SOFTBANK CORP.
CONSOLIDATED FINANCIAL REPORTFor the Fiscal Year Ended March 31, 2002
FINANCIAL HILIGHTS
1.

Results of Operations(Million yen; amounts less than one million yen are omitted.)
FY2002(April 2001
through March
2002)¥405,315(23,901)(33,302)(88,755)(263.53)−

Revenues
Operating income
Ordinary income (loss)
Net income
Net income per share— primary (yen)Year-on-yearchange

+2.1%
−
−
−
−
−

FY2001(April 2000
through March
2001)

Year-on-yearchange¥397,105
16,431
20,06536,631110.47109.38

-6.2%
+96.1
−
+333.7−−

Net income per share—diluted (yen)Notes:
1. Equity in earnings (losses) of affiliates (Million yen):
Fiscal Year ended March 31, 2002:¥(17,575)
Fiscal Year ended March 31, 2001:¥(19,765)
2. Average shares outstanding (consolidated)Year ended March 31, 2002: 336,798,168
Year ended March 31, 2001: 331,585,133
3. There were no 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 thecorresponding period of the previous fiscal year.
2.

Financial Condition(Million yen; amounts less than one million yen are omitted.)
FY2002
FY2001(As of March 31, 2002) (As of March 31, 2001)

Total assets
Shareholders’ equity
Equity ratio (%)
Shareholders’ equity per share (yen)Note: Shares outstanding (consolidated)3.

¥1,163,678
465,32640.0¥1,381.31¥1,146,083
424,26137.0¥1,260.14

As of March 31, 2002: 336,872,342
As of March 31, 2001: 336,677,714

Cash Flows(Million yen; amounts less than one million yen are omitted.)
FY2002
FY2001(April 2001 through(April 2000 throughMarch 2002)
March 2001)¥(79,123)
39,751
1,313¥119,855

Cash flows from operating activities
Cash flows from investing activities
Cash flows from financing activities
Cash and cash equivalents at end of the period
4.

5.

Scope of Consolidation
Consolidated subsidiaries:
Equity-method non-consolidated subsidiaries:
Equity-method affiliates:¥(91,598)(42,612)24,548¥159,105

285
2
111

Changes in Scope of Consolidation
Consolidated subsidiaries:
Newly added:
97
Newly deleted:
28
Equity-method non-consolidated subsidiaries and affiliates:
Newly added:
27
Newly deleted:
31

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 Adjustment
1. Consolidated Basis
Fiscal 1998

Fiscal 1999

Fiscal 2000

Fiscal 2001

Fiscal 2002

Net Income¥33.59¥121.79¥26.02¥110.47¥(263.53)

Shareholders’ equity¥791.75¥906.45¥1,152.18¥1,260.14¥1,381.31

2. Non-consolidated Basis
Fiscal 1998

Fiscal 1999

Fiscal 2000

Fiscal 2001

Fiscal 2002

Net Income¥44.60¥38.09¥165.04¥14.50¥(94.68)

Shareholders’ equity¥814.62¥863.72¥1,104.06¥1,172.75¥1,074.58

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 used in
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 2002, the SOFTBANK Group Comprised 398 companies with operation in 9 segments.

Business segment

Consolidated
subsidiaries (includes
partnerships)

Equity-method
non-consolidated
subsidiaries andaffiliates (includes
partnerships)

1.

e-Commerce

26

12

2.

e-Finance

135

21

3.

Media & Marketing

14

8

4.

Broadmedia

15

2

5.

Internet Culture

11

6

6.

Technology Services

8

3

7.

Broadband
Infrastructure

14

1

8.

Overseas Funds

43

52

9.

Others

19

8

285

113

Total

Principal products and operational content of eachbusiness
Sales of PC software and such hardware as PCs and peripherals;
enterprise solutions; diversified e-commerce business, including
e-commerce between business and consumer
All inclusive Web-based financial operations, including Internet
securities operations; management of domestic venture capitalfunds; incubation of portfolio corporations
Book and magazine publication in such areas as PCs, theInternet, entertainment, etc.; exhibition management; webcontent development
Provision of applications and content for broadband
broadcasting and communications and promoting the spread ofsuch operations
Internet-based advertising operations; broadband portal
business; Internet-based auction business
Systems solutions business; business solutions business
ADSL technology-based broadband infrastructure business;
optical fiber-based ultra high-speed Internet access services andother operations
U.S.- and Asia-focused global private equity operations inInternet-related companies
Holding company functions for overseas operations; back-officeservices in Japane - Fin an c e

e - Co mme rc e

Morningstar Inc.
SOFTBANK FRONTIERSECURITIES Co., Ltd.
SOFTBANK US Ventures VI LP Morningstar Japan K.K. WEB-Lease Co., Ltd.

CarPoint K.K. Nihon Ariba K.K.

SB Life Science Ventures Ⅰ,LP E*TRADE Securities Co., Ltd.

Emtorage Broadcommunications Inc.

SOFTBANKINVESTMENTCORPORATIONO ve rse as Fu n ds

E*TRADE
Japan K.K.

SOFTBANK FINANCECORPORATIONSB CHINA HOLDINGS PTE LTD

SOFTBANK COMMERCE CORP.
Vector Inc.
SOFTBANK ECHOLDINGSSOFTBANK Capital LP[Overseas][Domestic]

SOFTBANK
Holdings Inc.
[Operation Holding
SB Holdings
Companies](Europe) Ltd.

cyber communications inc.
Key3Media Group, Inc.

SOFTBANK Publishing Inc.

SOFTBANK Media &Marketing Corp.

SOFTBANK ZDNet Inc.

[Operation Holding
Companie s][Domestic][Overseas]S OFTBANK C ORP.

Yahoo Japan
Corporation(Pure Holding Company)

e-Shopping!
Books CORP.
Internet
Research
Institute, Inc.

I n te rn e t Cu ltu re

Me dia &Marke tin g

SOFTBANKTECHNOLOGYHOLDINGS CORP.

SOFTBANK
Broadmedia
Corporation

T e c h n o lo gy
Se rvic e s

BB Factory Corporation
Club iT Corporation
Xdrive Japan K.K.
Akamai Technologies
Japan K.K.

SOFTBANKTECHNOLOGY
CORP.

Aozora Bank, Ltd.
IP REVOLUTION INC.
BB Technologies Corporation

Nasdaq Japan Inc.
UTStarcom, Inc.
SOFTBANK Korea Co., Ltd.

B ro adme dia
O th e rs
B ro adban d
I n f rastru c tu re･･･ Segment･･･ Consolidated subsidiary･･･ Equity-method subsidiary or affiliate

SOFTBANK CORP.

3

Management Policies

1. Fundamental Management Policy
The core management philosophy of the SOFTBANK Group is “to contribute to mankind andsociety by using the digital information revolution to promote the sharing of wisdom andknowledge.” Over the past two decades, the Group has focused all its energy on developing Japan’s
digital information industry as the acknowledged industry leader. Initially, business activities werelimited to software sales and publishing PC magazines. Later, the SOFTBANK Group launched avariety of new businesses that targeted the unique structure of the IT industry, which is characterized
by dramatic and rapid changes. In recent years, the Group has been a driving force behind thegrowth of Internet businesses in Japan. A large number of businesses were started, enabling the
SOFTBANK Group to play an important role in raising Internet proliferation in Japan to its present
level.

Now, the SOFTBANK Group is placing priority on opportunities spawned by a new element of theInternet market: broadband technology. Resources are now being channeled to this field. By
achieving further growth, the Group is determined to make the greatest possible contribution to thedevelopment of Japan’s broadband services market, and, in the process maximize the Group’s value.

2. Fundamental Profit Allocation Policy
The SOFTBANK Group’s policy is to fulfill its obligations to society through the suitable
distribution of profits among all stakeholders. Furthermore, by generating a steady stream of
earnings from a variety of sources, the Group aims to continue to pay a stable dividend.

3. Medium- and Long-Term Strategies and Key Performance Indicators
The SOFTBANK Group’s primary goal over the medium and long term is to become thenumber-one corporate group in the broadband market. By implementing the following threestrategies, the Group plans to conquer the numerous markets born out of broadband technology.
These businesses will be operated so as to generate stable earnings and cash flows.
Strategy 1 – Become the number-one company in broadband infrastructure
BB Technologies Corporation has completed its own broadband network covering most of Japan,
making possible the provision of low-cost ADSL services. Since beginning to offer commercial
services in September 2001, this company has gained approximately 490,000 subscribers in just overhalf a year. This represents more than 20% of the approximately 2.4 million ADSL subscribers inJapan. BB Technologies Corporation will continue to offer a wide range of services and take othersteps to expand its subscriber base.

SOFTBANK CORP.

