for the Year Ended Ma
arch 31, 2
2013, andd Independent Aud
ditor's Re
eport

EIZO Corpora
ation andd Subsid
diariesFinancial Highlights
Thousands ofMillions of Yen

U.S. Dollars

2011

2012

2013

2013

Net sales

65,20459,55958,270619,894

Operating income

5,150

4,405

2,057

21,883

Net income

3,547

1,637

1,598

17,000Total assets

77,43377,032

79,368844,341

Total equity

59,21057,67861,432

653,532

Years ended March 31:

As of March 31:

Per share information

Yen

U.S. Dollars

Basic net income

158.93

74.08

74.96

0.80

Cash dividends applicable to the year

50.00

50.00

50.00

0.53

Note: U.S. dollar amounts are provided solely for convenience at the rate of ¥94 to US$1, the approximate exchange rate at March 31, 2013

(Millions of Yen)

Net Sales

Operating Income

Net Income

65,2045,150
4,405
59,5593,547
58,270

2011

2012

2013

Total Assets/
Total Equity

2,057

2011

2012

2011

2013

Net Salesby Products

1,637

1,598

2012

2013

Monitor for Computer Use
Amusement Monitor
Other

77,43359,21077,032
57,67879,36861,432

7,974,
12.2%

36,393,55.8%

7,403,
12.4%

Total 65,204
20,837,
32.0%

2012

2013

30,690,52.7%

Total 58,270

Total 59,559
20,545,
34.5%

2012
2011

31,611,53.1%

9,506,
16.3%

18,074,
31.0%

2013

2014

EIZO Corporation (Formerly, EIZO NANAO CORPORATION) and Subsidiaries
Consolidated Balance Sheet
March 31, 2013

Millions of Yen
2013
2012

ASSETS
CURRENT ASSETS:
Cash and cash equivalents (Note 12)
Notes and accounts receivables (Note 12):Trade notes
Trade accounts
Other
Allowance for doubtful receivables
Inventories (Note 5)
Deferred tax assets (Note 9)
Prepaid expenses and other current assets
Total current assets
PROPERTY, PLANT, AND EQUIPMENT:Land (Note 6)
Buildings and structures (Note 6)
Machinery and equipment
Furniture and fixtures
Construction in progress
Total
Accumulated depreciation
Net property, plant, and equipment
INVESTMENTS AND OTHER ASSETS:
Investment securities (Notes 4 and 12)
Goodwill
Deferred tax assets (Note 9)
Other assets
Total investments and other assets

Thousands of
U.S. Dollars(Note 1)
2013

¥16,138¥16,714$171,681

191
12,120567(90 )
20,756
1,775
574

182
16,560347(68)
17,907
2,077
447

2,032
128,936
6,032(957)
220,80918,883
6,106

52,031

54,166

553,522

2,947
11,592
3,712
4,136
6
22,393(14,329 )

3,084
11,594
3,741
4,141
33
22,593(13,867)

31,351
123,319
39,48944,00064
238,223(152,436)

8,064

8,726

85,787

15,045
857
297
3,074

10,778
949
319
2,094

160,053
9,117
3,160
32,702

19,27314,140205,032

LIABILITIES AND EQUITYCURRENT LIABILITIES:
Accounts payable (Note 12):Trade accounts
Other
Income taxes payable
Accrued expenses
Other current liabilities
Total current liabilities
LONG-TERM LIABILITIES:
Liability for retirement benefits (Note 7)
Deferred tax liabilities (Note 9)
Other long-term liabilities
Total long-term liabilities¥79,368¥77,032¥ 6,054
1,661
434
3,241
558

¥ 7,882
1,344
1,063
3,328
870

$ 64,404
17,6704,617
34,4795,936

11,94814,487

127,106

2,261
2,259
1,468

2,295
1,136
1,436

24,05324,032
15,618

5,988

4,867

63,703

4,426
4,314
49,672

4,426
4,314
49,13947,08545,894
528,426(2,661)(2,661)(28,309)

6,364
8
(691)

3,883
(1,423)67,70285(7,351)

61,432

57,678653,532¥79,368¥77,032$844,341

COMMITMENTS AND CONTINGENT LIABILITIES(Notes 11 and 13)
EQUITY (Notes 8 and 15):
Common stock—authorized, 65,000,000 shares;
issued, 22,731,160 shares in 2013 and 2012
Capital surplus
Retained earnings
Treasury stock—at cost, 1,410,166 shares in 2013 and1,410,098 shares in 2012
Accumulated other comprehensive income:Unrealized gain on available-for-sale securities
Deferred gain on derivatives under hedge accounting
Foreign currency translation adjustments
Total equity

TOTAL

Millions of Yen
2013
2012

Thousands of
U.S. Dollars(Note 1)
2013

$844,341

TOTAL

See notes to consolidated financial statements.

-2-

EIZO Corporation (Formerly, EIZO NANAO CORPORATION) and Subsidiaries
Consolidated Statement of Income
Year Ended March 31, 2013

Millions of Yen
2013
2012

Thousands of
U.S. Dollars(Note 1)2013

NET SALES¥58,270¥59,559$619,894

COST OF SALES (Note 10)40,927

41,531

435,394

Gross profit

17,34318,028

184,500

SELLING, GENERAL AND ADMINISTRATIVE
EXPENSES (Note 10)15,286

13,623

162,617

Operating income

2,057

4,405

21,883

246
860

249
(214 )
8(395 )(403 )

2,617
9,149

OTHER INCOME (EXPENSES):Interest and dividend income
Foreign exchange gain (loss)—net
Gain on sales of investment securities
Loss on sales of investment securities
Loss on valuation of investment securities
Loss on impairment of long-lived assets (Note 6)
Refunds of EU customs duties
Other—net

(27)
(181)

(287)
(1,926)

(61)

7
40

(649)

837

(708 )

8,904

INCOME BEFORE INCOME TAXES

2,894

3,697

30,787

INCOME TAXES (Note 9):
Current
Deferred

1,070
226

1,763
297

11,383
2,404

1,296

2,060

13,787¥ 1,598¥ 1,637$ 17,000

Other income (expenses)—net

Total income taxes
NET INCOMEYen
PER SHARE OF COMMON STOCK (Note 2.s):
Basic net income
Cash dividends applicable to the year

¥74.9650.00

See notes to consolidated financial statements.

