Consolidated Balance Sheet
Mizuho Leasing Company, Limited and Consolidated Subsidiaries
As of March 31, 2020
Thousands of
U.S. dollars(Note 1)Millions of yen
2019

2020
ASSETS
Current Assets:
Cash and Cash Equivalents
Lease Receivables and Investments in Lease (Notes 3 and 4)
Receivables (Notes 3 and 4):
Notes and Accounts
Lease
Installment Sales
Loans
Factoring
Other
Total Receivables
Operational Investment Securities (Notes 3 and 4)
Prepaid Expenses and Other
Allowance for Doubtful Receivables
Total Current Assets¥

Property and Equipment:
Leased Assets (Notes 3 and 4)
Advances for Purchases of Leased Assets
Other Operating Assets
Own-used Assets (Note 4)
Total Property and Equipment
Investments and Other Assets:
Investment Securities (Note 4)
Investments in Unconsolidated Subsidiaries
and Associated Companies
Long-term Receivables
Goodwill
Intangible Leased Assets (Note 3)
Deferred Tax Assets
Asset for Employees' Retirement Benefits
Other
Allowance for Doubtful Receivables
Total Investments and Other Assets
Total Assets¥

See accompanying Notes to Consolidated Financial Statements.
1

22,2991,082,088¥

25,438930,3182020$

204,898
9,942,922

886
6,560
141,812271,323
129,676
550,260
221,866
72,510(1,752)
1,947,272

1,015
3,336
147,979
235,279
233,106
750
621,467
239,814
51,121(1,555)
1,866,604

8,143
60,2871,303,068
2,493,092
1,191,554
5,056,144
2,038,653
666,273(16,101)
17,892,789

245,533
656
3,455
249,646

229,817
6,042
6,311
3,360
245,5312,256,121
6,035
31,7532,293,909

20,776
98,355

18,215
13,770190,910
903,749

5,448
63
101
2,609
24,629(487)
151,497
2,348,416

3,432
528
82
2,338
11
11,573(215)
49,7362,161,872

50,065588
936
23,979226,312(4,480)1,392,059
21,578,757¥$

Consolidated Balance Sheet
Mizuho Leasing Company, Limited and Consolidated Subsidiaries
As of March 31, 2020
Thousands of
U.S. dollars(Note 1)Millions of yen
2019

2020
LIABILITIES and EQUITYCurrent Liabilities:
Short-term Borrowings (Notes 4 and 5)
Current Portion of Long-term Debt (Notes 4 and 5)
Lease Payable
Accounts Payable - trade
Accrued Expenses
Income Taxes Payable
Deferred Profit on Installment Sales (Note 3)
Reserve for Management Board Benefit Trust - current
Accruals for Debt Guarantees
Other
Total Current Liabilities¥

Long-term Liabilities:
Long-term Debt (Note 4 and 5)
Deposits Received
Liability for Employees' Retirement Benefits
Reserve for Management Board Benefit Trust
Other
Total Long-term Liabilities¥

1,031,075
185,358
8,772
49,318
3,455
4,098
2,097
56
15
29,875
1,314,1232020

994,386
197,959
8,010
56,040
3,561
4,654
2,091
31
27,442
1,294,178$

9,474,183
1,703,196
80,606453,169
31,751
37,663
19,273514
138
274,516
12,075,009

784,202
31,2962,655
211
20,147
838,512642,411
33,217
2,461
144
7,299
685,534

7,205,753
287,571
24,3991,939
185,127
7,704,789

26,08826,088

239,714

Capital Surplus
Retained Earnings

23,941
131,579

23,941
118,219

219,990
1,209,035

Treasury Stock - at cost

(1,745)(400)(16,040)

7,430(1,060)(1,005)(41)
185,186
10,594
195,780
2,348,416

6,755
(502)
(577)
109
173,633
8,526
182,159
2,161,872

68,280(9,744)(9,237)(384)
1,701,614
97,345
1,798,959
21,578,757

Contingent Liabilities (Note 6)
Equity:Common Stock
Authorized, 140,000,000 Shares;
Issued, 49,004,000 Shares as of March 31, 2020 and 2019

640,003 shares as of March 31, 2020 and
147,127 shares as of March 31, 2019
Accumulated Other Comprehensive Income:Unrealized Gain on Available-for-sale Securities
Deferred Loss on Derivatives under Hedge Accounting
Foreign Currency Translation Adjustments
Defined Retirement Benefit Plans
Total
Non-controlling Interests
Total Equity
Total Liabilities and Equity¥

See accompanying Notes to Consolidated Financial Statements.
2¥$

Consolidated Statement of Income
Mizuho Leasing Company, Limited and Consolidated Subsidiaries
For the year ended March 31, 2020
Thousands of
U.S. dollars(Note 1)Millions of yen
2020

2019

¥ 539,241¥ 384,893

Cost and Expenses
Gross Profit

488,722
50,519340,765
44,1284,490,699
464,202

Selling, General and Administrative Expenses
Operating Income

24,243
26,27521,21422,913

222,766
241,436

Other Income (Expenses):
Interest Income
Dividend Income
Equity in Earnings of Associated Companies
Profit from Investments
Interest Expenses
Foreign Exchange Loss
Bond Issuance Costs
Stock Issuance Costs
Gain on Sales of Investment Securities
Gain on Step Acquisition
Loss on Devaluation of Investment Securities
Loss on Impairment of Long-lived Assets (Note 7)
Other ─ net
Income before Income Taxes

47
463
816
17
(700)
(87)
(268)
481
(336)
(322)
151
26,538

5
515
332
1,512
(526)
(109)
(345)
(143)
908
42
(53)
(8)
71
25,114

434
4,259
7,507
162
(6,441)(808)(2,469)4,426(3,088)(2,959)1,394
243,853

Income Taxes:
Current
Deferred
Total

8,506
(55)
8,450

7,581
327
7,909

78,164(514)
77,650Net Income
Net Income attributable to Non-controlling Interests
Net Income attributable to Owners of the Parent

