SOFTBANK CORP.
CONSOLIDATED FINANCIAL REPORTFor the Fiscal Year Ended March 31, 2001
FINANCIAL HIGHLIGHTS
1. Results of Operations

Revenues
Operating income
Ordinary income (loss)
Net income
Net income per share— primary (yen)Net income per share—diluted (yen)

FY2001(April 2000
through March
2001)¥397,105
16,431
20,06536,631110.47109.38(Million yen; amounts less than one million yen are omitted.)
Year-on-year
FY2000Year-on-yearchange(April 1999
changethrough March
2000)
–6.2%
¥423,220–19.9%
+96.1
8,377
–30.9
—
(51,932)—+333.7
8,446
-77.5
—
78.05
—
—
76.05
—

Notes:
1. Equity in earnings (losses) of affiliates (Million yen):
Fiscal Year ended March 31, 2001:¥(19,765)

Fiscal Year ended March 31, 2000:¥4,744

2. Average shares outstanding (consolidated)Year ended March 31, 2001: 331,585,133
Year ended March 31, 2000: 108,228,155

3. There were significant changes in accounting methods during the period under review.
4. Percentage changes for revenues, operating income, ordinary income and net income are compared with the corresponding periodof the previous fiscal year.

2. Financial Condition

Total assets
Shareholders’ equity
Equity ratio (%)
Shareholders’ equity per share (yen)(Million yen; amounts less than one million yen are omitted.)
FY2001
FY2000(As of March 31, 2001)(As of March 31, 2000)¥1,168,308¥1,146,083
380,740424,26132.6
37.0¥3,456.55¥1,260.14

Note: Shares outstanding (consolidated)

As of March 31, 2001: 336,677,714
As of March 31, 2000: 110,150,468

3. Cash Flows(Million yen; amounts less than one million yen are omitted.)
FY2001
FY2000(April 2000 through(April 1999 throughMarch 2001)
March 2000)¥349
Cash flows form operating activities¥(91,598)(60,341)
Cash flows from investing activities(42,612)220,914
Cash flows from financing activities
24,548¥268,060
Cash and cash equivalents at end of the period¥159,105
4. Scope of Consolidation
Consolidated subsidiaries:
Equity-method non-consolidated subsidiaries:
Equity-method affiliates:

216
7
110

5. Changes in Scope of Consolidation
Consolidated subsidiaries:
Newly added:

112

Newly deleted:

39

Equity-method non-consolidated subsidiaries and affiliates:
Newly added:

79

Newly deleted:

15

SOFTBANK CORP.

1

(Reference)
The following figures are based on those for the fiscal year ended March 31, 2001, and include adjustments andcorrections for dilution in connection with stock splits.
Per Share Indices after Retroactive Adjustments
1. Consolidated Basis
Fiscal 1997

Fiscal 1998

Fiscal 1999

Fiscal 2000

Fiscal 2001

Net income¥31.86¥33.59¥121.79¥26.02¥110.47

Shareholders’ equity¥764.19¥791.75¥906.45¥1,152.18¥1,260.14

2. Non-consolidated Basis
Fiscal 1997

Fiscal 1998

Fiscal 1999

Fiscal 2000

Fiscal 2001

Net income¥36.93¥44.60¥38.09¥165.04¥14.50Shareholders’ equity¥775.02¥814.62¥863.72¥1,104.06¥1,172.75

Notes:
1)

Average shares outstanding throughout the given fiscal year after retroactive adjustments was used in thecalculation of net income per share, and shares outstanding at year-end after retroactive adjustments was usedin the calculation of shareholders’ equity per share.

2)

Adjustments for the following stock splits were made to the preceding figures.
May 20, 1997, stock split (each share split into 1.3 shares)June 23, 2000, stock split (each share split into 3.0 shares)

SOFTBANK CORP.

2

The SOFTBANK GroupAs of March 31 2001,the SOFTBANK Group Comprised 333 companies with operations in 10 segments.
Equity-method
nonconsolidated
subsidiaries andaffiliates (includes
partnerships

Consolidated
subsidiaries(includes
partnerships)

Business segment

Principal products and operational content
of each business1.

e-Commerce

32

10

Sales of PC software and such hardware as PCs andperipherals; enterprise solutions; diversified ecommerce business, including business transaction
platform and e-commerce between business andconsumer operations

2.

e-Finance

82

21

All inclusive Web-based financial operations, includingInternet securities operations; management ofdomestic venture capital funds; incubation of portfolio
corporations

3.

Media & Marketing

19

7Book and magazine publication in such areas as PCs,
the Internet, entertainment, etc.; exhibition
management; web content development

4.

Broadmedia

7

2

Provision of applications and content for broadband
broadcasting and communications and promoting the
spread of such operations

5.

Internet Culture

47Internet-based advertising operations

6.

Technology Services

7

6

Systems integration, network integration, e-commerceand business operations

7.

Internet Infrastructure

4

2

Ultra high-speed Internet access services and such
related operations as data center business.

8.

Overseas Funds

39

49

U.S.- and Asia-focused global private equity operationsin Internet-related companies

9.

Services13

Human resources and general affairs services

10. Others

21

10

Total

216

117

e-Finance
InsWeb Corp.

e-Commerce
E*TRADE Group Inc.

Morningstar Inc.
SophiaBank Limited
Morningstar Japan K.K.

SB EV2 Limited

E*TRADE Japan K.K.

SOFTBANK Capital LP

INSWEB Japan K.K. CarPoint K.K.
Cognotec Japan K.K.

SOFTBANK MOBILE CORP.

e-Shopping Books CORP.

Vector Inc.

SOFTBANK COMMERCE CORP.
E*TRADE Securities Co.,LTD.
SOFTBANK INVESTMENT CORPORATION
VerticalNet Japan Corp.

Overseas Funds

SOFTBANK FINANCECORPORATIONSB CHINA HOLDINGS PTE LTD.
eVentures

WEB-Lease Co.,Ltd. Nihon Ariba K.K.

SOFTBANK
E-COMMERCE
CORP.

Media & Marketingcyber communications inc.ﾞ
SOFTBANK Publishing Inc.

@VISO Limited

SOFTBANK Media &Marketing Corp.

SOFTBANK Technology Ventures V L.P.
SOFTBANK Latin America Venture LP[Overseas]［ Domestic ］（ Operation Holding
Companies）

SOFTBANK CORP.
（ Pure Holding Company）

Key3Media Group, Inc.

SOFTBANK Forums Japan, Inc.

（ Operation Holding
Companies）

SOFTBANK ZDNet Inc.

［ Domestic ］[Overseas]

SOFTBANK Holdings Inc.
SB Holdings(Europe)Ltd.
Yahoo!Inc.

Yahoo Japan Corporation
Internet Research Institute,Inc.

Internet Culture

SOFTBANK TECHNOLOGYHOLDINGS CORP.
SOFTBANKTECHNOLOGY CORP.

SOFTBANK
Broadmedia
Corporation

Technology Services

SOFTBANK
Networks Inc.
AtWork Corporation

Digital Club Corporationﾞ
Nasdaq Japan Inc.

Computer Channel Corporation
IP REVOLUTION INC.

Aozora Bank,Ltd.
UTStarcom, Inc.
SOFTBANK Korea Co., Ltd.

Broadmedia
OthersInternet Infrastructure

・・・・ Segment・・・・ Consolidated subsidiary・・・・ Equity-method subsidiary or affiliate

SOFTBANK CORP.

3

SOFTBANK subsidiaries listed on domestic stock exchanges (or that have made IPOs) as of March 31, 2001:
Subsidiary

Listed exchange

1.Yahoo Japan Corporation

Over-the-counter2. SOFTBANK TECHNOLOGY CORP.

Over-the-counter

3. Morningstar Japan K.K.

Nasdaq Japan

4. Vector Inc.

Nasdaq Japan

5. E*TRADE Japan K.K.

Nasdaq Japan

6. SOFTBANK INVESTMENT CORPORATION

Nasdaq Japan(Reference) Subsidiaries listed on overseas stock exchanges:

Subsidiary

Listed exchange

1. Key3Media Group, Inc.

New York Stock Exchange

2. Softbank Investment International (Strategic) Limited

Hong Kong Stock Exchange

SOFTBANK CORP.

4

Management Policy and Results of Operations
1. Management Policy–New Developments in Internet Business through the Move to
Broadband
SOFTBANK CORP.’s efforts to leverage the full spectrum of management resources on theInternet reflect its belief that the digital information revolution will contribute significantly to theprogress of humankind and that its ongoing commitment to drive this revolution will ensure its
future growth.
Changes effected in the overheated Nasdaq market in the United States since spring2000 have begun to impact Japanese Internet-related stocks as well as business conditions
surrounding the information industry at large. Additionally, a pervasive sense of uncertainty
began to emerge in autumn 2000 regarding the outlook for the U.S. economy, andconsequentially its significant effects on business confidence in Japan, makes for overall
conditions that are far from optimistic.
Although many Internet startups are currently experiencing hardship due tochallenges to business model compatibility and other problems, at the same time a number ofpromising Internet businesses continue to solidify their revenue bases and prepare for the
next phase of market stemming from the increased proliferation of the Internet. In November
2000, the Basic IT Law (Basic Law for the Formation of an Advanced Information
Communications Network Society) was passed, spelling out Japan’s commitment to IT. The
government’s e-Japan strategy calls for bringing broadband to 40 million homes within five
years. With leading communications companies initiating broadband services since autumn
2000, the major barriers to the spread of the Internet in Japan—namely low speed and highcost—are crumbling and the nation is finally poised to embrace the Internet age in earnest.
Eyeing this period of full scale Internet proliferation, the SOFTBANK Group has
established numerous Internet-related businesses starting with Yahoo! operations andfollowed by e-commerce, e-finance, and media & marketing businesses. During fiscal 2001,
ended March 31, 2001, more than 100 companies, both in Japan and overseas, were added
to SOFTBANK’s stable. These new companies join existing SOFTBANK Group companies instriving to generate profitability and cash flow at the earliest possible date, with public listing
ever in their sights. In testimony to this, Morningstar Japan K.K., Vector Inc., E*TRADE Japan
K.K., Key3Media Group, Inc., cyber communications inc., and SOFTBANK INVESTMENTCORPORATION all made initial public offerings (IPOs) in fiscal 2001.
With emphasis placed on profitability, the SOFTBANK Group’s operating companies
are developing business in preparation for the next phase of Internet expansion. Determined
to cultivate this new wave of expansion at the earliest possible date, the SOFTBANK Group isproactively engaged in infrastructure and other broadband operations. In the United Statesand South Korea, the growth of broadband access is giving rise to a myriad of exciting newservices and markets. Optimally packaging high-value-added broadband content and services
with communications infrastructure is the key to success in this business.
In January 2001, SOFTBANK took a stake in Korea Thrunet Co., Ltd., operator of
Korea.com, South Korea’s largest broadband portal. The Group will leverage the expertise

SOFTBANK CORP.