-3-

U.S. Dollars¥74.08
50.00

$0.80
0.53

EIZO Corporation (Formerly, EIZO NANAO CORPORATION) and Subsidiaries
Consolidated Statement of Comprehensive Income
Year Ended March 31, 2013

Millions of Yen
2013
2012

Thousands of
U.S. Dollars(Note 1)2013

NET INCOME¥1,598¥1,637$17,000

OTHER COMPREHENSIVE INCOME (LOSS) (Note 14):
Unrealized gain (loss) on available-for-sale securities
Deferred gain on derivatives under hedge accounting
Foreign currency translation adjustments

2,481
8
732

(352 )
1(42 )

26,394
85
7,787

3,221

(393 )

34,266COMPREHENSIVE INCOME¥4,819¥1,244$51,266

TOTAL COMPREHENSIVE INCOME ATTRIBUTABLE TO—
Owners of the parent company¥4,819¥1,244$51,266

Total other comprehensive income (loss)

See notes to consolidated financial statements.

-4-

EIZO Corporation (Formerly, EIZO NANAO CORPORATION) and Subsidiaries
Consolidated Statement of Changes in Equity
Year Ended March 31, 2013
Thousands

BALANCE, APRIL 1, 2011
Net income
Cash dividends, ¥50 per share
Net decrease in unrealized gain on available-for-sale securities
Net change in deferred loss on derivatives under hedge accounting
Net change in foreign currency translation adjustments
Purchases of treasury stock
BALANCE, MARCH 31, 2012

Number of
Shares ofCommonStock
Outstanding

CommonStockCapitalSurplusRetained
Earnings

Millions of Yen
Accumulated Other Comprehensive Income
DeferredForeign
Gain (Loss)
Unrealized
Currency
on Derivatives
Gain onTranslation
under Hedge
Available-forTreasury
Adjustments
Accounting
Sale Securities
Stock

22,321¥4,426¥4,314¥48,616¥ (999)BALANCE, MARCH 31, 2012¥(1,381)(352 )
1(42)(1,000 )21,321(1,662)
4,426

4,314

49,139(2,661)

3,883

732

1,598
(1,065)
2,481
8
732

¥ (691)¥61,432

Thousands of U.S. Dollars (Note 1)
Accumulated Other Comprehensive Income
Foreign
Deferred Gain
Unrealized
Currency
on Derivatives
Gain onTranslation
under Hedge
Available-forTreasury
Adjustments
Accounting
Sale Securities
Stock

Total
Equity8¥4,426¥4,314¥49,672

CommonStockCapitalSurplusRetained
Earnings$47,085$45,894$522,755¥(2,661)$(28,309)¥6,364¥8$41,308$(15,138)$613,595

7,787

17,000(11,329)
26,39485
7,787$ (7,351)$653,532

17,000(11,329)
26,394$ 85$47,085$45,894

See notes to consolidated financial statements.

-5-$528,426

1,637(1,114)
(352)
1
(42)
(1,662)
57,6782,481

21,321¥59,210(1,423)

1,598(1,065)

Net income
Cash dividends, $0.53 per share
Net increase in unrealized gain on available-for-sale securities
Net change in deferred gain on derivatives under hedge accounting
Net change in foreign currency translation adjustments
BALANCE, MARCH 31, 2013

¥ (1)

1,637
(1,114)

Net income
Cash dividends, ¥50 per share
Net increase in unrealized gain on available-for-sale securities
Net change in deferred gain on derivatives under hedge accounting
Net change in foreign currency translation adjustments
BALANCE, MARCH 31, 2013

¥4,235

Total
Equity$(28,309)$67,702$ 85

EIZO Corporation (Formerly, EIZO NANAO CORPORATION) and Subsidiaries
Consolidated Statement of Cash Flows
Year Ended March 31, 2013

Millions of Yen
2013
2012
OPERATING ACTIVITIES:
Income before income taxes
Adjustments for:
Income taxes—paidDepreciation and amortization
Amortization of goodwill
Provision (reversal) of allowance for doubtful receivables
Foreign exchange (gain) loss—net (Note 3)
Loss on sales of investment securities
Loss on impairment of long-lived assets
Loss on valuation of investment securities
Changes in assets and liabilities:
Decrease (increase) in notes and accounts receivable
Increase in inventories(Decrease) increase in accounts payable(Decrease) increase in accrued expenses(Decrease) increase in liability for retirement benefits
Other—net
Total adjustments

Thousands of
U.S. Dollars(Note 1)2013

¥2,894¥ 3,697$30,787(1,691)
1,188
165
17
(425)

(2,580 )
1,254
169
(15 )
165
386

(17,989)
12,6381,755
181(4,521)

181
27

403

1,926
287

4,588
(2,081)(2,218)
(362)
(61)
(85)
(757)

(4,270 )(4,623 )
967
653
15
1,042
(6,434 )48,809(22,138)(23,596)(3,851)(649)(904)(8,052)

2,137(2,737 )

22,735(270)(1,337)(567 )(679 )(2,872)(14,223)

9

2,340

96

(601)
8

(1 )
(413 )(6,394)85(2,191)

680(23,308)(1,067)(1,114 )(1,662 )(11,351)

Net cash used in financing activities(1,067)(2,776 )(11,351)

FOREIGN CURRENCY TRANSLATION ADJUSTMENT ON CASH
AND CASH EQUIVALENTS

545

(45 )

5,796

NET DECREASE IN CASH AND CASH EQUIVALENTS—(Forward)¥ (576)¥ (4,878 )$ (6,128)

Net cash provided by (used in) operating activities
INVESTING ACTIVITIES:
Purchases of property, plant, and equipment
Purchases of software and other long-lived assets (Note 3)
Proceeds from sales of short-term investments andinvestment securities
Purchases of short-term investments and investment
securities
Decrease (increase) in other assets
Net cash (used in) provided by investing activities
FINANCING ACTIVITIES:Dividends paid
Purchases of treasury stock-6-(Continued)

EIZO Corporation (Formerly, EIZO NANAO CORPORATION) and Subsidiaries
Consolidated Statement of Cash Flows
Year Ended March 31, 2013

Millions of Yen
2013
2012
NET DECREASE IN CASH AND CASH EQUIVALENTS—(Forward)¥

Thousands of
U.S. Dollars(Note 1)
2013

(576)

¥ (4,878 )$ (6,128)

CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR

16,714

21,592

177,809

CASH AND CASH EQUIVALENTS, END OF YEAR

¥16,138¥16,714$171,681

See notes to consolidated financial statements.

