SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   Form 20 - F

                  ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

                    For the fiscal year ended March 31, 2005
                        Commission file number 2 - 68279

                             KABUSHIKI KAISHA RICOH
                             ----------------------
             (Exact name of registrant as specified in its charter)

                               RICOH COMPANY, LTD.
                               -------------------
                 (Translation of registrant's name into English)

                                      Japan
                                      -----
                 (Jurisdiction of incorporation or organization)

          15-5, Minami-Aoyama 1-chome, Minato-ku, Tokyo 107-8544, Japan
          -------------------------------------------------------------
                    (Address of principal executive offices)

              Securities registered or to be registered pursuant to
                            Section 12(b) of the Act.

         Title of each class               Name of each exchange on
                                           which registered

                None                              None
                ----                              ----

              Securities registered or to be registered pursuant to
                            Section 12(g) of the Act.

                                      None
                                      ----
                                (Title of Class)

        Securities for which there is a reporting obligation pursuant
                          to Section 15(d) of the Act.

                                  Common Stock*
                                  -------------
                                (Title of Class)

*247,043 American Depositary Shares evidenced by American Depositary Receipts,
     each American Depositary Share representing 5 shares of Common Stock of
                               Ricoh Company, Ltd.

Indicate the number of outstanding shares of each of the issuer's classes of
capital or common stock as of the close of the period covered by the annual
report.

Common stock outstanding as of March 31, 2005: 734,045,879 shares (excluding
10,866,199 shares of Treasury Stock)

        Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.

Yes   X              No      .
    -----               -----

        Indicate by check mark which financial statement item the registrant has
elected to follow.

Item 17           Item 18   X  .
        -----             -----


Defined Terms, Conventions and Presentation of Financial Information
--------------------------------------------------------------------

        On June 28, 2005, the noon buying rate for cable transfers in New York
City as certified for customs purposes by the Federal Reserve Bank of New York
for the Japanese Yen to the U.S. Dollar was Yen 109.89 = U.S.$1.00.

        In this document, the term "Company" refers to Ricoh Company, Ltd., the
registrant, and "Ricoh" refers to the Company and its consolidated subsidiaries,
unless the context otherwise indicates.

        Ricoh's fiscal year end is March 31. In this document "fiscal year 2005"
refers to Ricoh's fiscal year ended March 31, 2005, and other fiscal years of
Ricoh are referred to in a corresponding manner.

        As used in this annual report, "U.S. GAAP" means U.S. generally accepted
accounting principles.

Cautionary Statement With Respect to Forward-Looking Statements
---------------------------------------------------------------

        Statements made in this annual report with respect to Ricoh's current
plans, estimates, strategies and beliefs and other statements that are not
historical facts are or may be deemed to be forward-looking statements, within
the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the
Securities Exchange Act of 1934, about the future performance of Ricoh. These
forward-looking statements are made in reliance upon the protections provided by
such acts for forward-looking statements. Forward-looking statements include but
are not limited to those using words such as "believe," "expect," "plans,"
"strategy," "prospects," "forecast," "estimate," "project," "anticipate," "may"
or "might" and words of similar meaning in connection with a discussion of
future operations or financial performance. From time to time, oral or written
forward-looking statements may also be included in other materials released to
the public. These statements are based on management's assumptions and beliefs
in light of the information currently available to it. Ricoh cautions you that a
number of important risks and uncertainties could cause actual results to differ
materially from those discussed in the forward-looking statements, and therefore
you should not place undue reliance on them. You also should not rely on any
obligation of Ricoh to update or revise any forward-looking statements, whether
as a result of new information, future events or otherwise. Ricoh disclaims any
such obligation. Risks and uncertainties that might affect Ricoh include, but
are not limited to (i) general economic conditions in Ricoh's markets,
particularly levels of consumer spending; (ii) exchange rates, particularly
between the Japanese Yen and the U.S. Dollar, the Euro, and other currencies in
which Ricoh makes significant sales or in which Ricoh's assets and liabilities
are denominated; (iii) Ricoh's ability to continue to design and develop
products and services, and win acceptance of its products and services which are
offered in highly competitive markets characterized by continual introduction of
new products, rapid development in new technology, and consumer preferences that
are subjective and likely to change; (iv) Ricoh's ability to successfully
implement strategies for its Office Equipment business, such as further
globalization of its operations to increase account sales to corporate clients,
reinforcement of the color printer lineup to meet growing demand for color
products among its office users, implementation of optimal printing solutions
for customers' digitally networked offices and enhancement of printing
capabilities centered on multi-functional printers ("MFPs"), and implementation
of optimal localization of manufacturing operations so that such operations are
closer to its customer; (v) Ricoh's ability to continuously devote sufficient
resources to research and development, and capital expenditures for digital and
networking equipment, such as digital plain paper copiers ("PPCs"), MFPs and
laser printers; (vi) the success of Ricoh's alliances with various computer
manufacturers which Ricoh may engage in alliances with in the future; and (vii)
the outcome of contingencies.