4

Strategy 2 – Become the number-one broadband platform group
The SOFTBANK Group includes many companies that have their own powerful brands andplatforms. Among these companies are Yahoo Japan Corporation, Internet securities firm E*TRADE
Japan K.K., mutual fund information service Morningstar Japan K.K., Internet job search company
e-Career CORP., IT news network ZDNet (SOFTBANK ZDNet Inc.), software downloading site
operator Vector Inc. and many others. Growing opportunities to earn profits among these Group
companies is one example of synergies that can be generated by the development of the broadband
infrastructure business. In April 2002, BB Technologies Corporation began the commercial operationof a new broadband phone service, BB Phone, creating another potential source of earnings for theGroup.
Strategy 3 – Capturing the number-one market shares in broadband platform-based services andcontent markets
The SOFTBANK Group will develop and supply a variety of services and applications by promoting
far-reaching cooperation among SOFTBANK Group companies and companies outside the Group in
e-Commerce, e-Finance, media & marketing, broadcasting and other fields.

4. Important Management Issues
Making the broadband infrastructure business profitable as fast as possible
Now that BB Technologies Corporation has largely completed a nationwide broadband network, theGroup has the ability to supply identical services anywhere in Japan. The Group plans to distinguishitself from competitors by combining this network with the Group’s collective strengths to supply adiverse line of services. The goal is to rapidly achieve profitability and positive cash flows on astand-alone monthly basis.

Rapid establishment of profitable operations at other new businesses
The extremely difficult conditions prevailing in the Internet business marketplace have severely
impacted the operations of the SOFTBANK Group. On the positive side, this tumultuous period has
clearly demonstrated which business models are successful, while spotlighting those that are notviable. This rapid process of “natural selection” of business models is enabling the Group to
concentrate resources on carefully chosen activities by winding down and integrating Group
companies. More actions will be taken to make all Group companies profitable.

Enhancing the Group’s financial strength
The SOFTBANK Group is currently taking steps to realize a significant improvement in its financial
strength. One goal is to rapidly reduce net interest-bearing debt to a suitable level. Some investment
securities will be sold and cash will be used to repurchase bonds. Through these and other actions,

SOFTBANK CORP.

5there was a substantial drop in net interest-bearing debt during the second half of the past fiscal year.
The Group will seek further progress with the aim of building an even sounder financial position.

5. Measures Involving Management Systems and Organizations
The SOFTBANK Group is divided into three tiers: a pure holding company, operating holding
companies that oversee operating companies in a particular business field, and operating companies.
This structure is designed to facilitate rapid decision-making based on the specialized knowledge
required by each of the Group’s business segments. Each core operating company is headed by aCEO. Monthly meetings of these CEOs provide a forum for reports on business activities,
information exchange, refinements in management policies and other interchanges that increase
synergies within the Group. The SOFTBANK Board of Directors has nine members, three of whomcome from outside the Group. The board serves as the Group’s highest decision-making body. The
Board of Auditors is charged with monitoring how the directors perform their duties. The majority ofthese auditors come from outside the Group.

In January 2002, a Business Auditing Office was established at the holding company. This new bodyis responsible for monitoring the activities of the Group companies to ensure that they conform to
the Group’s management policies.

The SOFTBANK Group remains fully committed to making still more improvements in its
corporate governance systems in the coming years.

6. Other items
Fundamental policy regarding relationships with related parties
There are no applicable items.

Important items regarding the company’s management
There are no applicable items.

SOFTBANK CORP.

6

Results of Operations and Financial Position
1. Results of Operations

Summary
Revenues increased ¥8,209 million, or 2.1%, to ¥405,315 million. This was mainly attributable to
growth in the e-Commerce and Internet Culture segments.

There was an operating loss of ¥23,901 million, a decline of ¥40,332 million compared with theprevious year’s operating income. One reason was a loss of approximately ¥17,952 million due tostart-up expenses at BB Technologies Corporation and other Broadband Infrastructure businesses.
Another reason was losses posted by e-Finance and other segments due to adverse economic andmarket conditions in Japan and overseas.

Ordinary income declined ¥53,367 million to a loss of ¥33,302 million. Although an exchange gainof ¥24,939 million was recorded because of the decline in the yen’s value, equity losses under theequity method, mainly in overseas investments of ¥17,575 million and net interest expenses of¥13,574 million were recorded.

The net loss for the year was ¥88,755 million, ¥125,386 million less than the previous year. The
company recorded as a special income, a net gain of approximately ¥51,395 million from partial
sales of stock held in Yahoo! Inc., UTStarcom, Inc., E*TRADE Group Inc. and other companies.
However, loss of approximately ¥118,459 million on the revaluation of investment securities andstock held in affiliates was recognized.(major components are write-off of approximately ¥40.3
billion in Asia Global Crossing Ltd. stock, approximately ¥29.7 billion in CNET Networks, Inc.
stock and approximately ¥25.8 billion in overseas funds and other investments).

The valuation loss on goodwill and other intangible assets held by Key3Media Group, Inc., anaffiliate, of ¥19,978 million was recognized, which was the transitional impairment losses due to theapplication of new U.S. accounting standards.

Operating Results by Business Segment
In e-Commerce, revenues rose ¥25,674 million, or 9.9%, to ¥284,195 million. Broadband-related
revenues increased at Emtorage Broadcommunications, Inc. and AIP Bridge CORP., while
SOFTBANK COMMERCE CORP., e-Shopping! Toys CORP. and other companies performed well.
Operating income increased ¥1,436 million, or 81.2%, to ¥3,206 million. Although selling, generaland administrative expenses increased at SOFTBANK COMMERCE CORP. due to the launch of

SOFTBANK CORP.

7

broadband related businesses, the operating income improved at other businesses that have moved
out of their start-up phases.

In e-Finance, revenues declined ¥7,143 million, or 22.7%, to ¥24,260 million. Revenues grew atMorningstar Japan K.K., E*TRADE Japan K.K. and WEB Lease Co., Ltd., however there was adecrease in fund success fees at SOFTBANK INVESTMENT CORPORATION. There was an
operating loss of ¥4,920 million, ¥18,357 million less than the operating income posted in theprevious fiscal year. In addition to the lower fund success fees earned by SOFTBANKINVESTMENT CORPORATION, there was a loss on the revaluation of operational investment
securities at this company due to slumping stock markets and start-up losses from a number of new
business ventures.

In Media & Marketing, revenues declined ¥4,822 million, or 9.1%, to ¥48,439 million. Revenues
continued to climb at SOFTBANK ZDNet Inc., Click2learn Japan K.K. and other companies, but
this growth was outweighed by lower revenues at SOFTBANK Publishing Inc. and Key3MediaGroup, Inc. Operating income was down ¥3,342 million, or 56.6%, to ¥2,561 million. In publishing,
lower advertising revenues, a profitable source of funds, halved earnings at SOFTBANK Publishing.
Earnings also suffered from a narrowing of profit margins at Key3Media Group, Inc., as well as
start-up costs at new businesses. Key3Media Group, Inc. is no longer a consolidated subsidiary,
having become an equity-method affiliate at the end of the fiscal year due to a decline in the
SOFTBANK Group’s ownership.

In Broadmedia, revenues declined ¥874 million, or 6.7%, to ¥12,127 million. One reason was lower
revenues at Club iT Corporation because of a decline in new subscribers. Operating income wasdown ¥1,095 million to a loss of ¥39 million. Start-up expenses at Akamai Technologies Japan K.K.
and Xdrive Japan K.K. were the primary cause. Club iT posted a net loss of ¥613 million for the year
due to a write-down of ¥2,404 million on CS tuners, antennas and other items resulting from thetermination in April 2002 of a SKY PerfecTV! sales agent agreement with SKY Perfect
Communications Inc. Club iT will now concentrate on restructuring its operations. Plans call forpreserving its existing base of CS broadcast viewers while rapidly ramping up new businesses suchas the provision of broadband services and the distribution of video programs to individuals.

In Internet Culture, revenues surged ¥18,791 million, or 142.1%, to ¥32,015 million. Amid agenerally difficult advertising market, Yahoo Japan Corporation reported a small decrease inadvertising revenues. However, there were large increases in revenues at Yahoo! BB and Yahoo’s
auction business, two facets of Yahoo Japan’s diversification drive. Operating income was up ¥5,234

SOFTBANK CORP.

8

million, or 111.3%, to ¥9,936 million. This was mainly attributable to much higher earnings at
Yahoo! BB and the auction business.

In Technology Services, revenues increased ¥4,055 million, or 28.0%, to ¥18,527 million andoperating income rose ¥659 million, or 138.8%, to ¥1,135 million. In both cases, growth was theresult of the strong performance of broadband-related services, including the establishment of abroadband infrastructure by SOFTBANK Technology Corp.

Broadband Infrastructure is a newly formed business segment consisting of the operations of BB
Technologies Corporation, the three members of the Metallic Communications Group, including
Tokyo Metallic Communications Corp., IP Revolution Inc., and other entities. In the previous fiscal
year, these companies were part of the Internet infrastructure segment. Revenues in the segment’s
first year totaled ¥9,168 million. This represents ¥6,124 million in revenues at BB Technologies
Corporation, revenues from the newly consolidated Metallic Communications Group and the firstrevenues from the new IP REVOLUTION Inc., which formerly belonged to the Internet
infrastructure segment. As all of these companies are still in early stages of their development,
start-up expenses and other items resulted in an operating loss of ¥17,952 million in this segment.