18,087574
17,512

17,205611
16,594

166,203
5,283
160,920

Revenues

¥

¥

2020

See accompanying Notes to Consolidated Financial Statements.
3

4,954,901$

U.S. dollars(Note 1)

Yen

Amounts per Share of Common Stock (Note 8)
Net Income attributable to Owners of the Parent per Share

$

2020

2019

¥ 360.49¥ 388.64

2020
$

3.31

Consolidated Statement of Comprehensive Income
Mizuho Leasing Company, Limited and Consolidated Subsidiaries
For the year ended March 31, 2020
Thousands of
U.S. dollars(Note 1)Millions of yen

Net Income

2020

2019

¥

¥

Other Comprehensive Loss:
Unrealized Gain (Loss) on Available-for-sale Securities
Deferred Loss on Derivatives under Hedge Accounting
Foreign Currency Translation Adjustments
Defined Retirement Benefit Plans
Share of Other Comprehensive Income (Loss) in Associated Companies
Total Other Comprehensive Loss

18,087

17,2052020$(2,295)(647)(1,223)64(40)(4,142)

686
(559)
(599)
(154)
112
(513)

166,203

6,310(5,142)(5,508)(1,416)
1,037(4,719)Comprehensive Income¥

17,574¥

13,062$

161,484

Total Comprehensive Income attributable to:
Owners of the Parent
Non-controlling Interests¥

17,051522¥

12,519543$

156,679
4,805

See accompanying Notes to Consolidated Financial Statements.
4Consolidated Statement of Changes in Equity
Mizuho Leasing Company, Limited and Consolidated Subsidiaries
For the year ended March 31, 2020

Balance as of April 1, 2018
Net Income attributable to Ownersof the Parent
Cash Dividends Paid
Purchase of Treasury Stock
Disposal of Treasury Stock
Issuance of New Stock
Change in Scope of Consolidation
Change in Scope of Applicationof Equity Method
Change in an Interest in Subsidiary bySales Transaction
Change in an Interest in Subsidiary due
to Transactions with Non-controlling
Interests
Net change during year
Balance as of March 31, 2019
Net Income attributable to Ownersof the Parent
Cash Dividends Paid
Purchase of Treasury Stock
Disposal of Treasury Stock
Issuance of New Stock
Change in Scope of Consolidation
Change in Scope of Applicationof Equity Method
Change in an Interest in Subsidiary bySales Transaction
Change in an Interest in Subsidiary due
to Transactions with Non-controlling
Interests
Net change during year
Balance as of March 31, 2020

Thousands
Number ofshares ofCommon Stock
Outstanding
42,648Millions of yen
CommonStockCapitalSurplus¥ 17,874¥ 16,070

8,213

8,213

Retained
Earnings¥ 105,148
16,594(3,241)

6,208

Treasury Stock
¥ (1)

(399)

(282)
(59)
(283)

48,856¥ 26,088¥ 23,941¥ 118,219
17,512¥ (400)(3,920)(543)
50(1,483)137(232)

48,363¥ 26,088¥ 23,941¥ 131,579¥ (1,745)

Millions of yen

Balance as of April 1, 2018
Net Income attributable to Ownersof the Parent
Cash Dividends Paid
Purchase of Treasury Stock
Disposal of Treasury Stock
Issuance of New Stock
Change in Scope of Consolidation
Change in Scope of Applicationof Equity Method
Change in an Interest in Subsidiary bySales Transaction
Change in an Interest in Subsidiary due
to Transactions with Non-controlling
Interests
Net change during year
Balance as of March 31, 2019
Net Income attributable to Ownersof the Parent
Cash Dividends Paid
Purchase of Treasury Stock
Disposal of Treasury Stock
Issuance of New Stock
Change in Scope of Consolidation
Change in Scope of Applicationof Equity Method
Change in an Interest in Subsidiary bySales Transaction
Change in an Interest in Subsidiary due
to Transactions with Non-controlling
Interests
Net change during year
Balance as of March 31, 2020

Accumulated Other Comprehensive Income
Unrealized
Deferred Loss
ForeignDefinedGain onon Derivatives
Currency
Retirement
Available-for-sale
under Hedge
Translation
Benefit Plans
Securities
Accounting
Adjustments¥ 9,047
¥ 141
¥ 621
¥ 48

(2,292)¥ 6,755675¥ 7,430(644)¥ (502)(557)¥ (1,060)(1,198)¥ (577)(428)¥ (1,005)

Noncontrolling
Interests

Total¥ 148,951
16,59461¥ 109¥ 154,632
16,594(3,241)(399)(3,241)(399)

16,427

16,427

(282)

(282)

(59)

(59)

(283)

(283)

(4,074)¥ 173,633
17,512(151)¥ (41)¥ 5,681

Total Equity

2,845¥ 8,526(1,229)¥ 182,159
17,512(3,920)(1,483)137(3,920)(1,483)
137

(232)

(232)

(461)
¥ 185,186

2,067¥ 10,594

1,605¥ 195,780

Thousands of U.S. dollars (Note 1)
CommonStock
Balance as of March 31, 2019
Net Income attributable to Ownersof the Parent
Cash Dividends Paid
Purchase of Treasury Stock
Disposal of Treasury Stock
Issuance of New Stock
Change in Scope of Consolidation
Change in Scope of Applicationof Equity Method
Change in an Interest in Subsidiary bySales Transaction
Change in an Interest in Subsidiary due
to Transactions with Non-controlling
Interests
Net change during year
Balance as of March 31, 2020