5

gained from this investment in its broadband operations—not only in Japan but also
throughout Asia as well. In Japan, SOFTBANK is implementing infrastructure operations thattake advantage of the unique features of the entire spectrum of communications technologies,
including fiber optic and wireless technologies, while commencing broadband application andcontent businesses. In the days and months ahead, the Group will enhance the value of its
services by combining these services to produce a comprehensive package. To implement its
Asia-focused broadband strategies, the Group established the SOFTBANK Asia Infrastructure
Fund, with capital provided by Cisco Systems, Inc.
Another sector with equal priority as broadband operations is the business
transaction platform service business. A large number of corporations in the United States are
implementing cost reductions in direct and indirect procurement activities through theapplication of business transaction platform systems. With Japanese corporations now facedwith the task of fundamentally rethinking their procurement systems to contend withinternational competitors, this is a segment with enormous potential demand. In the field of
indirect material procurement, in December 2000 SOFTBANK took a stake in Nihon Ariba
K.K.—the Japanese arm of leading U.S. business transaction platform services provider Ariba,
Inc.—a move that will carve out a prime position for SOFTBANK in this growing market.
As the Internet business leader, SOFTBANK has established numerous venturebusinesses and is working to develop a definitive infrastructure for venture business in Japan.
SOFTBANK’s June 1999 announcement of Nasdaq Japan’s establishment resulted insweeping reforms in Japan’s equity finance market and paved the way for hopeful young
venture companies by providing capital to enable them to expand of their operations. During
the nine months between the commencement of trading in June 2000 and fiscal 2001 yearend, 49 companies had listed their shares on Nasdaq Japan.
Determined to revolutionize Japan’s bank loan finance systems, in September 2000 aconsortium consisting of SOFTBANK, ORIX Corporation, The Tokio Marine & Fire InsuranceCo., Ltd., and several other shareholders completed the acquisition of Nippon Credit Bank,
Ltd. (as of January 2001; renamed the Aozora Bank Ltd.). SOFTBANK is the largest
shareholder with a 48.9% stake in the bank. While enhancing its financial soundness, Aozora
Bank Ltd. is striving for careful but dynamic business development by pushing throughpreparations for Japan’s first pure venture financing operations.
SOFTBANK takes full advantage of the evolution of the Internet throughout the world
to implement one of its key strategies—time machine management. Through this strategy,
SOFTBANK is carrying out the worldwide incubation of superior business models foundthrough its venture capital operations in particular countries.
The SOFTBANK Group’s sphere of operations has expanded both geographicallyand categorically in step with the penetration of the Internet. To conduct swift and accurate
managerial decision making based on expert know-how in each business segment,
SOFTBANK has adopted a three-tiered Group structure, comprising a pure holding company,
operation holding companies, and operating companies.
To facilitate the implementation of Group strategies and reinforce its management
capabilities as a pure holding company for the Group, on October 2, 2000, SOFTBANK pulledformerly outsourced accounting, finance, legal, and investor relations activities in-house. To
enhance corporate value Groupwide, SOFTBANK is striving to ensure effective corporate

SOFTBANK CORP.

6

governance by delineating the function of the Board of Directors to entail high-level decision
making and supervision, while the Group CEO Council and chief executive officers oversee
operations.
2. Results of Operations
Consolidated revenues of SOFTBANK for fiscal 2001 amounted to ¥397,105 million, a 6.2%
decrease from the previous fiscal year. Although such businesses as e-finance and ecommerce are growing rapidly, this decrease in revenues is largely attributable to the sale of
the Group’s U.S. subsidiary Ziff-Davis Inc. and a change in the scope of consolidation for
UTStarcom, Inc., from a consolidated subsidiary to an equity-method affiliate, reflecting thedilutive effect of the exercise of warrants following UTStarcom, Inc.’s IPO. Ziff-Davis Inc. andUTStarcom, Inc. had accounted for 24% of fiscal 2000 revenues.
On the other hand, consolidated operating income surged 96.1%, to ¥16,431 million.
Primary factors contributing to this leap include the absorption of expenses related to thestart-up of new businesses by such superior performance of subsidiaries as SOFTBANKINVESTMENT CORPORATION and SOFTBANK COMMERCE CORP. as well as the sale ofZiff-Davis Inc., which had recorded an operating loss for the previous term.
SOFTBANK recorded consolidated ordinary income of ¥20,065 million, a significant
improvement compared with the previous term. At fiscal year-end, the Group held
approximately ¥137.5 billion in yen-denominated loans against wholly owned subsidiary
SOFTBANK Holdings Inc. and approximately US$700 million in U.S. dollar-denominatedreceivables against its overseas subsidiaries. ¥28,115 million in exchange gain was recorded
due to the yen’s depreciation at year-end. Interest expenses have also declined due to adecrease of approximately US$1.1 billion in interest-bearing debt as a result of the sale ofZiff-Davis Inc. Regarding equity in earnings/losses of affiliates, although gain was recorded
for equity investment in such operations as Aozora Bank Ltd. and Yahoo! Inc. in the UnitedStates, a loss was recorded for portfolio companies of SOFTBANK Capital Partners (SBCP)of the United States, one of SOFTBANK’s overseas funds. As a result, an overall loss of¥19,765 million was recorded in equities.
Net income for the term skyrocketed 333.7%, to ¥36,631 million, as public offeringrelated dilution, sales of stock in companies making IPOs, and the strategic restructuring of
SOFTBANK’s investment portfolio contributed to gain on sales of investment securities anddilution gain from changes in equity interest. However, loss on revalutaion of investment
securities was also recorded amid falling stock prices on the U.S. Nasdaq exchange andprotracted stagnation in the IPO market. BRAIN.COM, INC. of Japan, @viso Limited. (aninvestment business operating primarily in mainland Europe), eVentures Limited (aninvestment firm operating mainly in the United Kingdom) and SBCP were the primary entities
to which revaluation losses were applied.
Cash flows for the term declined ¥76,200 million overall, and cash and cash equivalents at
year-end amounted to ¥159,105 million.
Net cash used in operating activities amounted to ¥91,598 million. This reflected¥86,053 million in payments of income taxes due to taxes incurred on sales of investment
securities, countering the significant increase in income before income taxes, whichamounted to ¥87,009 million.

SOFTBANK CORP.

7

Net cash used in investing activities totaled ¥42,612 million, as such factors as
expenditures of ¥233,131 million for the purchase of marketable and investment securities
related to investments in Nippon Credit Bank Ltd., overseas funds, and other investments
offset ¥104,224 million in proceeds from sales of marketable and investment securities and¥82,906 million in proceeds from the sale of assets held for Ziff-Davis Inc. publishing
operations.
Net cash provided by financing activities amounted to ¥24,548 million due to suchfactors as ¥30,000 million in net proceeds from the issuance of commercial paper, ¥63,491
million in proceeds from long-term debt mainly incurred by Key3Media Group, Inc., a ZiffDavis Inc. spinoff, and other financing proceeds, which offset the ¥142,102 million in
expenditures from the repayment of the long-term debt, the majority of which was related to
Ziff-Davis Inc., the assets of which were sold off by SOFTBANK.
In line with the launch of a Groupwide cash management approach, in October 2000
SOFTBANK established a ¥145 billion commitment line with its banks.
3. Segment Performance and Strategies
e-Commerce—Focusing on the growing business transaction platform segment
Owing to the strong sales recorded by SOFTBANK COMMERCE CORP., revenues for the
SOFTBANK Group in the e-Commerce segment increased 11.7% compared with theprevious term, to ¥258,521 million. However, due to the Group’s establishment of new
businesses during the term and the large number of businesses still in the start-up phase,
operating costs increased, resulting in a 75.1% decline in operating income, to ¥1,769 million.
As the Internet is very much a first come, first serve industry, SOFTBANK considers
swift business development through proactive customer gathering to be the key to success.
During the term, the Group continued to establish numerous new e-commerce companies.
In consumer targeted e-commerce operations, SOFTBANK’s Internet retailcompanies, which conduct sales of such products as books, automobile components, toys,
and PCs over the Internet, are striving to attain profitability as quickly as possible. Meanwhile,
Vector Inc., which provides download services for consumer software, made its IPO in August
2000. As the rift between success and failure in the Internet businesses persists, SOFTBANK
recognizes the primary need for the flexible reform of business strategies, including
expansion, alteration, and withdrawal. Already during the term, SOFTBANK executued
reforms on five of its subsidiaries, including the reworking of the business model for ONSALE
JAPAN K.K. In the months and years ahead, the Group will continue to nurture business withstrong potential through the firm support systems provided by the operation holding company
SOFTBANK E-COMMERCE CORP.
SOFTBANK’s business transaction platform operations continue to gain prominence.
During the term under review, SOFTBANK followed up on its establishment of VerticalNet
Japan Corp., a provider of industry-specific community services, by taking an approximate
40% stake in Nihon Ariba K.K., a provider of procurement software for indirect goods inDecember 2000 (SOFTBANK: 20%, SOFTBANK E-COMMERCE CORP: 20%). During thecurrent fiscal year, the Group will extend its related business interests into such fields asenterprise software. The establishment of a corporate infrastructure to support business
transactions, exemplified by the procurement solutions of Ariba, is essential to the full-fledged

SOFTBANK CORP.