In Overseas Funds, revenues were up ¥740 million or 42.5% to ¥2,481 million as management feesfrom funds held by SOFTBANK Holdings, Inc. and other existing funds increased. The operating
loss decreased by ¥466 million to ¥226 million. The loss was the result of lower earnings from funds
at SOFTBANK Holdings, Inc. and the loss on funds at SB CHINA HOLDINGS PTE LTD., although
this represented an improvement from the previous fiscal year.

In others, net sales decreased ¥1,674 million to ¥20,803 million, mainly the result of lower sales at
SOFTBANK Korea Co., Ltd. A decline in earnings at this company along with start-up expenses at
Dee Corp. caused operating income to fall ¥1,090 million to ¥6,655 million.

Results by Geographic Segment
In Japan, revenues increased ¥11,743 million, or 3.4%, to ¥353,721 million. There were increases inthe e-Commerce, Internet Culture and certain other segments. Operating income was down ¥35,847
million to a loss of ¥15,992 million. The loss was mainly attributable to start-up expenses in the
broadband infrastructure segment and a loss in the e-Finance segment.

In North America, revenues decreased ¥626 million, or 2.0%, to ¥30,453 million. Operating income
fell ¥797 million, or 30.1%, to ¥1,854 million. Both declines were caused by lower revenues and

SOFTBANK CORP.

9earnings at Key3Media Group, Inc. and a one-time increase in selling, general and administrative
expenses and other costs at SOFTBANK Holdings, Inc. resulting from a restructuring view of its
fund operations.

In Europe, revenues were up ¥1,378 million, or 106.7%, to ¥2,669 million. This growth was theresult of higher European revenues at Key3Media Group, Inc. and higher management fees in thefund business. The region’s operating loss increased ¥787 million to ¥1,260 million because of lower
earnings at Key3Media Group, Inc. and an increase in fund management expenses.

In Korea, revenues decreased ¥1,751 million, or 8.2%, to ¥19,520 million and the operating loss
increased ¥720 million to ¥1,576 million. Both revenues and earnings are a reflection of the poor
performance of SOFTBANK Korea Co., Ltd. as market conditions were extremely challenging.

2. Financial Position

Balance Sheet
Current assets increased ¥29,280 million compared with March 31, 2001 to ¥394,447 million. Thiswas mainly attributable to the temporary payments for future lease assets of approximately ¥47.0
billion which were included in inventories and other current assets. (from BB Technologies
Corporation) and an increase of ¥19,463 million in receivables related to margin transactions at
E*TRADE Japan.

Intangible assets decreased by ¥88,242 million to ¥31,531 million, mainly because of the eliminationof ¥37,499 million in goodwill and ¥41,093 million in trade names of Key3Media Group, Inc. which
was excluded from consolidated subsidiaries.

Investments and other assets rose ¥61,518 million to ¥708,533 million. While the SOFTBANKGroup (“the company”) recognized the valuation loss on investment securities and sold off certain
investment, the investment securities increased ¥179,217 million because Yahoo! Inc. was valued at
the fair market value as other securities excluded from the affiliates accounted for by the equity
method.

Liabilities decreased ¥11,150 million to ¥651,218 million. There was an increase of ¥38,338 million
in deferred tax liabilities. The interest-bearing debts were down by ¥47,798 million.
Shareholders’ equity increased ¥41,064 million to ¥465,326 million. While the retained earnings
declined by ¥90,768 million, the unrealized gain on other securities rose by ¥108,190 million

SOFTBANK CORP.

10because Yahoo! Inc. was accounted at the fair market value and the translation adjustments increasedby ¥23,135 million.

Cash Flows
In this fiscal year, cash was provided by investing and financing activities, while used for operating
activities. The result was the net cash and cash equivalents decreased by ¥39,250 million to ¥119,855
million.

Net cash used for operating activities was ¥79,123 million. In addition to the operating loss, there
was an outflow of ¥37,474 million in other receivables mainly resulting from temporary advances
for the future lease assets by BB Technologies Corporation. Income tax payments resulted in an
outflow of ¥25,180 million. However, there was the improvement of ¥12,474 million in net
operating cash flows compared with the previous fiscal year because of a substantial decline inincome tax payments.

Net cash provided by investing activities was ¥39,751 million, a net increase of ¥82,363 million
compared with the previous fiscal year. There were payments of ¥71,426 million to purchasemarketable and investment securities and ¥30,272 million to purchase property and equipment andintangible assets. On the other hand, sales of marketable and investment securities generated
proceeds of ¥157,985 million.

Net cash provided by financing activities was ¥1,313 million, ¥23,234 million less than in theprevious fiscal year. The proceeds from issuance of bonds mainly by SOFTBANK CORP. andKey3Media Group, Inc. was ¥126,393 million. On the other hand, there were the repayment ofbonds of ¥53,597 million, decrease in short-term borrowings was ¥29,226 million, and net
repayment of commercial paper was ¥20,000 million based on the company’s strategy of reducing
the interest-bearing debts.

SOFTBANK CORP.

11

CONSOLIDATED BALANCE SHEETS(Millions of yen; amounts less than one million yen are omitted.
FY2001
FY2002
Increase
As of March 31, 2001
As of March 31, 2002
（Decrease）
Amount%Amount%ASSETS
Current assets
Cash and deposits
Trade notes and accounts receivable
Marketable securities
Inventories
Deferred tax assets
Receivables related to margin transactions
Other current assets
Less : Allowance for doubtful accounts (current)
Total current assets

33.9¥141,056
81,28629,343
23,413
8,234
22,85260,222(1,244)365,166

31.9¥(27,476)(19,239)(19,798)
12,898
7,195
19,46356,580(342)
29,2802.4

13,5291.2

14,8792.7

41,68041,093
7,135
15,07914,785
119,774

10.4(37,499)(41,093)
1,605
1,110
(12,365)(88,242)

521,150
1,287
35,832
141,456
10,313(1,506)
708,53360.9

492,853
3,033
9,826
133,303
9,440(1,442)647,01456.5

28,296(1,746)26,006
8,152
873
(63)
61,518

757

0.1

598

0.0

159

¥1,163,678

100.0¥1,146,083

100.0¥17,595¥113,580
62,047
9,545
36,312
15,43042,316
116,802(1,586)394,447

28,408Non current assets
Property and equipment

Intangible assets, net
Goodwill
Trade names
SoftwareConsolidation adjustment
Other intangible assets
Total intangible assets

4,180
8,741
16,1902,419
31,531

Investments and other assets
Investment securities
Long-term loan receivables
Deferred tax assets
Investments in partnerships
Other assets
Less : Allowance for doubtful accounts
Total investments and other assets

Deferred charges

TOTAL ASSETSSOFTBANK CORP.

12

CONSOLIDATED BALANCE SHEETS(Millions of yen; amounts less than one million yen are omitted.)
FY2001
FY2002
Increase(As of March 31, 2001)(As of March 31, 2002)（Decrease）
Amount%Amount%LIABILITIESCurrent liabilities
Trade notes and accounts payable
Short-term borrowings
Commercial paper
Current portion of straight bonds
Current portion of convertible bonds
Income taxes payable
Deferred tax liabilities
Accrued expenses
Payables related to margin transactions
Allowance for sales returns
Other current liabilities
Total current liabilities¥56,742
114,190
10,00048,8419,593
47
10,17637,417
1,343
70,623358,97630.8¥63,935
128,482
30,00021,4006,614
23,428298
10,654
17,545
1,471
75,478379,30933.1¥(7,193)(14,291)(20,000)
27,441(6,614)(13,834)
(250)
(478)
19,872(127)(4,855)(20,332)

24.7

3,997
125
(38,456)
38,589
179
4,747
9,182

Long-term liabilities
Straight bonds
Convertible bonds
Long-term debt
Deferred tax liabilities
Accrued retirement benefits
Other Liabilities
Total long-term liabilities

179,365
125
13,12170,962331
28,335292,241

175,368

25.1

51,57832,372
152
23,587
283,059

TOTAL LIABILITIES

651,21855.9

662,368

57.8(11,150)MINORITY INTERESTS

47,134

4.1

59,453

5.2(12,318)

Common stock

137,867

11.9

137,630

12.0

237

Additional paid-in capital

162,23113.9

161,953

14.1

278

4,035

0.3

94,803

8.3(90,768)

Net unrealized gain (loss) on other securities

126,625

10.9

18,435

1.6

108,190

Translation adjustments

34,5773.0

11,441

1.0

23,135

(10)

(0.0)

(2)

(0.0)

(8)

465,32640.0

424,261

37.0

41,064¥1,163,678

100.0¥1,146,083

100.0¥17,595-

SHAREHOLDERS' EQUITY

Retained earnings

Less: Treasury stock
TOTAL SHAREHOLDERS' EQUITYTOTAL LIABILITIES , MINORITY
INTERESTS AND SHAREHOLDERS' EQUITYSOFTBANK CORP.