        Important information regarding risks and uncertainties is also set
forth elsewhere in this annual report, including in "Risk Factors" included in
"Item 3. Key Information," "Item 4. Information on the Company," "Item 5.
Operating and Financial Review and Prospects" and "Item 11. Quantitative and
Qualitative Disclosures About Market Risk."


                                TABLE OF CONTENTS

PART I
        Item 1.   Identity of Directors, Senior Management and Advisers........1
        Item 2.   Offer Statistics and Expected Timetable......................1
        Item 3.   Key information..............................................1
        Item 4.   Information on the Company...................................9
        Item 5.   Operating and Financial Review and Prospects................24
        Item 6.   Directors, Senior Management and Employees..................64
        Item 7.   Major Shareholders and Related Party Transactions...........82
        Item 8.   Financial Information.......................................83
        Item 9.   The Offer and Listing.......................................83
        Item 10.  Additional Information......................................86
        Item 11.  Quantitative and Qualitative Disclosures About Market
                   Risk......................................................100
        Item 12.  Description of Securities Other Than Equity Securities.....103

PART II
        Item 13.  Defaults, Dividend Arrearages and Delinquencies............103
        Item 14.  Material Modifications to the Rights of Security
                   Holders and Use of Proceeds...............................103
        Item 15.  Controls and Procedures....................................103
        Item 16A. Audit Committee Financial Expert...........................103
        Item 16B. Code of Ethics.............................................104
        Item 16C. Principal Accountant Fees and Services.....................104
        Item 16D. Exemptions from the Listing Standards for Audit
                   Committees................................................105
        Item 16E. Purchases of Equity Securities by the Issuer and
                   Affiliated Purchasers.....................................106

PART III
        Item 17.  Financial Statements.......................................106
        Item 18.  Financial Statements.......................................106
        Item 19.  Exhibits...................................................106


Item 1. Identity of Directors, Senior Management and Advisers
        -----------------------------------------------------
        Not applicable.

Item 2. Offer Statistics and Expected Timetable
        ---------------------------------------
        Not applicable.

Item 3. Key information
        ---------------

A. Selected financial data.

        The following selected consolidated financial data has been derived from
the audited consolidated financial statements of Ricoh prepared in accordance
with U.S. generally accepted accounting principles as of each of the dates and
for each of the periods indicated below. This information should be read in
conjunction with Ricoh's audited consolidated balance sheets as of March 31,
2004 and 2005, the related consolidated statements of income, shareholders'
investment and cash flows for the three years ended March 31, 2003, 2004 and
2005 and the notes thereto that appear elsewhere in this annual report.