8diffusion of the e-marketplace. Currently, a large number of Japanese corporations are fully
embracing procurement software and enterprise solutions as a means of enhancing efficiency
and effectiveness in their operations, making this a market segment with substantial growthpotential. Through SOFTBANK COMMERCE CORP., the Group will leverage the customer
and supplier networks and expertise it has accumulated through conventional software
marketing operations while using the expansion in sales of Ariba solutions as a foothold tofirmly establish its enterprise business.

e-Finance—Fusing Net space and traditional (Real space) businesses together: the key
to future business success
Due to the substantial increase in carry earned by SOFTBANK INVESTMENTCORPORATION, revenues for this segment surged 68.4%, compared with the previous term,to ¥31,404 million. Although operating costs increased due to the large number of companies
in the start-up phase, operating income also increased 43.4%, to ¥13,437 million, due to theboost from carry earned by SOFTBANK INVESTMENT COPORATION.
During the term under review, the SOFTBANK FINANCE CORPORATION worked toactualize comprehensive Internet-based financial services by establishing new financecompanies under the fundamental strategy of providing the consumer-centric “Three-One
Services.” Theses services are so named because they comprise one-stop comprehensive
financial services; one-table services, which provide sites that enable the comparison ofvarious services; and one-to-one services, which provide counseling for individual customers.
During the term, Morningstar Japan K.K., E*TRADE Japan K.K., and SOFTBANKINVESTMENT CORPORATION all made IPOs.
Now that the SOFTBANK FINANCE CORPORATION has established numerous
Internet finance service companies, the strategic fusing of these Net space businesses with
Real space businesses will be a cornerstone for SOFTBANK’s future success in this segment.
As part of this strategy, in February 2001 the Group, together with Yamato Mutual Life
Insurance, Co., established Azami Life Insurance, Co., Ltd., and took over the insurance
policies of Taisho Life Insurance, Co., Ltd., entirely. In the future, the Group plans to merge
Yamato Mutual Life Insurance Co. into Azami Life Insurance Co., Ltd. With mutual benefits forGroup finance businesses firmly in mind, SOFTBANK will fuse together its establishedcustomer base and a sales network of more than 100 branches with the Group’s financial
services.
SOFTBANK also recognizes the importance of seeking alliances outside of the Groupand in other industries to respond to the needs of its clients for higher-value-added services.
SophiaBank Limited, an industry icubation-oriented think tank, has formed a consortium
comprising more than 50 major companies.
To strengthen cooperation among companies with similar strategies and customer
bases and provide more comprehensive and efficient services, SOFTBANK will establish newcompanies to unify its existing businesses and work toward IPOs. In line with this policy, in
April 2001 the marketspace-providing INSWEB Japan K.K., E-Loan Japan K.K., andGOODLOAN Co., Ltd. were integrated into Finance All Corporation.
The e-Finance Group, through SOFTBANK INVESTMENT CORPORATION, does
more than simply invest in and develop companies that penetrate new industries. It also

SOFTBANK CORP.

9

provides financial support for the creation of new industries and the reform of existing
industries. The Group will strive to generate new value by coordinating the Internet operations
in which it invests and traditional businesses. It is SOFTBANK FINANCE’s philosophy that thefinance industry forms the backbone of all other industries, and it will continue to provide
financial support for the IT armaments of Japanese companies.

Media & Marketing—Becoming the top content provider in every field
As SOFTBANK completed the sale of its assets in Ziff-Davis Inc. during the term, the resultsof Key3Media Group, Inc., a spin-off of Ziff-Davis Inc., are included in the Group’s overseas
consolidated results for this segment. Revenues, including domestic operations, amounted to¥53,262 million. An increase in participants in Key3Media Group, Inc.’s exhibitions andconferences, and strong advertising revenues helped absorb the increase in operating costs
related to new domestic start-ups, resulting in an overall increase in operating income for theterm, to ¥5,904 million.
Group’s domestic business SOFTBANK Media & Marketing Corp. strove to be acomprehensive Internet-based information supplier and established content development
companies during the term under review in a wide variety of fields, including music, medicine,sports, and education. To increase advertising revenues by augmenting its content,
increasing its number of page views, and elevating its media value SOFTBANK is improving
the level of its content by utilizing customer feeback.
Along with changes in the Internet business environment, Internet-based businesses
are continuing to undergo a weeding out process. Against this backdrop, the content
developers under the umbrella of SOFTBANK Media & Marketing Corp. are striving to attainthe number-one position in their respective fields with the utmost speed. Given the Internet’s
multiple page layer structures, users tend to remain loyal to that content with which they arefamiliar. Hence, obtaining the number-one position in each field will dramatically boost theGroup’s media value. Media value also increases as a result of the provision of specificcategory targeted content, as in the case of SOFTBANK ZDNet Inc., which specializes in IT
business. SOFTBANK ZDNet Inc. will further enhance its advertising effectiveness bydeveloping advertisements with strong impact, including those that make use of its skyscraper
advertising solutions.

Broadmedia—Delivering broadband applications to more and more customers
During the term under review, Digital Club Corporation subscriptions for SKY PerfecTV!
exceeded 360,000. Revenues from subscribers contributed to revenues for the segment of¥13,001 million, an increase of approximately ¥4.0 billion. Despite downward pressurecaused by the many new start-ups during the term, operating income remained at
approximately the same level as the previous term, amounting to ¥1,055 million.
The popularity of broadband networks has lowered the barriers that have traditionallyseparated broadcasting and communications. The two will soon converge. SOFTBANK has
so far engaged in satellite broadcasting associated business through Digital Club Corporation
and Computer Channel Corporation, a commissioned broadcaster specializing in the IT field.

SOFTBANK CORP.

10

In the days to come, the Group will leverage its accumulated expertise in an expanded rangeof broadband services on offer.
SOFTBANK Broadmedia Corporation, the heart of SOFTBANK’s broadmedia
business, is striving to expand its operations by working applications and content forbroadcasting and communications infrastructures into its own realm of business. Convincing
the greatest number of customers to use its applications and content is essential to thisbusiness, and SOFTBANK will ensure that its applications are utilized in the full spectrum of
broadband infrastructures, including cable and fiber optic services. To this end, in April 2001
SOFTBANK established Xdrive Japan K.K., which provides Internet-based storage services,and Akamai Technologies Japan K.K., which provides high-efficiency content delivery
network (CDN) services, as well as made Digital Media Factory Inc., the Okinawa-based
computer graphics production company, into a subsidiary.

Internet Culture—Internet advertising with high growth potential over the medium tolong term
Until fiscal 2000, the internet culture segment included the operations of Ziff-Davis’ ZDNet
division. However, with SOFTBANK’s sale of its stake in Ziff-Davis Inc, revenues during theterm under review declined in tandem. However, advertising revenues from Yahoo Japan
Corporation increased substantially, forestalling the overall decline at an acceptable rate of
26.2%, with revenues for the term amounting to ¥13,223 million. Due to the strong results
recorded by the Yahoo! Japan operations, operating income for the term surged 110.1%, to¥4,702 million.
As reports of slowdowns in the market for Internet advertising in the United States
make their way to Japan, Japanese advertisers as well have become more conservative intheir Internet advertising activities. It is possible that the stable growth of the past few years
may enter a period of deceleration. However, with expansion of the Internet user population
expected over the medium to long term, Internet advertising is expected to increase in media
value and continue to evolve as a business.
According to the Nippon Research Center Ltd., the proportion of users accessing theYahoo! Japan at least once in a four-week period is 86.9%, giving it a substantial lead overthe nearest contender (54.4%) and making it by far the most frequently accessed Japaneselanguage portal in Japan. Yahoo Japan Corporation will continue to improve its sales
structure, enhance the development of its advertising products and services, and strive tofurther expand its advertising business.
As Yahoo Japan Corporation expands its advertising revenues, it will also work todiversify its earnings. The company will endeavor to increase revenues from its shopping
operations and achieve revenues related to its auction business in their commencement ofsuch e-commerce between business and consumer services as Yahoo! Premium Auctions.
Yahoo Japan Corporation will also work to secure new sources of revenues in the businessenterprise service segment and explore the possibilities for of the adoption of Corporate
Yahoo!, a service that customizes corporate portals.

SOFTBANK CORP.

11

Technology Services—Providing comprehensive solutions
Due to increasing revenues from the network integration and other operations of SOFTBANKTECHNOLOGY CORP., revenues for the segment during the term under review increased
approximately ¥4.1 billion, to ¥14,471 million. However, as a result of the costs of starting up
new companies and SOFTBANK TECHNOLOGY CORP.’s advance investments in business
transaction platform technologies, operating income declined approximately ¥400 million, to¥475 million.
Leveraging the strengths of its business expertise gained through its experience inexisting e-commerce operations and network integration acumen, during the term underreview, SOFTBANK entered the business transaction platform market, began offering Ariba
solutions, and constructed business transaction platform systems for the retail industry.
As the improvement of communications infrastructure progresses, business
transaction platform solutions and broadband solutions are expected to expand. Starting fromthe three traditional business sectors of systems integration, network integration, and ecommerce and technical support, during the current term, SOFTBANK will introduce business
operations as a fourth pillar for its technology services business. Business operations
comprise a comprehensive operational service that includes all essential items for running an
Internet-based business, including authentication, billing, and payment systems; corporate
Intranets; storage management support; and system management and supervision services.
Through business operations services, SOFTBANK will provide a comprehensive package of
total solutions, including all consulting necessary to start up businesses as well as for network
integration and system and business operations once the business is up and running.
As with other business segments, on October 2000 SOFTBANK established
SOFTBANK TECHNOLOGY HOLDINGS CORP., an operation holding company to oversee
its technology services operations. It plans to invest in overseas companies that possess
promising new technologies.

Internet Infrastructure—Providing wide-ranging services at lowest costs
As SOFTBANK spent the term under review in preparation for the start-up of ultra high-speed
Internet access services, associated data centers, and overseas access service operations,no revenues were recorded for this segment. However, operating costs resulted in an
operating loss of ¥1,068 million.
Type I telecommunications carrier IP Revolution, Inc. (IPR), commenced operations
in Tokyo’s 23 wards in February 2001 and now provides fiber-optic ultra high-speed Internet
access to tenant buildings and apartment complexes. The firm is able to provide its services
at low prices by using dark fibers from other companies effectively and configuring simple
networks using devices compliant with Internet Protocol (IP) technology, in addition to
installing its own fiber optic cables.
SOFTBANK also established TeraPlanet Inc., an international type I
telecommunications carrier. The firm provides low-cost overseas access services by making
maximum use of the high-capacity fiber-optic submarine cable system of Asia Global
Crossing, Ltd., in which SOFTBANK holds an equity stake. Through these developments, IPR
high-speed Internet connection service costs have been further lowered and the high-capacity

SOFTBANK CORP.

12

backbone essential to broadband services has been secured. The Group also establishedInternet Facilities Inc., which provides Web and e-mail hosting and housing services using
IPR’s network. IPR will enhance the value of its lines by preparing a copious roster of low-costservices suited to the diverse needs of its customers. IPR will continue to differentiate itself
from its competitors amid increasingly severe market competition by providing a wide varietyof economical broadband solutions and raising the value of its fiber-optic backbone.