$ 239,714

CapitalSurplusRetained
Earnings$ 219,990$ 1,086,274
160,920

Treasury Stock$ (3,679)(36,022)(13,628)
1,267(2,137)$ 239,714$ 219,990$ 1,209,035$ (16,040)

Thousands of U.S. dollars (Note 1)

Balance as of March 31, 2019
Net Income attributable to Ownersof the Parent
Cash Dividends Paid
Purchase of Treasury Stock
Disposal of Treasury Stock
Issuance of New Stock
Change in Scope of Consolidation
Change in Scope of Applicationof Equity Method
Change in an Interest in Subsidiary bySales Transaction
Change in an Interest in Subsidiary due
to Transactions with Non-controlling
Interests
Net change during year
Balance as of March 31, 2020

Accumulated Other Comprehensive Income
Deferred Loss
ForeignDefinedon Derivatives
Currency
Retirement
under Hedge
Translation
Benefit Plans
Accounting
Adjustments$ (4,620)$ (5,302)$ 1,007

Unrealized
Gain onAvailable-for-sale
Securities$ 62,070

6,210$ 68,280(5,124)$ (9,744)(3,935)$ (9,237)(1,391)$ (384)

Total$ 1,595,454
160,920

Noncontrolling
Interests$ 78,348

Total Equity$ 1,673,802
160,920(36,022)(13,628)1,267(36,022)(13,628)
1,267(2,137)(2,137)(4,240)$ 1,701,614

See accompanying Notes to Consolidated Financial Statements.
518,997$ 97,345

14,757$ 1,798,959

Consolidated Statement of Cash Flows
Mizuho Leasing Company, Limited and Consolidated Subsidiaries
For the year ended March 31, 2020
Thousands of
U.S. dollars(Note 1)Millions of yen
2019

2020

2020

Cash Flows from Operating Activities:¥

Income before Income Taxes
Adjustments for:
Income Taxes Paid
Depreciation and Disposal of Fixed Assets
Equity in Earnings of Associated Companies
Profit from Investments
Loss on Impairment of Long-lived Assets
Increase (Decrease) in Allowance for Doubtful Receivables(Decrease) Increase in Accruals for Debt Guarantees
Gain on Sales of Marketable and Investment Securities
Loss on Devaluation of Investment Securities
Change in assets and liabilities:

26,538¥25,114$

243,853(9,059)15,108
(816)
(17)
322
468
(16)
(481)
336

(4,938)13,227(332)(1,512)8(1,022)
4(908)
53(83,242)
138,824(7,507)
(162)
2,959
4,304
(152)
(4,426)
3,088(151,648)
70,804
15,524(6,693)(181,931)
158,161(58)(5,670)(95,668)(69,130)(107,665)(105,120)(43,330)1,739(42)(120,504)
38,874
193
10,461(320,816)(295,701)(1,393,440)
650,601
142,650(61,508)(1,671,704)
1,453,287(535)(52,105)(879,068)(635,215)(3,032)(3,368)(27,867)(84,559)
1,527(9,812)6,434(776,983)
14,037

-

(711)

-

Other ─ net
Net Cash Used in Investing Activities(12,272)(98,336)(487)(7,945)(112,763)(903,576)

Cash Flows from Financing Activities:
Net Increase in Short-term Borrowings
Proceeds from Long-term Debt
Repayments of Long-term Debt
Proceeds from Common Stock IssuanceCash Dividends Paid
Other ─ net
Net Cash Provided by Financing Activities
Foreign Currency Translation Adjustments on Cash and Cash Equivalents
Net Decrease in Cash and Cash Equivalents

29,999356,368(217,958)(3,920)49
164,53865(2,862)

193,162
304,488(211,098)
16,427(3,241)(192)
299,546(68)(4,168)275,658
3,274,541(2,002,744)(36,022)455
1,511,888
601(26,302)25,438(276)

29,607-

233,745(2,545)

Increase in Lease Receivables and Investments in Lease
Decrease (Increase) in Receivables
Decrease (Increase) in Operational Investment Securities(Increase) Decrease in Accounts Payable ─ trade
Gain on Step Acquisition
Purchases of Leased Assets
Proceeds from Sales of Leased Assets(Decrease) Increase in Interest Payable
Other ─ net
Total Adjustments
Net Cash Used in Operating Activities
Cash Flows from Investing Activities:
Purchases of Own-used Assets
Purchases of Marketable and Investment Securities
Proceeds from Sales and Redemption of Marketable
and Investment Securities
Purchase of Subsidiaries causing Changes in Scope of Consolidation

Cash and Cash Equivalents at Beginning of Year
Decrease in Cash and Cash Equivalents resulting from Exclusionfrom Scope of Consolidation
Cash and Cash Equivalents at End of Year

See accompanying Notes to Consolidated Financial Statements.
6¥

22,299¥25,438$204,898

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. Basis of Presenting Consolidated Financial Statements
The accompanying consolidated financial statements of Mizuho Leasing Company, Limited (“the Company”)
and its consolidated subsidiaries (together with the Company, “the Group”) have been prepared in accordancewith the provisions 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, which are different incertain respects as to application and disclosure requirements of International Financial Reporting Standards.
In preparing these consolidated financial statements, certain reclassifications and rearrangements havebeen made to the company’s financial statements issued domestically in order to present them in a form which
is more familiar to readers outside Japan. Certain disclosures required in the notes to the financial statements
by the Japanese Financial Instruments and Exchange Law are omitted in this Business Report (Kessan
Tanshin).
The consolidated financial statements are stated in Japanese yen, the currency of the country in which theCompany is incorporated and operates. The translations of Japanese yen amounts into U.S. dollar amounts areincluded solely for the convenience of readers outside Japan and have been made at the rate of ¥108.83 to
US$1.00, the approximate rate of exchange at March 31, 2020. The translations should not be construed as
representations that the Japanese yen amounts could be converted into U.S. dollars at that or any other rate.
The amounts indicated in millions of yen are rounded down by truncating the figures below one million. As aresult, totals may not add up exactly.

