...................................................................................9
Consolidated Statement of Cash Flows .................................................................................................10
Notes to Consolidated Financial Statements..........................................................................................111

Business Review

Business Overview in the Consolidated Fiscal Year 2013
Regarding the global economy in the consolidated fiscal year 2013 ended March 31, 2014, signs of an economic turnaroundemerged in Europe while the US continued to experience a gradual economic recovery and Asia enjoyed solid growth
rates despite some slowing. The Japanese economy improved moderately owing to a recovery in exports and the effects ofeconomic and fiscal policies, among other factors.
Under such circumstances, the Toshiba Tec Group has been diligently working to become “a global one-stop solutions
company” under the three pillars of our business strategy, namely “acceleration of globalization,” “expansion of solutions
and services,” and “corporate structural reform to stabilize profitability.”
As for the consolidated business operations, the retail store solution (RSS) business acquired from International Business
Machines Corporation (IBM) as of August 1, 2012 contributed to business performance throughout the year, and as a result of
this and other factors, net sales increased 24% compared to the previous consolidated fiscal year to ¥498,871 million, operating
income increased 45% year-on-year to ¥23,086 million, and net income increased 15% year-on-year to ¥7,134 million.

Business Highlights for each Report Segment
The business highlights for each report segment in the consolidated fiscal year 2013 are described below.
System Solutions Business
The system solutions business, which deals with POS systems for the Japanese market, MFPs, Automatic Identification
systems and related products, was committed to developing new products appropriate to market needs, expanding sales ofcore products, and promoting area marketing, along with reinforcing cost competitiveness to improve the profit structure,
in a severe business environment where the overall retail industry as a major market became increasingly polarized andintense competition with rivals continued.
The retail solutions business enjoyed increased sales owing in part to growing sales of POS systems for massmerchandisers, specialty stores and restaurants.
The office solutions business continued to face strong competition, but sales increased thanks to bigger sales volumes forcolor MFPs and other factors.
As a result, net sales from the system solutions business rose 8% over the previous consolidated fiscal year to ¥195,307
million, and operating income advanced 12% over the previous consolidated fiscal year to ¥9,740 million.
Global Solutions Business
The global solutions business, which deals with MFPs, POS systems, Automatic Identification systems, printers and related
products as well as inkjets for markets outside Japan, focused efforts on releasing and expanding sales of strategic products,
while expanding sales by pioneering new business fields, new sales channels and new customers, and promoting an alliancestrategy, against a difficult business background marked by tough competition.
The retail solutions business saw larger sales in each region as a result of acquiring the RSS business from IBM and otherfactors.
In the printing solutions business, sales of MFPs and Automatic Identification systems increased in the wake of policies
such as the expansion of sales of strategic new products and the impact of exchange rates.
Sales from the inkjet business grew in both domestic and overseas markets.
As a result, net sales from the global solutions business advanced 35% over the previous consolidated fiscal year to¥317,488 million, and operating income rose 86% over the previous consolidated fiscal year to ¥13,346 million.
Note: Automatic Identification (AI) system refers to systems that contain hardware and software to automatically retrieve, identify andmanage data from barcodes and IC tags.

2Key Achievements for Fiscal Year 2013
Accelerated globalization(1) Retail store solution business, which was transferred to us from IBM the year before the last, contributed to our
performance throughout the year.
(2) In the overseas printing solution business, sales growth occurred as a result of the increased sales of strategic new
products (MFPs and auto ID systems), etc.
Expanded solutions & services(1) World’s first Object Recognition Scanner “IS-910T” released in Japan(2) 1st Experimental demo of Smart Receipt® with the combination of smartphone and digital receipt done in Japan(3) Released omni-channel enabled solutions connecting shops and customers “One on One”
(4) MFP lineup added and expansion of sales area other than office market(5) Document Transmission System “e-BRIDGE Hybrid Document” released

Forecasts for Fiscal Year 2014
With regard to the global economy, the US economy is expected to continue its gradual recovery while Europe will continue
to see low growth rates. The Asian economy however is expected to generally enjoy solid growth. Despite temporary
slowing caused by the increase in the consumption tax rate, the Japanese economy is expected to advance moderately
owing to the recovery in exports, the effect of economic and fiscal policies, and other factors.
Under such circumstances, the Toshiba Tec Group is diligently working to become “a global one-stop solutions company”
under the three pillars of our business strategy, namely “acceleration of globalization,” “expansion of solutions andservices,” and “corporate structural reform to stabilize profitability.”
Main measures on a segment basis for fiscal year 2014 ending March 31, 2015 are as follows:
System Solutions Business
The system solutions business strives to promote area marketing, develop new products appropriate to market needs, andenhance service and supply businesses, toward expanding sales of POS systems, MFPs, Automatic Identification systems
and related products in the Japanese market as well as providing total solutions. The system solutions business is also
committed to further streamlining sales and service systems domestically to improve the profit structure.
Global Solutions Business
The global solutions business aims to develop and release strategic new products, as well as expand sales and marketingin response to the region, optimize sales and service channels, toward expanding sales of MFPs, POS systems, Automatic
Identification systems, related products and inkjet heads in markets outside Japan as well as providing total solutions, which
capitalize on a wide range of products and markets. The global solutions business is also committed to expanding businessby enhancing operations in emerging countries and areas.
Consolidated forecasts for fiscal year 2014 have been made as follows based on the aforementioned measures:

3Forecasts for fiscal year 2014
Net sales¥520,000 million

Net income¥12,000 million

Operating income¥28,000 million

Expected forecasts per report segment for fiscal year 2014
Parenthesis: Relative to fiscal year 2013
Net sales

System Solutions Business¥195,000 million (100%)

Eliminations¥(15,000) million

Global Solutions Business
Total¥340,000 million (107%)¥520,000 million (104%)

Operating income¥11,000 million (113%)¥17,000 million (127%)¥28,000 million (121%)

For the above-mentioned forecasts, the exchange rates for fiscal year 2014 are 100 yen per dollar and 138 yen per euro.
Note: Forecasts are based on the Toshiba Tec Group's currently available data and certain assumptions considered rational, and are notintended as assurances from the Group that they will be achieved. Actual results are subject to change due to various factors.

Mid-term Business Plan
Basic Strategy(1) Business Strategies• Retail Business
Expand solution business based on our global top share customer base.
• Printing Business
Retain our existing customers and expand our market by “Differentiation” mainly with solutions.
• Auto ID Business
Expand sales of our differentiating solutions (sensing and RFID technology applied) to supply chain areas in wider
industries starting from our existing retail customer base.
• Inkjet Business
Provide our inkjet product lineups as printing solutions for industrial printing in which the adaption to small lot &various types of printing is more and more required.
(2) Structural Reform
Reduce cost by higher operational productivity/ Cultivate solution specialists.
Achievement of Goals						Net Sales

Operating Income
ROS

4

FY2013 (Result)

4,989
231

4.6%

(100 millions of yen)

FY2016 (Target)
5,800
350

6.0%

Consolidated Balance Sheet
March 31, 2014

Millions of yen

ASSETS

Thousands of
U.S.dollars (Note 1)

2014

2013

Cash and cash equivalents¥47,409¥72,032$460,639

Inventories

42,03537,720408,424

Current assets

Notes and accounts receivable-trade
Deferred tax assets (Note 10)Prepaid expenses and other current assets

88,52883,882

7,553

6,222

2014

860,163
73,38738,00831,568369,297

222,216

230,172

2,159,114

Buildings and structures

30,39328,999295,307

Tools, furniture and fixtures

51,57849,538501,147

Allowance for doubtful accounts

Total current assets(1,317)(1,252)(12,796)Noncurrent assets

Property, plant and equipment:
Machinery, equipment and vehicles
Land

Lease assets

Accumulated depreciation

40,50038,722

2,581

2,546

11,677

9,138

393,51025,078113,457(104,908)(99,123)(1,019,317)

33,316

31,846

323,708

Goodwill

39,601

75,223384,775

Other

26,60819,312

258,530

Construction in progress

Intangible assets:
Customer relationships

1,495

2,026

32,456−

98,66594,535

14,526315,352

958,657

Investments and other assets:

Investment securities: (Note 14)

Unconsolidated subsidiaries and affiliates
Other

Deferred tax assets (Note 10)
Other

Allowance for doubtful accounts

Total noncurrent assets
Deferred assets
Total assets

44

43

4,342

4,074

428

42,18821,001

19,672204,052

(154)

(312)

(1,496)

14,388

8,291

139,797

39,621

31,768384,969

171,602

158,149

1,667,334

147

192

1,428

¥393,965¥388,513$3,827,876

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

5Millions of yen

LIABILITIES AND NET ASSETS

Thousands of
U.S.dollars (Note 1)

2014

2013

Notes and accounts payable-trade¥75,673¥71,764$735,260

Accounts payable - other

17,52638,058170,288

Income taxes payable

3,769

3,417

36,621

Current liabilities

Short-term loans payable (Note 3)
Lease obligations (Note 3)
Provision for directors' bonuses
Other

Total current liabilities

Noncurrent liabilities

Lease obligations (Note 3)

Provision for retirement benefits (Note 4)

Provision for directors' retirement benefits
Net defined benefit liability (Note 4)
Other

1,054

3,093

3,427

2,602

51

53,941

59

43,561

2014

10,24133,298496

524,105

155,441

162,554

1,510,309

4,261

2,922

41,401

143

1,448

−

39,683

149

41,358

7,326

−

−

401,846

6,653

71,181

Total noncurrent liabilities

53,09449,401

515,876

Total liabilities

208,535

211,955

2,026,185

39,971

39,971

388,370

Capital surplus

52,971

52,984

514,681

Retained earnings

65,42260,484

635,659

13,670 thousand shares in 2014

(5,585)−(54,266)

Total shareholders' equity

152,779

147,815

1,484,444

988

764

9,600

Foreign currency translation adjustment

6,692

2,213

65,021Remeasurements of defined benefit plans(2,179)
5,442

−

2,903

(21,172)

130

145

1,263

27,07925,695

263,108

Total net assets

185,430

176,558

1,801,691

Total liabilities and net assets¥393,965¥388,513$3,827,876

Net assets
Shareholders' equity
Capital stock

Authorized-1,000,000 thousand shares

Issued- 288,146 thousand shares

Treasury stock, at cost:

13,827 thousand shares in 2013

Accumulated other comprehensive income

Valuation difference on available-for-sale securities
Deferred gains or losses on hedges

Minimum pension liability adjustment

Total accumulated other comprehensive income

Subscription rights to shares
Minority interests

6−(5,624)

(4)

−

(55)

(74)

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

−

(39)

(534)

52,876

Consolidated Statement of Income
Year ended March 31, 2014

Millions of yen

Net sales

Cost of sales (Notes 4 and 8)
Gross profit

Selling, general and administrative expenses (Notes 4, 6, 8 and 17)
Operating income

Non-operating income and expenses:
Interest and dividends income
Interest expenses

Restructuring cost (Note 9)

Gain on sales of investment securities
Gain on valuation of derivatives

Loss on sales and retirement of noncurrent assets
Foreign exchange gains (losses)

Reversal of allowance for doubtful accounts
Other, net

2014

2013

¥498,871¥403,694

215,123

179,332

283,748

224,362

192,037

163,446

23,086

15,886

384

382

(646)

(526)

Thousands of
U.S.dollars (Note 1)

2014$4,847,173

2,756,977

2,090,196

1,865,886
224,310
3,731(6,277)(5,696)(1,987)(55,344)

143

214

1,389

4

33

(663)