Overseas Funds —Focusing on companies with technological prowess reflecting theunique features of each market
Until fiscal 2000, the results of this segment were composed mostly of the results derived
from the current value assessment of investees of the SOFTBANK Capital Partners’ fund.
However, SOFTBANK Capital Partners underwent legal reorganization during the term underreview to strengthen fund control and to more accurately reflect SOFTBANK policies in fundmanagement. As a result, investees are now accounted for using the equity method or statedat cost, and only management fees were recorded as revenues. Revenues for the term
amounted to ¥1,741 million, and operating income totaled ¥239 million.
Due to adjustments made in the stock market, downward revisions have also been
made to hitherto over-valued investment appraisals, and SOFTBANK is now concentrating its
investment activities on companies with the greatest growth potential. SOFTBANK’s overseas
fund team operates around the world. Well-seasoned experts on each market actively searchfor profitable investments and analyze each market from a global perspective. Investments
are then made in companies with technological strength in these high-prospect fields and stillin the early stages of development.
SOFTBANK Emerging Markets, which is tied-up with the World Bank Group’s
International Finance Corporation, specializes in emerging markets. This year, it commenced
full-fledged operations and established offices in Malaysia and Poland. SOFTBANK Emerging
Markets will contribute to the growth of its investments by using SOFTBANK’s world-spanning
network to share information and introduce business partners.
Meanwhile, with the majority of Internet corporations in the United Statesconcentrating their operations within the U.S. market, SOFTBANK will suspend business
operations and possibly liquidate @viso Limited and eVentures Limited, which were
established to export the business models of U.S. Internet companies into Europe.
4. Geographic Segment Performance
Due to the strong performance of the e-Commerce and e-Finance segments, SOFTBANK’srevenues in Japan for the term under review increased 18.1% compared with the previous
term, to ¥341,978 million. Operating income also rocketed 38.9%, to ¥19,855 million.
In North America, Ziff-Davis, Inc. was sold and UTStarcom, Inc. was removed fromconsolidation, leaving Key3Media Group, Inc. as the only major source of revenue for theregion. As a result, revenues plummeted 72.0%, to ¥31,079 million. Although the operating
income ratio improved due to the sale of assets in underperforming Ziff-Davis Inc, owing to
the fall in net sales, operating income dropped 57.3%, to ¥2,651 million.

SOFTBANK CORP.

13

Revenues in Europe also consisted of revenue from the operations of Key3MediaGroup, Inc. only, due to the sale of assets in Ziff-Davis, Inc., and amounted to ¥1,291 million.
Although Key3Media Group, Inc. successfully generated income during the term, operating
costs incurred in the Group’s fund business in Europe resulted in an operating loss of ¥473
million.
In operations in South Korea, equity method affiliate SOFTBANK Korea, Co., Ltd.,was included in consolidation from the term under review. Demand is high for network
products in South Korea where broadband access is spreading rapidly, and IT productwholesale and marketing operations are expanding at a healthy pace, resulting in revenues of¥21,271 million. Although operating income from business operations was recorded for theterm, amortization of consolidated goodwill from the time the company was acquired resulted
in an operating loss of ¥856 million.

SOFTBANK CORP.

14

CONSOLIDATED BALANCE SHEETS(Million yen; amounts less than one million yen are omitted.)
FY2000/2001
FY1999/2000
Increase(As of March 31,2001)(As of March 31, 2000)（△Decrease）
Amount%Amount%ASSETS
Current assets(

Cash
Trade notes and accounts receivable
Marketable securities
Inventories
Deferred tax assets (current)
Assets held for sale
Other current assets
Allowance for doubtful accounts (current)

Non Current assets

365,166 ) (141,056
81,28629,343
23,413
8,234
83,075
△
1,244

(

12.4
7.1
2.6
2.0
0.7
7.2
△ 0.1

780,318 ) (68.1 )

Property and Equipment

13,529Intangible assets, net

516,458 ) (254,708
92,454
17,848
16,954
6,340
79,87251,507△3,227( △151,292 )

21.8
7.9
1.5
1.5
0.5
6.9
4.4
△ 0.3

△113,651△ 11,168
11,495
6,459
1,894△ 79,872
31,5671,983

55.8 )

1.2

8,243

0.7

5,286

119,774

10.4

131,784

11.3△ 12,009

Goodwill
Trade names
SoftwareAdvertiser lists
Consolidation adjustment
Other intangible assets

41,68041,093
7,135
15,07914,785

3.6
3.6
0.6
1.3
1.3

56,66438,4384,819
2,514
15,94013,405

4.9
3.3
0.4
0.2
1.4
1.1

△ 14,984
2,655
2,316
△ 2,514
△
861
1,379

Investments and other assets

647,01456.5

511,38443.8

135,630

Investments in securities
Long-term loan receivables
Deferred tax assets
Investments in partnership
Other assets
Allowance for doubtful accounts

492,853
3,033
9,826
133,303
9,440
△
1,442

43.0
0.3
0.9
11.6
0.8
△ 0.1

398,270
2,634
2,261
94,727
14,604
△
1,113

34.1
0.2
0.2
8.1
1.3
△ 0.1

94,582
399
7,565
38,575△ 5,163△328

TOTAL ASSETSSOFTBANK CORP.

(

598 ) (

1,146,083

0.0 )

100.0

(

44.2 )

651,412 ) (Deferred charges(

31.9 )(

436 ) (

1,168,308

0.0 )

100.0

(

(

128,906 )161 )△ 22,224

15

CONSOLIDATED BALANCE SHEETS(Million yen; amounts less than one million yen are omitted.)
FY2000/2001
FY1999/2000
Increase(As of March 31,2001)(As of March 31,2000)（△Decrease）
Amount%Amount%LIABILITIESCurrent liabilities(

344,767 ) (29.5 )

55,82888,88526,30057,74328,56523,681
10,287
2,259
51,216

4.8
7.6
2.3
4.9
2.4
2.0
0.9
0.2
4.4

336,463 ) (28.8 )( △ 53,404 )

15.3
4.5
0.0
2.8
2.1

169,089
8,182
126,248
76
3,764
29,102

14.5
0.7
10.8
0.0
0.3
2.5

6,278
△ 8,182△ 74,670
76
28,607△ 5,514

-

-

2,051

0.2

△

TOTAL LIABILITIES

662,36857.8

683,283

58.5△ 20,914

MINORITY INTEREST

59,453

5.2

104,284

8.9△ 44,831

Common stock

137,63012.0

124,957

10.7

12,672

Additional paid-in capital

161,953

14.1

149,21112.8

12,741Retained earnings

94,803

8.3

59,091

5.0

35,711

Net unrealized gains on securities
available for sale

18,435

1.6

47,546

4.1△ 29,111

Translation adjustments

11,441

1.0--

11,441

2

△ 0.0

66

△ 0.0

64

TOTAL SHAREHOLDERS' EQUITY

424,26137.0

380,740

32.6

43,521TOTAL LIABILITIES , MINORITY
INTEREST AND SHAREHOLDERS'EQUITY

1,146,083

100.0

1,168,308

100.0△ 22,224

Trade notes and accounts payable
Short-term borrowing
Current portion of straight bonds
Current portion of convertible bonds
Commercial paper
Income tax payable
Deferred tax liabilities (current)
Accrued expenses
Advance received
Allowance for sales returns
Other current liabilities

Long-term liabilities(

Straight bonds
Convertible bonds
Long-term debt
Pension accrual
Deferred tax liabilities
Other liabilities

Translation adjustments

379,309 ) (33.1 )

63,935
128,482
21,4006,614
30,00023,428298
10,654
11,3291,471
81,695

5.6
11.3
1.9
0.6
2.6
2.0
0.0
0.9
1.0
0.1
7.1

283,059 ) (24.7 )

175,368
51,578152
32,372
23,587(((34,541 )

△

△
△
△
△

8,106
39,5964,900
6,614
30,00034,31528,267
13,0261,042
787
30,4782,051

SHAREHOLDERS' EQUITY

Less: Treasury stock

SOFTBANK CORP.

△

△

16

CONSOLIDATED STATEMENTS OF INCOME(Million yen; amounts less than one million yen are omitted.)
FY2000/2001
FY1999/2000
Increase(April 2000 through March 2001) (April 1999 through March 2000)(△Decrease)
Amount%Amount%Revenue from non-Finance business

365,201

92.0

404,635

95.6△ 39,433

Cost of sales

291,507

73.4

280,780

66.3

10,727Gross profit

73,693

18.6

123,854

29.3△ 50,161

Selling, general and administrative expenses

70,49317.8

125,201

29.6△ 54,708

Operating income (△loss) from non-Finance

3,200

0.8

0.3

4,547

31,9038.0

18,585

4.4

13,31818,672

4.7

8,861

2.1

9,811

13,231

3.3

9,724

2.3

3,506

16,431

4.1

8,377

2.0

8,054

Revenue from Finance business
Expense for Finance business

(1)

(2)

Operating income from Finance business(3)

Total operating income

△

1,346

△

Non-operating income
Interest income
Exchange gain
Equity in earnings of affiliates
Other non-operating income(

42,374 ) (
4,363
28,115
9,895

10.7 ) (
1.1
7.1
2.5

17,571 ) (
2,779
4,744
10,046

4.2 ) (
24,803 )0.7
1,583
28,115
1.1
△
4,744
2.4
△
151

Non-operating expenses
Interest expenses
Exchange loss
Equity in losses of affiliates
Other non-operating expenses(

38,740 ) (12,263
19,765
6,710

9.7 )
3.1
5.0
1.6

77,881 ) (20,15344,37013,35718.5 )
4.8
10.5
3.2

( △ 39,140 )△7,889△ 44,370
19,765△
6,646

20,0655.1

12.3

71,998

169,925 ) (42.8 ) (289,072 ) (68.3 ) ( △ 119,146 )

119,054
49,712
1,158

30.0
12.5
0.3

218,207
40,07229,001
1,791

51.6
9.5
6.8
0.4

102,981 ) (26.0 ) (204,971 ) (48.4 ) ( △ 101,989 )

23,76429,23028,7618,604
1,558
11,062

6.0
7.4
7.2
2.2
0.4
2.8

602
3,662
77,043
3,236
119,126
1,300

0.1
0.9
18.2
0.8
28.1
0.3

23,162
25,56728,761△ 68,439△
1,677△ 119,126
9,762

87,00921.932,168

7.6

54,841

Ordinary income (△loss)
Special income(

Gain on sales of investment securities
Dilution gain from changes in equity interest
Gain on sales of operations
Other special income
Special loss(

Loss on sales of investment securities
Loss on revaluation of investment securities
Loss on revaluation of investments in affiliates
Loss on discontinued operations
Dilution loss from changes in equity interest
Evaluation loss on intangible assets
Other special loss
Income before income taxes(△ 51,932△△ 99,152
9,640△ 29,001△
633

Income taxes -current
Income taxes -deferred

69,043△ 20,427

△

17.4
5.1

52,722
62

12.5
0.0

16,320△ 20,489

Minority interest

△

△

0.4

29,063

6.9△ 30,825

9.2

8,446

2.0

28,184

Net income

Notes: Finance Business Break-down(1) Revenue from Finance business(2) Expense for Finance business(3) Operating income from Finance business

SOFTBANK CORP.

