From April 1, 2014 To   March 31, 2015 ( 3 FUNAI FUNAI ELECTRIC CO., LTD.
1. Summary of Operating Results (Consolidated)
1 equity method affiliate company.
2. Summary of Operating Results (Non-Consolidated)
44 May 11, 2015 Listed company name: Funai Electric Co., Ltd.    Securities Code: 6839 Tokyo Stock Exchange, First Section (URL http://www.funai.jp/ ) Representative: President and CEO Tomonori Hayashi Tetsuhiro Maeda Inquiries: Representative Director, Corporate Planning Dept. TEL: (072) 870-4395 Scheduled date of Annual General Shareholders Meeting; June 25, 2015 Scheduled date of Securities Report to be filed to the Kinki Finance Bureau; June 25, 2015 Scheduled date of Commencement of Annual Dividend Payment; June 8, 2015 Financial Results Supplementation: Yes Financial Results Seminar: Yes
1. Summary of Consolidated Results for the Fiscal Year ended March 2014 (April 1, 2014 – March 31, 2015) Fiscal Year ended March 31, 2014 (125) million yen
116,509 million yen Fiscal Year ended March 31, 2014
2. The dividend for FY 2015 has been undecided. The company’s dividend policy of DOE is unchanged. Because of the high impact stemmed from the recent fluctuations in exchange rates give to the consolidated net assets, the dividend is to be disclosed at t he time of disclosure has become possible to public. 3 Forecast of Consolidated Results for the Fiscal Year ending March 2016 (April 1, 2015 - March 31, 2016)

*Note
(1) Changes in Consolidated Subsidiaries (Changes in Scope of Consolidation): No (2) Changes in Accounting Practices, Procedures and Presentation Methods for Consolidated Financial Results 1. Changes arising from revision of accounting standards: Yes 2. Changes arising from other factors: No 3. Changes in accounting estimates: No 4. Restatement: No (3) Number of Shares Outstanding (Ordinary Shares) 1. Number of shares outstanding (including treasury stock) as of March 31, 2015; 36,130,796 shares as of March 31, 2014; 36,130,796 shares 2. Number of shares of treasury stock as of March 31, 2015; 2,011,665 shares as of March 31, 2014; 2,011,615 shares 3. The Average number of outstanding shares on March 31, 2015; 34,119,178 shares on March 31, 2014; 34,119,181 shares (Reference) Summary of Non-consolidated Results for the Fiscal Year ended March 2015 (April 1, 2014– March 31, 2015)