(110)

(26)

316

294

−

(2,516)(1,328)39(6,442)

(253)

2,857

(24,445)

Income before income taxes and minority interests

14,364

12,880139,565

Current

6,149

6,171

59,745

Income before minority interests

6,957

6,251

67,596

Net income¥7,134¥6,212Per share data (Note 22)

2014

Income taxes (Note 10):Deferred

Minority interests in income (loss)

1,258

458

(177)

39

Yen

Net income-Basic
Cash dividends¥25.99¥8.00

12,224(1,720)$69,316

U.S.dollars

2013

2014

¥8.00

$0.078¥22.64$0.253

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

7

Consolidated Statement of Comprehensive Income
Year ended March 31, 2014

Millions of yen

Income before minority interests

2014

2014

¥6,957¥6,251$67,596

225

423

2,186

Foreign currency translation adjustment

6,666

20,35064,770Total other comprehensive income (Note 7)

6,917

20,752

67,208Other comprehensive income

Valuation difference on available-for-sale securities
Deferred gains or losses on hedges

Minimum pension liability adjustment
Comprehensive income

Comprehensive income attributable toComprehensive income attributable to owners of the parent
Comprehensive income attributable to minority interests

(4)

30

-

(21)

(39)

291

¥13,874¥27,003$134,804

11,851

23,336

115,148

2,023

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

8

2013

Thousands of
U.S.dollars (Note 1)

3,667

19,656

Consolidated Statement of Changes in Net Assets
Year ended March 31, 2014

Capitalstock

Balance at April 1, 2013
Cash Dividends (Note 21)
Net income
Purchase of treasury stock
Disposal of treasury stock
Net changes of items other than shareholders' equity
Balance at March 31, 2014

Balance at April 1, 2013
Cash Dividends (Note 21)
Net income
Purchase of treasury stock
Disposal of treasury stock
Net changes of items other than shareholders' equity
Balance at March 31, 2014

¥39,971−−−−−¥39,971

Balance at April 1, 2012
Cash Dividends (Note 21)
Net income
Purchase of treasury stock
Disposal of treasury stock
Net changes of items other than shareholders' equity
Balance at March 31, 2013

Balance at April 1, 2012
Cash Dividends (Note 21)
Net income
Purchase of treasury stock
Disposal of treasury stock
Net changes of items other than shareholders' equity
Balance at March 31, 2013

¥52,984
−
−
−
(13)
−
¥52,971Retainedearnings¥60,484(2,196)
7,134−−−¥65,422

Accumulated other comprehensive income
Minimum
Valuation difference Deferred gains or Foreign currencytranslation
pension liability
on available-for-sale losses on hedges
adjustment
adjustment
securities

¥764
−
−
−
−
224
¥988

−
−
−
−
−
(4)
¥(4)

Capitalstock

Balance at April 1, 2013
Cash Dividends (Note 21)
Net income
Purchase of treasury stock
Disposal of treasury stock
Net changes of items other than shareholders' equity
Balance at March 31, 2014

Balance at April 1, 2013
Cash Dividends (Note 21)
Net income
Purchase of treasury stock
Disposal of treasury stock
Net changes of items other than shareholders' equity
Balance at March 31, 2014

Capitalsurplus$388,370−−−−−$388,370¥ 2,213
−
−
−
−
4,479
¥6,692

Capitalsurplus$514,808
−
−
−
(127)
−
$514,681

¥(74)
−
−
−
−
19
¥(55)

−
−
−
−
−
(39)
$(39)

Capitalstock¥39,971−−−−−¥39,971¥ 21,502−−−−
43,519$65,021

Capitalsurplus¥52,986−−−(2)−¥52,984

Treasurystock, at cost¥(5,624)
−
−
(38)
77
−
¥(5,585)

Retainedearnings$587,680(21,337)
69,316−−−$635,659$(719)−−−−
185$(534)¥56,466(2,194)
6,212−−−¥60,484¥147,815(2,196)
7,134
(38)
64
−
¥152,779

Millions of yen

−
−
−
−
−
(2,179)¥(2,179)¥ 2,903
−
−
−
−
2,539
¥5,442

Treasurystock, at cost¥(14,499)−−−−
16,712¥ 2,213

¥(63)
−
−
−
−
(11)
¥(74)

Total net
assets¥25,695
−
−
−
−
1,384
¥27,079¥176,558(2,196)
7,134
(38)
64
3,908
¥185,430$(54,644)
−
−
(369)
747
−
$(54,266)

Total
shareholders'equity$1,436,214(21,337)
69,316(369)
620−$1,484,444

Millions of yen

Subscription
Total accumulated
rights to
Remeasurements of othercomprehensive
sharesdefined benefit plansincome$−−−−−(21,172)$(21,172)$28,206−−−−
24,670$52,876$1,409
−
−
−
−
(146)
$1,263

Minority
interests

Total net
assets$249,660−−−−
13,448$263,108$1,715,488(21,337)
69,316(369)
622
37,971$1,801,691

Millions of yen

Treasurystock, at cost¥(5,629)
−
−
(10)
15
−
¥(5,624)

Total
shareholders'equity¥143,794(2,194)
6,212
(10)
13
−
¥147,815

Accumulated other comprehensive income
Subscription
Valuation difference Foreign currency
Minimum
Total accumulated
rights to
on available-for-saletranslation
pension liability other comprehensive
sharessecurities
adjustment
adjustment
income

¥341
−
−
−
−
423
¥764

¥145
−
−
−
−
(15)
¥130

Minority
interests

Thousands of U.S. dollars

Shareholder's equity
Retainedearnings

Total
shareholders'equitySubscription
Total accumulated
rights to
Remeasurements of othercomprehensive
sharesdefined benefit plansincomeShareholders' equity

Accumulated other comprehensive income
Minimum
Valuation difference Deferred gains or Foreign currencytranslation
pension liability
on available-for-sale losses on hedges
adjustment
adjustment
securities$7,423
−
−
−
−
2,177
$9,600Millions of yen

Shareholders' equity¥(14,221)−−−−
17,124¥ 2,903

¥113
−
−
−
−
32
¥145

Millions of yen

Minority
interests

Total net
assets¥10,046−−−−
15,649¥25,695¥139,732(2,194)
6,212
(10)
13
32,805¥176,558

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.
Numbers of shares in issue: 288,146 thousand shares in the fiscal year ended March 31, 2014.

9

Consolidated Statement of Cash Flows
Year ended March 31, 2014

Millions of yen

Cash flows from operating activities
Income before income taxes and minority interests
Depreciation and amortization
Decrease in allowance for doubtful accounts
Increase (decrease) in provision for retirement benefits
Increase in net defined benefit liability
Interest and dividends income
Interest expenses
Loss on sales and retirement of property, plant and equipment
Gain on sales of investment securities
Loss on valuation of investment securities
Restructuring cost
Changes in assets and liabilities:
Decrease (increase) in notes and accounts receivable-trade
Increase in inventories
Increase (decrease) in notes and accounts payable-trade
Other, net
SubtotalInterest and dividends income received
Interest expenses paid
Income taxes paid
Net cash provided by 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
Net increase in short-term loans receivable
Payments of long-term loans receivableCollection of long-term loans receivable
Payments for transfer of business
Other, net
Net cash used in investing activities
Cash flows from financing activities
Net increase (decrease) in short-term loans payable
Repayments of long-term loans payable
Repayments of finance lease obligations
Purchase of treasury stock
Cash dividends paid
Cash dividends paid to minority shareholders
Other, net
Net cash used in financing activities
Effect of exchange rate change on cash and cash equivalents
Net decrease in cash and cash equivalents
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period

2014

2013

¥14,364
21,216(88)(39,824)
37,974
(384)
646
663
(4)
101
5,696

¥12,880
16,856
(65)
3,015
−
(382)
526
110
(32)
8
1,987

$139,565
206,141(855)(386,941)
368,966(3,731)
6,277
6,442
(39)
981
55,344

3,621(1,493)(4,026)(11,340)
27,122405(622)(6,018)20,887(17,486)(1,835)
16,435(718)
31,299390(504)(4,674)
26,51135,183(14,506)(39,118)(110,184)
263,525
3,935(6,044)(58,472)
202,944(7,403)243(7,458)(14)
144(6,102)(18)
15(21,764)(198)(42,555)(8,298)971(2,013)
(114)
60
(294)
(12)
19
(33,510)(571)(43,762)(71,930)
2,361(72,464)
(136)
1,399
(59,289)(175)
146(211,465)(1,923)(413,476)(2,662)−(2,801)(38)(2,198)(518)
76(8,141)
5,186(24,623)
72,032701(2)(2,404)(135)(2,191)(96)
13(4,114)
7,438(13,927)
85,959(25,865)−(27,215)(369)(21,356)(5,033)
738(79,100)
50,389(239,243)
699,882¥47,409¥72,032$460,639

The accompanying Notes to Consolidated Financial Statements are an integral part of these statements.

10

Thousands of
U.S.dollars (Note 1)2014Notes to Consolidated Financial Statements
1. Basis of Presenting Consolidated
Financial Statements
The consolidated financial statements of TOSHIBA TECCORPORATION (the “Company”) have been prepared inaccordance with accounting principles generally accepted inJapan, which are different in certain respects as to the applicationand disclosure requirements of International Financial ReportingStandards, and are compiled from the consolidated financial
statements prepared by the Company as required by the
Financial Instruments and Exchange Law of Japan.
Certain reclassifications have been made to present theconsolidated financial statements in a format which is morefamiliar to the readers outside Japan.
Solely for the convenience of the readers, the consolidated
financial statements have been presented in U.S. dollars bytranslating Japanese yen amounts at the exchange rate of¥102.92 = US$1.00 prevailing as of March 31, 2014. The
translation should not be construed as a representation that theJapanese yen could be converted into U.S. dollar at the above or
any other rate of exchange.

2. Summary of Significant Accounting
Policies(A) Basis of Consolidation and Accounting ofInvestments in Affiliated Companies

The consolidated financial statements include the accountsof the Company and its majority-owned subsidiaries (together
the “Companies”). For the years ended March 31, 2014 and2013, the accounts of 89 and 88 subsidiaries are consolidated,
respectively. All significant inter-company transactions andaccounts are eliminated in consolidation.
All assets and liabilities of the consolidated subsidiaries arerevaluated on acquisitions, if applicable. The difference between
the cost of investments in subsidiaries and the equity in theirassets and liabilities at the dates of acquisition is recognized
as goodwill in the consolidated balance sheet and principallyamortized by the straight-line method over 5 to 17 years.
The Company has no unconsolidated subsidiary for which
the equity method of accounting has been applied for the years
ended March 31, 2014 and 2013.
From the perspective of immateriality, the investments in
the remaining unconsolidated subsidiaries and the affiliatedcompanies are stated at cost.
Certain subsidiaries have the yearend which differs from thatof the Company. As a result, adjustments have been made forany significant transactions as needed in consolidation that took
place during the period between the year end of the subsidiaries
and the year end of the Company.

(B) Foreign Currency Translation

Revenue and expense accounts of foreign consolidated
subsidiaries are translated into yen using the annual averagerate during each of the fiscal years. The balance sheet accounts,
except for the components of net assets, are translated at therate in effect at each of the balance sheet dates. The components
of net assets are translated at their historical rates. Translation
adjustments are presented as a component of “Accumulated

other comprehensive income” under Net Assets in the
consolidated balance sheet.
Foreign currency transactions are measured at the applicablerates of exchange prevailing at the transaction dates, unlesshedged by foreign exchange contracts. Assets and liabilities
denominated in foreign currencies at the balance sheet date arere-measured at the applicable rates of exchange prevailing at thatdate, unless hedged by foreign exchange contracts. Exchange
differences are charged or credited to income.