1,762
36,631

FY2000/2001
e-Finance
Overseas Funds
30,626
1,277
17,171
1,501
13,454△223

FY1999/2000
e-Finance
Overseas Funds
15,981
2,604
8,271
589
7,710
2,014

17

CONSOLIDATED STATEMENTS OF RETAINED EARNINGS(Million yen; amounts less than one million yen are omitted.)
FY2000/2001
FY1999/2000
Increase(April 2000 through (April 1999 through（ △ Decrease ）March 2001)
March 2000)
Retained earnings at beginning of period

Increase in retained earnings

59,091(

Increase due to exclusion of affiliates underequity method
Increase due to merger
Decrease in retained earnings
Dividends
Directors' bonus
Decrease due to exclusion of affiliates underequity method
Decrease due to exclusion of consolidated
subsidiaries(

1,431 )

52,556

(

256 )

1,385

-

46

256

2,351 )(

2,168 )

6,534(

1,175 )
1,385
△

(

210
182 )

2,203
117

2,095
72

107
44

1

-

1

29

-

29

Net income

36,631

8,446

28,184Retained earnings at end of period

94,80359,09135,711SOFTBANK CORP.

18

CONSOLIDATED STATEMENTS OF CASH FLOWS(Million yen; amounts less than one million yen are omitted.)
FY1999/2000
FY2000/2001(April 1999 through(April 2000 throughMarch 2000)
March 2001)
Ⅰ Cash flows from operating activities
Income before income taxes
Depreciation and amortization
Equity in losses (earnings) of affiliates
Dilution gain from changes in equity interest
Evaluation loss on intangible assets
Loss (gain) on revaluation of marketable and investment securities
Net gain on sales of marketable and investment securities
Exchange (gain) loss
Interest and dividends income
Interest expenses
Loss on discontinued operations
Increase in trade notes and accounts receivable
Increase in trade notes and accounts payable
Decrease in other assets
Increase in other liabilities
Other cash flows from operating activities
SubtotalInterest and dividends received
Interest expense paid
Income taxes paid
Net cash (used in) provided by operating activities
Ⅱ Cash flows from investing activities
Capital expenditures-property, equipment, and intangible assets
Purchase of marketable and investment securities
Proceeds from sales of marketable and investment securities
Proceeds from sales of subsidiary (which is not a subsidiary after the sale)
Purchase of subsidiary (which was not a subsidiary before the sale)
Proceeds from sales of subsidiaries' shares
Payment on lending
Proceeds from repayments on lending
Proceeds from sale of assets held for business
Other cash flows from investing activities
Net cash used in investing activities
Ⅲ Cash flows from financing activities
Proceeds from issuance of subsidiaries' stock to minority interest
Proceeds from sales of subsidiaries' stock to minority interest
Net increase in short-term borrowing
Proceeds from issuance of commercial paper
Payments for redemption of commercial paper
Proceeds from long-term debt
Repayment of long-term debt
Proceeds from issuance of bonds
Payment for redemption of bonds
Proceeds from issuance of common stock
Proceeds from silent partners of consolidated subsidiary
Dividends paid
Other cash flows from financing activities
Net cash provided by financing activities

△

△
△
△

△
△
△

△
△
△

△
△

△
△

△

△
△
△

△
△

Ⅳ Effect of exchange rate changes on cash and cash equivalents
Ⅴ Net (decrease) increase in cash and cash equivalents
Ⅵ Increase in cash and cash equivalents due to the change from equity method
affiliates to consolidated subsidiaries
Ⅶ Decrease in cash and cash equivalents due to the change from consolidated
subsidiaries to equity method affiliates
Ⅷ Decrease in cash and cash equivalents due to offset of anonymous investment
association
Ⅸ Cash and cash equivalents at beginning of the period
Ⅹ Cash and cash equivalents at end of the period

SOFTBANK CORP.

87,0098,072
19,765
48,15457,991
95,40428,2194,377
12,263
16,246
4,259
10,902
48,64424,759
5,777
2,174
4,103
11,82386,05391,59816,241
233,131104,22466
362
20,9656,647
5,154
82,906453
42,61238,50237,54750,00020,00063,491
142,102
27,867
26,60323,2752,200
25,22824,54833,461

△

△
△
△
△
△

△
△

△
△

△
△

△
△

△
△

△
△
△

△
△

△

32,16832,6594,744
36,835
119,126
3,028
218,677
44,3702,779
20,15348,041
26,21422,721
32,65038,523
3,454
36,291
2,938
20,882
17,997349

11,637
299,091
159,905
104,724
11,610
8,172
7,608
2,067
60,341

67,46583,43868,19920,0007,034
46,73861,84335,33344,485
2,095
7,385
220,914307

76,200160,615

517

1,558

△

22,444-△

10,827-

268,060

105,886

159,105

268,060

19

Basis of Presentation of Consolidated Financial Statements

1. Scope of Consolidation
The Company consolidates 216 subsidiaries. 20 subsidiaries are not consolidated, as their influence on the consolidated financial
statements is immaterial in the aspects of total assets, sales, net income and retained earnings.
Changes in scope of consolidation are followings.
<Increase; including Partnerships>
1. Key3Media Group, Inc.

Newly established resulting from spin-off from Ziff-Davis Inc.

2. SB Life Science Pte. Ltd.

Newly established

3.SOFTBANK Emerging Markets, Ltd.

Newly established4.SB Thrunet Fund, L.P.

Newly established

5.SOFTBANK TECHNOLOGY HOLDINGS

Newly established

CORP.
6.Finance All Corporation

Newly established7.IP Revolution Inc.

Newly established8.CreariveBank Inc.

Equity Increase due to new share issuance

Other 104 companies<Decrease; including Partnerships>
1. UTStarcom, Inc.

Changed to affiliates due to dilution by new share issuance

2. Ziff-Davis Inc.

Sold off

Other 37 companies

2. Application of the equity method
110 affiliates and 7 non-consolidated subsidiaries are under the equity method.
Changes in application of the equity method are followings.
<Increase; including Partnerships>
1. Aozora Bank Ltd. (formerly The Nippon

Newly invested

Credit Bank, Ltd.)
2. Nihon Ariba K.K

Newly invested

3. UTStarcom, Inc.

Changed from consolidated subsidiary

Other 76 companies<Decrease; including Partnerships>
1. Able Corporation

Sold off

Other 14 companies

3. Fiscal year ends of subsidiaries
Fiscal year ends of consolidated subsidiaries are followings:<Fiscal year end>

<Domestic ><Foreign>

7910June end2

44

September end

7-

December end

14

59

February end

1-March end(as same as consolidated
B/S date)

SOFTBANK CORP.

20

4. Summary of Significant Accounting Policies(1)

Major Asset evaluation(a) Marketable securities and investments in securities
Held-to-maturity securities:

Carried at Amortized Cost

Available-for-sale securities
With a market quotation:

Stated at fair value, valued at market prices at balance sheet date. (Amount of theunrealized gains / losses from valuation of marketable securities are charged directly toshareholders’ equity, while cost for sale is determined mainly by the moving-averagemethod.)Without a market quotation:
Stated at Cost, mainly by the moving-average method.
(b) Inventories
Inventories held by the domestic consolidated subsidiaries are stated at cost, mainly by the moving-average method.
Inventories held by the foreign consolidated subsidiaries are valued at the lower of cost or market; cost being determined by
the first-in, first-out method.

(2)

Depreciation methods for major assets(a) Tangible fixed assets:
For the Company and domestic consolidated subsidiaries, the declining-balance method is used. For foreign consolidated
subsidiaries, the straight-line method is used.
(b) Intangible fixed assets:
The straight-line method is used. Goodwill is amortized over 5 to 40 years.

(3)

Recording basis of major allowances and accrual(a) Allowance for doubtful accounts:
Allowance for doubtful accounts is provided at an amount of possible losses from uncollectable receivables based on theactual rate of losses from bad debt for ordinary receivables, and on estimated recoverability for specific doubtful receivables.

(b) Allowance for sales returns:
Allowance for sales returns is provided based on the estimated losses resulting from possible future returns.

(c) Pension Accrual:
For the Company and domestic consolidated subsidiaries, pension accrual is calculated based on projected benefit
obligations and fair value of the plan assets at the end of the fiscal year. The cumulative effect of adopting the new accounting
standard, amounting to 382 million yen, is expensed in this fiscal year. The impact to current year pension cost from theadoption of the new accounting standard is not material.

(4)

Finance Leases
Finance leases other than those transferring the ownership of the leased assets to lessees are accounted for by a principle similar
to that used for ordinary operating leases.

(5)

Anonymous Investment Association

SOFTBANK CORP.

21

For prior years, assets of an anonymous investment association had been treated as assets of a consolidated subsidiary
operating the association, and included in the consolidated balance sheet and footnotes. From this fiscal year, considering theincrease in the amount of assets of the anonymous investment association and the existence of assets substantially not belonging
to the consolidated group, assets and liabilities belonged to members outside the consolidated group are offset against thedeposits from the members of the association.
Cash and cash equivalents, which belong to the members of the association outside the consolidated group (amounting to 10,827
million yen) at the beginning of the fiscal year, are stated as “Decrease in cash and cash equivalents due to offset of anonymous
investment association” in the statement of cash flows.

5. Amortization of the consolidation adjustment
Consolidation adjustment is amortized on a straight-line basis over five to seven years. Immaterial amount of consolidation
adjustment is expensed as incurred.

6. Appropriation of retained earnings
Consolidated statement of retained earnings reflects the appropriation of retained earnings approved during the fiscal year.

7.The Scope of Cash and Cash Equivalents in the Consolidated Statement of Cash Flows
Cash and cash equivalents in the consolidated statement of cash flows are composed of cash in hand, bank deposits able to bewithdrawn on demand and short-term investments with an original maturity of three months or less and which represent a minor risk offluctuations in value.