Note:
This document contains forward-looking statements and projections regarding business performance which are not historical facts. Please note that these statements are based on the current expectations, assumptions, estimates and projections of the Funai Group in light of the information currently available to it. Actual performance may materially differ from projections included in this document because of the impacts of uncertainty in various factors. For the assumptions and other related matters concerning consolidated results forecast, please refer to “(1)Analysis of Business Performance”of “1 Business Performance.”
1. Business Performance
(1) Analysis of Business Performance 1. Summary of the consolidated fiscal year under review (Market environment) Economic indicators in the United States, which is our main market, generally remained on a recovery trend in the year ended March 2015, apart from a slowdown early in 2015 caused by a labor dispute in West Coast ports, a cold snap and other factors. Despite the effects of economic stagnation in Russia and the rekindling of the Greek debt crisis, the European economies followed a gradual recovery trend led by Germany. There were signs of a slowdown in the Chinese economy, resulting in part from a worsening trend in the housing market. The pace of economic recovery in Japan remained slow because of a reactionary downswing after a demand rush ahead of the consumption tax increase, as well as the effects of abnormal weather conditions. As a result of the above factors, the Funai Group posted net sales of JPY 217,088 million, a 7.2% decrease compared with the same period last year. Operating profit was JPY 564 million (the operating loss for the same period last year was JPY 5,465 million); we posted a foreign exchange gain of JPY 1,570 million, and ordinary profit was JPY 1,924 million (the ordinary loss for the same period last year was JPY 2,253 million); and a net profit of JPY 1,354 million (the net loss for the same period last year was JPY 6,745 million). Income improved despite lower sales of some items, such as DVD/BD-related products and printers. Reasons for this included efforts to improve efficiency through effective inventory management. Segment conditions by location were as follows: i) Japan Sales of DVD/BD-related products, LCD TVs and printers declined. As a result, net sales were JPY 42,489 million, a decrease of 24.8% year on year. Our segment loss (operating loss) was JPY 938 million (the operating loss for this segment for the same period last year was JPY 1,328 million). ii)  Americas LCD TV sales were strong, thanks to the shift to large-screen models and good sales during the year-end season. However, net sales basically remained static year on year because of lower sales of TVs with built-in DVD players. Sales of DVD/BD-related products were eroded by market shrinkage, and sales of home theater products were also down. As a result, net sales amounting to JPY 165,887 million, a decrease of 2.2 % year on year. In the other hand, our segment profit (operating income) was JPY 1,200 million (the operating loss for this segment for the same period last year was JPY 3,786 million) thanks to effective inventory management and other factors. (Notes) Effective from the first quarter of the fiscal year under review, the Company has changed the name of a reportable segment from the previous North America to Americas. This is a change of name only and has no impact on segment information.
iii) Asia
Higher sales of ink cartridges and other products helped to lift net sales to JPY 4,894 million, an increase of 7.3 % year on year. Our segment loss (operating loss) was JPY 202 million (the operating income for this segment for the same period last year was JPY 408 million).
iv) Europe
Sales of LCD TVs continued to stagnate, but sales of DVD-related products and ink cartridges expanded.    As a result, net sales increased 16.1 % year on year, to JPY 3,817 million, and an segment profit (operating income) of JPY 57 million (operating loss for the same period last year was JPY 425 million). Sales by product segment were as follows: i)   Audiovisual Equipment In the audiovisual equipment segment, sales of LCD TVs remained static, and there was a decline in sales of DVD/BD-related products because of market shrinkage. As a result, net sales of this equipment were JPY 172,367 million, a decrease of 5.9 % year on year. ii)  Information Equipment Despite higher sales of ink cartridges, net sales in the information equipment segment were lower because of reduced sales of printers. As a result, net sales of JPY 12,634 million, a decrease of 33.1 % year on year.
iii) Other Products
Sales of products other than the items listed above were higher year on year. Sales of electronic reception devices shrank, but there was a moderate increase in sales of audio accessories and other items. Net sales were JPY 32,087 million, an increase of 0.1 % year on year. 2. Outlook for the next consolidated fiscal year For the fiscal year ending March 31, 2016, the Funai Group expects the operating climate to remain problematic, plagued by ongoing uncertainty in its operating environment. To this end, we will further cultivate the Funai Production System (FPS), entrench cost reductions, promote the use of information technologies, improve operations and reinforce risk management. The outlook for the next consolidated fiscal year is provided below.
For its earnings estimates, the Funai Group has assumed an exchange rate of JPY 100 = US$1.00. The operating results outlook is a forward-looking statement about the future performance of the Company and is based on management's assumptions and beliefs in light of information currently available, and involves known and unknown risks and uncertainties. Various factors such as changes in economic conditions overseas, especially in the main U.S. market, and severe price fluctuations may cause actual events and results to differ materially from those anticipated in these statements.
(2) Analysis of Financial Position
1. Condition of total assets, total liabilities and net assets Total assets were ¥8,354 million above the total as of March 31, 2014. The main changes in assets included an increase of ¥17,652 million in cash and deposits, but a ¥5,266 million decrease in merchandise and finished products, a ¥1,718 million decrease in raw materials and supplies account. Total liabilities decreased by ¥1,842 million compared with the position as of March 31, 2014. The main items included a ¥1,317 million decrease in notes and accounts payable-trade. Net assets increased by ¥10,197 million from the level as of March 31, 2014. The main changes included a ¥9,307 million increases in the foreign currency translation adjustment account.
2. Condition of cash flow
An analysis of consolidated cash flows shows that net cash used for operating activities amounted to ¥16,897 million. Net cash used for investing activities was ¥17,360 million, and net cash used for financing activities amounted to ¥2,725 million. The balance of cash and cash equivalent as of March 31, 2015 was ¥42,991 million.