(C) Cash and Cash Equivalents

Cash and cash equivalents include all highly liquid
investments, generally with original maturates of three months
or less.

(D) Investment Securities

Marketable securities classified as “Other securities” arereported at fair value with unrealized holding gains or losses,
net of taxes, presented as a component of “Accumulated othercomprehensive income” under Net Assets in the consolidatedbalance sheet. Cost of securities sold is determined by themoving average method.
Non-marketable securities classified as “Other securities”
are carried at cost, which is determined by the moving averagemethod.

(E) Inventories

Finished goods, merchandises and semi-finished components
are principally stated at the lower of cost, determined by the
first-in, first-out method, or net realizable value. Work-in-process
and raw materials are principally stated at the lower of cost,
determined by the moving average method, or net realizablevalue. Supplies are principally stated at the latest purchase cost
method.

(F) Property, Plant and Equipment and Depreciation

Property, plant and equipment are depreciated by the straightline method over their estimated useful lives.
The useful lives of principal property, plant and equipment aresummarized as follows:
Buildings and structures 15 to 38 years
Machinery and equipment 5 to 13 years
Tools, furniture and fixtures 2 to 7 years(G) Intangible Assets and Amortization

Intangible assets are amortized by the straight-line method overtheir estimated useful lives.

(H) Leases

The Companies lease certain equipment under non-cancelable
lease agreements referred to as finance leases. Depreciation atlease assets is calculated by the straight-line method over thelease period with no residual value.

(I) Deferred Assets

Deferred organization expenses are amortized over a period offive years.

11(J) Allowance for Doubtful Accounts

Allowance for doubtful accounts is provided in the amountsufficient to cover probable losses on collection. It consists ofindividually estimated uncollectible amounts and an amountcalculated using the rate of actual losses on collection in thepast.

(K) Accrued Retirement Benefits to Directors

The retirement benefits to directors are determined based on theinternal rule and accounted for as an expense of the accounting
period in which such retirement benefits were accrued.

(L) Accrued Bonuses to Directors and Corporate
Auditors

The bonuses to directors and corporate auditors are determinedbased on the internal rule and accounted for as an expense of theaccounting period in which such bonuses were accrued.

(M) Retirement Benefits

The retirement benefit obligation for employees is attributed toeach period by the straight-line method over the estimated yearsof service of the eligible employees.
Prior service cost is being amortized as incurred by the straightline method over periods (mainly 10 years), which are shorter
than the average remaining years of service of the employees.
Actuarial gain or loss is amortized in the year following theyear in which the gain or loss is recognized primarily by thestraight-line method over periods (mainly 10 years), which
are shorter than the average remaining years of service of theemployees.
A part of subsidiaries use a simplified method for the
calculation of the defined benefit liability and retirement benefit
cost of their defined benefit plans and lump-sum payment plans.

(N) Income Taxes, Deferred Tax Assets and Liabilities

Deferred tax assets and liabilities are determined based on
the differences between financial reporting and the tax bases of
the assets and liabilities, and are measured using the enacted
tax rates and laws which will be in effect when the temporary
differences are expected to reverse.
The Company and its wholly owned domestic subsidiaries filetheir consolidated tax return in Japan for the Corporation Tax
purpose.

(O) Consumption Taxes

Consumption taxes withheld from sales and paid uponpurchasing goods and services by the Companies are notincluded in revenues and expenses.

(P) Derivative Financial Instruments

The Company and certain subsidiaries have entered into
forward exchange contracts to hedge the risk of fluctuationin exchange rate in the foreign currency transactions related
to accounts receivable and payable denominated in foreign
currency.
Derivative financial instruments are reported at fair value withunrealized gain or loss, charged or credited to income, except for

12

those which meet the criteria for the deferral hedge accounting
under which unrealized gains or losses is deferred as assets or
liabilities. Receivables and payables hedged by qualified forward
foreign exchange contracts are translated at the corresponding
foreign exchange contract rates.

(Q) Research and Development Expenses

Research and development costs are charged to income as
incurred.

(R) Impairment of Noncurrent Assets

According to the accounting standard, noncurrent assets arereviewed for impairment at least once a year and whenever
events or changes in circumstances indicate that the carrying
amount of an asset may not be recoverable.

(S) Changes in Accounting Policies (Adoption of
Accounting Standard for Retirement Benefits)

The Company adopted “Accounting Standard for Retirement
Benefits” (Accounting Standards Board of Japan (ASBJ)
Statement No.26 of May 17, 2012) and “Guidance on
Accounting Standard for Retirement Benefits” (ASBJ Guidance
No.25 of May 17, 2012) (except for certain provisions describedin the main clause of Section 35 of the standard and in the mainclause of Section 67 of the guidance) effective at the end of the
fiscal year ended March 31, 2014. These accounting standards
require entities to apply a revised method for recording theretirement benefit obligation, after deducting pension plan assets,
as a liability for retirement benefits. In addition, unrecognizedactuarial differences and unrecognized prior service costs arerecorded as a liability for retirement benefits. Concerning theapplication of the Accounting Standard for Retirement Benefits,based on the provisional treatment set out in Clause 37 of thestandard, the effects of such changes in the current fiscal year
have been recorded in retirement benefits liability adjustments
through accumulated other comprehensive income. As a resultof this change, a liability for retirement benefits was recognizedin the amount of ¥41,358 million ($401,846 thousand) andaccumulated other comprehensive income decreased by ¥2,179
million ($21,172 thousand) as of March 31, 2014.
The effect on per share information is stated in Note 22 Per
share Information.

(T) Changes in Accounting Policies Which are
Difficult to Distinguish from Changes in
Accounting Estimates (Change in Depreciation
Method of Property, Plant and Equipment)

Effective at the end of the fiscal year ended March 31, 2014,
the Company and its domestic subsidiaries changed depreciation
method from the declining-balance method to the straight-line
method.
The Companies are reorganizing their global manufacturingbases to optimize them for the rapid change of businessenvironment in recent years and business acquisition of RSS
business from IBM in the fiscal year ended March 31, 2013.
In the “2013 Mid-term Management Plan”, the Companies
in Japan plan to establish the production efficiency and focus
the investing area in order to stabilize the Companies’ profit.
In addition, the Companies also have been establishing theirproduction structures among mainly Asian countries to enhancetheir global cost competitiveness.
As a result of these reorganizations, it is expected for
production activities in Japan to specialize in high-value-added
areas, such as the productions with customization and the setup system for the customer, which will provide a stable profit tothem.
In order to better allocation of cost and revenue, the Companies
decided that it is more appropriate to apply the straight-line
method to property, plant and equipment of the Company and its
domestic subsidiaries.
As a result of this change, depreciation expense decreasedby ¥1,281 million ($12,447 thousand), operating income andincome before income taxes and minority interests increased
each comparatively by ¥1,251 million ($12,155 thousand) for
the year ended March 31, 2014, from the corresponding amounts
which would have been recorded under the previous depreciation
method.

(U) Changes in Accounting Estimates (Changes in
Estimated Useful Lives)

Following the change in depreciation method of property,
plant and equipment, the Company reviewed estimated useful
lives taking into consideration the actual status of the usage ofthe asset. As a result of this review, the Company determined
to change the estimated useful lives of property, plant andequipment. In addition, the residual value has been changed
to a memorandum value in the Company and its domestic
subsidiaries.
As a result of these changes, depreciation increased by ¥215
million ($2,089 thousand), operating income and income
before income taxes and minority interests decreased eachcomparatively by ¥213 million ($2,070 thousand) for the year
ended March 31, 2014, from the corresponding amounts which
would have been recorded under the previous depreciation
method.

(V) Accounting Standards Issued but Not Yet
Effective• Accounting Standard for Retirement Benefits (ASBJ Statement,
No.26 of May 17, 2012)• Guidance on Accounting Standard for Retirement Benefits(ASBJ Guidance No.25 of May 17, 2012)
1. Overview
The standard provides guidance for the accounting forunrecognized actuarial differences and unrecognized priorservice costs, the calculation methods for retirement benefit
obligation and service costs, and enhancement of disclosures
taking into consideration improvements to financial reportingand international trends.
2. Scheduled date of adoption
Revisions to the calculation method for the retirement
benefit obligation and the service cost, they are scheduled tobe adopted from the beginning of the fiscal year ending March
31, 2015.
3. Impact of adopting revised accounting standard and guidance
As a result of this change, the beginning balance of retained
earnings as at April 1, 2014 will increase by ¥3,623 million($35,202 thousand) in the Consolidated Balance Sheet.
In addition, the effect of this change on the Consolidated
Statement of Income is immaterial.
• Revised Accounting Standard for Business Combinations(ASBJ Statement, No.21 of September 13, 2013)• Revised Accounting Standard for Consolidated Financial
Statements (ASBJ Statement No.22 of September 13, 2013)• Revised Accounting Standard for Business Divestitures(ASBJ Statement No.7 of September 13, 2013)• Revised Accounting Standard for Earnings Per Share(ASBJ Statement No.2 of September 13, 2013)• Revised Guidance on Accounting Standard for Business
Combinations and Accounting Standard for Business
Divestitures(ASBJ Guidance No.10 of September 13, 2013)• Revised Guidance on Accounting Standard for Earnings Per
Share(ASBJ Guidance No.4 of September 13, 2013)
1. Overview
Under these revised accounting standards, (ⅰ) the accounting
treatment for any changes in a parent's ownership interestin a subsidiary when the parent retains control over thesubsidiary (ⅱ) the treatment of acquisition-related costs, (ⅲ)
the change of the presentation method of net income, and to
non-controlling interest from the minority interests, (ⅳ) thetreatment of the transitional provisions for these accounting
standards were also defined.
2. Scheduled date of adoption
These accounting standards are scheduled to be adopted
from the beginning of the fiscal year ending March 31, 2016.
In addition, in terms of the transitional provisions for theseaccounting standards, they are scheduled to be adopted
applicably from a business combination that will take place
after the beginning of the year ended March 31, 2016.
3. Impact of adopting revised accounting standards and guidance
The impact on the consolidated financial statements asa result of the adoption of these accounting standards iscurrently being evaluated.

(W) Changes in Presentation (Consolidated Statementof Cash Flows)

In the Consolidated Statement of Cash Flows, “Net increase in
short-term loans receivable”, which was included in “Other, net”
in the fiscal year ended March 31, 2013, is separately disclosed
due to the increase in materiality.
As result of this change, the Consolidated Statement of Cash
Flows of the fiscal year ended March 31, 2013 was reclassified.
It was presented in “Other, net” was reclassified ¥(294) million
as “Net decrease (increase) in short-term loans receivable”, and“Other, net” was reclassified ¥(571) million.