-7-(Concluded)

EIZO Corporation (Formerly, EIZO NANAO CORPORATION) and Subsidiaries
Notes to Consolidated Financial Statements
Year Ended March 31, 2013

1. BASIS OF PRESENTATION OF CONSOLIDATED FINANCIAL STATEMENTS
The accompanying consolidated financial statements have been prepared in accordance with theprovisions set forth in the Japanese Financial Instruments and Exchange Act and its related
accounting regulations and in accordance with accounting principles generally accepted in Japan("Japanese GAAP"), which are different in certain respects as to the application and disclosure
requirements of International Financial Reporting Standards.
In preparing these consolidated financial statements, certain reclassifications and rearrangements
have been made to the consolidated financial statements issued domestically in order to present
them in a form that is more familiar to readers outside Japan. In addition, certain reclassifications
have been made in the 2012 consolidated financial statements to conform to the classifications
used in 2013.
The consolidated financial statements are stated in Japanese yen, the currency of the country inwhich EIZO Corporation (the "Company") is incorporated and operates. The translations ofJapanese yen amounts into U.S. dollar amounts are included solely for the convenience of readers
outside Japan and have been made at the rate of ¥94 to $1, the approximate rate of exchange at
March 31, 2013. Such translations should not be construed as representations that the Japanese yenamounts could be converted into U.S. dollars at that or any other rate.
The Company has changed its corporate name from EIZO NANAO CORPORATION to EIZO
Corporation on April 1, 2013.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIESa.

Consolidation—The consolidated financial statements as of March 31, 2013, include theaccounts of the Company and its 15 (14 in 2012) subsidiaries (together, the "Group").
Under the control concept, those companies in which the Company, directly or indirectly, isable to exercise control over operations are fully consolidated.
All significant intercompany balances and transactions have been eliminated in consolidation.
All material unrealized profit included in assets resulting from transactions within the Group isalso eliminated.
During the year ended March 31, 2013, EIZO Austria GmbH has been included inconsolidation as a result of its establishment.

b.

Unification of Accounting Policies Applied to Foreign Subsidiaries for the Consolidated Financial
Statements—In May 2006, the Accounting Standards Board of Japan (the "ASBJ") issued ASBJ
Practical Issues Task Force ("PITF") No. 18, "Practical Solution on Unification of Accounting
Policies Applied to Foreign Subsidiaries for the Consolidated Financial Statements." PITF No. 18
prescribes that the accounting policies and procedures applied to a parent company and its
subsidiaries for similar transactions and events under similar circumstances should in principle
be unified for the preparation of the consolidated financial statements. However, financial-8-statements prepared by foreign subsidiaries in accordance with either International Financial
Reporting Standards or generally accepted accounting principles in the United States ofAmerica tentatively may be used for the consolidation process, except for the following items
should be adjusted in the consolidation process so that net income is accounted for inaccordance with Japanese GAAP, unless they are not material: (a) amortization of goodwill;(b) scheduled amortization of actuarial gain or loss of pensions that has been directly recordedin equity; (c) expensing capitalized development costs of research and development ("R&D");(d) cancellation of the fair value model of accounting for property, plant, and equipment andinvestment properties and incorporation of the cost model of accounting; and (e) exclusion ofminority interests from net income, if included.
c.

Business Combination—In October 2003, the Business Accounting Council issued a Statementof Opinion, "Accounting for Business Combinations," and in December 2005, the ASBJ issued
ASBJ Statement No. 7, "Accounting Standard for Business Divestitures," and ASBJ GuidanceNo. 10, "Guidance for Accounting Standard for Business Combinations and Business
Divestitures."
The accounting standard for business combinations allowed companies to apply thepooling-of-interests method of accounting only when certain specific criteria are met such thatthe business combination is essentially regarded as a uniting-of-interests. For businesscombinations that do not meet the uniting-of-interests criteria, the business combination isconsidered to be an acquisition and the purchase method of accounting is required. This
standard also prescribes the accounting for combinations of entities under common control
and for joint ventures.
In December 2008, the ASBJ issued a revised accounting standard for business combinations,
ASBJ Statement No. 21, "Accounting Standard for Business Combinations." Major accountingchanges under the revised accounting standard are as follows: (1) The revised standard
requires accounting for business combinations only by the purchase method. As a result, thepooling-of-interests method of accounting is no longer allowed. (2) The previous accounting
standard required R&D costs to be charged to income as incurred. Under the revised standard,
in-process R&D (IPR&D) costs acquired in a business combination are capitalized as anintangible asset. (3) The previous accounting standard provided for a bargain purchase gain
(negative goodwill) to be systematically amortized over a period not exceeding 20 years. Underthe revised standard, the acquirer recognizes the bargain purchase gain in profit or loss
immediately on the acquisition date after reassessing and confirming that all of the assets
acquired and all of the liabilities assumed have been identified after a review of the procedures
used in the purchase price allocation. The revised standard was applicable to businesscombinations undertaken on or after April 1, 2010.

d.

Cash Equivalents—Cash equivalents are short-term investments that are readily convertible
into cash and that are exposed to insignificant risk of changes in value.
Cash equivalents include time deposits, certificates of deposit, and commercial paper, all ofwhich mature or become due within three months of the date of acquisition.

e.

Inventories—Inventories are stated at the lower of cost, determined by the average method forfinished products and work in progress and by the moving-average method for raw materials,
or net selling value.

f.

Investment Securities—Available-for-sale securities, which represent securities not classified aseither trading securities or held-to-maturity debt securities, are reported at fair value, withunrealized gains and losses, net of applicable taxes, reported as a separate component of equity.
The cost of available-for-sale securities sold is determined based on the moving-averagemethod.
-9-

Nonmarketable available-for-sale securities are stated at cost determined by the moving-averagemethod.
For other-than-temporary declines in fair value, investment securities are reduced to net
realizable value by a charge to income.
g.

Property, Plant, and Equipment—Property, plant, and equipment are stated at cost.
Depreciation of property, plant, and equipment of the Company and its domestic subsidiaries
is computed substantially by the declining-balance method at rates based on the estimateduseful lives of the assets, while the straight-line method is applied to buildings of the Company
and its domestic subsidiaries acquired after April 1, 1998, and all property, plant, andequipment of foreign subsidiaries. The range of useful lives is principally from 15 to 50 years
for buildings and structures, from 7 to 10 years for machinery and equipment, and from 2 to 6
years for furniture and fixtures.

h.

Goodwill—Goodwill is amortized over 10 years by the straight-line method. Immaterial
goodwill may be charged entirely to income at acquisition. Amortization of goodwill is¥165 million ($1,755 thousand) and ¥169 million for the years ended March 31, 2013 and2012, respectively.

i.

Long-Lived Assets—The Group reviews its long-lived assets for impairment whenever events orchanges in circumstances indicate the carrying amount of an asset or asset group may not berecoverable. An impairment loss is recognized if the carrying amount of an asset or asset groupexceeds the sum of the undiscounted future cash flows expected to result from the continued
use and eventual disposition of the asset or asset group. The impairment loss would bemeasured as the amount by which the carrying amount of the asset exceeds its recoverable
amount, which is the higher of the discounted cash flows from the continued use and eventual
disposition of the asset or the net selling price at disposition.

j.