13

CONSOLIDATED STATEMENTS OF INCOME(Millions of yen; amounts less than one million yen are omitted.)
FY2002
FY2001
Increase(April 2000 through(April 2001 through(Decrease)
March 2001)
March 2002)
Amount%Amount%Net sales from non-financing business¥381,532

94.1¥365,20192.0¥16,331

Cost of sales

319,32878.8

291,50773.4

27,820Gross profit

62,204

15.3

73,693

18.6(11,489)

Selling, general and administrative expenses

81,311

20.0

70,49317.8

10,817

Operating income (loss) from non-financing business(19,107)

(4.7)

3,200

0.8

(22,307)

Revenue from financing business

23,782

5.9

31,9038.0(8,121)

Expenses of financing business

28,576

7.1

18,672

4.7

9,904

Operating income (loss) from financing business(4,794)(1.2)

13,231

3.3(18,025)

Total operating income (loss)(23,901)(5.9)

16,431

4.1(40,332)

Interest income
Exchange gains, net
Other non-operating income
Non-operating income

2,065
24,9395,526
32,5308.0

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

10.7(2,297)(3,176)(4,369)(9,843)

Interest expense
Equity in losses under the equity method, net
Other non-operating expenses
Non-operating expenses

15,64017,575
8,715
41,931

10.3

12,263
19,765
6,710
38,7409.7

3,376(2,189)
2,004
3,190

Ordinary income (loss)(33,302)(8.2)

20,065

5.1(53,367)

Gain on sale of investment securities
Dilution gain from changes in equity interest
Other special income
Special income

67,06819,353
4,776
91,19822.5

119,054
49,712
1,158
169,92542.8(51,985)(30,359)
3,617(78,727)

Loss on sale of investment securities
Loss on valuation of investment securities
Loss on valuation of investments in affiliates
Valuation loss on goodwill and other intangible assets
Loss on discontinued operations
Dilution loss from changes in equity interest
Other special losses
Special losses

15,673
99,046
19,413
19,9783,761
19,963
177,836

43.9

8,604
1,558
11,062102,98126.0(8,091)
69,816(9,347)
19,978(8,604)2,202
8,901
74,854

Income (loss) before income taxes and minority interests(119,939)(29.6)

87,00921.9(206,949)

Income taxes -current
Income taxes -deferred

8,378(36,219)

2.0
(8.9)

69,043(20,427)

17.4
(5.1)

(60,665)(15,791)

Minority interests

3,343

0.8

(1,762)

(0.4)

5,106

Net income (loss)¥(88,755)(21.9)¥36,6319.2¥(125,386)

SOFTBANK CORP.

23,76429,23028,761-

14

CONSOLIDATED STATEMENTS OF RETAINED EARNINGS(Millions of yen; amounts less than one million yen are omitted.
FY2001
FY2002
Increase(April 2000 through(April 2001 through（Decrease）
March 2001)
March 2002)
Retained earnings at the beginning of the period¥94,803¥59,091¥35,711

690
690

1,385
46
1,431

(695)
(46)
(741)

2,356
142

2,203
117

153
25

203

1

202

0
2,703

29
2,351

(28)
352

Net (loss) income(88,755)

36,631(125,386)

Retained earnings at the end of period¥4,035¥94,803¥(90,768)

Increase due to exclusion of affiliates
under equity method
Increase due to merger
Increase in retained earnings

Cash dividends paid
Bonuses to directors
Decrease due to exclusion of affiliates underequity method
Net decrease due to companies newly included
or excluded from consolidation
Decrease in retained earnings

SOFTBANK CORP.

15

CONSOLIDATED STATEMENTS OF CASH FLOWS(Millions of yen; amounts less than one million yen are omitted.)
FY2001
FY2002(April 2000 through(April 2001 throughMarch 2001)
March 2002)
I

II

III

Cash flows from operating activities:
Income (loss) before income taxes
Depreciation and amortization
Equity in losses under the equity method
Dilution gains from changes in equity interest, net
Loss on valuation of investment securities
Gains on sale of marketable and investment securities, net
Exchange gains, net
Interest and dividend income
Interest expense
Valuation loss on goodwill and other intangible assets
Loss on discontinued operations
Decrease (increase) in receivables- trade(Decrease) increase in payables-trade
Increase in other receivables
Increase in other payables
Other, net
Subtotal¥(119,939)
11,74917,575(15,591)
118,459(51,490)(20,311)(2,129)15,64019,978
16,684(10,533)(37,474)
9,785
8,613
(38,983)¥87,009
8,072
19,765(48,154)
57,991(95,404)(28,219)(4,377)
12,263
16,246(4,259)10,902(48,644)
24,759(5,777)2,174Interest and dividends received
Interest paid
Payments for income taxes
Net cash used for operating activities

2,320(17,281)(25,180)(79,123)

4,103(11,823)(86,053)(91,598)

Cash flows from investing activities:
Purchases of property and equipment and intangible assets
Purchase of marketable and investment securities
Proceeds from sale of marketable and investment securities
Additional investments in newly consolidated subsidiaries
Proceeds from sale of interests in previously consolidated subsidiaries
Proceeds from sale of interests in consolidated subsidiaries
Increase of loans
Collection of loans
Proceeds from sale of assets held for sale
Other, net
Net cash provided by (used for) investing activities(30,272)(71,426)
157,985(18,263)(33)
10,554(12,803)
8,294(4,283)39,751(16,241)(233,131)
104,224(362)
66
20,965(6,647)
5,154
82,906453(42,612)

Cash flows from financing activities:
Proceeds from issuance of shares to minority shareholders(Decrease) increase in short-term borrowings
Proceeds from issuance of commercial paper
Repayment of commercial paper
Proceeds from long-term debts
Repayment of long-term debts
Proceeds from issuance of bonds
Repayment of bonds
Cash dividends paid
Other, net
Net cash provided by financing activities

11,039(29,226)
71,400(91,400)
15,630(43,531)
126,393(53,597)(2,346)(3,048)1,313

38,50237,54750,000(20,000)
63,491(142,102)
27,867(26,603)(2,200)(1,952)
24,5483,578

33,461(34,479)(76,200)

2

517(4,772)(22,444)-(10,827)

159,105

268,060¥119,855¥159,105

IV Effects of exchange rate changes on cash and cash equivalents
V Net decrease in cash and cash equivalents
VI Net increase in cash and cash equivalents due to companies newly
consolidated
VII Decrease in cash and cash equivalents due to exclusion of consolidated
entities
VIII Decrease in cash and cash equivalents due to change in accounting policy
for the investment association
IX Cash and cash equivalents at the beginning of the period
X Cash and cash equivalents at the end of the period

SOFTBANK CORP.

16

Basis of Presentation of Consolidated Financial Statements
1 Scope of consolidation
As of March 31, 2002, the company consolidated 285 subsidiaries. 14 subsidiaries were not consolidated, as their influence on the
consolidated statements was immaterial in the aspects of total assets, sales, net income and retained earnings.
Changes in scope of consolidation for the period ended March 31, 2002 were as follows;<Increase；including partnerships>
1 Emtorage Broadcommunications Inc.
2 SBI E2-Capital Limited
3 Compy Inc
4 Akamai Technologies Japan K.K.
5 Tokyo Metallic Communications Corp.

Newly established
Newly invested
Newly invested
Newly established
Newly invested

Other 92 companies<Decrease；including partnerships>
1 Key3Media Group, Inc.

Change to affiliate due to dilution fromnew share issuance and sale of shares
Liquidation

2 SB K&K CORPORATIONOther 26 companies

2 Application of the equity method
111 affiliates and 2 non-consolidated subsidiaries were accounted for under the equity method at March 31, 2002.
Changes in application of the equity method for the period ended March 31, 2002 were as follows;<Increase；including partnerships>
1 RAINBOW TECHNOLOGIES K.K.

Newly established

Other 26 companies<Decrease；including partnerships>
1 Yahoo! Inc.
2 E* TRADE Group, Inc.
3 PROFECIO, Inc. (Former PASONA SOFTBANK, INC.)

Equity decrease due to sale of shares
Equity decrease due to sale of shares
Disposal

Other 28 companies
The company had accounted for Yahoo! Inc. under the equity method and the profit and loss of Yahoo! Inc. during
the current fiscal year were reflected in the consolidated financial statements. However, as a result of sale of part ofthe shares of Yahoo! Inc. in January and April 2002, the company accounted for Yahoo! Inc. as "investment
securities" at fair value at the end of the fiscal year.

3 Fiscal year end
Fiscal year ends of consolidated subsidiaries in terms of domestic and overseas are as follows;<Fiscal year end>
March end
(as same as consolidated B/S date)June end
August end
September end
December end
February end

SOFTBANK CORP.