Shareholders' equity ratio: Equity capital/total assets Shareholders' equity ratio on a market capitalization basis: Total market capitalization/Total assets Ratio of cash flow to interest-bearing debt: Interest-bearing debt/Operating cash flow Interest coverage ratio: Operating cash flow/Interest payments *  All indicators are calculated using financial values on a consolidated basis. * Total market capitalization is calculated by multiplying the closing share price at the end of the consolidated fiscal year by the number of shares outstanding (after deducting treasury stock) at the end of the consolidated fiscal year. Net cash provided by (used in) operating activities shown on the Consolidated Statements of Cash Flows is used as operating cash flow. Interest-bearing liabilities include all liabilities on which the Company pays interest that are accounted for on the Consolidated Balance Sheets. The amounts shown as interest expense on the Consolidated Statements of Cash Flows are used as interest payments. *  The ratio of cash flow to interest-bearing debt and the interest coverage ratio for the fiscal years ended March 2011, March 2013 and March 2014 have been omitted because cash flow from operating activities was negative. (3) Basic Policy Concerning Distribution of Earnings and Dividends for the Consolidated Fiscal Year under Review and Next Fiscal Year With regard to the distribution of earnings, the Funai Group recognizes the return of earnings to shareholders is an important management issue, and considers the maintenance of stable dividends while taking steps to strengthen the Company's management base to be a fundamental policy. The Funai Group implements a positive dividend policy, which takes into consideration factors such as the operating environment, based on a dividend ratio of 1.0% of consolidated net assets as a specific standard. The Funai Group plans to implement dividend payments as a year-end dividend (once a year).  If the Company pays an interim dividend, it makes a public announcement in advance. Based on this policy, for the fiscal year ended March 31, 2015, the Company plans to award a year-end dividend of JPY 35 per share. The dividend of the next fiscal year has been undecided. (4) Business and Other Risks Risks that may have a significant impact on the Funai Group's financial situation and operating results are outlined below. (Funai Group management policy) The Funai Group has adopted a policy of providing high-quality, low-cost products to consumers based upon optimized production and sales systems on a global scale. We manufacture and sell our principal products, such as audiovisual equipment (DVD-related products, LCD TVs, etc.) and information equipment (printers, etc.), in addition to other products (antennas and related devices, audio accessory-related products, etc.). Price competition in these product areas is intense. Additionally, the life cycle of digital products is short and the competition to develop new technologies and functions is also growing more severe. Accordingly, these factors may affect the Group's financial situation and operating results. i)    Product cost and market prices The Funai Group's primary target is customers of mass merchandisers such as Walmart and therefore we must deliver low prices. Consequently, the Funai Group is working to cut costs through measures such as establishing production systems in optimal locations, pursuing further application of the Funai Production System (FPS), the unique productivity improvement system developed by Funai, and utilizing internal production of parts and centralized purchasing. However, competition in the home electronic appliance industry is intense and when the cost of parts and raw materials rise, cost pressures may affect the Funai Group's financial situation and operating results regardless of the fact that we have implemented these measures.
ii) New technologies
As the number of digital products in the home electronic appliance industry increases and the needs of the market become more diverse, Funai must improve the quality, volume and speed of its new product development. The Funai Group must be able to respond to such issues and we will improve our technical capabilities, primarily in the digital product area, by collaborating with other companies, industry and academia, and through personnel training. We also will consider mergers and acquisitions among our options. However, a diversification of market needs or technological innovation beyond our expectations may affect the Funai Group's financial situation and operating results. iii)   Defects relating to products and services The Funai Group efforts to increase quality are centered on the departments that are responsible for quality management and technologies. In addition, a service platform consisting of service companies in both domestic and international markets has been established. However, if there is a defect in a product that requires the Funai Group to respond by repairing or replacing such product, the impact of the warranty and/or the resultant decrease in corporate reputation may have negative implications for the Funai Group's financial situation and operating results. iv)   Intellectual Property Rights Recent years have seen an increase in activity by so-called “patent trolls.” These are entities that sell no products of their own, but that attempt to generate income from patent royalties by filing lawsuits using intellectual property rights acquired from third parties. This is a worrisome trend for all companies involved in manufacturing and sales. As a result of this trend we could be compelled to make high compensation payments that may affect the Group’s financial situation and operating results.
v)   Corporate Acquisitions and Business Alliances
The Funai Group pursues corporate acquisitions and business alliances as ways to improve its business portfolio and efficiently bolster sales and profits. However in the event that, for various reasons, the synergies that are achieved fall short of initial expectations, fail to reach agreement on an acquisition and affiliate relationships cannot be maintained, this may affect the Funai Group's financial situation and operating results, as well as growth forecasts. (Impact of overseas market trends) i) Dependence on the North American market A large portion of the Group's net sales originates in overseas markets. The North American market in particular accounted for 70.1% of net sales in the current consolidated fiscal year. Should the North American economy rapidly enter a recession, this may affect the Group's financial situation and operating results.
ii) Dependence on Chinese production
The Funai Group is working to improve the cost competitiveness of its products by concentrating production in positive cost-benefit regions and purchasing parts in bulk. In the current consolidated fiscal year 99.0% of our products were produced overseas, with 62.1% produced in China (consignment manufacturing and in-house production). Changes in the Chinese government, the outbreak of conflict or natural disasters or other unforeseen circumstances may affect the Group's financial situation and operating results.
iii) Foreign currency risk