(X) Additional Information
Not applicable13

3. Short-Term Loans Payable and LongTerm Debt
The short-term loans payable and long-term debt (including
lease obligations) at March 31, 2014 and 2013, consist of thefollowing :Millions of yen

2014

2013

Thousands of
U.S.dollars

2014

Short-term loans payable¥1,054¥3,093$10,241

Lease obligations
Less current portion

7,688
3,427
¥4,261

5,524
2,602¥2,922

74,69933,298$41,401

The average interest rate for short-term loans outstanding at
March 31, 2014 and 2013 is 0.44 % and 0.43 %, respectively.
The average interest rate for lease obligations, a statement isomitted because the Companies recorded the amount of lease
payments before deducting interest in the Consolidated Balance
Sheet.
The aggregate annual maturities of lease obligations (excluding
the current portion) outstanding at March 31, 2014 are as
follows:
Year ending
March 31

Millions of yen

2016
2017
2018 and thereafter¥1,065
1,065
2,131¥4,261Thousands of
U.S.dollars$10,348
10,34820,705$41,401

4. Retirement Benefits

Retirement benefit obligation
at April 1, 2013
Service cost
Interest cost
Actuarial gain
Retirement benefit paid
Other
Retirement benefit obligation
at March 31, 201414

Thousands of
U.S.dollars¥92,668
3,602
1,118(2,737)(5,750)760$900,389
34,998
10,863(26,593)(55,869)
7,384¥89,661$871,172

2014

2014

2) The changes in plan assets during the year ended March 31,
2014

Plan assets at April 1, 2013
Expected return on plan assets
Actuarial gainContributions by the Company
Retirement benefits paid
Other
Plan assets at March 31, 2014

Millions of yen

Thousands of
U.S.dollars¥44,123
998
1,059
4,049
(2,252)
326¥48,303$428,712
9,697
10,29039,341(21,881)
3,167$469,326

2014

2014

3) The funded status of the plans and the amounts recognizedin the consolidated balance sheet as of March 31, 2014 for
the Company's and the consolidated subsidiaries' defined
benefit plans

Funded retirement benefit
obligation
Plan assets at fair value

For the year ended March 31, 2014
1. Summary of Retirement Benefit Plans
The Company and its consolidated subsidiaries have
either funded or unfunded defined benefit plans and defined
contribution plans.
In defined benefit plans which are funded pension plans, theamounts of which are determined by reference to qualificationand length of service.
In defined benefit plans which are unfunded and lumpsum payment plans, the amount of which are determined byreference to assessment and qualification.
In addition, a part of subsidiaries use a simplified method
for the calculation of defined benefit liability and retirement
benefit cost of their defined benefit plans and lump-sum
payment plans.						
				2. Defined Benefit Plans
1) The changes in the retirement benefit obligation during theyear ended March 31, 2014

Millions of yen

Unfunded retirement benefit
obligation
Net liability for retirement
benefits in the balance sheet
Liability for retirement benefits
Net liability for retirement
benefits in the balance sheet

Millions of yen

Thousands of
U.S.dollars¥51,962(48,303)¥3,659$504,878(469,326)$35,552¥37,699$366,294¥41,358$401,846¥41,358$401,846¥41,358$401,846

2014

2014

4) The components of retirement benefit expense for the year
ended March 31, 2014

Service cost
Interest cost
Expected return on plan assets
Amortization of actuarial loss
Amortization of prior service cost
Retirement benefit expenses

Millions of yen

Thousands of
U.S.dollars¥3,602
1,118
(998)
706
914
¥5,342$34,998
10,863(9,697)6,860
8,880$51,904

2014

2014

5) Unrecognized prior service cost and unrecognized actuarial
loss included in accumulated other comprehensive income(before tax effect) as of March 31, 2014

Unrecognized prior service cost
Unrecognized actuarial loss

Millions of yen

Thousands of
U.S.dollars¥2,1571,227¥3,384$20,958
11,922$32,880

2014

2014

6)-1. The fair value of plan assets, by major category, as apercentage of total plan assets as of March 31, 2014
Bonds
StocksAlternative
Life insurance company
general accounts
Other
Total

2014

40%
25%
24%

Millions of yen

Service cost
Interest cost
Expected return on plan assets
Amortization of actuarial loss
Amortization of prior service cost
Total

Retirement benefit expenses of subsidiaries which adopt simplified method arerecorded as “Service cost”.
The assumption used in accounting for the above plans for the years ended
March 31, 2013 are as follows:

Discount rates
Expected return on assets6)-2. How to set the expected long-term rate of return on plan assets
The Companies set the expected long-term rate of return inconsideration of target portfolio of plan assets by expectedlong-term rate of return and past performance.
7) The assumptions used in accounting for the above plans
2014

Mainly 1.2%
Mainly 2.5%

3. Defined Contribution Plans
Amounts which consolidated subsidiaries contributed totheir defined contribution plans for this fiscal year are ¥424
million ($ 4,120 thousand).

For the year ended March 31, 2013
1. Summary of retirement benefit plans
The Company and its consolidated subsidiaries have
either funded or unfunded defined benefit plans and defined
contribution plans.
In defined benefit plans which are funded pension plans, theamounts of which are determined by reference to qualificationand length of service.
In defined benefit plans which are unfunded and lumpsum payment plans, the amount of which are determined byreference to assessment and qualification.
Millions of yen

2013

Retirement benefit obligation¥(92,667)
Plan assets
44,123
Unfunded retirement benefit obligation(48,544)
Unrecognized actuarial gain
5,791
Unrecognized prior service cost
3,070
Net amount recognized in the
consolidated balance sheet(39,683)
Accrued retirement benefit obligation¥(39,683)

2013¥3,475
1,110
(835)
1,605
1,018
¥6,373

Note: 1 Apart from the retirement benefit expenses above, additional retirement benefit
payments are included in Non-operating expenses.
The additional retirement benefit payments for the years ended March 31, 2013are ¥ 62 million.
2

10%
1%
100%

Discount rates
Expected rates of long return on plan assets

The components of retirement benefit expenses for the years
ended March 31, 2013 are as follows:

Amortization period of past service cost
Amortization period of actuarial gain or loss

2013

Mainly 1.2%
Mainly 2.5%
Mainly 10 years
Straight-line method
Mainly 10 years
Straight-line method

5. Contingent liabilities
Contingent liabilities at March 31, 2014 and 2013 are as follows :Millions of yen

Trade notes receivablediscounted or endorsed
Guarantees on employees' bank loans

2014

2013

¥115
261

¥250
360

Thousands of
U.S.dollars

2014$1,1172,536

6. Selling, General and Administrative
ExpensesMajor components of selling, general and administrative
expenses for the years ended at March 31, 2014 and 2013 are as
follows:
Millions of yen

2014

Personnel expenses¥93,489
Retirement benefit expenses
3,980
Research and development expenses 21,802

2013¥83,071
4,804
18,833Thousands of
U.S.dollars

2014$908,366
38,671
211,834

7. Other Comprehensive Income
Other Comprehensive Income for the year ended March 31,
2014 and 2013 are follows:

Note:		 Certain subsidiaries adopted a simplified method in the calculation of theirretirement benefit obligation.

15

Thousands of
U.S.dollars

Millions of yen

Other comprehensive income
Unrealized holding
gain(loss) on securities
Amount of accrual
Amount of recycling
Amount before tax effect adjustment

Tax effect adjustments

Valuation difference on
available-for-sale securities

2014

2013

2014

¥352
(4)
348
(123)

¥689
(31)
658
(235)

$3,420(39)
3,381(1,195)

¥225

¥423

$2,186

Deferred gains or losses onhedgesAmount of accrualTax effect adjustments
Deferred gains or losses on hedges

¥(6)
2
¥(4)

−
−
−

$(58)
19
$(39)

¥6,666−
6,666−¥20,350−
20,350−$64,769−
64,769−¥6,666¥20,350$64,769

Minimum pension liability
adjustment
Amount of accrualTax effect adjustments
Minimum pension
liability adjustment

¥50
(20)

¥(36)
14

$486
(194)

¥30

¥(22)

$292

Total other comprehensive income¥6,917¥20,751$67,208

Foreign currency translation
adjustment
Amount of accrual
Amount of recycling
Amount before tax effect adjustment
Tax effect adjustments
Foreign currencytranslation adjustment

8. Research and Development Expenses
Research and development costs charged to income for theyears ended March 31, 2014 and 2013 are as follows:
Millions of yen

2014¥25,1122013¥22,147

Thousands of
U.S.dollars

2014$243,995

9. Restructuring Cost
The contents of Restructuring Cost for the year ended March
31, 2014 are extra retirement benefit payments and costs ofdisposal and consolidation of sales bases overseas.

10. Income Taxes and Deferred Tax Assets
and Liabilities
1. Significant components of the Companies' deferred tax assets
and liabilities for the years ended March 31, 2014 and 2013
are as follows:

16

Thousands of
U.S.dollars

Millions of yen

Deferred tax assets:
Provision for retirement benefits
Net defined benefit liability
Intangible assets
Provision for bonuses
Elimination of consolidated
unrealized gains
Other
Total gross deferred tax assets
Valuation allowance
Total deferred tax assets

2014

2013

2014

¥−
14,376
5,516
2,811¥13,813
−
5,867
2,554

$−
139,681
53,59527,312

1,796
4,887
29,386

1,355
3,805
27,394

17,45047,485285,523(833)
28,553(1,500)25,894(8,094)277,429

Deferred tax liabilities:
Reserve for advanced
depreciation of
noncurrent assets
Valuation difference
on available-for-salesecurities
Other
Total deferred tax liabilities

(427)

(441)

(4,149)(528)(1,763)(2,718)

(407)
(896)
(1,744)(5,130)(17,130)(26,409)

Net deferred tax assets¥25,835¥24,150$251,020

Net deferred tax assets are included as below on consolidatedbalance sheet for the years ended March 31, 2014 and 2013.
Thousands of
U.S.dollars

Millions of yen

Current assets Deferred tax assets
Noncurrent assets Deferred tax assets
Current liabilities Other
Noncurrent liabilities Other

2014

2013

2014

¥7,553¥6,222$73,387

21,001

19,672204,052

(253)

(115)

(2,458)(2,466)(1,630)(23,960)

2. Difference between statutory tax rate and Company's effective
tax rate
The following table summarizes the difference between thestatutory tax rate and the Company's effective tax rate for theyears ended March 31, 2014 and 2013.
2014

2013

Statutory tax rate
Effect of :Different tax rates applied to income of foreignsubsidiaries
Expenses permanently not deductiblefor income tax purposes
Income permanently not included asrevenue
Corporation tax special credit for
research expenditures

38.0%

38.0%

(9.6)

(5.7)

1.4

1.1

(4.6)

(4.3)

(4.7)

(3.2)

Downward revision of deferred tax
asset by change in statutory tax rate
Amortization of goodwill of foreignsubsidiaries
Other, net
Effective tax rates

0.2

1.7

6.1

−

24.6

23.1

0.2
51.6%

0.8
51.5%

Changes in valuation allowance3. Effect of a change in the corporate income tax rate
The “Act for Partial Amendment of the Income Tax Act”
(Act No.10, 2014) was promulgated on March 31, 2014 andas a result, the Company is no longer subject to the Special
Reconstruction Corporation Tax effective for fiscal years
beginning on or after April 1, 2014.
As a result, the statutory tax rate used to measure the Company'sdeferred tax assets and liabilities was changed from 38.0% to35.6% for the temporary differences expected to be realized or
settled from fiscal years beginning April 1, 2014.
The effect of the announced reduction of the statutory tax
rate was to decrease deferred tax assets after offsetting
deferred tax liabilities by ¥729 million ($ 7,083 thousand) as
of March 31, 2014 and increase deferred income tax by ¥729
million ($7,083 thousand) for the year ended March 31, 2014.

11. Leases
Finance Lease transactions, except for those which meetthe conditions that the ownership of the leased assets wastransferred to the lessee.
1. The content of Lease assets: Machinery and equipment
2. Depreciation method of lease assets:
Please refer to Note 2 Summary of Significant Accounting
Policies (H) Leases.