Retirement and Pension Plans—The Company and certain of its domestic subsidiaries have adefined contribution pension plan and unfunded retirement benefit plans. Other domestic
subsidiaries have a defined benefit pension plan and unfunded retirement benefit plans.
Certain foreign subsidiaries have either a defined contribution plan or defined benefit plan.
Additionally, the Company or its subsidiaries may add premium severance pay.
The Group accounted for the liability for retirement benefits based on the projected benefit
obligations and plan assets at the consolidated balance sheet date.
Retirement benefits to directors and Audit & Supervisory Board members are recorded at theamount that would be required if all directors and Audit & Supervisory Board members retired
at the consolidated balance sheet date. In June 2004, the retirement benefit system wasabolished and the amount required to be paid at the time of the abolishment will be paid to
directors and Audit & Supervisory Board members upon their retirement.

k.

Asset Retirement Obligations—In March 2008, the ASBJ published ASBJ Statement No. 18,"Accounting Standard for Asset Retirement Obligations," and ASBJ Guidance No. 21, "Guidanceon Accounting Standard for Asset Retirement Obligations." Under this accounting standard, an
asset retirement obligation is defined as a legal obligation imposed either by law or contractthat results from the acquisition, construction, development, and normal operation of atangible fixed asset and is associated with the retirement of such tangible fixed asset. The asset
retirement obligation is recognized as the sum of the discounted cash flows required for the
future asset retirement and is recorded in the period in which the obligation is incurred if areasonable estimate can be made. If a reasonable estimate of the asset retirement obligation
cannot be made in the period the asset retirement obligation is incurred, the liability should be- 10 -

recognized when a reasonable estimate of the asset retirement obligation can be made. Upon
initial recognition of a liability for an asset retirement obligation, an asset retirement cost is
capitalized by increasing the carrying amount of the related fixed asset by the amount of theliability. The asset retirement cost is subsequently allocated to expense through depreciation
over the remaining useful life of the asset. Over time, the liability is accreted to its present
value each period. Any subsequent revisions to the timing or the amount of the original
estimate of undiscounted cash flows are reflected as an adjustment to the carrying amount of
the liability and the capitalized amount of the related asset retirement cost.
l.

R&D Costs—R&D costs are charged to income as incurred.

m. Leases—In March 2007, the ASBJ issued ASBJ Statement No. 13, "Accounting Standard for Lease
Transactions," which revised the previous accounting standard for lease transactions. The
revised accounting standard for lease transactions was effective for fiscal years beginning on orafter April 1, 2008.
Under the previous accounting standard, finance leases that were deemed to transfer
ownership of the leased property to the lessee were to be capitalized. However, other financeleases were permitted to be accounted for as operating lease transactions if certain "as if
capitalized" information was disclosed in the notes to the lessee's financial statements. The
revised accounting standard requires that all finance lease transactions should be capitalized torecognize lease assets and lease obligations in the consolidated balance sheet. In addition, therevised accounting standard permits leases that existed at the transition date and that did nottransfer ownership of the leased property to the lessee to be accounted for as operating leasetransactions.
The Company applied the revised accounting standard effective April 1, 2008. In addition, theCompany accounted for leases that existed at the transition date and that did not transfer
ownership of the leased property to the lessee as operating lease transactions.
All other leases are accounted for as operating leases.
n.

Software Development Contracts—In December 2007, the ASBJ issued ASBJ Statement No. 15,"Accounting Standard for Construction Contracts," and ASBJ Guidance No. 18, "Guidance on
Accounting Standard for Construction Contracts."
Under this accounting standards, revenue from sales of the customized software and costs ofdevelopment of the customized software should be recognized by the percentage-ofcompletion method if the outcome of a development contract can be estimated reliably. When
total revenue, total costs, and the stage of completion of the contract at the consolidatedbalance sheet date can be reliably measured, the outcome of a development contract can be
estimated reliably. If the outcome of a development contract cannot be reliably estimated, thecompleted contract method should be applied. When it is probable that the total costs will
exceed total revenue, an estimated loss on the contract should be immediately recognized byproviding for a loss on development contracts.

o.

Income Taxes—The provision for income taxes is computed based on the pretax income
included in the consolidated statement of income. The asset and liability approach is used torecognize deferred tax assets and liabilities for the expected future tax consequences of
temporary differences between the carrying amounts and the tax bases of assets and liabilities.
Deferred taxes are measured by applying currently enacted tax laws to the temporary
differences.

- 11 -

The Group files a tax return under the consolidated corporate tax system in Japan, whichallows companies to base tax payments on the combined profits or losses of the parent
company and its wholly owned domestic subsidiaries.
p.

Foreign Currency Transactions—All short-term and long-term monetary receivables andpayables denominated in foreign currencies are translated into Japanese yen at the exchange
rates at the consolidated balance sheet date. The foreign exchange gains and losses fromtranslation are recognized in the consolidated statement of income to the extent that they are
not hedged by forward exchange contracts.

q.

Foreign Currency Financial Statements—The balance sheet accounts of the foreign subsidiaries
are translated into Japanese yen at the current exchange rate as of the balance sheet date,
except for equity, which is translated at the historical rate.
Differences arising from such translation were shown as "Foreign currency translation
adjustments" under accumulated other comprehensive income as a separate component ofequity.
Revenue and expense accounts of foreign subsidiaries are translated into Japanese yen at the
average exchange rate.

r.

Derivatives and Hedging Activities—The Group uses derivative financial instruments to manage
its exposures to fluctuations in foreign exchange. Foreign exchange forward contracts are
utilized by the Group to reduce foreign currency exchange risks. The Group does not enter into
derivatives for trading or speculative purposes.
Derivative financial instruments are classified and accounted for as follows: (1) all derivatives
are recognized as either assets or liabilities and measured at fair value with gains or losses onderivative transactions recognized in the consolidated statement of income and (2) for
derivatives used for hedging purposes, if the derivatives qualify for hedge accounting becauseof high correlation and effectiveness between the hedging instruments and the hedged items,
the gains or losses on derivatives are deferred until maturity of the hedged transactions.
Foreign currency forward contracts applied for forecasted transactions are measured at the fairvalue, but the unrealized gains or losses are deferred until the underlying transactions arecompleted.

s.

Per Share Information—Basic net income per share is computed by dividing net income
available to common shareholders by the weighted-average number of common shares
outstanding for the period.
Cash dividends per share shown in the consolidated statement of income are presented on an
accrual basis, and include interim dividends paid and year-end dividends to be approved after
the consolidated balance sheet date.
Diluted net income per share of common stock is not disclosed herein because the Company
has not issued any securities that are potentially dilutive for the years ended March 31, 2013
and 2012.

- 12 -

t.