The Funai Group selects production sites for its principal products after giving consideration to optimal production sites and sales systems. DVD-related products, LCD TVs, and printers are produced in China, LCD TVs are produced in Thailand, ink cartridges are produced in Philippines. The Funai Group purchases products from overseas subsidiaries in these countries and sells them in overseas markets, particularly North America, either through Funai’s overseas sales subsidiaries or through direct sales to OEM supply partners. Domestic sales are also conducted through direct sales and sales subsidiaries. Purchases from overseas subsidiaries in these countries accounted for 85.3% of gross purchases during the current consolidated fiscal year. Likewise, overseas net sales accounted for 85.2% of net sales. The majority of our purchasing and sales are conducted in U.S. dollars. We believe this reduces the risks that accompany currency fluctuations. However, since currency fluctuation risks cannot be completely eliminated and foreign currency-denominated assets and liabilities are converted to yen using the exchange rates on the settlement date, significant currency fluctuations may affect the Group's financial situation and operating results.
(Other Risks)
i) Statutory Regulations In each country where the Funai Group engages in business activities, it is subject to a variety of local laws and regulations, including antitrust laws and laws concerning commercial transactions, importing and exporting, intellectual property rights, product liability, environmental protection, consumer protection, financial transactions, and corporate taxation. Changes to these laws and regulations, or the ways in which they are interpreted by the authorities, could affect the Group's financial position and business performance.
ii) Litigation
The Funai Group is active in Japan and overseas, and there is a continuing risk of litigation relating to the Group’s business activities. A major lawsuit or other legal action could affect the Group's financial position and business performance. iii) Management of Information The Funai Group has in place internal systems to prevent information leaks and protect itself against viruses. However, factors such as operational mistakes and the advent of new virus strains may preclude efforts to avoid information leaks and system shutdowns altogether. Such events could affect the Funai Group's financial situation and operating results.
iv) Retirement Benefit Obligations
The Funai Group and its consolidated domestic subsidiaries have in place defined benefit corporate pension systems, and retirement benefit obligations are based on actuarial assumptions on pension assets, such as rates of return and discount rates. The Funai Group's financial situation and operating results could be affected if changes in these assumptions become necessary, if a deterioration in the investment environment results causes pension assets to decrease, or if changes in the pension system cause future retirement benefit expenses to increase.
v) Deferred tax assets
The Funai Group bases its decisions on the recoverability of deferred tax assets on various forecasts and assumptions related to future taxable earnings. If these forecasts and assumptions about future taxable earnings change or if the Group determines that part or all of its deferred tax assets cannot be recovered, subsequent reductions in deferred tax assets could affect the Funai Group's financial situation and operating results.
vi) Access to Finance
If the Funai Group's access to finance is limited due to deteriorating business performance, the cost of finance could increase. This could affect the Group's financial position and business performance. Some of the Group's debt is subject to financial covenants. The consequences of a covenant violation, such as a higher loan interest rate or the loss of benefits of time, could affect the Group's financial position and business performance.
2. Current Conditions of the Company's Group
The Funai Group has omitted disclosure of this item because there are no material changes from the information reported in “Diagram of Operating Business Relationships (Business Contents)” and “Affiliated Companies” in the most recent financial statements (submitted on June 20, 2014).
3. Management Policies
(1) Basic Management Policy of the Company As its basic management policy, the Funai Group will pursue its business activities by building strong trust and seeking the mutual prosperity of all parties related to the Company as its basic policy, by creating the most efficient development, manufacturing and sales organization possible and stably supplying high quality and fairly priced products to global markets, based on a corporate creed of continual product improvements, promotion of deeper trust and further harmony and mutual prosperity. (2) Management Indicators Established as Objectives As a management indicator for the Funai Group, the Company places the greatest emphasis on operating income margin, and will seek to achieve an operating income margin of at least 5% at all companies over the medium term. (3) Medium to Long-term Management Strategy and Issues to be addressed Demand for LCD TVs expanded because of improving resolutions, including 4K technology, and the shift to larger screens. However, the consumer electronics industry continued to face challenging conditions because of an ongoing slump in the market for DVD/BD-related products and signs of a slowdown demand for products hitherto regarded as growth drivers, such as smartphones and tablets. As outlined below, the Funai Group will need to overcome a number of specific challenges in this industry environment. i) Increasing net sales and returning to profitability The Funai Group has positioned the increase of net sales and improvement of earnings as its highest priority issue.
(Product strategy)
Our revenues declined year on year in the year ended March 2015 because of reduced revenues from revenues from LCD TVs and DVD/BD-related products, which have been our main sales drivers. Sales of printers and other items were also lower. However, we were able to achieve income growth by further strengthening our control of purchasing, sales and inventories (PSI), and by creating systems to ensure the supply of cost-competitive products with optimal timing. We also took steps to expand sales, including the takeover of the North American TV business of Sanyo Electric Co., Ltd., which is a subsidiary of Panasonic Corporation, in October 2014. In February 2015 we concluded a licensing agreement with Eastman Kodak Company covering the global supply, delivery, marketing, sales and servicing of Kodak brand consumer and small office printer products and related consumables. Previously our involvement with inkjet printer products had been limited to contract manufacturing of hardware. However, we regard expansion into new business areas as an urgent priority, and we used inkjet technology and assets acquired under an agreement with Lexmark International, Inc. to complement our own resources, resulting in the creation of a structure that includes the manufacture and sales of inkjet cartridges on a more profitable basis. In the year ended March 2014 we began to develop and ship our own printers.
(Market strategy)