<Domestic><Overseas>

108

19

5
1
6
17
1

47
81
-

17

4 Summary of significant accounting policies[1] Evaluation standards and methods for major assets(1) Marketable securities and investment securities
Held-to-maturity debt securities :Other securities:
With market quotations:Without market quotations:(2) Inventories

Stated at amortized cost

Stated at fair value, which represents the market prices at the balance sheet date
(Unrealized gain/loss are included as a separate component in shareholders' equity,
net of tax, while cost of sales is determined primarily based on the moving-average method)
Carried at cost, primarily based on the moving-average method
Carried at cost, primarily based on the moving-average method[2] Depreciation and amortization(1) Property and equipment:
Depreciation at the company and its domestic consolidated subsidiaries is computed primarily based on the declining-balance method.
Depreciation at the foreign consolidated subsidiaries is based on the estimated useful lives using the straight line method , in accordancwith the accounting principles generally accepted and applied in their respective countries of domicile.
(2) Intangible assets:
The straight-line method. Goodwill is amortized over 5 to 20 years.
(The US consolidated subsidiaries ceased the amortization of the goodwill, due to applying SFAS No.142 from this period.)[3] Accounting principles for major allowances and accruals(1) Allowance for doubtful accounts is provided based on the aggregate amount of estimated credit losses for doubtful receivables plus anamount for the receivables other than doubtful receivables calculated using historical written-off experience from certain prior periods(2) Allowance for sales returns:
Allowance for sales returns is provided based on the estimated losses resulting from possible future returns.
(3) Accrued retirement benefits
For the Company and most of its domestic consolidated subsidiaries, accrued pension benefits are calculated based on projected benefi
obligations and fair value of the plan assets at the balance sheet date. Actuarial gains and losses are recognized in the consolidated
statements of income in the year immediately subsequent to the fiscal year of occurrence.
[4] Translation of foreign currency transactions and accounts
Assets and liabilities denominated in foreign currencies are translated using foreign exchange rates prevailing at the respective balance
sheet dates. Exchange gains or losses are included in the net income when incurred.
The translation of revenues and expenses in the financial statements of foreign consolidated subsidiaries into Japanese yen is performe
by using the average exchange rate during the period. The assets and liabilities of foreign consolidated subsidiaries are translatedusing the foreign exchange rates prevailing at the balance sheet dates, and capital stock is translated using the historical rates.
The resulting translation adjustments are accumulated as a component of shareholders' equity, except that the portion pertain tominority shareholders is included in minority interests.
[5] Finance lease
Finance leases other than those transferring the ownership of the leased assets to lessees at the end of the lease term are accounted
for in the same manner as operating leases.
[6] Accounting method for consumption taxes
Consumption taxes are accounted for using net-of-tax method.

5 Accounting for business combinations
Purchase method - Revalue the assets and liabilities of the acquired firm to the respective fair market value at the combination date.

6 Amortization of the consolidation adjustment
The consolidation adjustment is amortized on a straight- line basis over 5 to 7 years. Immaterial amounts ofconsolidation adjustment are expensed as incurred.

.

7 Appropriation of retained earnings
The consolidated statement of retained earnings reflects the appropriation of retained earnings approved during the fiscal year.

8 Scope of cash and cash equivalents in the consolidated statements of cash flow
Cash and cash equivalents in the consolidated statements of cash flow are composed of cash on hand, bank deposits
withdrawable on demand and highly liquid investments purchased with initial maturities of three months or less andwhich represent low risk of fluctuation in value.

SOFTBANK CORP.

18

(Additional information)[1] Effective April 1, 2001, the consolidated subsidiaries engaged in securities business adopted the "Uniform Accounting Standards of Securities
Companies", issued by Japan Securities Dealers Association on September 28, 2001.
Principal changes in the presentation of the consolidated balance sheets are as follows,(1) In accordance with the "Securities and Exchange Law, No.47, Paragraph 3", segregated cash from customers (money trust only) included in "cashand deposits" in prior years, is now included in "other current assets" in the assets section.
The money trust from customers of 10,590 million yen was included into "cash and deposits" at prior year end.

(2) Securities received as collateral, recorded as "other current assets" (27,368 million yen as of 3/31/2001) in the assets section, "other current
liabilities" (27,365 million yen as of 3/31/2001) and "other non current liabilities" (2 million yen as of 3/31/2001) in the liabilities section, are nolonger recognized on the consolidated balance sheets.

[2] Statement of Financial Accounting Standards No.142: Goodwill and Other Intangible Assets
The U.S. consolidated subsidiaries have adopted SFAS No.142 from this period, which requires an impairment test at least annually and also
whenever events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable, for goodwill and indefinitelived intangible assets, rather than recognizing periodic amortization charges.
Key3Media Group Inc., which is an affiliate under the equity method, and Yahoo! Inc, which has been excluded from affiliates under the equity
method and stated as "investment securities " at the end of this period, have recognized the transitional impairment losses due to the application of
SFAS No.142 in their first quarter in January through March 2002 for their fiscal year ended at December end. The Company has recognized its
portion of impairment losses of 19,978 million yen as "valuation loss on goodwill and other intangible assets" in the consolidated statement ofincome in this period.
In addition, the goodwill held by consolidated subsidiaries and affiliates other than U.S companies continues to be amortized based on the straightline method

SOFTBANK CORP.

19

NOTES
1 Accumulated depreciation of property and equipment
As of March 31, 2002
10,756 million yen

As of March 31, 2001
6,516 million yen

As of March 31, 2002
4,484 shares

As of March 31, 2001
465 shares

2 Number of treasury stock held by the Company

3 Assets and liabilities of the silent investment association
The assets and liabilities belonging to the silent investment association, net of deposits from the association members, at theend of periods are as follows;

Cash and deposits
Marketable securities
Other current assets- investments
Other current assets- other
Investment securities
Investments in partnerships
Other current liabilities
Other non-current liabilities (advancereceived and held by the silent association)

As of March 31, 2002
6,800 million yen- million yen
11,936 million yen
232 million yen
1,491 million yen
1,976 million yen
163 million yen

As of March 31, 2001
5,689 million yen
235 million yen
15,489 million yen
305 million yen
5,291 million yen
1,392 million yen
482 million yen

22,273 million yen

27,921 million yen

4 Receivables and payables related to margin transactions
The receivables and payables related to margin transactions, held by the consolidated subsidiaries engaged in securities
business, at the end of periods are as follows;

Receivables related to margin transactions
Loans receivable from customers for
margin transactions
Cash deposits as collateral for securities
borrowed from securities financecompanies
Payables related to margin transactions
Loans from securities finance companies
for margin transactions
Proceeds from securities sold for margintransactions

SOFTBANK CORP.

As of March 31, 2002

As of March 31, 2001

37,881 million yen

20,938 million yen

4,434 million yen

1,914 million yen

24,379 million yen

13,514 million yen

13,038 million yen

4,031 million yen

205 Assets pledged as collateral and secured liabilities(1) Assets pledged as collateral related to lease contracts
FY 2002 (as of March 31, 2002)(Millions of yen; amounts less than one million yen are omitted.)
Secured liabilities

Assets pledged as collateralType of collateral
Trade notes and accounts receivable
Other current assets(accounts receivable -other)

Carrying
amount3,592
53

Type of security

Account

Mortgage

Trade notes and accounts payable
Other current liabilities(accounts payable -other)Mortgage

Carrying amount319
96

Notes : The collateral for the future lease liabilities of 43,837 million yen, of which 319 million yen was accounts payable and 96 million yen was accounts
payable - other, was provided by mortgaging credits that certain consolidated subsidiaries held for the future cash flow from customers andconsigned broadcasting companies based on marketing agreements, etc. The balances of these credits as of March 31,2002 were 3,592 million yen
in accounts receivable and 53 million yen in other current assets.
FY 2001 (as of March 31, 2001)(Millions of yen; amounts less than one million yen are omitted.)
Secured liabilities

Assets pledged as collateralType of collateral

Carrying amount

Trade notes and accounts receivable
Other current assets(accounts receivable - other)Type of security

Account963

Mortgage

Trade notes and accounts payable

12

Mortgage

Carrying amount
401

Notes : The collateral for the future lease liabilities of 11,225 million yen, of which 401 million yen was accounts payable, was provided by mortgaging credits thatcertain consolidated subsidiaries held for the future cash flow from customers and consigned broadcasting companies based on marketing agreements, etc.
The balances of these credits as of March 31,2001 were 963 million yen in accounts receivable and 12 million yen in other current assets.

(2) Assets pledged as collateral related to deposits received for securities loaned
FY 2002 (as of March 31, 2002)(Millions of yen; amounts less than one million yen are omitted.)
Secured liabilities

Assets pledged as collateralType of collateral

Carrying
amountOther current assets(marketable securities in custody)

Type of security-(Millions of yen; amounts less than one million yen are omitted.)
Secured liabilities

Assets pledged as collateral

Other current assets(marketable securities in custody)

Carrying amount

Other current liabilities(Deposits received for securities loaned)-

FY 2001 (as of March 31, 2001)
Type of collateral

Account

Carrying amount
2,351

Type of security

Account

Mortgage

Other current liabilities(Deposits received for securities loaned)

Carrying amount
13,514

Notes : In addition to above, the collateral securities received from customers on margin transaction (3,732 million yen) have been provided to Japan Securities
Finance Company as the collateral for securities borrowed as of March 31,2001.