Accounting Changes and Error Corrections—In December 2009, the ASBJ issued ASBJ Statement
No. 24, "Accounting Standard for Accounting Changes and Error Corrections," and ASBJ
Guidance No. 24, "Guidance on Accounting Standard for Accounting Changes and Error
Corrections." Accounting treatments under this standard and guidance are as follows:(1) Changes in Accounting Policies—When a new accounting policy is applied following
revision of an accounting standard, the new policy is applied retrospectively, unless the revised
accounting standard includes specific transitional provisions, in which case the entity shallcomply with the specific transitional provisions. (2) Changes in Presentation—When thepresentation of consolidated financial statements is changed, prior-period consolidated
financial statements are reclassified in accordance with the new presentation. (3) Changes in
Accounting Estimates—A change in an accounting estimate is accounted for in the period of
the change if the change affects that period only, and is accounted for prospectively if thechange affects both the period of the change and future periods. (4) Corrections of Prior-Period
Errors—When an error in prior-period consolidated financial statements is discovered, those
consolidated financial statements are restated.

u.

New Accounting Pronouncements
Accounting Standard for Retirement Benefits—On May 17, 2012, the ASBJ issued ASBJ Statement
No. 26, "Accounting Standard for Retirement Benefits" and ASBJ Guidance No. 25, "Guidanceon Accounting Standard for Retirement Benefits," which replaced the Accounting Standard for
Retirement Benefits that had been issued by the Business Accounting Council in 1998 with aneffective date of April 1, 2000, and the other related practical guidance, and followed by partial
amendments from time to time through 2009.
Major changes are as follows:(a) Treatment in the consolidated balance sheet
Under the current requirements, actuarial gains and losses and past service costs that are
yet to be recognized in profit or loss are not recognized in the consolidated balance sheet,and the difference between retirement benefit obligations and plan assets (hereinafter,"deficit or surplus"), adjusted by such unrecognized amounts, is recognized as a liability orasset.
Under the revised accounting standard, actuarial gains and losses and past service costs
that are yet to be recognized in profit or loss shall be recognized within equity(accumulated other comprehensive income), after adjusting for tax effects, and any
resulting deficit or surplus shall be recognized as a liability (liability for retirement
benefits) or asset (asset for retirement benefits).
(b) Treatment in the consolidated statement of income and the consolidated statement ofcomprehensive income
The revised accounting standard does not change how to recognize actuarial gains andlosses and past service costs in profit or loss. Those amounts would be recognized in profit
or loss over a certain period no longer than the expected average remaining working livesof the employees. However, actuarial gains and losses and past service costs that arose in
the current period and have not yet been recognized in profit or loss shall be included inother comprehensive income and actuarial gains and losses and past service costs thatwere recognized in other comprehensive income in prior periods and then recognized in
profit or loss in the current period shall be treated as reclassification adjustments.

- 13 -

(c) Amendments relating to the method of attributing expected benefit to periods and relating to thediscount rate and expected future salary increases
The revised accounting standard also made certain amendments relating to the method of
attributing expected benefit to periods and relating to the discount rate and expected
future salary increases.
This accounting standard and the guidance for (a) and (b) above are effective for the end ofannual periods beginning on or after April 1, 2013, and for (c) above are effective for the
beginning of annual periods beginning on or after April 1, 2014, or for the beginning ofannual periods beginning on or after April 1, 2015, subject to certain disclosure in March 2015,
both with earlier application being permitted from the beginning of annual periods beginningon or after April 1, 2013. However, no retrospective application of this accounting standard toconsolidated financial statements in prior periods is required.
The Company expects to apply the revised accounting standard for (a) and (b) above from theend of the annual period beginning on April 1, 2013, and for (c) above from the beginning of
the annual period beginning on April 1, 2014, and is in the process of measuring the effects ofapplying the revised accounting standard in future applicable periods.
3. CHANGES IN PRESENTATION
Prior to April 1, 2012, "Foreign exchange (gain) loss—net" was included in the other—net among
the operating activities section of the consolidated statement of cash flows. Since the accountbecame significant during this fiscal year ended March 31, 2013, such amount is disclosed
separately in the operating activities section of the consolidated statement of cash flows for theyear ended March 31, 2013. The amount included in the other—net for the year ended March 31,
2012, was ¥165 million.
Prior to April 1, 2012, "Purchases of software and other long-lived assets" was included in "Decrease(increase) in other assets" among the investment activities section of the consolidated statement ofcash flows. Since the account became significant during this fiscal year ended March 31, 2013, suchamount is disclosed separately in the investment activities section of the consolidated statement ofcash flows for the year ended March 31, 2013. The amount included in "Decrease (increase) inother assets" for the year ended March 31, 2012, was ¥679 million.
4. INVESTMENT SECURITIESInvestment securities as of March 31, 2013 and 2012, consisted of the following:

Millions of Yen
2013
2012

Thousands of
U.S. Dollars
2013

Investment securities:
Marketable equity securities
Nonmarketable equity securities
Debt securities
Others¥14,692
16304
33¥10,72216
40$156,298
170
3,234
351

Total

¥15,045¥10,778$160,053- 14 -

The cost and aggregate fair value of the securities classified as available for sale at March 31, 2013
and 2012, were as follows:
Millions of Yen
Unrealized Unrealized
Gains
LossesFair
Value

March 31, 2013

Cost

Securities classified as available for sale:
Equity securities
Debt securities
Others¥4,954300
33¥9,8844¥ 146¥14,692
304
33

Total

¥5,287¥9,888¥ 146¥15,029

Securities classified as available for sale:
Equity securities
Others¥4,68041¥6,509¥ 467
1¥10,72240

Total¥4,721¥6,509¥ 468¥10,762

March 31, 2012

March 31, 2013

Cost

Thousands of U.S. Dollars
Unrealized Unrealized
Gains
LossesFair
Value

Securities classified as available for sale:
Equity securities
Debt securities
Others$52,702
3,191
348$105,149
43
3$1,553$156,298
3,234
351

Total

$56,241$105,195$1,553$159,883

The proceeds from sales of available-for-sale securities for the year ended March 31, 2012, were¥113 million. The gross realized gains and losses on these sales, computed on the moving-average
cost basis, for the year ended March 31, 2012, were ¥8 million and ¥395 million, respectively.
The impairment loss on available-for-sale equity securities for the years ended March 31, 2013 and2012, was ¥27 million ($287 thousand) and ¥403 million, respectively.
5. INVENTORIESInventories at March 31, 2013 and 2012, consisted of the following:

Millions of Yen
2013
2012

Thousands of
U.S. Dollars
2013

Finished products
Work in process
Raw materials and supplies¥ 6,592
4,628
9,536

¥ 4,982
5,043
7,882

$ 70,128
49,234
101,447

Total¥20,756¥17,907$220,809- 15 -

6. LONG-LIVED ASSETS
The total loss on impairment of long-lived assets at March 31, 2013, amounted to ¥181 million($1,926 thousand), which was a write-down of buildings and land. The Group decided to sell theseassets in the future, and thus the recoverable amount was measured at its net selling value.
7. RETIREMENT AND PENSION PLANS
The Company and its certain subsidiaries have severance payment plans for employees, directors,
and Audit & Supervisory Board members.
Under most circumstances, employees terminating their employment are entitled to retirement
benefits determined based on the rate of pay at the time of termination, years of service, andcertain other factors. Such retirement benefits are given in the form of a lump-sum severance
payment from the Company or from certain subsidiaries and annuity payments from theCompany, certain subsidiaries, or a trustee. Employees of the Company or certain subsidiaries areentitled to larger payments if the termination is involuntary, by retirement at the mandatory
retirement age, by death, or by voluntary retirement at certain specific ages prior to the mandatory
retirement age.
The liability for employees' retirement benefits at March 31, 2013 and 2012, consisted of thefollowing:

Millions of Yen
2013
2012

Thousands of
U.S. Dollars
2013

Projected benefit obligation
Fair value of plan assets
Unrecognized actuarial loss

¥3,310(886)(265)¥3,388(1,044 )(155 )$35,213(9,426)(2,819)Net liability¥2,159¥2,189$22,968

The components of net periodic benefit costs for the years ended March 31, 2013 and 2012, are as
follows:

Millions of Yen
2013
2012
Service cost
Interest cost
Expected return on plan assets
Recognized actuarial loss (gain)

¥332
37

Net periodic benefit costs

Thousands of
U.S. Dollars
2013

21

¥ 378
65
(13 )
(8 )

$3,532
394
(1)
223

¥390

¥ 422

$4,148Assumptions used for the years ended March 31, 2013 and 2012, are as follows:

Discount rate
Expected rate of return on plan assets
Recognition period of actuarial gain/loss- 16 -

20132012

0.5%–3.5%
0.0%
5 years

1.0%–5.3%
0.5%–2.5%
5 years

The liability for retirement benefits at March 31, 2013 and 2012, for directors and Audit &Supervisory Board members was ¥102 million ($1,085 thousand) and ¥106 million, respectively.
8. EQUITY
Japanese companies are subject to the Companies Act of Japan (the "Companies Act"). The
significant provisions in the Companies Act that affect financial and accounting matters are
summarized below:a.

Dividends
Under the Companies Act, companies can pay dividends at any time during the fiscal year in
addition to the year-end dividend upon resolution at the shareholders' meeting. For companies
that meet certain criteria, such as (1) having a board of directors, (2) having independent
auditors, (3) having an Audit & Supervisory Board, and (4) the term of service of the directors
is prescribed as one year rather than two years of normal term by its articles of incorporation,
the board of directors may declare dividends (except for dividends in kind) at any time during
the fiscal year if the company has prescribed so in its articles of incorporation. The Company
meets all of the above criteria.
The Companies Act permits companies to distribute dividends in kind (noncash assets) toshareholders subject to certain limitations and additional requirements.
Semiannual interim dividends may also be paid once a year upon resolution by the board of
directors if the articles of incorporation of the company so stipulate. The Companies Act
provides certain limitations on the amounts available for dividends or the purchase of treasury
stock. The limitation is defined as the amount available for distribution to the shareholders,
but the amount of net assets after dividends must be maintained at no less than ¥3 million.

b.

Increases/Decreases and Transfer of Common Stock, Reserve, and Surplus
The Companies Act requires that an amount equal to 10% of dividends must be appropriatedas a legal reserve (a component of retained earnings) or as additional paid-in capital (acomponent of capital surplus), depending on the equity account charged upon the payment ofsuch dividends, until the total of the aggregate amount of the legal reserve and additional
paid-in capital equals 25% of the amount of common stock. Under the Companies Act, thetotal amount of additional paid-in capital and legal reserve may be reversed without limitation.
The Companies Act also provides that common stock, legal reserve, additional paid-in capital,
other capital surplus, and retained earnings can be transferred among the accounts undercertain conditions upon resolution of the shareholders.

c.

Treasury Stock and Treasury Stock Acquisition Rights
The Companies Act also provides for companies to purchase treasury stock and dispose of suchtreasury stock by resolution of the board of directors. The amount of treasury stock purchased
cannot exceed the amount available for distribution to the shareholders which is determinedby specific formula.
Under the Companies Act, stock acquisition rights are presented as a separate component ofequity.

- 17 -

The Companies Act also provides that companies can purchase both treasury stock acquisitionrights and treasury stock. Such treasury stock acquisition rights are presented as a separate
component of equity or deducted directly from stock acquisition rights.
9. INCOME TAXESThe Company and its domestic subsidiaries are subject to Japanese national and local income taxes
that, in the aggregate, resulted in normal effective statutory tax rates of approximately 37.8% and40.4% for the years ended March 31, 2013 and 2012, respectively.
The tax effects of significant temporary differences and tax loss carryforwards that resulted indeferred tax assets and liabilities at March 31, 2013 and 2012, are as follows:

Millions of Yen
2013
2012

Thousands of
U.S. Dollars
2013

Deferred tax assets:
Inventories
Pension and severance costs
Tax loss carryforwards
Accrued expenses
Other
Less valuation allowance

¥ 909
723
1,906
723
1,816
(2,866)

¥ 820
741
1,348
994
1,975
(2,446 )$ 9,670
7,691
20,277
7,691
19,320(30,489)

Total

3,211

3,432

34,160(3,379)(46)(2,158 )(47 )(35,947)(489)(3,425)(2,205 )(36,436)¥ (214)¥1,227$ (2,276)

Deferred tax liabilities:
Unrealized gain on available-for-sale securities
Other
Total
Net deferred tax assets

Deferred tax assets and liabilities were included in the consolidated balance sheet as follows:

Millions of Yen
2013
2012

Thousands of
U.S. Dollars
2013

Current assets—Deferred tax assets
Investments and other assets—Deferred tax assets
Current liabilities—Other current liabilities
Long-term liabilities—Deferred tax liabilities¥1,775297(27)(2,259)¥2,077319(33 )(1,136 )$18,883
3,160(287)(24,032)

Net deferred tax assets¥ (214)¥1,227$ (2,276)- 18 -

A reconciliation between the normal effective statutory tax rates and the actual effective tax rates
reflected in the accompanying consolidated statement of income for the year ended March 31,
2013, with the corresponding figures for and 2012 is as follows:
2013

2012

Normal effective statutory tax rate
Tax credit for research expenses
Increase in valuation allowance
Effect of tax rate reduction
Other—net

37.8%
(4.1)
14.4
(3.3)

40.4%
(6.1)
9.4
8.1
3.9

Actual effective tax rate

44.8%

55.7%

On December 2, 2011, new tax reform laws were enacted in Japan, which changed the normal
effective statutory tax rate from approximately 40.4% to 37.8%, effective for the fiscal years
beginning on or after April 1, 2012 through March 31, 2015, and to 35.4% afterwards.
At March 31, 2013, certain subsidiaries have tax loss carryforwards aggregating approximately¥7,267 million ($77,307 thousand) that are available to be offset against taxable income of such
subsidiaries in future years. These tax loss carryforwards, if not utilized, will expire as follows:Year Ending
March 31

10.