We recognize the need to avoid the risks associated with excessive reliance on the U.S. market, to level out production and sales by reducing the effects of seasonal fluctuations, and to expand sales. We are therefore developing our business in emerging growth markets, such as Mexico and other Central and South American countries. Through the steady implementation of the above-mentioned strategies, we plan to minimize the time lags between product planning, development, material procurement, production and sales. Additionally we are addressing the improvement for provide products that meet market needs precisely in a timely manner.
ii) Reinforcing manufacturing and development systems
Excessive reliance on production in China is a risk factor for the Funai Group. To avoid that risk, we have been working to distribute our production sites to other locations. While this strategy has resulted in a downward trend in the percentage of items manufactured in China, the ratio is still high. We completed construction of a factory in the Philippines for our production subsidiary, Funai Electric Philippines Inc., during the year under review, and we are now making preparations for the early start-up of production. We are also continuing our efforts to improve development efficiency across the entire Funai Group, including our operations in China and Asia.
ii) Training and appointment of human resources
The Company recognizes that improving each employee's capabilities and being able to link this to bolstering the strength of the Funai Group will be critical for ensuring the Funai Group stays in the lead in the new era of global competition and implementing the Group’s medium to long-term business strategy. Therefore the Company’s policy is to actively train and assign employees, without regard to whether they are younger employees or mid-career staff, by strengthening and expanding its internal or external training systems.
4. Basic Thinking about the Selection of Accounting Standards
The Funai Group applies Japanese accounting standards. We have not set a definite timetable for the adoption of international accounting standards, but we will consider taking this step if this seems appropriate in light of related developments, such as the adoption of international standards by other Japanese companies in our industry.
(2) Consolidated Statements of Income and Consolidated Statement of Comprehensive Income
(3) Consolidated Statements of Changes in Shareholders' Equity
(Fundamental important matters for preparation of consolidated financial statements) 1. The matter regarding consolidation scope The number of consolidated subsidiaries : 22 The major consolidated subsidiaries are FUNAI CORPORATION, INC., FUNAI ELECTRIC (H.K.), LTD. and DX ANTENNA CO., LTD. The newly-established DX ANTENNA MARKETING, INC. have also been included within the scope of consolidation in the fiscal year.
(Change in Accounting Policy)
Application of Accounting Standard for Retirement Benefits Starting from the current consolidated accounting year, the Funai Group has modified the method used to calculate retirement benefit obligations and prior service costs by applying the Accounting Standard for Retirement Benefits (ASBJ Statement No. 26, May 17, 2012, hereinafter referred to as “the Standard”) and the Guidance on Accounting Standard for Retirement Benefits (ASBJ Guidance No. 25, March 26, 2015, hereinafter referred to as “the Guidance”) with regard to the provisions of Article 35 of the Standard and Article 67 of the Guidance. The method used to attribute estimated retirement benefits to each period has been changed from the straight-line attribution standard to the benefit formula standard. The basis for determining the discount rate has been changed from the average period until the estimated benefit payment date to a single weighted average discount reflecting the amounts for the estimated retirement benefit payment period and the estimated payment period. In accordance with the provisions of Article 37 of the Accounting Standard for Retirement Benefits concerning the handling of the transition to the Accounting Standard for Retirement Benefits, the income surplus for the current consolidated accounting year has been adjusted to reflect the change in the method used to calculate retirement benefit obligations and past service costs at the start of the accounting year. As a result, assets and liabilities relating to retirement benefits at the start of the current consolidated accounting year have increased by ¥934million and ¥200million respectively, and the income surplus by ¥483million, while minority interests have decreased by ¥11million. Consolidated operating income, ordinary income, and net income before income taxes and minority interests for the fiscal year ended March 31, 2015 have each increased by ¥11 million. In addition, consolidated net assets per share and net income per share for the fiscal year ended March 31, 2015 have increased by ¥14.38  and ¥0.20 , respectively. (Additional Information) About Anti-Tax Haven Law The Funai Group received a rectification notice from the Osaka Regional Taxation Bureau on June 29, 2011. The Bureau determined that our Hong Kong subsidiary does not meet the requirements for exclusion under the anti-tax haven system and the Hong Kong subsidiary's income for the three fiscal years ended March 31, 2008 through 2010, will be considered, and taxed as our income. We objected to these supplementary tax assessments, and filed a petition with the Osaka Regional Tax Tribunal on August 25, 2011, to overturn the supplementary tax assessment order. Thereafter, we received written verdicts on this case on July 24, 2012 indicating that our assertions had been dismissed. We will continue to assert the validity of its arguments in the future. The additional tax of JPY 825 million (JPY 935 million including incidental taxes) includes corporate, enterprise and residence taxes. We charged the tax assessments to income as "prior year's taxes" in the fiscal year ended March 31, 2012. The financial effect of applying the tax system beginning in the fiscal year ended March 31, 2011, the accounting period after the fiscal year in which the tax examination concluded, has been charged to income. (Consolidated balance sheets) Fiscal Year 2014 (As of March 31, 2015) Contingent liabilities Funai Electric Co., Ltd. (hereinafter, “Funai”) resolved to acquire from Koninklijke PHILIPS N.V. (hereinafter, “PHILIPS”) all shares in a company that will hold the operation of the PHILIPS’ Lifestyle Entertainment Business and concluded a share purchase agreement on January 29, 2013. But PHILIPS filed against Funai a petition as of October 25, 2013 for arbitration to claim compensation for damages on the grounds of breach of the agreement by Funai and the petition has been served on November 8, 2013 by the International Chamber of Commerce. With regard to this matter, Funai recognizes there to have been no breach of contract on its behalf. Consequently, on December 6, 2013, Funai filed with the International Chamber of Commerce a counterclaim for claiming compensation for damages on the grounds of breach of the agreement and undue action by PHILIPS. On May 20, 2014 Funai received notice from PHILIPS of the amount of the claim for compensatory damages. Subsequently, on October 1, 2014 the Company filed a statement with the International Court of Arbitration including indication of the amount of compensatory damages claimed against PHILIPS. On December 24, 2014 Funai received notice from PHILIPS of a revised amount of compensatory damages claimed by PHILIPS. The results of these arbitral proceedings may affect the Funai Group's operating performance, but given the difficulty of making a rational estimate of this impact during this third quarter consolidated fiscal period, such impact has not been reflected in the Funai Group's operating performance or financial condition. Following is the outline of arbitration filed against Funai and counterclaim filed by Funai. 