<TABLE>
<CAPTION>
                                                    Millions of Yen except per share amounts and number of shares
                                                                       Year ended March 31,
                                         ----------------------------------------------------------------------------------
                                             2001              2002              2003             2004              2005
                                         -----------       -----------       -----------      -----------       -----------
<S>                                      <C>               <C>               <C>              <C>               <C>
Income Statement Data:
Net sales:                                 1,538,262         1,672,340         1,738,358        1,780,245         1,814,108

Operating income                             105,105           129,695           133,654          150,006           135,506
Net income                                    53,228            61,614            72,513           91,766            83,143

Per American Depositary Share:
   Net income (Basic)                         384.25            441.35            498.95           618.15            563.20
   Net income (Diluted)                       355.10            412.30            484.05           618.15            563.20

Balance Sheet Data:
Total Assets                               1,704,791         1,832,928         1,884,922        1,852,793         1,953,669
Shareholders' investment                     556,728           633,020           657,514          795,131           862,998
Common Stock                                 103,434           120,461           135,364          135,364           135,364
Weighted Average Number of shares
outstanding                              692,616,894       698,025,167       726,659,698      742,292,806       738,160,042

Cash dividends declared
Per American Depositary Share:
      Interim                                  30.00             30.00             35.00            40.00             50.00
                                              ($0.27)           ($0.24)           ($0.28)          ($0.36)           ($0.49)

      Year-end                                 30.00             35.00             35.00            50.00             50.00
                                              ($0.28)           ($0.29)           ($0.29)          ($0.46)           ($0.45)
</TABLE>

                                      - 1 -

<TABLE>
<CAPTION>
                                                     Millions of except per share amounts and number of shares
                                                                       Year ended March 31,
                                         ----------------------------------------------------------------------------------
                                             2001              2002              2003             2004              2005
                                         -----------       -----------       -----------      -----------       -----------
<S>                                          <C>               <C>               <C>              <C>               <C>
At year-end:
  Cash and cash equivalents                  107,746           170,172           189,243          203,039           186,857
  Capital investments                         73,329            75,676            73,956           75,507            84,701
  Long-term indebtedness                     217,743           332,995           345,902          281,570           226,567
</TABLE>

Notes:

        1.      Each American Depositary Share represents five shares of Ricoh
                Common Stock.
        2.      Long-term indebtedness includes convertible bonds and
                debentures. (See Note 10 to the Consolidated Financial
                Statements.)

        In the preceding table, cash dividends declared in U.S. Dollars are
based on the exchange rates at each respective payment date, using the noon
buying rates for cable transfer in Japanese Yen in New York City as certified
for customs purposes by the Federal Reserve Bank of New York.

        On June 28, 2005, the noon buying rate for cable transfers in New York
City as certified for customs purposes by the Federal Reserve Bank of New York
for the Japanese Yen to the U.S. Dollar was Yen 109.89 = U.S.$1.00.

        The following table sets forth the exchange rates for the Japanese Yen
and the U.S. Dollar based on the noon buying rate for cable transfers in
Japanese Yen in New York City as certified for customs purposes by the Federal
Reserve Bank of New York during the previous six months and prior five fiscal
years:

<TABLE>
<CAPTION>
              December        January          February         March          April             May
                2004            2005             2005            2005           2005             2005
              --------        --------         --------         ------         ------          ------
<S>             <C>             <C>             <C>             <C>            <C>             <C>
High            102.56          102.26          103.70          103.87         104.64          104.41
Low             105.59          104.93          105.84          107.49         108.67          108.17
</TABLE>

<TABLE>
<CAPTION>
                                                         Year ended March 31,
                                 ----------------------------------------------------------------------
                                  2001            2002            2003            2004            2005
                                 ------          ------          ------          ------          ------
<S>                              <C>             <C>             <C>             <C>             <C>
Year-end                         125.54          132.70          118.07          104.18          107.22
Average*                         111.65          125.64          121.10          112.75          107.28
High                             104.19          115.89          115.71          104.18          102.26
Low                              125.54          134.77          133.40          120.55          114.30
</TABLE>

*The average Japanese Yen exchange rates represent average noon buying rate on
the last business day of each month during the respective period.

                                      - 2 -

B. Capitalization and indebtedness.

        Not applicable.

C. Reasons for the offer and use of proceeds.

        Not applicable.