(Additional Information)
1. Accounting Principle for Pension Plans
Effective April 1, 2000, the Company adopted a new accounting standard for its pension plans in accordance with "Policy Statement on
Accounting for Pensions" issued by the Business Accounting Deliberation Council on June 16, 1998.

2. Accounting Principle for Financial Instruments
Effective April 1, 2000, the Company adopted a new accounting standard for financial instruments in accordance with "Policy
Statement on Accounting Standards for Financial Instruments" issued by the Business Accounting Deliberation Council on
January 22, 1999.
After examining the holding purposes for marketable securities held by the Company at the beginning of the fiscal year,
marketable securities to be matured within one year are included in current assets and the rest of the marketable securities areincluded in investments in securities.

3. Accounting Principle for Foreign Currency Transactions
Effective April 1, 2000, the Company adopted a new accounting principle for foreign currency transactions in accordance with “Policy
Statement on Revising Accounting Standards for Foreign Currency Transactions” issued by the Business Accounting Deliberation
Council on October 22, 1999.

SOFTBANK CORP.

22

NOTES
1 Accumulated depreciation of property and equipment
As of March 31, 2001
As of March 31, 2000
6,516 million yen
6,953 million yen
2 Number of Treasury stock held by the Company
As of March 31, 2001
465 shares

As of March 31, 2000
720 shares

3 Assets and Liabilities held by anonymous Investment Association
For prior years, assets of an anonymous investment association had been treated as assets of a consolidated subsidiary operating theassociation, and included in the consolidated balance sheet.
From this fiscal year, assets and liabilities belonging to members outside the consolidated group are offset against the deposits
form the members of the association.

(1) FY2000/2001 (For the year ended March 31, 2001)
The assets and liabilities belonging to the anonymous investment association, net of deposits from the members of the association,
for FY2000/2001 are as follows.
Cash
Marketable securities
Other current assets
Investments in securities
Investments in partnerships
Other current liabilities
Other non-current liabilities

5,689 million yen
235
15,794 (including operating investment securities of 15,489 million yen)
5,291
1,392
482
27,921 (deposits from the members of the association)(2) FY1999/2000 (For the year ended March 31, 2000)
The assets and liabilities belonging to the anonymous investment association included in the consolidated balance sheets
for FY1999/2000 are as follows.
Cash
Marketable securities
Other current assets
Investments in securities
Other current liabilities
Other non-current liabilities

SOFTBANK CORP.

2,025 million yen
8,802
16,512 (including operating investment securities of 16,150 million yen)
1,491
1,416
24,680 (deposits from the members of the association)23

4 Assets pledged as collateral and secured liabilities(1) Assets pledged as collateral related to lease contracts

Account
Cash
Trade notes and accounts
receivable
Other current assets (Accountreceivable -other)(Million yen; amounts less than one million yen are omitted.)
Assets pledged as collateral
As of March 31, 2001
As of March 31, 2000
Type ofType of
Carrying amount
Carrying amountcollateralcollateral
550
Pledge963

Mortgage561

12Mortgage-

Mortgage

Secured liabilities
As of March 31, 2001
Carrying amount

As of March 31, 2000
Account
Carrying amount
Trade notes and accounts
374
401
payableNotes for FY2000/2001 (as of March 31, 2001)
The collateral listed above are for lease liability of 11,225 million yen (including the above accounts payable of 401
million yen), and are made by mortgaging credits, claimed by consolidated subsidiaries in future, to members based onmembership agreements and to a consigned broadcasting company based on marketing agreements.
The ending balances of the above credits are 963 million yen of accounts receivable and 12 million yen of other current
assets shown above.
Notes for FY1999/2000 (as of March 31, 2000)
The collateral listed above are for lease liability of 11,257 million yen (including the above accounts payable of 374
million yen), and are made by mortgaging credits, claimed by consolidated subsidiaries in future, to members based onmembership agreements and to a consigned broadcasting company based on marketing agreements.
The ending balance of the above credits is 561 million yen of accounts receivable shown above.
(2) Assets pledged as collateral related to deposits received for securities loaned

Account
Other current assets(Marketable securities incustody)(Million yen; amounts less than one million yen are omitted.)
Assets pledged as collateral
As of March 31, 2001
As of March 31, 2000
Type ofType of
Carrying amount
Carrying amountcollateralcollateral
2,351

-

Mortgage

Secured liabilities
As of March 31, 2001
Carrying amount

As of March 31, 2000
Account
Carrying amount
Other current liabilities(Deposits received for
13,514securities loaned)
Notes:In addition to the above, collateral securities received form customers on margin transactions (3,732 million yen)
have been provided to Japan Securities Finance Company as collateral for securities borrowed.
(3) Assets pledged as collateral related to loans

Account
Cash(Time deposits)
Property and equipment
Investment in securities(Million yen; amounts less than one million yen are omitted.)
Assets pledged as collateral
As of March 31, 2001
As of March 31, 2000
Type ofType of
Carrying amount
Carrying amountcollateralcollateral
48
1,026
69,519Mortgage-

Mortgage
Mortgage

1,219-

Mortgage

Secured liabilities
As of March 31, 2001
As of March 31, 2000
Account
Carrying amount
Carrying amount
Short-term borrowing
52
20,564Long-term debt
146
124
Notes for FY2000/2001 (as of March 31, 2001)
Assets and subsidiary stocks of Key3Media, a U.S. consolidated subsidiary of the Company, are pledged as collateral
to long-term debt of 298 million dollar (34,243 million yen) and to short-term borrowing (which is reclassified from long-termbank loans) of 1 million dollar (181 million yen).
(4) Commitment to extend credit (Unused credit facility)
As of March 31, 2001
42 million yen

SOFTBANK CORP.

As of March 31, 2000
― million yen

245 Accounting for trade notes receivable with maturity date at the end of the fiscal year
Trade notes receivable with maturity date at the end of the fiscal year were settled on actual exchange dates.
Amount described below is included in the balance sheets at the end of the fiscal year because the last day of this fiscal year was a holiday
Trade notes receivable

983 million yen

6 Notes to consolidated statements of cash flows(1) Reconciliation of cash and cash equivalents and accounts on the consolidated balance sheets

Cash
Marketable securities
Time deposits with original maturity exceeding threemonth period
Deposits received from customers of the consolidated
subsidiaries involved in securities business
Stocks and Bonds with original maturity exceeding threemonth period
Cash equivalents included in inventories of consolidated
subsidiaries involved in securities business
Cash and cash equivalents(As of March 31, 2001)
141,056 million yen
29,343(As of March 31, 2000)
254,708 million yen
17,848

△

2,009

△

△

10,590

△

95

4,410
-

△

86

1,400
159,105 million yen

268,060 million yen

1,568 million yen

40,327 million yen(2) Significant non-cash transactions
Conversion of convertible bonds

7 Lease transaction
7-1. Finance leases in which the ownership of leased assets is not transferred to lessees(as a lessee)
FY2000/2001
FY1999/2000
million yen
million yen(a) Amount equivalent to acquisition costs, accumulated depreciation and costs less accumulated depreciation at end of year
Property, plant and equipment
Amount equivalent to acquisition costs
Amount equivalent to accumulated depreciation
Amount equivalent to costs, less accumulated
depreciation at end of the fiscal year
Software (Intangible assets)
Amount equivalent to acquisition costs
Amount equivalent to accumulated amortization
Amount equivalent to costs, less accumulated
amortization at end of the fiscal year
Total
Amount equivalent to acquisition costs
Amount equivalent to accumulated depreciation
Amount equivalent to costs, less accumulated
depreciation at end of the fiscal year

15,186
4,463

12,401
1,595

10,722

10,805

256
46

406
65

209

341

15,4434,510

12,808
1,661

10,932

11,146

3,136
8,552
11,6892,405
8,938
11,344(b) Amount equivalent to finance lease obligation at end of the fiscal year
One year or lessOver a year
Total(c) Lease payments, amount equivalent to depreciation expenses and interest expenses
Lease payments
Amount equivalent to depreciation expenses
Amount equivalent to interest expenses

4,221
4,256
1,029

1,407
1,203
385

(d) Calculation method of amount equivalent to depreciation expenses and interest expenses
The amount equivalent to depreciation expenses is computed using the straight line method based on the lease term
and no remaining amount.
The amount equivalent to interest expenses, which is calculated by subtracting acquisition costs from total lease
payments, is allocated over lease periods based on the interest method.

SOFTBANK CORP.

25

(as a lessor)
FY2000/2001(a) Acquisition costs, accumulated depreciation and costs less accumulated depreciation at end of year
Property, plant and equipment
Acquisition costs
Accumulated depreciation
Costs, less accumulated depreciation at endof the fiscal year

478 million yen
41
436

Software (Intangible assets)
Acquisition costs
Accumulated amortization
Costs, less accumulated amortization at endof the fiscal year

441
62
378

Total
Acquisition costs
Accumulated depreciation
Costs, less accumulated depreciation at endof the fiscal year

919
104
815

(b) Amount equivalent to finance lease obligation at end of the fiscal year
One year or lessOver a year

248
959
1,208

(c) Lease income, depreciation expenses and amount equivalent to interest income
Lease income
Depreciation expenses
Amount equivalent to interest income

180
118
38

(d) Calculation method of amount equivalent to interest income
The amount equivalent to interest income, which is calculated by subtracting acquisition costs from total lease
incomes and estimated residual value, is allocated over lease periods based on the interest method.
7-2. Non-cancelable operating lease transactions(as a lessee)
Future lease payments
One year or lessOver a year
Total

FY2000/2001
million yen
1,000
3,245
4,245

FY1999/2000
million yen
57,629355,178
412,808(as a lessor)
N/A
8 Dilution gain/loss from changes in equity interest
During the current fiscal year, as a result of capital transactions including initial public offerings at the investee level, the Company's
accounting interest in certain investments was adjusted due to dilution.
The major dilution gain / loss from changes in equity interest are as follows:

Yahoo! Inc.
SOFTBANK INVESTMENT CORPORATIONE*TRADE Group, Inc.
E*TRADE Japan K.K.
UTStarcom, Inc.
Nasdaq Japan, Inc.
Yahoo! Korea Corporation
Ziff-Davis Inc.
Morningstar Japan K.K.
cyber communications inc.

SOFTBANK CORP.