2. Summary of Significant Accounting Policies(a) Consolidation
The consolidated financial statements include the accounts of the Group, which include Mizuho-TOSHIBA
Leasing Company, Limited, Dai-ichi Leasing Co., Ltd., Mizuho Auto Lease Company, Limited, ML Estate
Company, Limited, Mizuho Leasing (China) Ltd., PT. VERENA MULTI FINANCE Tbk, IBJ Air Leasing
Limited and IBJ Air Leasing (US) Corp.
The number of consolidated subsidiaries as of March 31, 2020 and 2019 was 31 and 32, respectively. The
consolidated financial statements for the year ended March 31, 2020 newly include the accounts of TDP 1
Limited and MM WHEEL LLC as they were newly incorporated. PT. IBJ VERENA FINANCE was excluded
from the scope of the consolidation as it was merged with other consolidated subsidiary. The accounts of KL
INSURANCE&CO., LTD. was excluded as it became immaterial. The accounts of IBJ Air Funding Limited
was also excluded as it was liquidated during the year.
The number of associated companies accounted for under the equity method as of March 31, 2020 and2019 was 6 and 3, respectively. Major investments in associated companies consist of MG Leasing
Corporation, PLM Fleet, LLC, Krung Thai IBJ Leasing Co., Ltd. PNB-Mizuho Leasing and FinanceCorporation and Aircastle Limited. MM Air Limited was newly included in the associated companies
accounted for under the equity method as it was newly incorporated. Aircastle Limited and PLM Fleet, LLC
were also included in the associated companies as the Company purchased these shares.
Kaikias Leasing Co., Ltd. and 103 other subsidiaries are neither consolidated nor accounted for under theequity method, as they are acting as operators under Tokumei Kumiai agreements and the leased assets andliabilities do not substantially belong to the subsidiaries. Aries Line Shipping S.A. and 32 other subsidiaries
are also not consolidated or accounted for under the equity method, as they are immaterial. IBJ ROYAL LINE
S.A. and 1 associated company are not accounted for under the equity method, as they are immaterial.
Upon consolidation, significant intercompany accounts and transactions have been eliminated. In
addition, all significant unrealized profit included in assets resulting from transactions within the Group has
also been eliminated.
The accounting standard for consolidated financial statements requires a company to consolidate all
subsidiaries where the company controls the operations, irrespective of whether or not the company owns amajority of their shares. Control is considered to exist where the company has (a) the power to appoint or7

remove the majority of the Board of Directors or an equivalent governing body, and/or (b) the power to castthe majority of the votes at a meeting of the Board of Directors or an equivalent governing body.
Goodwill represents the excess of the cost of an acquisition over the fair value of the net assets of theacquired subsidiary at the date of acquisition. The differences between the costs and underlying net equity ofinvestments in consolidated subsidiaries and associated companies at acquisition are recorded as Goodwill andare amortized on a straight-line basis over the estimated benefit period.
Implementation Guidance No. 15 “Implementation Guidance on Disclosures about Certain Special
Purpose Entities” issued by the Accounting Standards Board of Japan (the “ASBJ”) permits companies toavoid consolidation of certain Special Purpose Entities (“SPEs”) that were established and are being operated
for the purpose of securitization of receivables.
The Company securitizes its lease receivables to diversify its funding sources and ensure stable funding.
In the securitization structures, the Company uses SPEs that include Tokurei Yugen Kaisha and Kabushiki
Kaisha. The Company transfers the lease receivables to the SPEs in the securitization structures. The SPEs
procure funds, such as borrowings, backed by the transferred assets and these funds flow back to the Company
as sales proceeds of the transferred assets. The Company also provides collection services to the SPEs. A
portion of the receivables is not transferred and is held by the Company. These receivables held by theCompany are properly evaluated at the end of the fiscal year, and these are appropriately reflected in the
consolidated financial statements.
As a result of securitizations, the Company had 21 and 20 SPEs that were not consolidated under
Guidance No. 15 as of March 31, 2020 and 2019. Total assets (simply compiled amount) of such SPEs as ofMarch 31, 2020 and 2019 were ¥189,934 million ($1,745,244 thousand) and ¥124,429 million, respectively.
Total liabilities (simply compiled amount) of such SPEs as of March 31, 2020 and 2019 were ¥190,322 million($1,748,804 thousand) and ¥124,935 million, respectively. The Company owns no voting rights in most of theSPEs while some employees of the Company serve as directors.
The total amount of Lease Receivables and Investments in Lease transferred from the Company to such
SPEs in 2020 and 2019 was ¥27,188 million ($249,825 thousand) and ¥11,151 million, respectively, with nogain/loss on the transfer of such receivables. The Company holds subordinated interests of such transferred
receivables of ¥5,234 million ($48,097 thousand) and ¥212 million in 2020 and 2019, respectively. The
Company recognized profit dividends of ¥303 million ($2,793 thousand) and ¥173 million, respectively, forthe years ended March 31, 2020 and 2019, and servicing fees received of ¥1 million ($14 thousand) withrespect to the transactions with such SPEs for both of the years ended March 31, 2020 and 2019. Theseamounts do not include transactions with SPEs that do not meet the criteria for off-balance-sheet transactions,because the Company treats these asset transfer transactions to the SPEs as financial transactions.
(b) Business Combinations
Business combinations are accounted for using the purchase method. Acquisition-related costs, such asadvisory fees or professional fees are accounted for as expenses in the periods in which the costs are incurred.
If the initial accounting for a business combination is incomplete by the end of the reporting period in which
the business combination occurs, an acquirer shall report in its financial statements provisional amounts forthe items for which the accounting is incomplete. During the measurement period, which shall not exceed one
year from the acquisition, the acquirer shall retrospectively adjust the provisional amounts recognized at theacquisition date to reflect new information obtained about facts and circumstances that existed as of theacquisition date and that would have affected the measurement of the amounts recognized as of that date. Suchadjustments shall be recognized as if the accounting for the business combination had been completed at theacquisition date. The acquirer recognizes the bargain purchase gain in profit or loss immediately on theacquisition 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. A parent's
ownership interest in a subsidiary might change if the parent purchases or sells ownership interests in its
subsidiary. The carrying amount of noncontrolling interest is adjusted to reflect the change in the parent's
ownership interest in its subsidiary while the parent retains its controlling interest in its subsidiary. Any
difference between the fair value of the consideration received or paid and the amount by which thenoncontrolling interest is adjusted is accounted for as capital surplus as long as the parent retains control over8