D. Risk factors.

        Ricoh is a global manufacturer of office equipment and conducts business
on a global scale. As such, Ricoh is exposed to various risks which include the
risks listed below. Although certain risks that may affect Ricoh's businesses
are listed in this section, this list is not exhaustive. Ricoh's business may in
the future also be affected by other risks that are currently unknown or that
are not currently considered significant or material. In addition, this section
contains forward-looking statements that are subject to the "Cautionary
Statement with Respect to Forward-Looking Statements" appearing elsewhere in
this annual report.

RICOH'S SUCCESS WILL DEPEND ON ITS ABILITY TO RESPOND TO RAPID TECHNOLOGICAL
CHANGES IN THE DOCUMENT IMAGING AND MANAGEMENT INDUSTRY

        The document imaging and management industry includes products such as
copiers, printers, facsimile machines and scanners. The technology used in this
industry changes rapidly and products in this industry will often require
frequent and timely product enhancements or have a short product life cycle.
Most of Ricoh's products are a part of this industry and as such Ricoh's success
will depend on its ability to respond to such technological changes in the
industry. To remain competitive in this industry, Ricoh invests a significant
amount of resources and capital every year in research and development
activities. Despite this investment, the process of developing new products or
technologies is inherently complex and uncertain and there are a number of risks
that Ricoh is subject to, including the following:

..       No assurances can be made that Ricoh will successfully anticipate
        whether its products or technologies will satisfy its customers' needs
        or gain market acceptance;

..       No assurances can be made that the introduction of more advanced
        products that also possess the capabilities of existing products will
        not adversely affect the sales performance of each such product;

..       No assurances can be made that Ricoh will be able to procure raw
        materials and parts necessary for new products or technologies from its
        suppliers at competitive prices;

..       No assurances can be made that Ricoh will be able to successfully manage
        the distribution system for its new products to eliminate the risk of
        loss resulting from a failure to take advantage of market opportunities;

                                      - 3 -

..       No assurances can be made that Ricoh will succeed in marketing any newly
        developed product or technology; and

..       No assurances can be given that Ricoh will be able to respond adequately
        to changes in the industry.

        Ricoh's failure to respond to any risks associated with this industry,
including those described above, may reduce Ricoh's future growth and
profitability and may adversely affect Ricoh's financial results and condition.

        In addition to the above general risks, Ricoh is exposed to the
following specific risks relating to the document imaging and management
industry:

        Digital Technology
        ------------------

        Among the various technologies used in the document imaging and
management industry, Ricoh believes the successful development of digital
technology is one of the most essential factors in attaining a competitive
advantage. Ricoh currently is a leader in digital technology and believes that
the importance of digital technology used in office equipment, including
copiers, printers, facsimiles and scanners, will continue to grow in the future.
While most of Ricoh's PPCs sold in Japan and overseas are already digital, Ricoh
believes that the digital technology used in connection with digital copiers and
other digital products will continue to develop and that competition with
respect to digital products will intensify. There is no assurance that Ricoh
will continue to be in the forefront of digital technology despite its
commitment to invest in research and development activities in this area.
Failure of Ricoh to adequately develop digital technology may adversely affect
Ricoh's financial results and condition.

        Multi-Functional Equipment
        --------------------------

        Ricoh believes that the document imaging and management industry is
moving towards a multi-functional office environment where various office
equipment (including copiers, facsimile machines, printers, scanners and
personal computers) become more interdependent on each other due to the
increasing use of digital technology and initiatives taken by many offices to
eventually become a "paperless office." As a result, certain existing office
equipment may either be consolidated into multi-functional equipment or may be
linked together electronically to perform various office functions. Although
Ricoh already manufactures certain multi-functional equipment, as a result of
this trend towards multi-functional equipment, some of Ricoh's products may
become obsolete while other products may require substantial product
enhancements, requiring technologies currently unavailable within Ricoh. No
assurances can be made that Ricoh will be able to successfully adjust to such
changes.