Millions of Yen

Thousands of
U.S. Dollars

2015
2016
2017
2018
2019 and thereafter

¥

54
107
96
21
6,989

$

574
1,138
1,021
223
74,351

Total¥7,267$77,307

R&D COSTS
R&D costs charged to income were ¥5,323 million ($56,628 thousand) and ¥5,311 million for theyears ended March 31, 2013 and 2012, respectively.

11.

LEASES
The minimum rental commitments under noncancelable operating leases at March 31, 2013 and2012, were as follows:

Millions of Yen
2013
2012

Thousands of
U.S. Dollars
2013

Due within one year
Due after one year

¥239
644

¥ 94
142

$2,543
6,851

Total

¥883

¥ 236

$9,394- 19 -

12.

FINANCIAL INSTRUMENTS AND RELATED DISCLOSURES(1) Group Policy for Financial Instruments
The Group uses financial instruments based on its capital expenditure plan. Cash surpluses, ifany, are invested in low-risk financial assets. Derivatives are used, not for speculative purposes,
but to manage exposure to financial risks as described in (2) below.
(2) Nature and Extent of Risks Arising from Financial Instruments
Receivables such as trade notes and trade accounts, are exposed to customer credit risk.
Although receivables in foreign currencies are exposed to the risk of fluctuation in foreign
currency exchange rates, the position, net of payables in foreign currencies, is hedged by using
forward foreign currency contracts. Marketable and investment securities, mainly debt
securities and equity instruments of customers and suppliers of the Group, are exposed to therisk of market price fluctuations.
All payment terms of payables, such as trade accounts, are due within one year. Althoughpayables in foreign currencies are exposed to the risk of fluctuation in foreign currency
exchange rates, those risks are netted against the balance of receivables denominated in thesame foreign currency, as noted above.
Derivatives mainly include forward foreign currency contracts that are used to manage
exposure to risk of changes in foreign currency exchange rates of receivables and payables.
Please see Note 13 for more details about derivatives.
(3) Risk Management for Financial Instruments
Credit risk management
Credit risk is the risk of economic loss arising from a counterparty's failure to repay or service
debt according to the contractual terms. The Group manages its credit risk from receivables on
the basis of internal guidelines, which include monitoring of payment terms and balances ofmajor customers by each business administration department to identify the default risk ofcustomers at an early stage. With respect to debt securities, the Group manages its exposure tocredit risk by limiting its funding to high-credit rating bonds in accordance with in its internal
guidelines. Please see Note 13 for information about derivatives.
The maximum credit risk exposure of financial assets is limited to their carrying amounts as ofMarch 31, 2013.
Market risk management (foreign exchange risk and interest rate risk)
Foreign currency trade receivables and payables are exposed to fluctuations in foreign currency
exchange rates. Such foreign exchange risk is hedged occasionally by forward foreign currency
contracts.
Marketable and investment securities are managed by monitoring the market values andfinancial position of issuers on a regular basis.
The basic principles of derivative transactions have been approved by the chief financial officer
based on internal guidelines that prescribe the authority and the limit for each transaction by
the corporate treasury department. Reconciliation of the transaction and balances withcustomers is made and the transaction data is reported to the chief financial officer on amonthly basis.
- 20 -

Liquidity risk management
Liquidity risk comprises the risk that the Group cannot meet its contractual obligations in fullon maturity dates. The Group manages its liquidity risk by holding adequate volumes of liquid
assets along with adequate financial planning by the corporate treasury department.
(4) Concentration of Credit Risk
As of March 31, 2013, 16.6% of total receivables are from specific major customers of theGroup.
(5) Fair Values of Financial Instruments
Fair values of financial instruments are based on quoted prices in active markets. If quoted
prices are not available, other rational valuation techniques are used instead.
(a) Fair value of financial instruments
Millions of Yen
March 31, 2013

Carrying
AmountCash and cash equivalents
Notes and accounts receivables
Allowance for doubtful receivables
Notes and accounts receivables (net)
Investment securities¥16,138
12,878(90)
12,78815,028¥16,138

Total¥43,954¥43,954

Accounts payable¥ 7,715¥ 7,715

Total¥ 7,715¥ 7,715

Derivatives

¥

¥

(4)

Fair Value

12,78815,028(4 )March 31, 2012
Cash and cash equivalents
Notes and accounts receivables
Allowance for doubtful receivables
Notes and accounts receivables (net)
Short-term investments and investment
securities¥16,714
17,089(68)
17,021¥16,714

10,761

10,761

Total¥44,496¥44,496

Accounts payable¥ 9,226¥ 9,226

Total¥ 9,226¥ 9,226- 21 -

17,021

Unrealized
Gain/LossMarch 31, 2013

Thousands of U.S. Dollars
Carrying
Unrealized
AmountFair Value
Gain/Loss

Cash and cash equivalents
Notes and accounts receivables
Allowance for doubtful receivables
Notes and accounts receivables (net)
Investment securities$171,681
137,000(957)
136,043
159,872$ 171,681

Total$467,596$ 467,596

Accounts payable$ 82,074$ 82,074

Total$ 82,074$ 82,074

Derivatives

$

$

(43)

136,043
159,872(43 )Cash and Cash Equivalents
The carrying values of cash and cash equivalents approximate fair value because of theirshort maturities.
Notes and Accounts Receivables
The carrying values of notes and accounts receivables approximate fair value because of
their short-term settlement.
Short-Term Investments and Investment Securities
The fair values of short-term investments and investment securities are measured at thequoted market price of the stock exchange for equity instruments and at the quoted priceobtained from financial institution for certain debt instruments. Information on the fairvalue for the short-term investments and investment securities by classification is includedin Note 4.
Accounts Payable
The carrying values of accounts payable approximate fair value because of their short-term
settlement.
Derivatives
The information of the fair value for derivatives is included in Note 13.
(b) Carrying amount of financial instruments whose fair value cannot be reliably determined

Millions of Yen
2013
2012
Investments in equity instruments that do nothave a quoted market price in an active market- 22 -¥16¥ 16

Thousands of
U.S. Dollars
2013

$ 170

(6) Maturity Analysis for Financial Assets and Securities with Contractual Maturities

Due in1 Yearor Less

March 31, 2013
Cash and cash equivalents
Receivables
Investment securities—Corporate bonds¥16,133
12,878Total¥29,011

Millions of Yen
Due after
Due after
5 Years
1 Yearthroughthrough
10 Years
5 Years

Due after
10 Years

¥304
¥304

March 31, 2012
Cash and cash equivalents
Receivables¥16,710
17,089Total¥33,799

Due in1 Yearor Less

March 31, 201313.