(Gain)
12,553 million yen
9,087
6,897
5,052
2,534
2,340
2,113
1,469
1,354
1,079

(Loss)△△△△- million yen
332
85
59
21
-

26

9. Accounting change related with reorganization of SOFTBANK Capital Partners
For the year ended March 31, 2000, SOFTBANK Capital Partners (Cap Fund) revalued the portfolio at fair value andrecorded gain /loss in operating income from Finance business on the statements of income under US GAAP.
For the year ended March 31, 2001, the Company legally reorganized Cap Fund to increase the level of control, which
SOFTBANK Group has over the Fund, and to be able to exercise significant influence over decision-making of the Fund.
As a result, Cap Fund was divided into SOFTBANK side fund (SB side fund) and Non-SOFTBANK side fund, which
consisted of external investments. Under US GAAP, investments held by SB side fund are either consolidated, accounted forunder the equity method, or cost method based on the percentage of ownership of shares.
For the year ended March 31, 2001, the equity method and/or cost method were applied to investments held by the SB side
fund.
There was no significant effect on net income before income taxes for FY2000/2001 due to this reorganization.
Adjustment to the beginning balance of retained earnings amounting 2,797 million yen, due to the reorganization, wasreported as special loss.

10. Loss on Discontinued Operations
The Company recognized loss on U.S. discontinued operations related to Ziff-Davis Inc. and Kingston Technology Company
for the year ended March 31, 2001.

Loss on discontinued operations was separately recorded from gain/loss on continued

operations under US GAAP, whereas under Japanese GAAP total amounts of loss on sales of operations and operating
losses before sales of operations were recorded as special losses from discontinued operations.

(1)

Ziff-Davis Inc. (ZD)

After sales of publishing division in April 2000, ZD mainly operated ZDNet and ZD Events of an exhibition business.

The

exhibition business was spun off as Key3Media and continued the operation as a consolidated subsidiary.
On the other hand, ZDNet and ZD were merged to CNET Network, Inc. (CNET) on October 2000, and recorded operating
losses as loss on discontinued operations amounting 4,831 million yen regarding ZD and ZDNet (excluding a spun-off
exhibition business).

(2)

Kingston Technology Company (Kingston)

As a result of settlement of assets and liabilities regarding SOFTBANK Kingston Inc., which was a holding company ofKingston being sold during the consolidated fiscal year ended March 31, 2000, settlement losses of 3,772 million yen werereported as a loss on discontinued operations in statements of income.

11. Loss on investments in affiliates
Loss on revaluation of investments in affiliates classified as special loss was as follows:(a) Impairment charge of consolidation adjustment for consolidated subsidiaries(b) Impairment charge of differences resulted from elimination of investment for affiliates

12. Significant Subsequent Events

SOFTBANK CORP.

168 million yen
28,592 million yen

N/A

27

SEGMENT INFORMATION
1. Business Segment Information(1) FY2000/2001(For the year ended March 31, 2001)(Million yen; amounts less than one million yen are omitted.)ee-FinanceCommerce

Ⅰ. Net sales andoperating income/loss
Net sales(1) Sales to externalcustomers(2) Inter-segment sales
and transfers

253,943

Media &
Broadmedia
Marketing

30,62652,414

12,998Internet
CultureTechnology
Internet
Overseas
Services Infrastructure Funds

12,481

11,728-Others

1,277

Total

21,635

Elimination
Consolidated
or
Total
Corporate
Assets397,105-

397,105

4,577

778

847

3

742

2,743

-

463

840

10,997 △10,997-

Total

258,52131,40453,262

13,001

13,223

14,471-

1,741

22,476408,102 △10,997397,105

Operating expenses

256,751

17,96647,358

11,946

8,521

13,996

1,068

1,501

28,141

387,252 △6,578

380,673

5,664

20,850 △4,418

16,431

Operating income(△loss)Assets, depreciation &Ⅱ.
capital expenditures(1) Identifiable assets

1,769

13,437

5,904

1,055

4,702

97,821

308,828

140,523

33,417

129,771

9,282

7,587

140,886

210,839

1,078,958

67,125

1,146,083(2) Depreciation

1,571

1,313

4,313

18

1,317

132

13

14

1,858

10,553150

10,703(3) Capital expenditures

4,472

10,197

1,625

165

1,911

443

115

127

1,069

20,127

2,618

22,745

475 △

1,068

239 △

(2) FY1999/2000(For the year ended March 31, 2000)

ee-FinanceCommerce

Ⅰ. Net sales andoperating income/loss
Net sales(1) Sales to externalcustomers(2) Inter-segment sales
and transfers

222,897

Media &
Marketing

15,981

118,441

Internet
Culture17,255(Million yen; amounts less than one million yen are omitted.)
Elimination
Overseas
Consolidate
or
Total
Other
Funds
d TotalCorporate
Assets2,604

41,040423,220-423,220

3,630

2,668

443

655

-

2,893

10,289 △10,289-Total

231,527

18,649118,884

17,911

2,604

43,934

433,509 △10,289423,220

Operating expenses

224,430

9,278

120,806

15,672589

53,897424,675 △

9,832

414,843

7,097

9,371 △

1,921

2,238

2,014 △

9,963

8,834 △

457

8,377

Operating income(△loss)Assets, depreciation &Ⅱ.
capital expenditures(1) Identifiable assets(2) Depreciation(3) Capital expenditures

86,572345,957

239,287

85,580117,451

239,299

1,114,148

54,1591,168,308

458

190

143,492

1,723

-

5,904

151,77015

151,785

1,683

1,253

5,514

1,502

-

2,105

12,06014

12,074

Notes:
1 1. Business segments are determined according to the responsibility of each operating officer of the segment controlling company.
2. The Company operates principally in the following business segments. (based on FY2000/2001)
Sales of PC software and such hardware as PCs and peripherals; enterprise solutions; diversified e-commerce(1) e-commercebusiness, including business transaction platform and e-commerce between business and consumer operations.
(2) e-Finance
All inclusive Web-based financial operations, including Internet securities operations; management of domestic
venture capital funds; incubation of portfolio corporations.
(3) Media & MarketingBook and magazine publication in such areas as PCs, the Internet, entertainment, etc.; exhibition management;
web content development.
(4) Broadmedia
Provision of applications and content for broadband broadcasting and communications and promoting the spreadof such operations.
(5) Internet Culture
Internet-based advertising operations.
(6) Technology Services
Systems integration, network integration, e-commerce and business operations.
(7) Internet Infrastructure
Ultra high-speed Internet access services and such related operations as data center business.
(8) Oversears Funds
U.S.- and Asia-focused global private equity operations in Internet-related companies.
(9) Other
Human resources and general affairs services.
2 The amount of assets classified in the column "Elimination or Corporate Assets" was 75,101million yen, and included the Company's surplus funds(cash and marketable securities), investment securities and assets held by the corporate devision of the parent company
3 Depreciation and capital expenditures include long-term prepaid expenses, deferred assets and related amortizations.
Depreciation of Media & Marketing operations for FY1999/2000 (for the year ended March 31, 2000) included evaluation loss on intangible assets at
Ziff-Davis Inc. amounting to 119,126 million yen.

SOFTBANK CORP.

28

2. Geographical Segment Information(1) FY2000/2001(For the year ended March 31, 2001)(Million yen; amounts less than one million yen are omitted.)
North
AmericaJapan

Ⅰ. Net sales andoperating income/loss
Net sales(1) Sales to externalcustomers(2) Inter-segment sales
and transfers

341,978

Europe30,523

Korea

1,291

Others21,271Elimination
Consolidated
or Corporate
Total
Assets

Total

2,040

397,105-

397,105

-

555

-

-

-

555 △

555

-

Total

341,978

31,0791,291

21,2712,040

397,660 △555

397,105

Operating expenses

322,123

28,427

1,765

22,1272,820

377,264

3,409

380,673

Operating income(△loss)Ⅱ. Identifiable assets

19,855491,551

2,651 △
385,017473 △
41,282856 △
26,556

20,396 △780
128,068

1,072,477

3,964

16,43173,606

1,146,083(2) FY1999/2000(For the year ended March 31, 2000)(Million yen; amounts less than one million yen are omitted.)
North
AmericaJapan

Ⅰ. Net sales andoperating income/loss
Net sales(1) Sales to Externalcustomers(2) Inter-segment sales
and transfers

289,458

Europe111,229

Other

11,126

11,406

Total

Elimination
Consolidate
or Corporate
d TotalAssets423,220-423,22072--

11,644

11,717 △

11,717-

Total

289,531111,229

11,12623,050434,937 △

11,717423,220

Operating expenses

275,240

105,020

11,21927,982

419,462 △4,619

414,843

Operating income ( △loss)
Ⅱ. Identifiable Assets

377,262

14,2916,209 △
553,33193 △
84,097

4,932
83,185

15,475 △1,097,877

7,097

8,377

70,4301,168,308

Notes : Geographical segmentation policy and major countries of each area is as follows.(for the year ended March 31, 2001)
1 1. Geographical segmentation policy
based on geographical adjacency
2. Major countries included in each area
North America
U.S.A. and Canada
EuropeU.K., Germany and France
OthersSingapore, Hong Kong and China
2 The amount of assets classified in the column "Elimination or Corporate Assets" was 75,101million yen, and included the Company's
surplus funds (cash and marketable securities), investment securities and assets held by the corporate devision of the parent company

SOFTBANK CORP.

29

3. Overseas sales(1) FY2000/2001(For the year ended March 31, 2001)(Million yen; amounts less than one million yen are omitted.)
North
AmericaⅠ. Overseas sales

31,399Europe

1,376

Korea

21,286

Other

2,581

Ⅱ. Consolidated sales
Ⅲ.

Total

56,644
397,105

Ratio of overseas sales toconsolidated sales

8%

0%

5%

1%

14 %

(2) FY1999/2000(For the year ended March 31, 2000)(Million yen; amounts less than one million yen are omitted.)
North
AmericaⅠ. Overseas sales

96,774

Europe12,330Other26,275

Ⅱ. Consolidated sales
Ⅲ.

Ratio of overseas sales toconsolidated sales

Total

135,380423,220

23 %

3%

6%

32 %

Notes: Segmentation policy of overseas sales and major countries of each area is as follows. (for the year ended March 31,2001)
1. Segmentation policy of overseas sales
based on geographical adjacency
2. Major countries of each area
North America
U.S.A., Canada
EuropeU.K., Germany, France
Other
Singapore, Hong Kong, China

SOFTBANK CORP.