RICOH MUST SUCCESSFULLY OPERATE IN HIGHLY COMPETITIVE MARKETS

        The document imaging and management industry, including the copier
industry, is intensely competitive. Ricoh expects to face increased competition
in the various markets in which it operates. Currently, Ricoh's competitors
include other large

                                      - 4 -

manufacturers and distributors of office equipment as well as office superstores
and consumer electronics chains. In addition, as digital and other new
technology develops and as new office equipment products using these newly
developed technologies gain increased market acceptance, Ricoh may find itself
competing with new competitors that develop such new technologies, including
computer software and hardware manufacturers and distributors. Accordingly, it
is possible that new competitors or alliances among existing and new competitors
may emerge and rapidly acquire significant market share. While Ricoh believes it
is a leading manufacturer and distributor in the document imaging and management
industry and it intends to maintain its position, no assurances can be made that
it will continue to compete effectively in the future. Pricing pressures or loss
of potential customers resulting from Ricoh's failure to compete effectively may
adversely affect Ricoh's financial results and condition.

RICOH IS SUBJECT TO THE RISKS OF INTERNATIONAL OPERATIONS AND THE RISKS OF
OVERSEAS EXPANSION

        A substantial portion of Ricoh's manufacturing and marketing activity is
conducted outside of Japan, including in the United States, Europe, and in
developing and emerging markets such as China. There are a number of risks
inherent in doing business in such overseas markets, including the following:

        .       unfavorable political or economical factors;
        .       fluctuations in foreign currency exchange rates;
        .       potentially adverse tax consequences;
        .       unexpected legal or regulatory changes;
        .       lack of sufficient protection for intellectual property rights;
        .       difficulties in recruiting and retaining personnel, and managing
                international operations; and
        .       less developed infrastructure.

        Ricoh's inability to manage successfully the risks inherent in its
international activities could adversely affect its business, financial
condition and operating results. In addition, while Ricoh plans to continue to
expand its business worldwide and increase overseas sales, because of the risks
associated with conducting an international operation (including the risks
listed above), there can be no assurances that Ricoh's overseas expansion will
be successful or have a positive effect on Ricoh's financial results and
condition.

ECONOMIC TRENDS IN RICOH'S MAJOR MARKETS MAY ADVERSELY AFFECT RICOH'S SALES

        Demand for Ricoh's products is affected by cyclical changes in the
economies of Ricoh's major markets, including Japan, the United States and
Europe. Economic downturns and declines in consumption in Ricoh's major markets
may adversely affect Ricoh's financial results and condition.

                                      - 5 -

FOREIGN EXCHANGE FLUCTUATIONS AFFECT RICOH'S RESULTS

        Local currency-denominated financial results in each of the Company's
subsidiaries around the world are translated into Japanese Yen by applying the
average market rate during each financial period and recorded on Ricoh's
consolidated statements of income. Local currency-denominated assets and
liabilities are translated into Japanese Yen by applying the market rate at the
end of each financial period and recorded on Ricoh's consolidated balance
sheets. Accordingly, the financial results, assets and liabilities are subject
to foreign exchange fluctuations.

        In addition, operating profits and losses are highly sensitive to the
appreciation in the value of the Japanese Yen because the high volume of Ricoh's
production and sales activities in the Americas, Europe and Other, such as
China, result in a large proportion of revenues and costs denominated in local
currencies. Although Ricoh engages in hedging transactions such as forward
contracts with several financial institutions having credit ratings satisfactory
to Ricoh to minimize the negative effects of short-term fluctuations in foreign
exchange rates among major currencies such as the U.S. Dollar, Euro and Japanese
Yen, mid-to-long-term volatile changes in the exchange rate levels make it
difficult for Ricoh to execute planned procurement, production, logistics, and
sales activities and may adversely affect Ricoh's financial results and
condition.