1. Outline of arbitration filed against Funai (1) Institution and date of arbitration i) Institution where petition for arbitration is filed: International Chamber of Commerce ii)   Date of petition for arbitration: October 25, 2013 (2) Petitioner of arbitration i)    Name : Koninklijke PHILIPS N.V. ii)   Location : Eindhoven, The Netherlands iii)  Title & name of representative : Chief Executive Officer    Frans van Houten (3) Details of petition and claimed amount for damages Details of petition : A claim for damages on the grounds of breach of the agreement by Funai i) ii)   Claimed amount : €189.6 million (amount revised from the amount of €171.8 million filed by PHILIPS on May 20, 2014), statutory interest and arbitration costs 2. Outline of counterclaim filed by Funai (1) Institution with which counterclaim filed and date of filing i) Institution with which counterclaim filed : International Chamber of Commerce ii)   Date of counterclaim: December 6, 2013 (2) Other party to counterclaim filing i) Name : Koninklijke PHILIPS N.V. ii)   Location : Eindhoven, The Netherlands iii)  Title & name of representative : Chief Executive Officer    Frans van Houten (3) Details of petition and claimed amount for damages Details of petition : Claim for damages on the grounds of breach of the agreement and undue action by PHILIPS i) ii)   Claimed amount : an indication of the amount of compensatory damages claimed in such counterclaim, consisting of    €312.3M , the amount of tax payable,contractual interest and arbitration costs. An overview of the above-mentioned share purchase agreement is as follows. 1. Name of other company and content of acquired businesses (1) Name of other company : Koninklijke PHILIPS N.V. (2) Content of acquired businesses : Lifestyle Entertainment Business (Note) The Lifestyle Entertainment Business involves the development and design, sales and (partial) manufacture of the PHILIPS-brand Audio Video Multimedia products, Home Communication products and Accessories products. 2. Reasons for Acquiring the Shares The Transaction to assume the operation will enable the Funai Group to expand the lineup of products that it handles and expand its sales region to include Asia, South America and other emerging markets, as well as advanced countries in Europe. Funai decided to acquire shares in the New Company, based on the belief that the acquisition would foster sustained growth of the Funai Group's business. 3. Acquisition price and percentage of shares held after acquisition Acquisition price : €150 million Percentage of shares held after acquisition : 100% (Consolidated statement of income) *1. Impairment loss Fiscal Year 2013 (From April 1, 2013 to March 31, 2014) During the fiscal year under review, the Funai Electric Group recorded losses on impairment in the following asset groups.
In principle, the Funai Group groups business assets on the basis of legal units that strive to maintain an ongoing understanding of income and expenses. The idle assets are grouped by individual asset. Since the prospects for future profitability are expected to worsen due to factors including a decrease in orders for information equipment, during the fiscal year under review, the Company reduced the book value of manufacturing facilities, etc. to their recoverable amount and recorded the decrease in value (JPY 266 million) under extraordinary losses. Details of the loss are JPY 149 million for machinery, equipment and vehicles, JPY 51 million for tools, furniture and fixtures, and JPY 65 million for long-term prepaid expenses. The recoverable amount of the assets has been determined using net realizable value, taking the net realizable value of long-term prepaid expenses as zero and calculating the net realizable value of assets other than long-term prepaid expenses using reasonable estimates taking into account the market value.
In principle, the Funai Group groups business assets on the basis of legal units that strive to maintain an ongoing understanding of income and expenses. The idle assets are grouped by individual asset. The book values of assets used for business activities affected by significant declines in profitability in the current consolidated accounting year have been reduced to the recoverable amounts. This reduction (¥618 million) is shown in the accounts as an extraordinary loss. The total consists of ¥596 million for buildings and ¥22 million for land. Recoverable amounts are based on the net amounts that can be realized through sales, which are calculated on the basis of real estate valuations.
*2. Business structure improvement expenses
Fiscal Year 2013 (From April 1, 2013 to March 31, 2014) Expenses incurred on business restructuring stem mainly from costs incurred due to the shrinking of the overseas LED business, principally including an inventory valuation loss of JPY 205 million, an impairment loss on investment in subsidiaries and associated companies of JPY 651 million and impairment losses of JPY 393 million. (Impairment loss) During the fiscal year under review, the Funai Electric Group recorded losses on impairment in the following asset groups.
In principle, the Funai Group groups business assets on the basis of legal units that strive to maintain an ongoing understanding of income and expenses. The idle assets are grouped by individual asset. Mainly as a result of the decision to downsize the overseas LED business, during the fiscal year under review, the Company reduced the book value of manufacturing facilities, etc. with no prospects of future use to their recoverable amount, and recorded the decrease in value (JPY 393 million) in business structure improvement expenses under extraordinary loss. Details of the loss are JPY 238 million for machinery, equipment and vehicles, JPY 99 million for tools, furniture and fixtures, and JPY 55 million for long-term prepaid expenses. The recoverable amount of the assets has been determined using net realizable value, taking the net realizable value of long-term prepaid expenses as zero and calculating the net realizable value of assets other than long-term prepaid expenses using reasonable estimates taking into account the market value.
*3. Advisory fees
Fiscal Year 2013 (From April 1, 2013 to March 31, 2014) Advisory fees were paid as specified compensation and fees to third-party advisors to determine an acquisition price for the intended acquisition of all shares in a company handling the Lifestyle business of Koninklijke Philips N.V. (hereinafter, “PHILIPS”). However, we are treating these fees as expenses, as PHILIPS has terminated the share purchase agreement and submitted a request for arbitration with the International Chamber of Commerce, and we have filed a counterclaim in this regard.
(Consolidated statement of comprehensive income)
* 1. Reclassification adjustment and tax effect amount involved in other comprehensive income