30

TAX EFFECT ACCOUNTING

FY2000/2001(For the year ended March 31, 2001)

FY1999/2000 (For the year ended March 31, 2000)

1. Major items causing deferred tax assets / liabilities

1. Major items causing deferred tax assets / liabilities

Deferred tax assets

Deferred tax assets(Million yen)
28,25016,7672,667
2,079

Loss carryforward
Evaluation loss on investment securities
Foreign exchange loss
Enterprise taxes payable
Interests payable

1,601

Allowances for bad debts, etc.
Evaluation gain / loss on stock options
for officers / employees
Depreciation

1,021

OthersDeferred tax assets: subtotal
Valuation reserve
Deferred tax assets: total△(Million yen)
15,505
10,874
10,1644,487

Foreign exchange loss
Loss carryforward
Unrealized gain / loss
Enterprise taxes payable
Evaluation gain / loss on stock options
for officers / employees
Evaluation loss on investment securities

3,646
3,348

515

Interests receivable

1,602

369

Depreciation
Allowances for bonus, etc.
OthersDeferred tax assets: subtotal
Valuation reserve
Deferred tax assets: total

1,544
446
2,601
54,21745,615
8,602

4,818
58,08930,623
27,466

Deferred tax liabilities△

Deferred tax liabilities(Million yen)

Evaluation gain on other marketablesecurities
Accelerated amortization on goodwill /trade names
Evaluation gain on investment securities
Foreign exchange gain on long-term
receivables△

21,160(Million yen)
Gain on sale of investment securities△

21,467

△

6,285

△

1,890

△

806

△

6,197

Gain on restructuring of overseas
subsidiaries
Goodwill△

3,685Interests received

OthersDeferred tax liabilities : total

△
△

481
42,076

Unrealized gain
OthersDeferred tax liabilities : total

△
△
△

716
1,165
32,329Net amount of deferred tax liabilities△(Million yen)
14,610Net amount of deferred tax liabilities△(Million yen)
23,727△

10,5502. Major items causing differences between statutory andeffective rate after tax effect accounting
Statutory tax rate
(Reconciliation)
Perpetually-nondeductible expenses
such as entertainment expenses
Nondeductible taxes
Valuation reserve
Equity gain / loss
Tax rate difference
Others
Effective tax rate after tax effect accounting

SOFTBANK CORP.

42.05 %
1.76 %

△

8.56
7.94
2.64
8.13
1.05
55.87 %

2. Major items causing differences between statutory andeffective rate after tax effect accounting
Statutory tax rate
(Reconciliation)
Perpetually-nondeductible expenses
such as entertainment expenses
Nondeductible goodwill
Valuation reserve
Prorated residential taxes
Tax rate difference
Equity gain / loss
Others
Effective tax rate after tax effect accounting

42.05 %
7.62 %

△
△
△

48.56
74.88
0.13
2.17
4.91
2.07
164.09 %31

MARKETABLE SECURITIESFY2000/2001 (For the year ended March 31, 2001)
1. Available for sale securities with fair value(Million yen; amounts less than one million yen are omitted.)
FY2000/2001 (For the year ended March 31, 2001)
Cost

Carrying Amount

Differences

Fair Value > Carrying Amount① Stocks② Bonds
Corporate bonds
Sub-total

56,710101,276

44,5663,140
59,850

5,828
107,105

2,687
47,25469,78253,798△15,983

1,350
71,132130,982

1,311
55,109162,215△△38
16,022
31,232

Fair Value ≦ Carrying Amount① Stocks② Bonds
Corporate bonds
Sub-total
Total

Notes: Fair value information at the end of FY2000/2001 is described just for "available for sale securities", whereas at the end of FY1999/2000"Stocks of subsidiaries and affiliates" are included in addition to "available for sale securities".
2.Held-to-matureity securities sold in FY2000/2001 (for the year ended March 31, 2001)

Cost for sale
Bonds

40
Total

40

(Million yen; amounts less than one million yen are omitted.)
Gain/Loss on
Amount for saleObjectives of sales
sale
Voluntary redemption by
40
0issuance
40
0

3.Available for sale securities sold in FY2000/2001 (for the year ended March 31, 2001)(Million yen; amounts less than one million yen are omitted.)
Total losses on
Total gains on
Amount for sale
sale
sale
① Stocks

51,605② Bonds
Total

42,359△ 3,346

25,447

1,682△ 1,123

77,05344,042△ 4,470

4.Marketable securities not stated at fair value(Million yen; amounts less than one million yen are omitted.)
Stated amounton consolidatedbalance sheet(1) Held-to-maturity securities
Unlisted bonds
0(2) Available for sale securities
Unlisted stocks (excluding stocks traded over
45,063the counter)
Unlisted foreign bonds
9,008
Unlisted bonds
1,776
MMF
22,184Mid-term government bonds fund2,365
Others4,793(3)Stocks of subsidiaries and affiliates
Stocks of subsidiaries
214
Stocks of affiliates
274,575
Total
359,980SOFTBANK CORP.

32

5. Prospected amount for redemption of available for sale securities with maturity date and held-to maturity securities
subsequent to the consolidated balance sheet date(Million yen; amounts less than one million yen are omitted.)
More than one
More than five
Within one year year, less thanyear, less than ten
five years
years(1) Held-to-maturity securities
Others0
sub total
0(2) Available for sale securities
Bonds
Government bond and municipal bond
0
1
Corporate bonds
17,623
Others00Sub-total
017,623
1
17,623
1
Total
1

FY1999/2000 (As of March 31, 2000)(Million yen; amounts less than one million yen are omitted.)
FY1999/2000 (As of March 31, 2000)
Carrying amount① Items classified as current assets
Stocks
Bonds
OthersSub-total② Items classified as non-current assets
Stocks
Bonds
OthersSub-total
Total

Fair value

Unrealized gain

5,029
0
5,030

56,720056,72051,69051,690255,391
3,984
259,376
264,406

3,115,210
3,790
3,119,000
3,175,721

2,859,818
194△
2,859,624
2,911,315

Note 1: Fair values are calculated based on the following principles.
(1) Listed securities: closing prices on the Tokyo Stock Exchange or Luxembourg Stock Exchange(2) Securities traded over the counter: final prices announced by the Japan Securities Dealers Association.
: closing prices on Nasdaq(3) Securities traded over the foreign counter(4) Beneficiary certificates of securities investment: standard prices(5) Securities held by Overseas Fund
: prices after discounting from the closing price of Nasdaq
Note 2: Carrying amount of securities excluded from above disclosure
Current assets

Fixed assets

MMF
Mid-term government bonds fundInvestment securities for business(Carrying amount as of March 31, 2000)
14,108 million yen
3,653
11,585

Unlisted stocks

131,544(excluding securities traded over the counter)

Unlisted foreign bonds

SOFTBANK CORP.

7,350

33

CONTRACT AND OTHER AMOUNTS, FAIR VALUE AND UNREALIZED GAIN
/LOSS ON DERIVATIVE TRANSACTIONSCurrency Related(Million yen; amounts less than one million yen are omitted.)
FY2000/2001 (As of March 31, 2001)

Nature of transaction

Contract and otheramounts

Fair valueOver 1 year

FY1999/2000 (As of March 31, 2000)

Unrealize
d lossContract and otheramounts

Fair valueOver 1 year

Unrealized
loss

Swap Transactions
・Australia dollars Receiver,JPY Payer

Off-market
transactions ・ Call option in US dollars(Option premium)・ Put option in US dollars(Option premium)
Total

1,000 △

176 △

176

1,000

26
0

-

0△

0

26
0

-

0△

1,053

1,000 △

176 △

1,000

1,000 △

23 △

23

-

-

-

-

0

-

-

-

-

176

1,000

1,000 △

23 △23Interest Related(Million yen; amounts less than one million yen are omitted.)
FY2000/2001 (As of March 31, 2001)

Nature of transaction

FY1999/2000 (As of March 31, 2000)

Notional and otheramounts

Unrealize
Fair value d gain or
Over 1 year
(loss)

Notional and otheramounts

Fair value

Unrealized
gain or(loss)

Over 1 year

Swap Transactions
Fix Rate Reciever,・
Floating Rate Payer
Off-market
Floating Rate Reciever,transactions ・
Fix Rate Payer
Fix Rate Reciever(receipt
・ later), Floating Rate
Payer(pre payment)
Total

6,014

5,771

397

397

6,257

6,257

439

439

8,157

7,485 △

563 △

563

8,828

8,828 △

624 △

624

1,000

1,000

36

36

2,000

1,000

68

68

15,171

14,257 △

128 △

128

17,08516,085 △

117 △

117

Notes: Description of narrative information for derivative transaction is omitted.

SOFTBANK CORP.

34

RELATED PARTY TRANSACTIONS
1. Parent Company and Major Corporate Shareholders
N/A

2. Directors and Major Individual Shareholders

Name

Major individual
Masayoshi Sonshareholder

Address

Capital /EquityBusiness /Occupation--

Representative
Director, Son
Asset Management

Shareholding(being held)%
37% being
directly held

Account

Amountoutstanding(million yen)Othercurrent
assets1

Relationship
Concurrent
Post

Business
Relations--

Transactions
Travel /transportation
expenses

Amount(million yen)18

3. Subsidiaries
N/A

4. Affiliates
N/A

PENSION PLANS
1. Outline of Pension Plans
The Company and domestic consolidated subsidiaries, except some companies, adopt a qualified pension plan and a welfare
pension plan, as defined-benefit pension plans.
2. Projected Benefit Obligation (as of March 31, 2001)① Projected benefit obligation② Plan assets at fair value③ Funded status④ Unrecognized transition obligations⑤ Unrecognized actuarial gain/loss⑥ Pension accruals(million yen)
1,078
782
296
143
152

3. Pension Costs (April 2000 through March 2001)(million yen)
① Service cost
(Notes 1,2)571
② Interest cost28
③ Expected return on plan assets
11④ Amortization of transition obligations
382⑤ Amortization of actuarial gain/loss⑥ Pension Costs
971
Notes
1. Service cost includes a contribution of 360 million yen to a synthetic-type welfare pension plan.
2. Service cost includes pension costs of subsidiaries under simplified method.

4. Computation Basis of Pension Liabilities① Periodic allocation principle for projected benefit obligations② Discount rate
③ Expected return on plan assets④ Amortization period of prior service cost
⑤ Amortization period of actuarial gain/loss

SOFTBANK CORP.

Standard of fixed-amount-for-period
3.0 %
2.2 %
1 year
1 year from the next fiscal year of occurrence35