RICOH IS SUBJECT TO GOVERNMENT REGULATION THAT CAN LIMIT ITS ACTIVITIES OR
INCREASE ITS COST OF OPERATIONS

        Ricoh is subject to various governmental regulations and approval
procedures in the countries in which it operates. For example, Ricoh may be
required to obtain approvals for its business and investment plans, be subject
to export regulations and tariffs, as well as rules and regulations relating to
commerce, antitrust, patent, consumer and business taxation, exchange control,
and environmental and recycling laws. Ricoh has established a Corporate Social
Responsibility Office to heighten awareness of the importance of corporate
social responsibility. Through this office, Ricoh involves its employees in
various activities designed to ensure compliance with applicable regulations as
part of its overall risk management and compliance program. However, if Ricoh is
unable to comply with any of these regulations or fails to obtain the requisite
approvals, Ricoh's activities in such countries may be restricted. In addition,
even if Ricoh is able to comply with these regulations, compliance can result in
increased costs. In either event, Ricoh's financial results and condition may be
adversely affected.

RICOH'S BUSINESS DEPENDS ON PROTECTING ITS INTELLECTUAL PROPERTY RIGHTS

        Ricoh owns or licenses a number of intellectual property rights in the
field of office equipment automation and, when Ricoh believes it is necessary or
desirable, obtains additional licenses for the use of other parties'
intellectual property rights. If Ricoh fails to protect, maintain or obtain such
rights, its performance and ability to compete may be adversely affected. Ricoh
has a program in place under which company employees are compensated for any
valuable intellectual property rights arising out of any inventions developed by
them during the course of their employment with Ricoh.

                                      - 6 -

While unlikely, management believes that there could arise instances in the
future where Ricoh may become the subject of legal actions or proceedings where
claims alleging inadequate compensation are asserted by company employees.

RICOH IS DEPENDENT ON SECURING AND RETAINING SPECIALLY SKILLED PERSONNEL

        Ricoh believes that it can continue to remain competitive by securing
and retaining additional personnel who are highly skilled in the fields of
management and information technology. However, the number of skilled personnel
is limited and the competition for attracting and retaining such personnel is
intense, particularly in the information technology industry. Securing and
retaining skilled personnel in the information technology industry is especially
important for Ricoh to compete effectively with its competitors as expectations
and market standards for office equipment become more technologically advanced.
Ricoh cannot assure that it will be able to successfully secure and retain
additional skilled personnel.

RICOH MAY BE ADVERSELY AFFECTED BY ITS EMPLOYEE BENEFIT OBLIGATIONS

        With respect to its employee benefit obligations and plan assets, Ricoh
accrues the cost of such benefits based on applicable accounting policies and
funds such benefits in accordance with governmental regulations. Currently,
there is no immediate and significant funding requirement; however, if returns
from investment assets decrease due to unforeseeable market conditions, such as
the fluctuations in the stock or bond markets, additional funding and accruals
may be required. Such additional funding and accruals may adversely affect
Ricoh's financial position and results of operations.

RICOH'S OPERATIONS ARE SUBJECT TO ENVIRONMENTAL LAWS AND REGULATIONS

        Ricoh's operations are subject to many environmental laws and
regulations governing, among other things, air emissions, wastewater discharges,
the use and handling of hazardous substances, waste disposal, product recycling,
and soil and ground-water contamination. Ricoh faces risks of environmental
liability in our current and historical manufacturing activities. Costs
associated with future additional environmental compliance or remediation
obligations could adversely affect Ricoh's business, operating results, and
financial condition.

RISKS ASSOCIATED WITH RICOH'S EQUIPMENT FINANCING BUSINESS MAY ADVERSELY AFFECT
RICOH'S FINANCIAL CONDITION

        Ricoh provides financing to some of its customers in connection with its
equipment sales and leases. Ricoh evaluates the creditworthiness and the amount
of credit extended to a customer prior to the financing arrangement and during
the financing term on a regular basis. Depending on such evaluations, Ricoh
makes adjustments to such extensions of credit as it deems necessary to minimize
any potential risks of concentrating credit risk or non-payment of credit.
Despite the application of these monitoring procedures, no assurances can be
made that Ricoh will be able to fully collect on such extensions of credit due
to unforeseeable defaults by its customers.