(B) Operating Lease as a lessee

Future minimum lease payments for noncancelable operatingleases are summarized as follows:
Millions of yen

2014

¥541
632
¥1,173

2013

¥463
463
¥926

Thousands of
U.S.dollars

2014$5,2576,140$11,397

1. Details of investment lease2) Investment lease - others
Lease revenues receivable
Interests receivable

Within one year
Between 1 to 2 years
Between 2 to 3 years
Between 3 to 4 years
Between 4 to 5 years
More than 5 years

2014

¥133
674
187
83
21
0
¥1,098

2013

¥131
620
439
110
21
81
¥1,402Millions of yen

2014

¥133
(7)
¥126

¥966
(53)
¥913

Thousands of
U.S.dollars

2014$1,292
6,549
1,817
806
204
0
$10,668(D) Operating Lease as a lessor

Future minimum lease payments for noncancelable operatingleases are summarized as follows:

Due within one year
Due after one year

2014

¥752
1,410
¥2,162

2013

¥646
799
¥1,445

Thousands of
U.S.dollars

2014$7,307
13,700$21,007(E) Other related information

Future minimum lease payments for noncancelable operating
sub-leases are summarized as follows:
Investment lease
Current assets
OthersLease expenses payable
Current liabilities
Fixed liabilities

Millions of yen

Thousands of
U.S.dollars

2014

2013

¥414
372
¥786

$4,567
8,443$13,010¥470869¥1,339

¥414
372
¥786

$4,567
8,443$13,010¥470869¥1,3392014

12. Consolidated Statement of Cash Flows(C) Finance Lease as a lessor

1) Investment lease - current
assetsLease revenues receivable
Interests receivable

Millions of yen

Millions of yen(A) Finance Lease as a lessee

Due within one year
Due after one year

2. Expected collect amounts of lease revenues receivable are as follows :2013

Thousands of
U.S.dollars

2014

¥131
(7)
¥124

$1,292(68)$1,224¥1,271(72)¥1,199$9,386(515)$8,871

The content of important non-cash transactions
The impact of non-cash transactions on assets and liabilities
under finance lease is ¥3,608 million ($35,056 thousand) and¥3,608 million ($35,056 thousand) for the year ended March 31,
2014 and ¥2,797 million and ¥2,841 million for the year ended
March 31, 2013, respectively.

13. Financial Instruments
Overview

1. Policy for financial instruments
The Companies raise funds mainly using Toshiba Group
Finance program. Essentially the Companies use the program
for temporarily excess funds.
The Companies use derivatives for the purpose of reducing
risks (described below) and do not enter into derivatives for
speculative or trading purposes.

17

18

2. Types of financial instruments and related risks
Trade receivables (Notes and accounts receivable-trade) are
exposed to credit risk in relation to customers. In addition,
the Companies are exposed to foreign currency exchange
rate fluctuation risk arising from receivables denominated inforeign currencies. In principle, the foreign currency exchange
rate fluctuation risk deriving from the trade receivables
denominated in foreign currencies, net of trade payables
denominated in the same currencies, are hedged by forward
foreign exchange contracts.
Investment securities are exposed to market risk. These are
the equity securities of certain enterprises with which theCompanies have business relationships.
Substantially all trade payables (Notes and accounts payabletrade) are due within one year. Although the Companies are
exposed to foreign currency exchange rate fluctuation risk
arising from those payables denominated in foreign currencies.
But the volume of account payable is in the range of accounts
receivable of the same currency.
A debt is a short-term used working capital which is mainly
raised using the Toshiba Group Finance program.
Regarding derivatives, the Companies enter into forward
foreign exchange contracts and options to reduce the foreign
currency exchange rate fluctuation risk arising from thereceivables and payables denominated in foreign currencies.
With regard to instrumentals, targets, policies and methodsof evaluating the effectiveness of the hedge, please refer
to Note 2 Summary of Significant Accounting Policies (P)Derivative Financial Instruments.

4. Supplementary explanation of the estimated fair value offinancial instruments
The fair value of financial instruments is based on theirquoted market price, if available. When there is no quoted
market price available, the fair value is determined based onreasonable estimates.
Since various assumptions and factors are reflected inestimating the fair value, different assumptions and factors
could result in different fair value. In addition, the notionalamounts of derivatives in Note 15 Derivative Transactions are
not indicative of the actual market risk involved in derivativetransactions.

3. Risk management for financial instruments
1) Monitoring of credit risk (the risks that related to breach ofcontract with client)
In accordance with the internal policies, the Credit
Managing division monitors credit worthiness of theircustomers periodically, and monitors due dates andoutstanding balances by individual customer.
In addition, the Companies are making efforts to identify
and mitigate risks of bad debts from customers who arehaving financial difficulties.
2) Monitoring of market risks (the risks arising fromfluctuations in foreign exchanges rates, interest rates andothers)For trade receivables and payables denominated inforeign currencies, the Companies identify the foreign
currency exchange rate fluctuation risk for each currency
on a monthly basis and enter into forward foreign exchange
contracts to hedge such risk.
The Financial Division manages risks on derivativetransaction, in accordance with the internal policies.
Monthly reports including actual transactions data aresubmitted to top management for their review.
For marketable and investment securities, the Companies
periodically review the fair values of such financial
instruments and the financial position of the issuers. In
addition, the Companies continuously evaluate whether
securities should be maintained taking into account theirfair values and relationships with the issuers.
3) Monitoring of liquidity risk (the risk that the Companies may
not be able to meet its obligations on scheduled due dates)
Based on the report from each division, the Companies
prepare and update their cash flow plans on a timely basis
to manage liquidity risk.

and(c) Marketable
investment securities
and accounts(d) Notes
payable-trade

Estimated Fair Value of Financial Instruments

For the year ended March 31, 2014
The carrying value of financial instruments in the consolidatedbalance sheet as of March 31, 2014, and their estimated fairvalue are as follows:(a) Cash and cash equivalents
and accounts(b) Notes
receivable-trade
Allowance for
doubtful accounts *1

Consolidatedbalance sheet¥47,409

Millions of yen
Estimated
fair value¥47,409

Difference−

88,528(1,191)87,33787,337

−

2,611

2,611

−

(75,673)(75,673)−(e) Short- term loans payable(1,054)(1,054)−(f) Derivative transactions *2

(6)

(6)

−

(a) Cash and cash equivalents
and accounts(b) Notes
receivable-trade
Allowance for
doubtful accounts *1

Thousands of U.S. dollars
Consolidated
Estimatedbalance sheet
fair value
Difference$460,639−

848,591

848,591−

25,36925,369−and accounts(d) Notes
payable-trade(735,260)(735,260)−(e) Short- term loans payable(10,241)(10,241)−(f) Derivative transactions *2

(58)

(58)

−

and
(c) Marketable
investment securities*1*2$460,639

860,163(11,572)

Allowance for doubtful accounts provided for individual customers are deducted.
The value of assets and liabilities arising from derivatives is shown at net value.

Note: 1. Method to determine the estimated fair value of financial instruments and othermatters related to securities and derivative transactions(a) Cash and cash equivalents, (b) Notes and accounts receivable-trade
Since these items are settled in a short period of time, their carrying value
approximates the fair value.
(c) Marketable and investment securities
The fair value of marketable and investment securities is based on the quoted market
price. For information on securities by each holding purpose, please refer to Note 14
Securities.
(d) Notes and accounts payable-trade, (e) Short-term loans payable
Since these items are settled in a short period of time, their carrying value
approximates the fair value.
(f) Derivatives transactions
Please refer to Note 15 Derivative Transactions.

2. Financial instruments for which it is extremely difficult to determine the fair value

Millions of yen

Unlisted stocks¥1,774

Thousands of
U.S. dollars$17,237

Because no quoted market price is available and it is extremely difficult to determine
the fair value, the above financial instruments are not included in the above table.
3. Redemption schedule for receivables and marketable securities with maturities at
March 31,2014
Due in one
year or less
Cash and cash equivalents

Notes and accounts
receivable-tradeMarketable andinvestment securities
Held-to-maturity
debt securities
National and local
government bonds¥47,40988,528

−

−

−

−

−

−

−

−

−

−

−

¥135,937

−

−

−

−

Other

Due in one
year or less

$460,639
860,163

Millions of yen

Unlisted stocks¥1,849Because no quoted market price is available and it is extremely difficult to determine
the fair value, the above financial instruments are not included in the above table.

−−

Thousands of U.S. dollars
Due after fiveDue after one
years throughyear throughten years
five years

−

−

−
−

−

Due after
ten years−−

Due in one
year or less

¥72,032

Cash and cash equivalents

Notes and accounts
receivable-tradeMarketable andinvestment securities
Held-to-maturity
debt securities
National and local
government bonds
Corporate bonds
Other marketablesecurities with maturities
Corporate bonds

Millions of yen
Due after fiveDue after one
years throughyear throughten years
five years

Due after
ten years

−

−

−

−

−

−

−

−

−

−

−

−

−

−

−

¥155,914−−−

83,882

−

Total

−

−

−

−

−

−

−

−

−

−

−

−

−

−

14. Securities

−

−

−

−

1. Information regarding marketable other securities as of March
31, 2014 and 2013 are as follows:$1,320,802

−

−

−

Other marketable securities
with maturities
Corporate bonds
Other

−

−

−

−

For the year ended March 31, 2013
The carrying value of financial instruments in the consolidatedbalance sheet as of March 31, 2013, and their estimated fairvalue are as follows:(a) Cash and cash equivalents
and accounts(b) Notes
receivable-trade
Allowance for
doubtful accounts *1

Consolidatedbalance sheet¥72,032

Millions of yen
Estimated
fair value¥72,032

Thousands of U.S.dollars

Carrying value

83,882(1,126)
−

2,268

2,268

−

and accounts(d) Notes
payable-trade(71,764)(71,764)−(e) Short- term loans payable(3,093)(3,093)−(f) Derivative transactions *2

(150)

(150)

−

Allowance for doubtful accounts provided for individual customers are deducted.
The value of assets and liabilities arising from derivatives is shown at net value.

2013
Carrying Acquisition Unrealized
value
cost
gain (loss)

Securities whose carrying value exceeds their acquisition cost:
Stocks¥2,490 ¥1,009 ¥1,481 ¥2,005¥892 ¥1,113
Securities whose acquisition cost exceeds their carrying value:
Stocks
121
141
(20)
263
306
(43)
Total
¥2,611 ¥1,150 ¥1,461 ¥2,268 ¥1,198 ¥1,070−

82,756and(c) Marketable
investment securities

Millions of yen

2014
Carrying Acquisition Unrealized
value
cost
gain (loss)

Difference

82,756*1*2

2. Financial instruments for which is extremely difficult to determine the fair value

Other

Corporate bonds

Total

−

−

−

Corporate bonds

Notes and accounts
receivable-tradeMarketable andinvestment securities
Held-to-maturity
debt securities
National and local
government bonds

−

−

−

Other marketable securities
with maturities

Cash and cash equivalents−

Due after
ten years

3. Redemption schedule for receivables and marketable securities with maturities at
March 31, 2013

Corporate bonds

Total

Millions of yen
Due after fiveDue after one
years throughyear throughten years
five years

Note: 1. Method to determine the estimated fair value of financial instruments and othermatters related to securities and derivative transactions(a) Cash and cash equivalents, (b) Notes and accounts receivable-trade
Since these items are settled in a short period of time, their carrying value
approximates the fair value.
(c) Marketable and investment securities
The fair value of marketable and investment securities is based on the quoted market
price. For information on securities by each holding purpose, please refer to Note 14
Securities.
(d) Notes and accounts payable-trade, (e) Short-term loans payable
Since these items are settled in a short period of time, their carrying value
approximates the fair value.
(f) Derivatives transactions
Please refer to Note 15 Derivative Transactions.