its subsidiary.
(c) Cash Equivalents
Cash Equivalents are short-term investments that are readily convertible into cash and that are exposed toinsignificant risk of changes in value. Cash Equivalents include time deposits, certificates of deposit,
commercial paper and bond funds, all of which mature or become due within three months of the date ofacquisition.
(d) Lease Accounting
In March 2007, the ASBJ issued ASBJ Statement No. 13, “Accounting Standard for Lease Transactions”,
which revised the previous accounting standard for lease transactions. As a lessor, all finance leases that are
deemed to transfer ownership of the leased property to the lessee are recognized as Lease Receivables, and all
finance leases that are deemed not to transfer ownership of the leased property to the lessee are recognized as
Investments in Lease. All other leases are accounted for as operating leases.
As a lessee, all finance leases that are deemed to transfer ownership of the leased property to the lessee
are capitalized.
(e) Installment Sales
For installment sales contracts, Installment Sales Receivables are recognized for the principal equivalentportion of the total contract amounts when properties are delivered. Interest equivalent amounts are recognized
as Installment Sales when the related installment receivables become due.
For sales-type contracts, Installment Sales and the corresponding Installment Cost of Sales are fullyrecognized when the property is sold. Interest equivalent amounts applicable to the portion to be collected are
deferred and recorded as Deferred Profit on Installment Sales.
(f) Marketable Securities, Operational Investment Securities and Investment Securities
Marketable Securities, Operational Investment Securities and Investment Securities are classified as
Available-for-sale Securities based upon management's intent. Available-for-sale Securities, which have areadily determinable fair value, are stated at fair value with changes in net unrealized gain or loss, net of
applicable income taxes, included directly in Equity (cost of securities sold is calculated by the moving averagemethod). Available-for-sale Securities, which do not have readily determinable fair value, are stated at cost.
Operational Investment Securities is held for the purpose of generating operational financial income. The
income from Operational Investment Securities is stated in Revenues in the Consolidated Statement of Income.
(g) Loans Receivables and Factoring Receivables
Loans to customers and receivables arising from factoring are included in Loans Receivables and Factoring
Receivables, respectively. Income from these receivables is recognized as Revenues.
(h) Property and Equipment
1. Leased Assets
Leased Property and Equipment are stated at cost and depreciated over the lease term by the straight-line
method to the residual value, which is an amount to be realized at the time when the lease contract isterminated.
2. Own-used Assets
Own-used Assets of the Company and its domestic consolidated subsidiaries are stated at cost anddepreciated over the following estimated useful lives mainly by the declining-balance method:
Buildings
3-65 years
Fixtures and furniture
2-20 years(i) Long-lived Assets
The Group reviews its long-lived assets for impairment whenever events or changes in circumstance indicate
the carrying amount of an asset or asset group may not be recoverable. An impairment loss is recognized if
9the carrying amount of an asset or asset group exceeds 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 be measured 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) Intangible Assets
1. Leased Assets
Intangible Leased Assets are accounted for in the same way as Leased Property and Equipment.
2. Own-used Software
Own-used Software is amortized over the internally estimated useful lives (5years) by the straight-line
method.
3. Other Intangible Assets
Other Intangible Assets are stated at cost. Amortization of intangible assets by the Company and its
domestic consolidated subsidiaries is mainly computed by the straight-line method over the estimateduseful lives.
(k) Bond Issue Costs
Costs for bond issuance are expensed upon payment.
(l) Allowance for Doubtful Receivables
Allowance for Doubtful Receivables is provided based on the estimated historical default rate for general tradereceivables, and is based on individual reviews for receivables from doubtful and legally bankrupt creditors.
The amounts of Long-term Receivables considered uncollectible, which include receivables from legallybankrupt creditors, were directly written-off. The amounts directly written-off were ¥7,199 million ($66,150
thousand) and ¥8,406 million at March 31, 2020 and 2019, respectively.
(m) Reserve for Bonus Payments
The Company and certain domestic consolidated subsidiaries provide a reserve for future bonus payments toemployees. This reserve is maintained at the estimated amount payable after the year-end, based on the services
provided during the fiscal year.
(n) Reserve for Bonus Payments to Directors
The Company and certain domestic consolidated subsidiaries provide a reserve for future bonus payments to
executive officers. This reserve is maintained at the estimated amount payable for the fiscal year.
(o) Retirement and Pension Plans
The Company and certain consolidated subsidiaries have a corporate pension plan and/or lump-sum severance
payment plan as a defined benefit type of a retirement benefits plan as well as a corporate pension plan as adefined contribution type of a retirement benefits plan. There are some cases in which extra retirement benefits
are paid to employees when they retire.
The Company and certain consolidated subsidiaries account for the liability for retirement benefits basedon the projected benefit obligations and plan assets at the balance sheet date. The projected benefit obligations
are attributed to periods on a benefit formula basis. Actuarial gains and losses that are yet to be recognized in
profit or loss are recognized within equity (accumulated other comprehensive income), after adjusting for tax
effects and are recognized in profit or loss over 10 to 15 years no longer than the expected average remaining
service period of the employees. The discount rate is determined using a single weighted-average discount rate
reflecting the estimated timing and amount of benefit payment.
(p) Reserve for Management Board Benefit Trust
Reserve for Management Board Benefit Trust is provided for the payment of the Company’s shares, etc. to
executive officers based on the estimated amount of stock benefit obligations at the end of the fiscal year.
10(q) Asset Retirement Obligations
An asset retirement obligation is recorded for a legal obligation imposed either by law or contract that resultsfrom the acquisition, construction, development and the normal operation of a tangible fixed asset and isassociated with the retirement of such tangible fixed asset. The asset retirement obligation is recognized as thesum of the discounted cash flows required for the future asset retirement and is recorded in the period in which
the obligation is incurred if a reasonable 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 berecognized when a reasonable estimate of the asset retirement obligation can be made. Upon initial recognitionof 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 the liability. 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 andthe capitalized amount of the related asset retirement cost.
(r) Accruals for Debt Guarantees
The Company and certain domestic consolidated subsidiaries provide Accruals for Debt Guarantees for losses
that might occur in relation to guarantees of the indebtedness of others, taking the debtors’ financial condition
into consideration.
(s) Income Taxes
The Company and its domestic consolidated subsidiaries are subject to corporate tax, inhabitants' taxes andenterprise taxes. Deferred income taxes are recorded by the asset and liability method based on the differences
between the tax bases of assets and liabilities and those as reported in the consolidated financial statements,using enacted tax rates that will be in effect when the differences are expected to reverse.
(t) Recognition of Revenues and Cost of Sales
Revenues and cost of sales relating to finance lease transactions are recognized when lease payments arereceived.
(u) Translation of Foreign Currency Assets and Liabilities
1. Translation of foreign currency transactions
All monetary receivables and payables denominated in foreign currencies are translated into Japanese yenat the exchange rates at the balance sheet date. The foreign exchange gain and loss from translation arerecognized in the Consolidated Statement of Income as income or expenses.
Revenue and expense items arising from transactions denominated in foreign currencies are generallytranslated into Japanese yen at the rates effective at the respective transaction dates.
2. Translation of foreign currency financial statements
The assets, liabilities, revenues and expenses of overseas consolidated subsidiaries are translated into
Japanese yen at the exchange rates at the balance sheet dates of each subsidiary. Differences arising fromsuch translation are shown in either Non-controlling Interests or Foreign Currency Translation
Adjustments under Accumulated Other Comprehensive Income in a separate component of Equity.
(v) Derivatives and Hedging Activities
The Group uses derivative financial instruments to manage its exposures to fluctuations in foreign exchange
and interest rates. Interest rate swaps are utilized to manage interest rate risks associated with certain assets
and liabilities, including Loans Receivables and Long-term Debt. Short-term Borrowings, Long-term Debt
and Foreign currency forward contracts are utilized to reduce risks from fluctuations of foreign currency
exchange rates associated with certain assets including Other Receivable, Operational Investment Securities
and Investment Securities as well as committed transactions denominated in foreign currencies. Interest rate11