Cash and cash equivalents
Receivables
Investment securities—Corporate bonds$171,628
137,000

Total$308,628

Thousands of U.S. Dollars
Due after
Due after
5 Years
1 YearthroughDue after
through
10 Years
10 Years
5 Years$3,234$3,234DERIVATIVESThe Group enters into derivative contracts, including foreign currency forward contracts, to hedge
foreign exchange risk associated with certain assets and liabilities denominated in foreign
currencies.
All derivative transactions are entered into to hedge foreign currency exposures incorporated
within the Group's business. Accordingly, market risk in these derivatives is basically offset by
opposite movements in the value of hedged assets or liabilities.
Because the counterparties to these derivatives are limited to major international financial
institutions, the Group does not anticipate any losses arising from credit risk.
Derivative transactions entered into by the Group have been made in accordance with internal
policies that regulate the authorization and credit limit amount.

- 23 -

Derivative Transactions to Which Hedge Accounting Is Not Applied
Derivative transactions to which hedge accounting is not applied at March 31, 2013, are as follows:

March 31, 2013

Contract
AmountMillions of Yen
Contract
AmountDue after
Fair
1 YearValue

Foreign currency forward contracts—
Selling Euro

¥1,345¥ (17 )

Unrealized
Gain/Loss¥ (17)March 31, 2013

Thousands of U.S. Dollars
Contract
AmountDue after
Fair
Unrealized
Contract
1 YearValue
Gain/Loss
AmountForeign currency forward contracts—
Selling Euro

$14,309$ (181 )$ (181)

The fair value of derivative transactions is measured at the quoted price obtained from financial
institutions.
There were no derivative transactions at March 31, 2012.
Derivative Transactions to Which Hedge Accounting Is Applied
Derivative transactions to which hedge accounting is applied at March 31, 2013, are as follows:

March 31, 2013
Foreign currency forward
contracts—Selling Swiss franc

March 31, 2013
Foreign currency forward
contracts—Selling Swiss franc

Hedged Item

Forecast transactions

Hedged Item

Forecast transactions

Millions of Yen
Contract
AmountDue after
Fair
Contract
1 YearValue
Amount

¥ 460

¥ 13

Thousands of U.S. Dollars
Contract
AmountDue after
Fair
Contract
1 YearValue
Amount$4,894$ 138

The fair value of derivative transactions is measured at the quoted price obtained from financial
institutions.
There were no derivative transactions at March 31, 2012.

- 24 -

The contract or notional amounts of derivatives that are shown in the above table do not represent
the amounts exchanged by the parties and do not measure the Group's exposure to credit ormarket risk.
14.

COMPREHENSIVE INCOME
The components of other comprehensive income and loss for the years ended March 31, 2013 and2012, were as follows:
Thousands of
U.S. Dollars
2013

Millions of Yen
2013
2012
Unrealized gain (loss) on available-for-sale securities:
Gains (losses) arising during the year
Reclassification adjustments to profit or loss
Amount before income tax effect
Income tax effect
Total
Deferred gain on derivatives under hedge accounting:
Gains arising during the year
Reclassification adjustments to profit or loss
Amount before income tax effect
Income tax effectTotal¥ (1,908 )
790(1,118 )766$39,096287
39,383(12,989)¥2,481¥ (352 )$26,394¥

Total
Total other comprehensive income (loss)

13

$
¥

1
1

13
(5)
¥

Foreign currency translation adjustments:
Adjustments arising during the year
Amount before income tax effect
Income tax effect15.

¥3,67527
3,702(1,221)

138
138
(53)

8

¥

1

$

85

¥ 732
732

¥

(42 )
(42 )

$ 7,787
7,787

¥ 732

¥

(42 )

$ 7,787¥3,221¥ (393 )$34,266

SUBSEQUENT EVENT
The following appropriation of retained earnings at March 31, 2013, was approved at the board of
directors' meeting held on May 21, 2013:

Year-end cash dividends, ¥25 ($0.3) per share- 25 -

Millions of Yen

Thousands of
U.S. Dollars¥533$5,67016.

SEGMENT INFORMATION
Under ASBJ Statement No. 17, "Accounting Standard for Segment Information Disclosures," andASBJ Guidance No. 20, "Guidance on Accounting Standard for Segment Information Disclosures,"an entity is required to report financial and descriptive information about its reportable segments.
Reportable segments are operating segments or aggregations of operating segments that meet
specified criteria. Operating segments are components of an entity about which separate financial
information is available, and such information is evaluated regularly by the chief operating
decision maker in deciding how to allocate resources and in assessing performance. Generally,
segment information is required to be reported on the same basis as is used internally forevaluating operating segment performance and deciding how to allocate resources to operating
segments.
(1) Description of Reportable Segments
The Group is primarily engaged in the manufacture, development, and sale of visual display
systems and related products. The Group consists of the single industry, and therefore, it is not
required to disclose separate financial information by segment.
(2) Information about Products and Services

Monitor for
Computer Use
Sales to external customers

Millions of Yen
2013
Amusement
Monitor
Other¥30,690

Monitor for
Computer Use
Sales to external customers¥18,074¥9,506¥58,270

Millions of Yen
2012
Amusement
Monitor
Other

Total

¥31,611¥20,545¥7,403Thousands of U.S. Dollars
2013
Monitor for
Amusement
Computer Use
Monitor
Other
Sales to external customers$326,489

Total$192,277$ 101,128¥59,559

Total$619,894(3) Information about Geographical Areas(a) Sales

Japan

EuropeMillions of Yen
2013
North
America¥39,055¥14,297¥3,038- 26 -

Other

Total

¥1,880¥58,270

JapanEuropeMillions of Yen
2012
North
America¥38,838¥15,577¥2,917¥2,227¥59,559

Japan

EuropeThousands of U.S. Dollars
2013
North
America

Other

Total

$ 415,479$ 152,096$32,319$20,000$619,894

Other

Total

Note: Sales are classified in countries or regions based on location of customers.
(b) Property, plant, and equipment
The amount of property, plant, and equipment that exist in Japan exceeds 90% of theamount of property, plant, and equipment in the consolidated balance sheet, and thus,
there is no requirement to disclose such information.
(4) Information about Major Customers

Name of Customers

Millions of Yen
2013
Sales

JT Japan Technicals¥23,132

Name of Customers

Millions of Yen
2012
Sales

JT Japan Technicals
AVNET Technology Solutions GmbH

¥22,756
6,388

Name of Customers

Thousands of
U.S. Dollars
2013
Sales

JT Japan Technicals$246,085******- 27 -