2014
Acquisition cost

Unrealized gain (loss)

Securities whose carrying value exceeds their acquisition cost:
Stocks$24,194$9,804
Securities whose acquisition cost exceeds their carrying value:
Stocks
1,175
1,370
Total
$25,369$11,174$14,390(195)$14,195

2. The proceeds from sales of securities, except those of theaffiliated companies, for the years ended March 31, 2014
and 2013 were ¥7 million ($ 68 thousand) and ¥57 million,
respectively. The realized gains on those sales for the years
ended March 31, 2014 and 2013 were ¥4 million ($39
thousand) and ¥33 million, respectively.

19

3. Information regarding non-marketable securities as of March
31, 2014 and 2013 is as follows.
Millions of yen

Thousands of
U.S.dollars

Carrying value

Carrying value

2014

Other securities
Unlisted stocks
OthersTotal

2013¥1,774−¥1,774$17,237−$17,237

15. Derivative Transactions

Transaction outside the market
Currency-related transactions

Contract amount
Maturing Maturing
within after one
one yearyear
Forward foreignexchange contracts

Sell:
EUR
CAD
AUD
Buy:
USD
Total

Unrealized
gain (loss)

2013

Contract amount
Maturing Maturing
within after one
one year
year

Fair
value

Unrealized
gain (loss)

¥(0)
−
(0)

¥(0)
−
(0)

¥6,0055−¥ − ¥(149) ¥(149)
−
(1)
(1)
−
−
−

2,299
¥9,246

−
¥−

(6)
¥(6)

(6)
¥(6)

−
¥6,010−−−¥ − ¥(150) ¥(150)*Calculation of the fair value is based on the value from financial institutions.
Thousands of U.S. dollars
2014

Contract amount

Sell:
EUR
CAD
AUD
Buy:
USD
Total

Maturing
after one
year

¥−

¥19

¥−

¥(0)

¥−

2,241
¥2,260

¥−

−

(6)
¥(6)

¥−

−

Contract amount

Forward foreignexchange contracts

Fair value

Maturing
after one year

Total

¥−

−

−

¥−

¥−

Maturing
within one year

2014

Fair value

Maturing
after one year

AUD

$185

$−

$(1)

USD

21,774$21,959

−
$−

(58)
$(59)

*Calculation of the fair value is based on the value from financial institutions.

Unrealized
gain (loss)

Millions of yen

2014
Contract amount

Forward foreignexchange contracts

Sell:
CAD
AUD
Sell:
USD
Total

Fair value

Maturing Maturing
within one after one
year
year

¥703
1,046
206
¥1,9552013

Contract amount
Maturing
after one
year

¥−

¥(47)
(26)

−

−
¥(73)

¥−

¥24
(32)

¥317
169

−

(2)
¥(10)

−
¥486

−

¥−

Fair value

Maturing
within one
year

−

¥−

*Calculation of the fair value is based on the value from financial institutions.
Thousands of U.S. dollars$67,412
−
87

$−
−
−

$(0)
−
(0)

$(0)
−
(0)

22,338$89,837

−
$−

(58)
$(58)

(58)
$(58)

Contract amount

Forward foreignexchange contracts

Sell:*Calculation of the fair value is based on the value from financial institutions.

2. Summarized below are the amount of contract and theestimated fair value of the derivative instruments outstandingat March 31, 2014 and 2013, for which hedge accounting isapplied.

Currency-related transactions

1) Net deferred profits on hedges, accounted for as a part ofaccounts receivable

20

Fair value

Maturing
within one
year2) Forward foreign exchange contracts, accounted for as a partof accounts receivable¥−−−

Forward foreignexchange contracts

Maturing Maturing
within one after one
year
year

2013

Contract amountThousands of U.S. dollars

Buy:¥6,938−9

Maturing
within one year

Sell:
AUD
Sell:
USD
Total

Sell:

Millions of yen
Fair
value

Forward foreignexchange contracts

Fair value*Calculation of the fair value is based on the value from financial institutions.

1. Summarized below are the amount of contract and theestimated fair value of the derivative instruments outstandingat March 31, 2014 and 2013, for which the hedge accounting
is not applied.

2014

Contract amount2014¥1,849−¥1,849Millions of yen

2014

Sell:
Total

Maturing
within one year

2014

Maturing
after one year

Fair value

CAD
AUD

$6,831
10,163

$−
−

$233
(311)

USD

2,001
$18,995

−
$−

(19)
$(97)

*Calculation of the fair value is based on the value from financial institutions.

16. Segment Information(A) Business Segments
1. Summary of reportable segments
The reportable segments of the Companies are components
for which discrete financial information is available and whose
operating results are regularly reviewed by the Executive
Committee to make decisions about resource allocation and toassess the performance.
Aiming to become “a global one-stop solutions company”,
the Companies create comprehensive strategies per market anddevelop business activities under a framework for business
operation by each market segment.
Therefore, the Companies report on “System Solutions
Business Group” and “Global Solutions Business Group” as areportable segments.
2.The calculation method for amounts of sales, income, assets
and other items per reportable segments
The accounting policies of the segments are substantially thesame as those described in the significant accounting policies
in Note 2 Summary of Significant Accounting Policies.
Intersegment sales and transfers are calculated at theprevailing market prices.
As discussed in Note 2 Summary of Significant Accounting
Policies (T) Changes in Accounting Policies Which are
Difficult to Distinguish from Changes in Accounting
Estimates (Change in Depreciation Method of Property,
Plant and Equipment), (U) Changes in Accounting Estimates(Changes in Estimated Useful Lives), the Company anddomestic subsidiaries changed the depreciation method andthe estimated useful lives of property, plant and equipment asof the end of the fiscal year ended March 31, 2014.
As a result of this change, compared to the previous
method, segment profit for the year ended March 31, 2014,
was increased by ¥278 million ($2,701 thousand) in System
Solutions Business Group, ¥760 million ($7,384 thousand) in
Global Solutions Business Group.
Millions of yen

Net Sales
System Solutions Business Group
Unaffiliated customers
Intersegment
Total
Global Solutions Business Group
Unaffiliated customers
Intersegment
Total
Adjustments
Consolidated
Segment Income
System Solutions Business Group
Global Solutions Business Group
Consolidated

2014

2013

Thousands of
U.S.dollars

Segment Assets
System Solutions Business Group
Global Solutions Business Group
Adjustments
Consolidated¥79,724
294,661
19,580¥393,965¥74,546
302,062
11,905¥388,513$774,621
2,863,010
190,245$3,827,876

Depreciation
System Solutions Business Group
Global Solutions Business Group
Consolidated¥1,985
14,761¥16,746¥2,475
9,587¥12,062$19,287
143,422$162,709

Amortization
System Solutions Business Group
Global Solutions Business Group
Consolidated

¥164
4,306
¥4,470¥164
4,630¥4,794$1,593
41,839$43,432

Capital Expenditures
System Solutions Business Group
Global Solutions Business Group
Consolidated¥2,363
15,911¥18,274¥2,67381,064¥83,737$22,960
154,595$177,555

Note: 1. Adjustments of segment assets are corporate assets, and consist of cash and cash
equivalents and investment securities in the amount of ¥ 19,580 million ($190,245
thousand) and ¥ 11,905 million in March 31,2014 and 2013, respectively.
2. Segment income corresponds to operating income of Consolidated Statement of
Income.
The main products of each business segment
System Solutions Business GroupPOS Systems, MFPs, Auto ID systems and related products, in Japan
Global Solutions Business Group
MFPs, POS Systems, Auto ID systems, Printers and related products, abroad(B) Relative Information

1. Products and service information
Millions of yen

Net sales of Retail
Net sales of MFP¥179,008
1,769
180,777$1,875,768
21,8901,897,658

305,817
11,671
317,488(13,924)¥498,871

224,686
10,756
235,442(12,525)¥403,694

2,971,405
113,399
3,084,804(135,289)$4,847,173¥9,74013,346¥23,086¥8,708
7,178¥15,886$94,636
129,674$224,310

2013¥238,110
165,584¥403,694

2014$2,916,091
1,931,082$4,847,173

Retail : POS systems, Auto ID systems and related products, etc.
MFP : Multi Function Peripherals, Facsimiles, Office Printers, Multi-function peripheraldevices, scanner function and document management, etc. which enables realized
in one piece

2. Information by geographical area

Millions of yen

2014¥193,054
2,253
195,3072014¥300,124
198,747¥498,871

Thousands of
U.S.dollars

Net SalesJapan
American States
EuropeAsia and others
Net sales

Tangible Fixed Assets

Japan
American States
EuropeAsia and others
Net sales

Thousands of
U.S.dollars

2014

2013

2014

¥204,581
142,847
105,169
46,274¥498,871¥190,086
103,326
76,211
34,071¥403,694$1,987,767
1,387,942
1,021,852
449,612$4,847,173¥13,328
6,467
9,139
4,382
¥33,316¥13,425
7,173
7,058
4,190
¥31,846$129,499
62,83588,79742,577$323,708

21

Criteria of geographical segmentation and the name of countries
or areas mainly included in each segment except for Japan are as
follows:
1) Criteria: geographical closeness2) Countries & Areas2)-1. American States
U.S.A., Canada, Mexico, Puerto Rico, Panama, Venezuela,
Brazil, Chile2)-2. Europe
U.K., France, Germany, Spain, Switzerland, Belgium, Italy,
Netherlands, Sweden, Norway, Denmark, Finland, Poland2)-3. Asia and Others
Singapore, Malaysia, Indonesia, China, Australia, Korea
3. Information by major customer
There are no customers whom the Companies sell it to morethan 10% of total sales for the years ended in March 31, 2014
and 2013.
4. Information on impairment loss in noncurrent assets bebusiness segment
There are no events to be noted for this purpose for the years
ended in March 31, 2014 and 2013.
5. Information on amortization of goodwill and unamortizedbalance by business segment
Millions of yen

System Solutions Business Group
Global Solutions Business Group
Consolidated

2014
2013
Balance at endof period¥328
39,272¥39,600¥492
74,731¥75,223

Thousands of
U.S.dollars

2014
Balance at endof period$3,187
381,578$384,765

For the amount of amortization of goodwill, it is omitted as it isdisclosed in “Segment Information”
6. Information on negative goodwill by business segment
For the year ended in March 31, 2014
The importance of the amount of money is scarce, so astatement is omitted.
For the year ended in March 31, 2013
The importance of the amount of money is scarce, so astatement is omitted.