(3) Assets pledged as collateral related to borrowings
FY2002 (as of March 31, 2002)(Millions of yen; amounts less than one million yen are omitted.)
Secured liabilities

Assets pledged as collateral

Property and equipment

Carrying
amount175

Property and equipment

1,087

Type of collateral

FY2001 (as of March 31, 2001)
Assets pledged as collateralType of collateral
Carrying amount
Cash and deposits (time deposits)
48
Property and equipment
1,026
Investment securities
69,519Type of security

Account

Carrying amountMortgage

Short-term borrowings

163

MortgageLong-term debts

275(Millions of yen; amounts less than one million yen are omitted.)
Secured liabilities
Account
Carrying amountType of security
Short-term borrowings
Mortgage
20,564Long-term debts
Mortgage
124
Mortgage

Notes : In addition to the above, the assets of Key3Media, a U.S. consolidated subsidiary of the Company, and the common stock of Key3Media's subsidiaries were
provided as collateral for long- term debts of US$298 million (34,243 million yen) and short-term borrowings of US$1 million (181million yen) at March
31, 2001.

SOFTBANK CORP.

21

6 Line of Credit (not used)
As of March 31, 2002
24 million yen

As of March 31, 2001
42 million yen

As of March 31, 2002
40 million yen

As of March 31, 2001
- million yen

7 Contingent Liabilities
Total of trade notes receivable discounted
Total of accounts receivable discounted-

11,825 million yen

million yen

8 Notes receivable maturing on the period end date
Trade notes receivable are settled on the date of clearance.
The following amounts of notes receivable matured on the period end dates were included in the consolidated balance statements,
because the last day of the respective period was a non-business day.

Trade notes receivable

As of March 31, 2001
983 million yen

As of March 31, 2002
98 million yen

9 Dilution gain (loss) from changes in equity interest
Due to capital transactions by investees such as initial public offerings, the Company's shareholding percentages in some investees were diluted.
The major dilution gain (loss) from changes in equity interest for the period ended March 31, 2002 are as follows:
Gain
Yahoo! Inc.
UTStarcom, Inc.
E*TRADE Group, Inc.
SOFTBANK INVESTMENT INTERNATIONAL(STRATEGIC) LIMITED
National Leisure Group
Global Sports, Inc.

SOFTBANK CORP.

7,414 million yen
7,189
1,385
982
674

(Loss)(894) million yen(117)(1,523)
(274)
(0)

22

10 Valuation loss on investments in subsidiaries and affiliates
Valuation loss on investments in subsidiaries and affiliates recognized in the consolidated statements of income for the periods ended
March 31 2002 are as follows:(1) Valuation loss on investment in consolidated subsidiaries
As of March 31, 2002
331 million yen

As of March 31, 2001
168 million yen(2) Valuation loss on investment in affiliates accounted for under the equity method
As of March 31, 2002
19,082 million yen

As of March 31, 2001
28,592 million yen

11 Consolidated statements of cash flow
(1) Reconciliation of cash and cash equivalents to amounts included on the consolidated balance sheets.
As of March 31, 2002
Cash and deposits

113,580 million yen

As of March 31, 2001
141,056 million yen

Marketable securities (mainly MMF)

9,545

29,343Time deposits with original
maturity over three months(1,065)(2,009)Deposits received from customersof the consolidated subsidiaries
engaged in commodity futures

(31)

-

Deposits received from customersof the consolidated subsidiaries
engaged in securities business-(10,590)(2,173)

(95)

-

1,400

Stocks and bonds with original
maturity over three months
Cash equivalents included ininventories of consolidated subsidiaries
engaged in securities business
Cash and cash equivalents

119,855 million yen

159,105 million yen

146 million yen

1,568 million yen(2) Significant non-cash transactions
Conversion of convertible bonds toshareholders' equity.

SOFTBANK CORP.

23

12 Lease transactions
12-1. Finance leases in which the ownership of leased assets is not transferred to lessees at the end of lease term
(as a lessee)(1) Amounts equivalent to acquisition costs, accumulated depreciation and costs less accumulated depreciation at the end of the periods
As of March 31, 2002
Property and equipment
Acquisition costs
Less: Amount equivalent to accumulated
depreciation
Amount equivalent to costs, less accumulated
depreciation at the end of the period

Software (Intangible assets)
Acquisition costs
Less: Amount equivalent to accumulated
amortization
Amount equivalent to costs, less accumulated
amortization at the end of the period

Total
Acquisition costs
Less: Amount equivalent to accumulated
depreciation
Amount equivalent to costs, less accumulated
depreciation at the end of the period

As of March 31, 2001

42,315

15,186(8,872)33,442 million yen(4,463)
10,722 million yen

1,358

256

(353)
1,004 million yen(46)
209 million yen

43,673

15,443(9,226)34,447 million yen(4,510)10,932 million yen(2) The future lease payments for finance lease at the end of the periods
As of March 31, 2002
Due within one year
Due after one year
Total

8,780
27,56536,346 million yen

As of March 31, 2001
3,136
8,552
11,689 million yen(3) Lease payments, amounts equivalent to depreciation and interest expense for the periods
For the period ended
March 31, 2002

For the period ended
March 31, 2001

Lease payments

6,370 million yen

4,221 million yen

Amount equivalent to depreciation expense

5,366 million yen

4,256 million yen

Amount equivalent to interest expense

1,263 million yen

1,029 million yen(4) Calculation method of amount equivalent to depreciation and interest expense
The amount equivalent to depreciation is computed using the straight line method over the lease term, assuming no remaining
amount, except in case that the residual value is guaranteed on the lease contract.
The amount equivalent to interest expense, which is calculated by subtracting acquisition costs from total lease payments, isallocated over lease periods based on the interest method.

SOFTBANK CORP.

24

12 Leases transaction (continued)
12-1. Finance leases in which the ownership of leased assets is not transferred to lessees at the end of lease term.
(as a lessor)(1) Acquisition costs, accumulated depreciation and costs less accumulated depreciation at the end of the periods
As of March 31, 2002

As of March 31, 2001

Property and equipment
Acquisition costs
Less: Accumulated depreciation
Costs, less accumulated depreciation

1,004
(231)
773 million yen

478
(41)
436 million yen

Software (Intangible assets)
Acquisition costs
Less: Accumulated amortization
Costs, less accumulated amortization

511
(134)
377 million yen

441
(62)
378 million yen

Total
Acquisition costs
Less: Accumulated depreciation
Costs, less accumulated depreciation

1,516
(365)
1,150 million yen

919
(104)
815 million yen(2) The future lease receivables for finance leases at the end of the periods
As of March 31, 2002
Due within one year
Due after one year
Total

286
902
1,189 million yen

As of March 31, 2001
248
959
1,208 million yen(3) Lease income, depreciation and amount equivalent to interest income for the periods
For the period ended
March 31, 2002

For the period ended
March 31, 2001

Lease income

307 million yen

180 million yen

Depreciation

262 million yen

118 million yen

Amount equivalent to interest income

71 million yen

38 million yen(4) 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.

12-2. Non-cancelable operating lease transactions(as a lessee)
The future lease payments for non-cancelable operating lease
As of March, 2002
Due within one year
Due after one year
Total

253
1,723
1,977 million yen

As of March 31, 2001
1,000
3,245
4,245 million yen(as a lessor)
No transactions applicable for the current period.

SOFTBANK CORP.

25

13 Subsequent events after the date of consolidated financial statements.
(1) Sales of stock of Yahoo! Inc.
SOFTBANK America Inc., which is a fully-owned subsidiary of the Company in U.S., has sold off 11.5 million sharesof Yahoo! Inc. at approximately 171 million dollars in April 2002 (approximately 22.4 billion yen at the rate of 131 yen
per US dollar). The Company will recognize the gain on sale in the amount of approximately 15.7 billion yen in the next
fiscal year.

(2) Public tender offer for shares in Club iT Corporation
SOFTBANK Broadmedia Corporation (SBBM), a fully-owned subsidiary of the Company, has announced the take-overbid for shares of Club iT Corporation, which is a consolidated subsidiary of the Company.
Club iT lost the right to be an agent of SKY Perfect Communications Inc. due to breach of the agency agreement.
The Company believes that the take-over bid avoids confusion among investors and the support of SBBM as the parent
company will help to expand Club iT Corporation's broadband services businesses.
The funding required for this take-over bid is expected to be 4 billion yen.

SOFTBANK CORP.