                                       - 7 -

        In addition, these financing arrangements that Ricoh enters into with
its customers result in long-term receivables bearing a fixed rate of interest.
However, Ricoh finances these financing arrangements primarily with short-term
borrowings subject to a variable interest rate. Although Ricoh engages in
hedging activities, Ricoh is not able to fully hedge this interest rate
mismatch.

        If Ricoh is unable to successfully manage these risks associated with
its equipment financing business, Ricoh's financial results and condition may be
adversely affected.

RICOH MAY BE SUBJECT TO PRODUCT LIABILITY CLAIMS THAT COULD SIGNIFICANTLY AFFECT
ITS FINANCIAL CONDITION

        Ricoh may be held responsible for any defects that occur with respect to
its products and services. Based on the defect, Ricoh may be liable for
significant damages, which may adversely affect its financial results and
condition. Furthermore, as Ricoh increasingly provides products and services
utilizing sophisticated and complex technologies, such defects may occur more
frequently. Such potential increase in defects, which could result in an
increase in Ricoh's liability, may adversely affect its financial results and
condition.

        In addition, negative publicity concerning these defects could make it
more difficult for Ricoh to attract and maintain customers to purchase Ricoh
products and services. As a result, Ricoh's financial results and condition may
be adversely affected.

RICOH'S PERFORMANCE CAN BE AFFECTED BY ALLIANCES WITH OTHER ENTITIES

        Ricoh engages in alliances with other entities to create various
products and services to fulfill customer demands. Ricoh believes that an
alliance is an effective method for timely development of new technology and
products using management resources of both parties. However, if Ricoh's
interest differs from other parties' interests due to financial or other
reasons, Ricoh may be unable to maintain the alliance. Failure to maintain an
on-going alliance and failure to establish a necessary alliance in the future
may adversely affect Ricoh's financial position and results of operations.

RICOH MAY SUFFER LOSS AS A RESULT OF CATASTROPHIC DISASTER, INFORMATION
TECHNOLOGY PROBLEMS OR INFECTIOUS DISEASES

        Several of Ricoh's manufacturing facilities in Japan could be subject to
a catastrophic loss caused by earthquakes as such facilities are located in
areas with above average seismic activity. If any of these facilities were to
experience a catastrophic loss, Ricoh could experience disruptions in its
operations and delays in its production and shipments. If such occurred, Ricoh
is likely to record a decrease in revenue, and require large expenditures to
repair or replace the damaged facility, which is highly likely to affect Ricoh's
financial results and condition.

        As Ricoh becomes increasingly dependent on information technology,
software and hardware defects, computer viruses, as well as internal database
problems ( e.g.,

                                      - 8 -

leaks and falsifications or disappearance of information relating to our
customers) pose a greater risk to its operations. Although Ricoh has taken
various precautionary measures, such as installing firewalls and anti-virus
software to detect and eliminate computer viruses, Ricoh may not be able to
completely prevent or mitigate the effects of such problems, which may affect
Ricoh's performance.

        In addition, the Ricoh Group is continually expanding its worldwide
operations to set in place a global supply chain of its products and services so
that we can satisfy our local customer needs faster, more effectively and on a
regular basis. As Ricoh expands our operations worldwide, additional risks, such
as infectious diseases and epidemics, may adversely affect Ricoh's operations
and financial positions.

Item 4. Information on the Company
        --------------------------

A. History and Development of the Company

        The Company was originally incorporated as a joint stock corporation
(KABUSHIKI KAISHA) on February 6, 1936 in accordance with Japanese law under the
name Riken Kankoshi Co., Ltd. as a manufacturer and distributor of sensitized
paper for use in copiers. Since its incorporation, Ricoh has expanded its
business into related businesses in the office equipment field. It now
manufactures and markets copiers, facsimile machines, MFPs, printers, optical
drives and discs, personal computers and servers, network related software and
other equipment, including semiconductors, metering instruments, educational
equipment and cameras.

        Historical highlights
        ---------------------

<TABLE>
<S>                       <C>
February 1936             Riken Kankoshi Co., Ltd. is formed in Kita-kyushu to manufacture and market sensitized
                          paper.