2. The size of stock option and its circumstances
1) General information
The first new share subscription rights
as share-reward type stock option
Qualified beneficiaries
Type of shares for which new
subscription rights offered (Note 1)

August 1, 2008

Vesting period

No conditional period required

Condition of exercising
Subscription rights exercise period(Note 2)

From August 2, 2008 to August 1, 2038
The second new share subscription rights
as share-reward type stock option

Qualified beneficiaries
Type of shares for which new
subscription rights offered (Note 1)

17 of the Company directors and corporate
officers
169,000 shares of Common stock

Date of issuance

July 31, 2009

Vesting period

No conditional period required

Condition of exercising
Subscription rights exercise period(Note 2)

From August 1, 2009 to July 31, 2039
The third new share subscription rights
as share-reward type stock option

Qualified beneficiaries
Type of shares for which new
subscription rights offered (Note 1)

17 of the Company directors and corporate
officers
134,000 shares of Common stock

Date of issuance

July 30, 2010

Vesting period

No conditional period required

Condition of exercising
Subscription rights exercise period(Note 2)

From July 31, 2010 to July 30, 2040
The fourth new share subscription rights
as share-reward type stock option

Qualified beneficiaries
Type of shares for which new
subscription rights offered (Note 1)

17 of the Company directors and corporate
officers
128,000 shares of Common stock

Date of issuanceAugust 2 , 2011

Vesting period

No conditional period required

Condition of exercising
Subscription rights exercise period(Note 2)

From August 3, 2011 to August 2, 2041
The fifth new share subscription rights
as share-reward type stock option

Qualified beneficiaries
Type of shares for which new
subscription rights offered (Note 1)

The stock options outstanding as of March 31,2014 are as
follows:

Condition of exercising

17 of the Company directors and corporate
officers
156,000 shares of Common stock

Date of issuanceAugust 2 , 2012

Vesting period

No conditional period required

Subscription rights exercise period(Note 2)

From August 3, 2012 to August 2, 2042
The sixth new share subscription rights
as share-reward type stock option

Qualified beneficiaries
Type of shares for which new
subscription rights offered (Note 1)

17 of the Company directors and corporate
officers
89,000 shares of Common stock

Date of issuance

July 31, 2013

Vesting period

No conditional period required

Condition of exercising
Subscription rights exercise period
Note: 12

22

83,000 shares of Common stock

Date of issuance

17. Stock Option Plan

1. The amount and the accounting subject in relation to the stock
options existing for the year ended March 31, 2014.
Selling, General and Administrative Expenses for the years
ended March 31, 2014 and 2013 are ¥49 million ($476
thousands) and ¥45 million, respectively.

18 of the Company directors and corporate
officers(Note 2)

From August 1, 2013 to July 31, 2043

The amount is converted into the number of shares.
Fixed term of the right is not given.
Subscription rights may be exercised in a lump sum within expiration cycle and 10
days after a beneficiary resigns from directors or corporate officers.

2) The size of stock option and movement
Addressed is the amount of stock options existing as ofMarch 31, 2014.
As for the number of stock options, it is converted into thenumber of shares.
2)-1. The number of stock options

Before the resolution

End of the preceding term

OfferedCancelled

VestedThe first new The second new The third new
share
share
share
subscription
subscription
subscription
rightsrightsrightsas share-reward as share-reward as share-reward
type stock option type stock option type stock option
−

−

−

−

−

−

−

−

−

−

−

−

End of the preceding term

28,00068,00069,000Exercised

12,00032,00041,000

Outstanding

16,00036,00028,000

Outstanding

After the resolution
VestedCancelled

Before the resolution

End of the preceding term

Offered

−

−

−

−

−

−

−

−

−

The sixth new
The fifth new
The fourth new
share
share
share
subscription
subscription
subscription
rightsrightsrightsas share-reward as share-reward as share-reward
type stock option type stock option type stock option
−

−

−

−

89,000−−89,000End of the preceding term

114,000

156,000

Exercised48,00057,000

Outstanding

66,00099,000Cancelled

VestedOutstanding

After the resolution
VestedCancelled

−

−

−

−

−

−

−

−

−

−

−

89,000−−−89,0002)-2. Per share data

The first new The second new The third new
share
share
share
subscription
subscription
subscription
rights as
rights as
rights as
share-reward
share-reward
share-reward
type stock option type stock option type stock option¥1¥1¥1
Exercised price($0.010)($0.010)($0.010)
The average price
¥556
¥554
¥555
at the time of exercising($5.402)($5.383)($5.393)
Official price at the date of
¥560
¥393
¥307
offered($5.441)($3.818)($2.983)
The sixth new
The fifth new
The fourth new
share
share
share
subscription
subscription
subscription
rights as
rights as
rights as
share-reward
share-reward
share-reward
type stock option type stock option type stock option¥1¥1¥1
Exercised price($0.010)($0.010)($0.010)
The average price
¥559
¥558
−
at the time of exercising($5.431)($5.422)
Official price at the date of
¥316
¥291
¥550
offered($3.070)($2.827)($5.344)

3. The evaluation of fair price of stock option
1) The evaluation method used: Black–Scholes method
2) General information and the method of estimation
The sixth new share subscription rights
as share-reward type stock option
Stock market volatility (Note 1)
Estimated residual period (Note 2)

Estimated dividends (Note 3)
Risk-free rate (Note 4)
Note: 1
2

3
4

32.8%

1.8 years¥8 ($0.078) per share
0.12%

The figure is calculated based on actual share data from October 3, 2011 up to theweek of offered.
The calculation is based on the condition that the Company's directors or corporate
officers are resigned and the exercised exactly after the day of resignation.
For tenure of directors and executive officers, the Company has calculated theaverage tenure remaining term at the date of grant based on the average tenure.
The estimated figure is based on the actual dividend amount for the year ended March
31, 2013.
Estimated capitalization cycle of government bond is in accordance with estimatedresidual period

4. The method of estimating the number of stock option vested
Fundamentally, only the actual number of cancelled is shownas it is difficult to estimate possible number of cancelled.

18. Business Combination
Business combinations of acquisition
Acquiring IBM's RSS business
1. Nature and amounts of material adjustments to the initial
allocation of acquisition cost
The allocation of acquisition cost of IBM's RSS
business, which the Company acquired in the fiscal year
ended March 31, 2013, had not been completed because
the Company applied provisional accounting treatment
based on reasonable information available to management
for the fiscal year ended March 31, 2013.
Since the allocation of acquisition cost has been
completed for the fiscal year ended March 31, 2014, theCompany adjusted the amount of goodwill at the time of
the acquisition.
The amount of goodwill was ¥52,523 million ($510,328
thousand) at the time of acquisition, out of which ¥31,349
million ($304,595 thousand) has been allocated to certain
intangible assets.
As a result of this adjustment, the Company revised
the amount of goodwill to ¥21,174 million ($205,733
thousand).
2. Amortization method and amortization period
Straight-line in 17 years
Goodwill		Intangible assets
Straight-line in 15 to 20 years

19. Asset Retirement Obligation
The importance of the amount of money is scarce, so astatement is omitted.

2320. Transactions with Related Parties(¥=Million, US$=Thousand)

1.Transactions with Related Parties(A) Transactions with related parties for the year
ended March 31, 2014.

(¥=Million, US$=Thousand)StatusParentcompanyName
Toshiba
Corporation

Address
Minato-ku,
Tokyo

Relationship

Capital¥439,901($4,274,203)

Business

Percentage of voting
rights held (%)

Manufacturing andsales of digital
Direct: 52.8%
products andelectronic devices Indirect: 0.1%
and homeappliances

Name

Address

CapitalBusiness

Subsidiaryof the parent
company

Toshiba
America, Ltd.

New York,
USA$1,002,550

The regional
representative
company inAmericas

Relationship
Dispatch of
Business
executive
relationshipofficers, etc.

Transaction

Transaction
amountAccount item

Balance at
fiscal year end

Deposits offunds(Note)

Interest
income¥0($0)

Cash and cash
equivalents¥1,184($11,504)

None

Deposits of
funds

None

With regard to the amounts above, transaction amount and balance at fiscal year end don't include
consumption taxes.

BusinessrelationshipTransaction

Transaction
amountAccount item

Balance at
fiscal year end

Sales of our
products,
Interlocking of deposits of funds
and purchasedirectorsof Toshiba
products

Note: Concerning deposits of funds, it's difficult to figure out transaction amount because fundsettlement is performed whenever needed.
Therefore, only balance at fiscal year end is stated.

Deposits offunds(Note)Cash and cash
equivalents¥18,749($182,171)

Interest
income¥7($68)

Accruedinterest¥0($0)

Policy for determining trade terms and conditions and other related matters(1) Depositing funds are determined from market rates and offers from third party interests rates.
(2) For sales of the products, it is determined as general transaction over negotiation withoffering our price, considering market price and total cost.

Dispatch of
executive
officers, etc.

With regard to the amounts above, transaction amount and balance at fiscal year end don't include
consumption taxes.
Note: Concerning deposits of funds, it's difficult to figure out transaction amount because fundsettlement is performed whenever needed.
Therefore, only balance at fiscal year end is stated.
Policy for determining trade terms and conditions and other related matters(1) Depositing funds are determined from market rates and offers from third party interests rates.
(2) For sales of the products, it is determined as general transaction over negotiation withoffering our price, considering market price and total cost.
(¥=Million, US$=Thousand, S$=Thousand)StatusName

Subsidiaryof the parent
company

Toshiba Asia
Pacific Pte.,
Ltd.

Address

Dispatch of
executive
officers, etc.

Businessrelationship

None

Deposits of
funds

Percentage of voting
rights held (%)

CapitalBusiness

Singapore

S$6,784

The regional
representative
company
in Asia and Pacific

Transaction

Transaction
amountAccount item

Balance at
fiscal year end

Deposits offunds(Note)

Interest
income¥3($29)

Cash and cash
equivalents¥2,309($22,435)

Relationship

NoneWith regard to the amounts above, transaction amount and balance at fiscal year end don't include
consumption taxes.
Note: Concerning deposits of funds, it's difficult to figure out transaction amount because fundsettlement is performed whenever needed.
Therefore, only balance at fiscal year end is stated.
Policy for determining trade terms and conditions and other related matters(1) Depositing funds are determined from market rates and offers from third party interests rates.
(2) For sales of the products, it is determined as general transaction over negotiation withoffering our price, considering market price and total cost.
(¥=Million, US$=Thousand, GBP=Thousand)StatusName

Subsidiaryof the parent
company

Toshiba
International
Finance (UK)Plc.

London, UK

Relationship
Dispatch of
Business
executive
relationshipofficers, etc.

Transaction

Transaction
amountDeposits offunds(Note)

Interest
income

¥2
($19)

None

Deposits offunds

Address

CapitalBusiness

GBP 5,000

Financingof corporate
subsidiaries
overseas etc.

Percentage of voting
rights held (%)
None

Account item

Balance at
fiscal year end

Cash and cash
equivalents¥6,593($64,059)

With regard to the amounts above, transaction amount and balance at fiscal year end don't include
consumption taxes.
Note: Concerning deposits of funds, it's difficult to figure out transaction amount because fundsettlement is performed whenever needed.
Therefore, only balance at fiscal year end is stated.
Policy for determining trade terms and conditions and other related matters(1) Depositing funds are determined from market rates and offers from third party interests rates.
(2) For sales of the products, it is determined as general transaction over negotiation withoffering our price, considering market price and total cost.

24

Percentage of voting
rights held (%)

Status(¥=Million, US$=Thousand, CNY=Thousand)Status
Subsidiaryof the parent
company

Name

Address

Business

CNY249,362

The regional
representative
company in
China

Transaction

Transaction
amountAccount item

Balance at
fiscal year end

Deposits offunds(Note)

Other¥6,470($62,864)

Toshiba China
Beijing,China
Co., Ltd.

Relationship
Dispatch of
Business
executive
relationshipofficers, etc.
Deposits of
None
funds

Percentage of voting
rights held (%)

CapitalNone

With regard to the amounts above, transaction amount and balance at fiscal year end don't include
consumption taxes.
Note: Concerning deposits of funds, it's difficult to figure out transaction amount because fundsettlement is performed whenever needed.
Therefore, only balance at fiscal year end is stated.
Policy for determining trade terms and conditions and other related matters(1) Depositing funds are determined from market rates and offers from third party interests rates.
(2) For sales of the products, it is determined as general transaction over negotiation withoffering our price, considering market price and total cost.