26

SEGMENT INFORMATION
1. Business Segment Information(1) FY2002 (for the period ended March 2002)

e-Commerce

e-Finance

Media &
MarketingBroadmedia

Internet
CultureTechnology
Services

Broadband
Infrastructure(Millions of yen; amounts less than one million yen are omitted.)
Elimination
Consolidated
Others
Total
or
Total
Corporate Assets

OverseasFunds

Net Sales(1) Customers¥265,107¥21,301¥47,553¥11,795¥20,152¥9,955¥7,386(2) Inter-segment

19,087

2,959

885

331

11,862

8,571

1,781

284,195

24,26048,43912,12732,015

18,527

9,168

Total

¥2,481
2,481¥19,581¥405,315-

1,222

46,703(46,703)

20,803452,018(46,703)¥405,315
405,315

Operating expenses

280,989

29,18145,877

12,16622,07817,391

27,121

2,708

27,458464,972(35,756)

429,216

Operating income (loss)¥3,206¥(4,920)¥2,561¥(39)¥9,936¥1,135¥(17,952)¥(226)¥(6,654)¥(12,953)¥(10,947)¥(23,901)

Identifiable Assets
Depreciation and Amortization
Capital Expenditures¥83,060
1,152
2,431

¥298,496
4,377
16,501¥26,494
3,478
2,962

¥16,259
238
2,749¥279,657
2,065
3,439

¥8,134
174
262¥77,298
1,913
10,410¥134,016
85
66¥184,476
1,942
1,302

¥1,107,894
15,42840,127¥55,784
197
560¥1,163,678
15,62540,687

Technology
Services

Internet
Infrastructure(2) FY2001 (for the period ended March 2001)

e-Commerce

e-Finance

Media &
MarketingBroadmedia

Internet
CultureOverseas
Funds(Millions of yen; amounts less than one million yen are omitted.)
Elimination
Consolidated
or
Total
Total
Corporate Assets

OthersNet Sales(1) Customers(2) Inter-segment
Total¥253,943¥30,626¥52,414¥12,998¥12,481¥11,728-¥1,277¥21,635¥397,105

-

4,577

778

847

3

742

2,743

-

463

840

10,997(10,997)¥397,105

258,52131,40453,262

13,001

13,223

14,471-

1,741

22,476408,102(10,997)

397,105
380,673-

Operating expenses

256,751

17,96647,358

11,946

8,521

13,996

1,068

1,501

28,141

387,252(6,578)Operating income (loss)¥1,769¥13,437¥5,904¥1,055¥4,702¥475¥(1,068)¥239¥(5,664)¥20,850¥(4,418)¥16,431

Identifiable Assets
Depreciation and Amortization
Capital Expenditures¥97,821
1,571
4,472

¥308,828
1,313
10,197¥140,523
4,313
1,625

¥33,41718
165¥129,771
1,317
1,911

¥9,282132
443¥7,58713
115¥140,88614
127¥210,839
1,858
1,069

¥1,078,958
10,553
20,127¥67,125150
2,618¥1,146,083
10,70322,745

Notes:[1] 1. Business segments are determined according to the responsibility of each operating officer of the segment controlling company.
2.Principal products and operational content of each business:(1) e-Commerce
Distributes PC software, hardware, and peripherals; operates enterprise businesses and business transaction platform- and consumer-related e-commerce businesses(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 broadcasting and broadband communications and promoting the spread of such operations(5) Internet Culture

Internet-based advertising, broadband portals, auctions, etc.

(6) Technology Services

System solutions, business solutions, etc.

(7) Broadband Infrastructure Provides ADSL-based broadband infrastructure services, fiber optic ultrahigh-speed internet access services and other businesses.
(8) Overseas Funds

U.S.- and Asia-focused global private equity operations in Internet-related companies(9) Others

Function as overseas holding companies, provide back-office support services in Japan, etc.

[2] The amount of assets classified in the column "Elimination or Corporate Assets" was 75,936 million yen, which included the Company's surplus funds (Cash and Marketable securities), investment securities and assets held by
the corporate division of the parent company.
[3] The columns of "Capital Expenditure" and "Depreciation and Amortization" represent long-term prepaid expenses, deferred charges and related amortization amounts.
[4] "Broadband Infrastructure" segment, which is the broadband business in ADSL (Asymmetric Digital Subscriber Line) technologies started in this fiscal period, includes "Internet Infrastructure" segment separately disclosed inprior fiscal years.

SOFTBANK CORP.

27

2. Geographic Segment Information(1) FY2002 (for the period ended March 31, 2002)
North
AmericaJapan
Net Sales(1) Customers(2) Inter-segment
Total
Operating expenses
Operating income (loss)
Identifiable Assets¥352,044
1,677
353,721369,714¥(15,992)¥567,478¥28,947
1,505
30,45328,599¥1,854¥398,053

Europe(Millions of yen; amounts less than one million yen are omitted.)
Elimination
Consolidated
Others
Total
or
Total
Corporate Assets

Korea¥1,575
1,094
2,669
3,930
¥(1,260)¥44,059¥19,520¥3,227--

19,52021,097¥(1,576)¥29,565

3,227
5,497
¥(2,270)¥63,799¥405,315
4,277
409,592
428,838¥(19,245)¥1,102,956(4,277)(4,277)377¥(4,655)¥60,721¥405,315
405,315429,216¥(23,901)¥1,163,678(2) FY2001(ｆor the period ended March 31, 2001)
North
AmericaJapan
Net Sales(1) Customers(2) Inter-segment
Total
Operating expenses
Operating income (loss)
Identifiable Assets¥341,978341,978
322,123¥19,855¥491,551¥30,523555
31,07928,427¥2,651¥385,017

Europe(Millions of yen; amounts less than one million yen are omitted.)
Elimination
Consolidated
Total
Othersor
Total
Corporate Assets

Korea¥1,291¥21,271¥2,040

-

-

-

1,291
1,765
¥(473)¥41,282

21,271
22,127¥(856)¥26,556

2,040
2,820
¥(780)¥128,068¥397,105
555
397,660
377,264¥20,396¥1,072,477

(555)
(555)
3,409
¥(3,964)¥73,606¥397,105
397,105
380,673¥16,431¥1,146,083

Note:[1] Geographic segmentation policy and major countries of each area are as follows (based on FY2002):
1. Geographic 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 75,936 million yen, which included the Company's surplus funds(Cash and Marketable securities), investment securities and assets held by the corporate division of the parent company.

SOFTBANK CORP.

28

3. Overseas Sales(1) FY2002 (for the period ended March 31, 2002)(Millions of yen; amounts less than one million yen are omitted.)
North
AmericaI. Overseas sales

Europe¥29,323

Korea¥1,944

Other¥19,532

Total¥3,597¥405,315

II. Total consolidated salesIII.

¥54,398

Overseas sales as a percentage
of total consolidated sales

7%

0%

5%

1%

13 %

(2) FY2001 (for the period ended March 31, 2001)(Millions of yen; amounts less than one million yen are omitted.)
North
AmericaI. Overseas sales

Europe¥31,399

Korea¥1,376Other¥21,286

Total¥2,581

II. Total consolidated sales

III.

Overseas sales as a percentage
of total consolidated sales¥56,644¥397,105

8%

0%

5%

1%

14 %

Note: Segmentation policy of overseas and major countries of each area are as follows (based on FY2002)
1. Segmentation policy of overseas sales:
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

SOFTBANK CORP.

29

TAX EFFECT ACCOUNTING

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

FY2001/2002 (For the year ended March 31, 2002)

1. Significant components of deferred tax assets and liabilities

1. Significant components of deferred tax assets and liabilities

Deferred tax assets

Deferred tax assets
Valuation loss on marketable and investment
securities
Loss carryforward
Unrealized profit
Allowances for doubtful debts, etc.
Valuation loss on inventories
Enterprise taxes payable
OthersGross deferred tax assets
Less: Valuation allowance
Total deferred tax assets(Million yen)
¥79,151
60,247
3,506
1,771
1,483
841
4,225
151,228(79,393)
71,834(66,785)(16,815)(3,185)(4,796)(91,581)¥(19,747)

2. Reconciliation between the statutory tax rate and effective tax rate:
Statutory tax rate
(Reconciliation)
Differences related to investments inaffiliates
Change in valuation allowance
Tax rate difference
OthersIncome tax rate per statement of income

SOFTBANK CORP.

(Million yen)
¥28,250
16,767
2,667
2,079
1,601
1,021
515
369
4,818
58,089(30,623)
27,466

Deferred tax liabilities

Deferred tax liabilities
Unrealized gains on other securities
Valuation gain on marketable andinvestment securities
Foreign exchange gain on long-term
receivables in foreign currency
OthersGross deferred tax liabilities
Net deferred tax liabilities

Loss carryforward
Valuation loss on marketable and investment
securities
Foreign exchange loss
Enterprise taxes payable
Interests payable
Allowances for doubtful debts, etc.
Employee Compensation
Depreciation
OthersGross deferred tax assets
Less: Valuation allowance
Total deferred tax assets

42.05 %
30.32 %
(32.44)(15.09)(1.63)
23.21 %

Unrealized gains on other securities
Accelerated amortization on goodwill
and trade names
Valuation gain on marketable and investment
securities
Foreign exchange gain on long-term
receivables in foreign currency
OthersGross deferred tax liabilities
Net deferred tax liabilities(21,160)(10,550)(6,197)(3,685)(481)(42,076)¥(14,610)

2. Reconciliation between the statutory tax rate and effective tax rate:
Statutory tax rate
(Reconciliation)
Perpetually-nondeductible expenses such asentertainment expenses
Nondeductible taxes
Change in valuation allowance
Equity in net gains under the equity method
Tax rate difference
OthersIncome tax rate per statement of income