and currency swaps are utilized to manage interest rate risks as well as foreign currency risks. The Group does
not enter into derivatives for trading or speculative purposes.
Derivative financial instruments and foreign currency transactions are classified and accounted for as
follows: a) all derivatives are recognized as either assets or liabilities and measured at fair value, and gains orlosses on derivative transactions are recognized in the Consolidated Statement of Income and b) for derivatives
used for hedging purposes, if such derivatives qualify for hedge accounting because of high correlation andeffectiveness between the hedging instruments and the hedged items, gains or losses on derivatives aredeferred until maturity of the hedged transactions.
Monetary receivables and payables covered by forward exchange contracts are translated at the contract
rates. Any differences between the foreign exchange contract rates and historical rates resulting from thetranslation of receivables and payables are recognized as income or expense over the lives of the related
contracts.
Interest rate swaps that qualify for hedge accounting and meet specific matching criteria are notremeasured at market value, but the differential paid or received under the swap agreements is recognized andincluded in interest expense.
(w) Consumption Taxes
The Company and its domestic consolidated subsidiaries are subject to Japanese consumption taxes. Japanese
consumption taxes are excluded from the transaction amounts.
(x) Per Share Information
Basic net income per share is computed by dividing net income attributable to common shareholders by theweighted-average number of common shares outstanding for the period, retroactively adjusted for stock splits.
(y) Accounting Changes and Error Corrections
Under ASBJ Statement No. 24, “Accounting Standard for Accounting Changes and Error Corrections,” andASBJ Guidance No. 24, “Guidance on Accounting Standard for Accounting Changes and Error Corrections,”
accounting treatments are required 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 unlessthe revised accounting standard includes specific transitional provisions in which case the entity shall comply
with the specific transitional provisions. (2) Changes in Presentation - When the presentation of financial
statements is changed, prior-period financial statements are reclassified in accordance with the newpresentation. (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 the change
affects both the period of the change and future periods. (4) Corrections of Prior-Period Errors - When an error
in prior-period financial statements is discovered, those statements are restated.

12

3. Operating Assets(1) Operating Assets as of March 31, 2020 and 2019 consisted of the following:(Thousands of（Millions of yen）

Leasing and Installment Sales:
Finance Lease
Operating Lease
Installment Sales (*1)
Leasing and Installment Sales total
Finance
Other
Total Operating Assets

U.S. dollars）

2020

2019

2020

¥ 1,082,088
245,635
139,715
1,467,439
622,866¥ 2,090,305¥930,318
229,900
145,888
1,306,106
708,950
6,311¥2,021,368$ 9,942,922
2,257,057
1,283,795
13,483,774
5,723,299$ 19,207,073(*1) The amount of Installment Sales represents "Installment Sales Receivables" less "Deferred Profit on
Installment Sales".