1. Summary of Reporting Segments
The Group's reporting segments are based on those units within the Group where separate financial information is available and where the Chief Executive Officer (Representative Director, President and Executive Officer) of the Group periodically deliberates over matters such as the distribution of management resources and financial performance of such segments. The Group's main business is to manufacture and sell electrical equipment and devices. Within Japan, such functions are the responsibility of DX Antenna Co., Ltd. Overseas, the areas of the United States, Asia and Europe are managed by Funai Corporation, Inc. (Americas), P&F USA, Inc. (Americas), Funai Electric (H.K.) Ltd. (Asia), FUNAI ELECTRIC EUROPE Sp.z o.o (Europe), and other locally domiciled entities. Each locally domiciled entity is an independently managed unit that engages in business activities after formulating comprehensive strategies on the products to carry in the region. Consequently, the Group is comprised of location-specific segments that are based on its manufacturing and sales structure and have established “Japan”, “Americas”, “Asia” and “Europe” as its four reporting segments. 2. Measurement of the amount of sales, income/loss, assets and liabilities and other in each reporting segment The accounting policies of the reporting segment are the same as “Basis of presenting consolidated financial statements". Net sales of intersegment are based on sales price to outside customers.
(Application of Accounting Standard for Retirement Benefits)
Effective from the first quarter of the fiscal this year under review, the Company has applied the provisions set forth in the main clauses of Paragraph 35 of the Accounting Standard for Retirement Benefits (ASBJ Guidance No. 26, May 17, 2012) and Paragraph 67 of the Guidance on Accounting Standard for Retirement Benefits (ASBJ Guidance No. 25, May 17, 2012). As a result, the methods for calculating retirement benefit obligations and service costs have been revised in the following respects: the method for attributing projected benefits to periods has been changed from the straight-line basis to the benefit formula basis, and the method for determining the discount rate has been changed from a discount rate based on the average period until payment of estimated amount of retirement benefits to use a single weighted-average discount rate that reflects the periods until the expected payment of retirement benefits and the amount of projected benefits for each period. The effect of this change is immaterial.
(Change the Name of a Reportable Segment)
Effective from the first quarter of the fiscal this year under review, the Company has changed the name of a reportable segment from the previous North America to Americas. This is a change of name only and has no impact on segment information. Segment information for the current third quarter is presented using the revised segment name. 3. Information of the amount of sales, income/loss, assets, liabilities and other in each reporting segment