(B) Transactions with related parties for the year
ended March 31, 2013.

(¥=Million)

StatusName

Address

CapitalBusiness

Percentage of voting
rights held (%)

Minato-ku,
Tokyo¥439,901

Manufacturing andsales of digital
Direct: 52.8%
products andelectronic devices Indirect: 0.1%
and homeappliances

BusinessrelationshipTransaction

Transaction
amountAccount item

Balance at
fiscal year end

Sales of our
products,
Interlocking of deposits of funds
directors
and purchaseof Toshiba
products

Deposits offunds(Note)Cash and cash
equivalents¥19,323

Interest
income¥34

Accruedinterest¥0

Parentcompany

Toshiba
Corporation

Relationship

Dispatch of
executive
officers, etc.

With regard to the amounts above, transaction amount and balance at fiscal year end don't include
consumption taxes.
Note: Concerning deposits of funds, it's difficult to figure out transaction amount because fundsettlement is performed whenever needed.
Therefore, only balance at fiscal year end is stated.
Policy for determining trade terms and conditions and other related matters(1) Depositing funds are determined from market rates and offers from third party interests rates.
(2) For sales of the products, it is determined as general transaction over negotiation withoffering our price, considering market price and total cost.

(¥=Million, S$=Thousand)Status

Subsidiaryof the parent
companyName

Toshiba
Singapore
Pte., Ltd.

Relationship
Dispatch of
Business
executive
relationshipofficers, etc.
None

Sales of our
products

Address

Singapore

Transaction
Sales of document
processing andmultifunction
peripherals, etc.

CapitalBusiness

S$11,600

Sales andmaintenanceof audio visualequipment,
personalcomputers,
document
processing andtelecommunicationequipment, etc.

Transaction
amountAccount item

¥7,552

Accounts
receivable

Percentage of voting
rights held (%)

None

Balance at
fiscal year end¥3,023

With regard to the amounts above, transaction amount and balance at fiscal year end don't include
consumption taxes.
Policy for determining trade terms and conditions and other related matters(1) Depositing funds are determined from market rates and offers from third party interests rates.
(2) For sales of the products, it is determined as general transaction over negotiation withoffering our price, considering market price and total cost.
(¥=Million, S$=Thousand)
Percentage of voting
rights held (%)

StatusName

Address

CapitalBusiness

Subsidiaryof the parent
company

Toshiba
Capital (Asia),
Ltd.

Singapore

S$ 4,000Financingof corporate
subsidiaries
overseas etc.

Relationship
Dispatch of
Business
executive
relationshipofficers, etc.

Transaction

Transaction
amountAccount item

Balance at
fiscal year end

Deposits offunds(Note)

Interest
income¥7

Cash and cash
equivalents¥8,379None

Deposits of
funds

None

With regard to the amounts above, transaction amount and balance at fiscal year end don't include
consumption taxes.
Note: Concerning deposits of funds, it's difficult to figure out transaction amount because fundsettlement is performed whenever needed.
Therefore, only balance at fiscal year end is stated.
Policy for determining trade terms and conditions and other related matters(1) Depositing funds are determined from market rates and offers from third party interests rates.
(2) For sales of the products, it is determined as general transaction over negotiation withoffering our price, considering market price and total cost.
(¥=Million, GBP=Thousand)StatusName

Subsidiaryof the parent
company

Toshiba
International
Finance (UK)Plc.

Relationship
Dispatch of
Business
executive
relationshipofficers, etc.
Deposits of
None
funds

Address
London, UK

CapitalBusiness

GBP 5,000

Financingof corporate
subsidiaries
overseas etc.

Transaction

Transaction
amountDeposits offunds(Note)

Percentage of voting
rights held (%)
None¥4,838With regard to the amounts above, transaction amount and balance at fiscal year end don't include
consumption taxes.
Note: Concerning deposits of funds, it's difficult to figure out transaction amount because fundsettlement is performed whenever needed.
Therefore, only balance at fiscal year end is stated.
Policy for determining trade terms and conditions and other related matters(1) Depositing funds are determined from market rates and offers from third party interests rates.
(2) For sales of the products, it is determined as general transaction over negotiation withoffering our price, considering market price and total cost.

CapitalBusiness

Percentage of voting
rights held (%)

New York,
USA$1,002,550

The holding
company of the
U.S. operation
supervising
company

None

Transaction

Transaction
amountAccount item

Balance at
fiscal year end

Deposits offunds(Note)Cash and cash
equivalents¥10,450

StatusName

Address

Subsidiaryof the parent
company

Toshiba
America, Ltd.

Relationship
Dispatch of
Business
executive
relationshipofficers, etc.
Deposits of
None
funds

With regard to the amounts above, transaction amount and balance at fiscal year end don't include
consumption taxes.
Note: Concerning deposits of funds, it's difficult to figure out transaction amount because fundsettlement is performed whenever needed.
Therefore, only balance at fiscal year end is stated.
Policy for determining trade terms and conditions and other related matters(1) Depositing funds are determined from market rates and offers from third party interests rates.
(2) For sales of the products, it is determined as general transaction over negotiation withoffering our price, considering market price and total cost.

(C) Unconsolidated subsidiaries, affiliates and otherrelated parties of the Company submitting
consolidated financial statements
Not applicable(D) Directors and major shareholders of the Company
submitting consolidated financial statements(limited to the case of individual) etc.
Not applicable

2. Notes regarding parent company and material
affiliated companies

Information on the parent company
Toshiba Corporation (listed on Tokyo Stock Exchange,
Nagoya Stock Exchange)

21. Cash Dividends(A) Cash dividends for the year ended March 31, 2014
1. Cash dividends paid
(Resolution)

Balance at
Account item
fiscal year end
Cash and cash
equivalents(¥=Million, US$=Thousand)Type ofsharesBoard ofCommondirectors held on
stock
April 26, 2013
Board of directors
Commonheld on Octoberstock
28, 2013(Resolution)

Type ofsharesBoard ofCommondirectors held on
stock
April 26, 2013
Board of directors
Commonheld on Octoberstock
28, 2013

Total amount Dividendsof dividends per share Record date Effective date(Millions of yen)

(Yen)

¥1,097¥4.0

March 31,2013

June 3, 2013

¥1,098¥4.0

September
30, 2013

December 2,
2013

Total amount
Dividends
of dividends
per share Record date Effective date(Thousands of
US dollars)(US dollars)$10,659$0.039March 31,2013

June 3, 2013$10,668$0.039September
30, 2013

December 2,
2013

25

2. Year end dividends of the following fiscal year
(Resolution)

Type ofsharesBoard ofdirectors held Common
stock
on April 28,
2014(Resolution)

Type ofsharesBoard ofdirectors held Common
stock
on April 28,
2014

Total amountof dividends(Millions of yen)

¥1,098
Total amountof dividends(Thousands of
US dollars)$10,668

Dividends
per share Record date Effective date

Dividend
resource(Yen)

Retainedearnings

March 31,
2014

¥4.0

June 2, 2014

Dividends
per share Record date Effective date

Dividend
resource(US dollars)

Retainedearnings

March 31,2014

$0.039June 2, 2014

1. Cash dividends paid
Type ofsharesBoard ofdirectors held Common
stock
on April 27,
2012
Board ofdirectors held Common
on November stock
1, 2012

Total amountof dividends

Dividends
per share¥1,097¥4.0

March 31,2012

June 1, 2012

¥1,097¥4.0

September
30, 2012

December 3,
2012(Millions of yen)

Record date Effective date(Yen)

2. Year end dividends of the following fiscal year
(Resolution)

Type ofsharesBoard ofdirectors held Common
stock
on April 26,
2013

Total amountof dividends(Millions of yen)

¥1,097

Dividends
per share Record date Effective date

Dividend
resource(yen)

Retainedearnings

March 31,
2013

¥4.0

June 3, 2013

22. Per share Information
1. Per share information at March 31, 2014 and 2013 is asfollows:
Net assets per share
Net income per share
Net income per share fully diluted

2014

Yen

¥576.50
25.99
25.94

U.S.dollars

2013¥549.42
22.64
22.61

2014

$5.601
0.253
0.252* Net income per share and net assets per share fully diluted were calculated on the basis of
the following data.
Thousands of
U.S.dollars

Millions of yen

2014

Net income per share
Net income¥7,134
Amounts not attributable tocommon stock−
Net income attributable tocommon stock
7,134
Average number of sharesof common stock during theperiod (thousand shares)
274,430
Net income per share fully diluted
Adjustment to net income−
Increase in number ofcommon stocks(thousand shares)
523(Share subscription rights)
523
Outline of the residual
securities excluded fromthe calculation of the fully
diluted net income per sharebecause they have no dilutive
effects.
−

26

23. Subsequent Event
Not applicable(B) Cash dividends for the year ended March 31, 2013
(Resolution)

2. As stated in “Changes in Accounting Policies”, the Companies
have adopted the accounting standard for retirement benefits,
and comply with the treatment of transitional provisions
defined in Section 37 of Accounting Standard for Retirement
Benefits.
As a result, the net assets per share has decreased by ¥7.93($0.077) at the end of the fiscal year ended March 31, 2014.

2013

2014

¥6,212$69,316−
6,212
274,324
−
389
389

−

69,316

27

Corporate Data
1-11-1, Osaki, Shinagawa-ku, Tokyo 141-8562, Japan
Tel: +81-3-6830-9100
Fax: +81-3-6684-4001
http://www.toshibatec.co.jp/
Established: February 21, 1950
Employees: 3,579 <Consolidated: 20,292> (as of March 2014)
Common Stock: ¥39,971 million (as of March 2014)
Stock Listing: Tokyo Stock Exchange (1st Section)

Board of Directors and Audit ＆ Supervisory Board (as of June 27, 2014)
President and Chief Executive Officer◊Takayuki Ikeda
Directors

Masato Yamamoto
Masayoshi Hirata
Issei Ichihara
Mitsuhiro Taketani
Hiroshi Tangoku
Masatsugu Sakabe
Hidejiro Shimomitsu◇:Representative Director

Audit & Supervisory Board Members

Hiroyuki Ikeda
Hiroshi Kitano
Takehiko Ouchi
Toshihiko Matsumoto

Main Consolidated Companies (as of March 31, 2014)• TOSHIBA AMERICA BUSINESS SOLUTIONS, INC.
• TOSHIBA TEC SOLUTION SERVICES CORPORATION• TOSHIBA GLOBAL COMMERCE SOLUTIONS, INC.
• TOSHIBA TEC GERMANY IMAGING SYSTEMS GmbH• TOSHIBA TEC FRANCE IMAGING SYSTEMS S.A.
• TOSHIBA TEC EUROPE RETAIL INFORMATION SYSTEMS S.A.
• TOSHIBA GLOBAL COMMERCE SOLUTIONS MEXICO, S. DE R.L. DE C.V.
• TOSHIBA TEC U.K. IMAGING SYSTEMS LTD.
• TOSHIBA TEC INFORMATION SYSTEMS (SHENZHEN) CO., LTD.
• TOSHIBA TEC SINGAPORE PTE LTD• P.T. TEC INDONESIA• TEC PRECISION CO., LTD.
• TOSEI CORPORATION• TEC INFORMATION SYSTEMS CORPORATION• KOKUSAI CHART CORPORATION• TOSHIBA TEC (H.K.) LOGISTICS & PROCUREMENT LTD.
• TOSHIBA GLOBAL COMMERCE SOLUTIONS HOLDINGS CORPORATION