(2) The total amounts of new contracts for the years ended March 31, 2020 and 2019 were as follows:(Thousands of（Millions of yen）

Leasing and Installment Sales:
Finance Lease
Operating Lease
Installment Sales (*1)
Leasing and Installment Sales total
Finance
Other
Total

U.S. dollars）

2020

2019

2020

¥ 447,660
187,316
57,373692,350
590,088¥ 1,282,438¥374,218
120,31454,885549,418
996,700
2,698¥1,548,817$ 4,113,388
1,721,188
527,181
6,361,757
5,422,116$ 11,783,873(*1) The amount of Installment Sales represents "Installment Sales Receivables" less "Deferred Profit on
Installment Sales".

13

4. Pledged Assets
Assets pledged as collateral as of March 31, 2020 were as follows:(Thousands of（Millions of yen）

U.S. dollars)

2020

2020

Lease Receivables and Investments
in Lease
Installment Sales Receivable
Loans Receivables
Operational Investment Securities
Leased Assets
Own-used Assets
Investment Securities
Total¥12,916
990
5,789
22,02330,9901068¥72,825$118,687
9,099
53,202
202,365284,764
974
77$669,168

Liabilities secured by the above assets as of March 31, 2020 were as follows:(Thousands of（Millions of yen）

U.S. dollars)

2020

2020

Short-term Borrowings
Current Portion of Long-term Debt
Long-term Debt
Total

¥8,982
4,522
51,383¥64,888$82,538
41,557472,146$596,241

5. Short-term Borrowings and Long-term Debt
(1) “Short-term Borrowings” as of March 31, 2020 and 2019 was as follows:(Thousands of(Millions of yen)

Short-term Borrowings
Short-term Borrowings from banks andother financial institutions
Commercial Paper
Payables under securitized leasereceivables
Total
Current Portion of Long-term Debt
Bonds payable
Long-term Debt from banks and otherfinancial institutions
Total

U.S. dollars)

2020

2019

¥256,732¥302,209$2,359,023

669,100
105,242

609,800
82,376

6,148,121967,039¥1,031,075¥994,386$9,474,183¥185,358¥20,777
177,182$1,703,196¥185,358¥197,959$1,703,196

14

2020

(2) “Long-term Debt” as of March 31, 2020 and 2019 was as follows:(Thousands of(Millions of yen)

Long-term Debt
Bonds payable
Long-term Debt from banks and otherfinancial institutions
Payables under securitized leasereceivables
Total

U.S. dollars)

2020

2019

¥135,332
622,890¥85,000
524,173$1,243,523
5,723,517

25,97933,238

238,713¥784,202¥642,411$7,205,753

2020

6. Contingent Liabilities
Contingent Liabilities as of March 31, 2020 were as follows:(Thousands ofGuarantee Obligations with respect tooperating activities
Other Guarantee Obligations
Total(Millions of yen)

U.S. dollars)

2020

2020

¥12,519$115,039

11,394¥23,914104,701$219,740

7. Segment Information(1) Description and revision of reportable segments
The reportable segments of the Group are those for which separate financial information is available and regular
evaluation by the Company management is being performed in order to decide periodically how resources areallocated among the Group.
The Group provides total financial services such as leasing business, installment sales and loan businessto a wide range of customers from large companies to small and medium-sized companies. The Group has
three business segments based on its services: “Leasing and Installment Sales”, “Finance” and “Other”.
“Leasing and Installment Sales” segment represents leasing business for industrial machinery,information-related equipment and transportation equipment (including sales of subject properties upon
expiration or cancellation of lease agreements) and installment sales business. “Finance” segment represents
loan business, factoring business and securities business which invests in securities that are held for the purposeof generating operational revenues. “Other” segment represents buying and selling of used properties businessand sales of solar power business etc.
(2) Methods of measurement for the amounts of sales, profit, assets, liabilities and other items for each reportablesegment
The accounting policies of each reportable segment are consistent with those disclosed in Note 2, “Summaryof Significant Accounting Policies”.

15

(3) Information about sales, profit, assets, liabilities and other items for the years ended March 31, 2020 and 2019
was as follows:(Millions of yen)
2020
Reportable segment
Leasing andInstallment

Finance

Other

Total

Sales

Reconciliations

Consolidated(*1) (*2) (*3)(*4)

Sales:
Sales to external¥511,721¥18,772¥8,747¥539,241¥-¥539,241

348

867

18

1,234

(1,234)-

Total

512,069

19,6408,766

540,476(1,234)539,241

Operating Expenses

493,481

6,807

8,181

508,470

4,495

512,966

Segment Profit¥18,588¥12,832¥584¥32,005¥(5,730)¥26,275

Segment Assets¥1,558,974¥712,935¥2,288¥2,274,197¥74,218¥2,348,416

12,962--

12,962

2,141

15,104

181,931--

181,931

3,032

184,964

Reconciliations

Consolidated(*1) (*2) (*3)(*4)

customers
Intersegment sales andtransfers

OthersDepreciation andAmortization
Capital Expenditure(Millions of yen)
2019
Reportable segment
Leasing andInstallment

Finance

Other

Total

Sales
Sales:
Sales to external¥366,095¥16,724¥2,073¥384,893¥-¥384,893

333

700

119

1,153

(1,153)-

Total

366,429

17,424

2,193

386,047(1,153)384,893

Operating Expenses

348,382

7,837

1,532

357,753

4,227

361,980

Segment Profit¥18,046¥9,587¥660¥28,294¥(5,380)¥22,913

Segment Assets¥1,320,729¥842,165¥11,940¥2,174,835¥(12,962)¥2,161,872

11,460--11,4601,767

13,227

120,504--

120,504

3,368

123,872

customers
Intersegment sales andtransfers

OthersDepreciation andAmortization
Capital Expenditure

16

(Thousands of U.S. dollars)
2020
Reportable segment

Leasing andInstallment

Finance

Other

Total

Reconciliations

Consolidated(*1) (*2) (*3)