42.05 %
1.76 %
8.56
7.94
2.64
(8.13)
1.05
55.87 %

30

INVESTMENT IN DEBT AND EQUITY SECURITIESFY2002 (as of March 31, 2002)
1. Available for sale and other securities at fair value(Millions of yen; amounts less than one million yen are omitted.)
FY2002 (as of March 31, 2002)
Investment
Cost
Carrying Amount > Investment Cost
(1) Equity securities
Sub-total
Carrying Amount≦Investment Cost
(1) Equity securities(2) Debt securities
Government bonds(3) Others
Sub-total
Total

Carrying Amount

Differences¥79,171
79,171¥268,420
268,420¥189,249
189,249

27,93525,530(2,405)301
228,239¥107,410300
225,833¥294,254(0)(2,405)¥186,843

2. Available for sale and other securities sold during the year ended March 31, 2002
(Millions of yen; amounts less than one million yen are omitted.)
Sales Price(1) Equity securities(2) Debt securities(3) Others¥48,068
6,044
236¥54,348

Total

Gain on sales

Loss on sales¥9,4967
0¥9,505¥11,357
39¥11,396

3. The carrying amounts of the unlisted investment securities(Millions of yen; amounts less than one million yen are omitted.)
Carrying Amounts(1) Held-to-maturity securities
Unlisted debt securities
Unlisted foreign debt securities(2) Other and available for sale securities
Unlisted equity securities (w/o OTC stocks)
Unlisted foreign debt securities
Unlisted debt securities
MMF
Mid-term government bonds fund
Beneficial interest in trust
Preferred fund certificate
OthersTotal¥099
42,375
2,797
1,742
11,520
323
1,000
2,000
30
¥61,889

4. Redemption schedule for "held-to-maturity securities" and "available-for-sale and other securities" with maturity date
subsequent to the consolidated balance sheet date(Million yen; amounts less than one million yen are omitted.)
Within one year
Held-to-maturity securities
Corporate bonds
sub total
Other and available for sale securities(2) Debt securities
Government bonds
Corporate bonds(3) Others
Sub-total
Total

SOFTBANK CORP.

More than one year,
less than five years

More than five years,
less than ten years

¥100
100

-

-

300
1,772
30
2,102
¥2,203

12
1,645
1,657
¥1,6571,109
1,109¥1,10931

INVESTMENT IN DEBT AND EQUITY SECURITIES (Continued)
FY2001 (as of March 31, 2001)
1. Available for sale and other securities at fair value(Millions of yen; amounts less than one million yen are omitted.)
FY2001 (as of March 31, 2001)
Investment Cost

Carrying Amount¥56,710¥3,140¥59,850¥101,276¥5,828¥107,105¥44,566¥2,687¥47,254¥69,782¥53,798¥(15,983)

1,350¥71,132¥130,982

1,311¥55,109¥162,215(38)¥(16,022)¥31,232

Carrying Amount > Investment Cost
(1) Equity securities(2) Debts securities
Sub-total
Carrying Amount ≦ Investment Cost
(1) Equity securities(2) Debt securities
Corporate bonds
Sub-total
Total

Differences

2. Held-to-maturity securities sold in prior period (for the year ended March 31, 2001)(Millions of yen; amounts less than one million yen are omitted.)
Sales Price
Corporate bonds
Total

Gain on sales

Loss on sales

Purpose of sales

40

40

0

¥40

¥40

¥0

Voluntary redemption
by issuer

3.Available for sale and other securities sold in prior period (for the year ended March 31, 2001)(Millions of yen; amounts less than one million yen are omitted.)
Sales Price
Gain on sales
Loss on sales(1) Equity securities¥51,981¥42,359¥3,346(2) Debt securities
25,4471,682
1,123(3) Others
1,000
Total
¥78,429¥44,042¥4,4704.The carrying amounts of the unlisted investment securities(Millions of yen; amounts less than one million yen are omitted.)
Carrying Amounts(1) Held-to-maturity securities
Unlisted debt securities(2) Other and available for sale securities
Unlisted equity securities (w/o OTC stocks)
Unlisted foreign debt securities
Unlisted debt securities
MMF
Mid-term government bonds fund
OthersTotal¥045,0639,008
1,776
25,8772,365
1,099¥85,192

5. Redemption schedule for "held-to-maturity securities" and "available-for-sale and other securities" with maturity date
subsequent to the consolidated balance sheet date(Million yen; amounts less than one million yen are omitted.)
Within one year
Held-to-maturity securities
OthersSub-total
Other and available for sale securities(2) Debt Securities
Government Bonds
Corporate bonds(3) Others
Sub-total
Total

More than one year,
less than five years

More than five year,
less than ten years

¥0
0

-

-

0
0
¥1

0
17,623
17,623¥17,623

1
1¥1

32
SOFTBANK CORP.

CONTRACT AND OTHER AMOUNTS, FAIR VALUE AND UNREALIZED GAIN
OR LOSS ON DERIVATIVE TRANSACTIONSCurrency Related(Millions of yen; amounts less than one million yen are omitted.)
FY2001 (as of March 31, 2001)

FY2002 (as of March 31, 2002)

Nature of transaction

Contract amounts

Fair
value

Over 1 year

Contract amounts

Unrealized
gain/(loss)

Fair
value

Over 1 year

Unrealized
gain/(loss)

Swap Transactions
・Australia dollars Receivable,
JPY Payable¥1,000Off-market ・ Call option
in US dollars
transactions(Option premium)・

Put option
in US dollars(Option premium)¥1,000¥10¥1,000¥10¥1,000¥(176)

-

-

-

-

26

-

-

-

-

-

0

-

-

-

-

-

26

-

-

-

-

-

0

-

Total

¥(176)

-

-

0

(0)
-

-

0

(0)
¥(176)¥10

Notes: Fair value is based on the information from the financial institutions.

Interest Related(Millions of yen; amounts less than one million yen are omitted.)
FY2001 (as of March 31, 2001)

FY2002 (as of March 31, 2002)

Nature of transaction

Notional amounts
Over 1 year

Fair
value

Unrealized
gain/(loss)

Notional amounts
Over 1 year

Fair
value

Unrealized
gain/(loss)

Swap Transactions
・

Fix Rate Receivable,
Floating Rate Payable

Off-market
Floating Rate Receivable,transactions ・
Fix Rate Payable
・Fix Rate Receivable (receipt later),Fix Rate Payable (pre payment)¥5,771¥1,771¥248¥248¥6,014¥5,771

¥397

¥397

7,485

3,485

(366)

(366)

8,157

7,485

(563)

(563)

1,000

1,000

36

36

1,000

1,000

36

36

Total

¥(81)

¥(128)

Notes: Fair value is based on the information from the financial institutions.

SOFTBANK CORP.

33

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

Major individual
shareholder

Name

Address

Capital /EquityMasayoshi Son--

Business / Occupation

Shareholding %Representative director of
Son Asset Management Co.

37% holdingof the Company

Relationship
Concurrent
Business
Post
Relations-

Transactions
Advertising
Expenses-

Amount(million yen)
15

Account

Amountoutstanding(million yen)Othercurrent assets

0

Terms of trade and conditions
1. The advertising expenses are categorized in the same manner as other similar transactions
2. There are no consumption taxes included in the amounts above
3. Subsidiaries
N/A
4. Affiliates
N/A

PENSION AND SEVERANCE PLANS
1. Pension Plans
The Company and most of its Japanese consolidated subsidiaries maintain tax qualified pension plans and participate in multi-employers' contributory defined benefit welfare pension plans, which are defin
benefit pension plans.
Note: The Company and most of its Japanese consolidated subsidiaries will adopt the defined contribution pension plan in conformity with "Defined-Contribution Pension Law", which
effective from October 1, 2001.

2. Projected Benefit Obligationa) Projected benefit obligation (PBO)b) Plan assets at fair valuec) Unfunded PBOd) Unrecognized transition obligationse) Unrecognized actuarial lossesf) Accrued pension and severance costs

As of March 31, 2002
1,567
1,218
348
(17)
331 million yen

As of March 31, 2001
1,078
782
296
(143)
152 million yen

3. Pension and Severance Costs(Notes 1,2)a) Service costsb) Interest costsc) Expected return on plan assetsd) Amortization of transition obligationse) Amortization of actuarial lossesf) Net pension and severance costs

688
32
15
143
849 million yen

571
28
11
382
971 million yen

Notes
1. The current year's service cost includes a contribution of 409 million yen to a synthetic-type welfare pension plan
2. The service cost includes the pension costs of subsidiaries adopting the simplified method of pension accounting

4. Actuarial Computation of the Retirement Benefit Obligation
For the period ended
March 31, 2002a) Allocation of projected benefit obligationsb) Discount ratec) Expected return on plan assetsd) Amortization period of transition obligations

Project unit-credit method
2.5% (exclude some subsidiaries/affiliates)
2.2% (exclude some subsidiaries/affiliates)e) Amortization period of actuarial gain/loss

Expensed out in the year
subsequent to the fiscal year ofoccurrence

SOFTBANK CORP.

-For the period ended
March 31, 2001
Project unit-credit method
3.0%
2.2%
Expensed out at the time of
implementing the new standard
Expensed out in the year
subsequent to the fiscal year ofoccurrence34