(Note)
1. Adjustments were as follows.

* Corporate expenses that are categorized under adjustments are within segment income mainly comprise general & administration expenses that do not correspond to the reporting segments
*Total assets that are categorized under adjustments within segment assets mainly comprise excess cash/deposits, long term securities for investment that do not correspond to the reporting segments. 2. Segment income and loss are adjusted with the operating income reported in the consolidated statements of income and loss.
[Related Information]
Fiscal year 2013 (April 1, 2013- March 31, 2014)

Information every area
2.

(Note) Geographical sales are groupings of nations and regions based on geographical location of customers. (2) Property, plant and equipment (Units: Million Yen)

Fiscal year 2014 (April 1, 2014- March 31, 2015)

Information every area
2.
(1) Sales (Units: Million Yen)
(Note) Geographical sales are groupings of nations and regions based on geographical location of customers. (Changes Geographical Area Namings) In the previous consolidated accounting year, sales in Central and South American markets, such as Mexico, were shown in the accounts under “Others.” In the current consolidated accounting year, the increasing importance of these markets has resulted in their inclusion in the “Americas” category, which replaces the “North America” category. To reflect this change in the presentation method, the regional sales information for the previous consolidated accounting year has been reallocated from ¥24,320 million under “Others” to ¥20,409 million under “Mexico” within the “Americas” category, and ¥3,319 million , ¥591 million under “Others.” , respectively.

Information every main customer
3.

(Units: Million Yen) [Information of impairment loss in each reporting segments] Fiscal year 2013 (April 1, 2013 - March 31, 2014)
(Units: Million Yen)
Fiscal year 2014 (April 1, 2014 - March 31, 2015)
[Information of amortization of goodwill and unamortized balance in each reporting segments] Fiscal year 2013 (April 1, 2013 - March 31, 2014) (Units: Million Yen)
[Information of amortization of negative goodwill in each reporting segments] Fiscal year 2013(April 1,2013-March 31,2014) No Applicable Fiscal year 2014(April 1,2014-March 31,2015) No Applicable
1. In the current consolidated accounting year, net income per share after dilution is not shown because there are no issuable shares with a dilutive effect. In the previous consolidated accounting year, the net loss per share after adjustment for dilution was not shown, since there were no issuable shares with a dilutive effect.
(Events after the reporting period) Not appreciable.
FY 2014 from 2014.4.1 2015.3.31 to Page
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4 4 FUNAI ELECTRIC CO., LTD.
1. Summary of Full Year Financial Statements (Consolidated)

(1) Operating Results, Financial Conditions
(※) Yen-Dollars / Exchange rate

(2) Profitability and Per Share Data etc.
(3) Capital Expenditures, Depreciation, R&D Expenses

2.  Operating Activities (Consolidated)
(1) Sales by Equipment

(Note)
Effective from FY 2014, sales to Central and South America, which were previously included in the Asia and others , have been included in Americas.  The segment name North America has been changed to Americas. Figures for FY 2013 have been restated accordingly.

(3) Sales by Equipment in Areas
Effective from FY 2014, sales to Central and South America, which were previously included in the Asia and others , have been included in (Note) Americas.  The segment name North America has been changed to Americas. Figures for FY 2013 have been restated accordingly.
3.  Summary of 4Q (January to March) Financial Statements (Consolidated)
(1) Operating Results

(※) Yen-Dollars / Exchange rate

(2) Sales by Equipment

(Company) FUNAI ELECTRIC CO., LTD. INVESTOR RELATIONS OFFICE 7-7-1 Nakagaito Daito-city, Osaka 574-0013, Japan TEL 81-72-870-4395・FAX 81-72-870-4613