(*4)

Sales
Sales:
Sales to external$4,702,024$172,497$80,380$4,954,901$ -$4,954,901

3,204

7,970

172

11,346(11,346)-

Total

4,705,228

180,467

80,552

4,966,247(11,346)

4,954,901

Operating Expenses

4,534,428

62,55075,1784,672,156

41,3094,713,465

Segment Profit$170,800$117,917$5,374$294,091$(52,655)$241,436

Segment Assets$14,324,856$6,550,907$21,025$20,896,788$681,969$21,578,757

119,112--

119,112

19,679138,791

1,671,704--

1,671,704

27,867

1,699,571

customers
Intersegment sales andtransfers

OthersDepreciation andAmortization
Capital Expenditure(*1) The details of Reconciliations to Segment Profit for the years ended March 31, 2020 and 2019 were as follows:(Thousands of(Millions of yen)

U.S. dollars)
2019

2020

2020

Elimination of intersegment transactions¥332¥(426)$3,052Administrative expenses not allocated to(6,062)(4,953)(55,707)¥(5,730)¥(5,380)$(52,655)

the reportable segments
Total(*2) The details of Reconciliations to Segment Assets as of March 31, 2020 and 2019 were as follows:(Thousands of(Millions of yen)

U.S. dollars)

2020

2019

Elimination of intersegment transactions¥(48,014)¥(49,664)$( 441,192)

Corporate assets not allocated to the122,233

36,702

1,123,161¥74,218¥(12,962)$681,969

2020

reportable segments
Total(*3) Reconciliations of “Depreciation and Amortization” and “Capital Expenditure” are related to corporate assets notallocated to the reportable segments.
(*4) Segment Profits are reconciled to Operating Income in the Consolidated Statement of Income.

17

(4) Information about Geographical Areas
Property and Equipment(Millions of yen）
2020

Japan

North
America/ LatinAmerica¥39,234

Europe¥201,178¥8,982

Asia

Total

¥250

¥249,646(Millions of yen）
2019

Japan

North
America/ LatinAmerica¥18,933

Europe¥216,669¥9,515

Asia

Total

¥413

¥245,531(Thousands of U.S. dollars)
2020

Japan

North
America/ LatinAmerica$360,514

Europe$1,848,560$82,534

Asia

Total

$2,301$2,293,909(*1)Assets are classified by country or region based on the location of the Company and consolidated subsidiaries.
(*2) Information by geographic segment of Sales is not presented as domestic sales exceeded 90% of all segments.

(5) Impairment loss of long-lived assets per reportable segment:(Millions of yen)
2020
Reportable segment
Leasing andInstallment

Finance

Other

Total

Reconciliations

Consolidated

¥-

¥-

¥ 322

¥-

¥322

Sales
Impairment loss

¥ 322(Millions of yen)
2019
Reportable segment
Leasing andInstallment

Finance

Other

Total

Reconciliations

Consolidated

¥-

¥-

¥-

¥8

¥8

Sales
Impairment loss¥-

(Thousands of U.S. dollars)
2020
Reportable segment
Leasing andInstallment

Finance

Other

Total

Reconciliations

Consolidated$-$-$ 2,959$-$2,959

Sales
Impairment loss

$ 2,95918

(6) Goodwill per reportable segment:
Not applicable

8. Per Share Information
Details of basic net income attributable to owners of the parent per share (“EPS”) for the years ended March 31,
2020 and 2019 were as follows:

For the year ended March 31, 2020:
Basic EPS
Net income available to commonshareholders(Millions of yen)(Thousands of shares)

Net income
attributable toowners of theparent(Yen)(U.S. dollars)

Weighted-average
shares¥17,51248,581¥360.49$3.31¥16,594

42,697¥388.64

$3.57

EPS

For the year ended March 31, 2019:
Basic EPS
Net income available to commonshareholders

19

9. Subsequent Event
Acquisition of the shares
On March 9, 2020, the Company, Ricoh Company, Ltd. (“Ricoh”), and Ricoh Leasing Company, Ltd. (“Ricoh
Leasing”) reached an agreement to enter into a business alliance among the three companies, subject to thecondition of the acquisition of Ricoh Leasing’s 6,160,000 shares of common stock (20.00% of the voting rights
ratio (Rounded at the third decimal point. In the calculation of the voting rights ratio, hereinafter the same
applies.)) by the Company from Ricoh. The Company completed the acquisition of 6,160,000 shares ofcommon stock of Ricoh Leasing on April 23, 2020.
(1) Purpose of the business alliance agreement
The Company, Ricoh and Ricoh Leasing have agreed to proceed discussions to decide the specific detailsof the business alliance between the parties in order to achieve their own business growth and increase
corporate value for the purpose of effectively utilizing their own business foundations to strengthen their
existing businesses, and using their know-how and infrastructure to create new business opportunities.
(2) Corporate name, business and capital of the company whose shares were acquired(a) Corporate name
Ricoh Leasing Company, Ltd.
(b) Description of the business
Lease, Installment Sales Business and Financial Services Business(c) Capital¥7,896 million ($72,561 thousand)(3) Date of the acquisition of the shares
April 23, 2020
(4) Number of shares acquired, acquisition price and voting rights ratio held after the transaction(a) Number of shares acquired
6,160,000 shares(b) Acquisition price¥36,799 million ($338,141 thousand)(c) Voting rights ratio held after the transaction
20.00%

20