March 1938                The Company's name is changed to Riken Optical Co., Ltd., and starts manufacturing and
                          selling optical devices and equipment.

May 1949                  The Company lists its securities on the Tokyo and Osaka Stock Exchanges.

April 1954                The Company establishes an optical device and equipment plant in Ohmori, Ohta-ku, Tokyo
                          (now known as the Ohmori plant).

May 1955                  The Company begins manufacturing and selling desktop copiers.

April 1960                The Company starts operations at a paper plant in
                          Numazu, Shizuoka, which integrates everything from raw
                          to sensitized paper production (now known as the
                          Numazu plant).

March 1961                The Company establishes a sensitized paper plant in Ikeda, Osaka (now known as the Osaka
                          plant).

October 1961              The Company lists its securities on the First Sections of the Tokyo and Osaka Stock
                          Exchanges.
</TABLE>

                                      - 9 -

<TABLE>
<S>                       <C>
February 1963             The Company establishes Ricoh of America, Inc. (a subsidiary, now known as Ricoh
                          Corporation).

April 1963                The Company changes its corporate name to Ricoh Company, Ltd.

July 1967                 The Company establishes Tohoku Ricoh Co., Ltd. (a subsidiary) in Shibata-gun, Miyagi.

March 1971                The Company completes its manufacturing facility in Atsugi, Kanagawa (now known as the
                          Atsugi plant), to which it transfers some of its
                          office equipment production from the Ohmori plant.

November 1971             The Company establishes Ricoh Nederland B.V. (a subsidiary, now known as Ricoh Europe
                          B.V.).

January 1973              The Company establishes Ricoh Electronics, Inc. (a subsidiary) in the United States.

September 1973            The Company lists its securities on the Amsterdam Stock Exchange.

December 1976             The Company forms Ricoh Leasing Co., Ltd. (a subsidiary).

March 1977                The Company relocates its headquarters to Minato-ku, Tokyo.

July 1978                 The Company lists its securities on the Frankfurt Stock Exchange.

December 1978             The Company establishes Ricoh Business Machines, Ltd. (a subsidiary, now known as Ricoh
                          Hong Kong Ltd.).

March 1981                The Company constructs the Electronic Technologies Development Center (now known as the
                          Ikeda plant) to develop and manufacture electronic devices.

October 1981              The Company lists its securities on the Paris Stock Exchange.

May 1982                  The Company establishes a copier manufacturing facility in Fukui (now known as the
                          Fukui plant), which takes over some of the sensitized paper production from the Osaka plant.

October 1983              The Company launches its information technology equipment facility in Hatano, Kanagawa
                          (now known as the Hatano plant).

December 1983             The Company establishes Ricoh UK Products Ltd. (a subsidiary).

October 1985              The Company builds a copier manufacturing plant in Gotenba, Shizuoka (now known as the
                          Gotenba plant), which takes over some of the Atsugi plant's production.

April 1986                The Company opens a research and development facility in Yokohama, Kanagawa (now known as
                          the Ricoh Research and Development Center), to which it transfers some of its research and
                          development operations from the Ohmori plant.

April 1987                The Company establishes Ricoh Industrie France S.A. (a subsidiary, now known as Ricoh
                          Industrie France S.A.S.).
</TABLE>

                                     - 10 -

<TABLE>
<S>                       <C>
April 1989                The Company sets up an electronic devices facility in Yashiro-cho, Kato-gun, Hyogo (now
                          known as the Yashiro plant).

January 1991              The Company establishes Ricoh Asia Industry (Shenzhen) Ltd. (a subsidiary) in China.

March 1995                Ricoh Corporation acquires Savin Corporation, an American office equipment sales company.

September 1995            The Company acquires Gestetner Holdings PLC (now known as NRG Group PLC), a British office
                          equipment sales company.

January 1996              Ricoh Leasing Co., Ltd. lists its securities on the Second Section of the Tokyo Stock
                          Exchange (currently listed on the First Section of the Tokyo Stock Exchange).

December 1996             The Company establishes Ricoh Asia Pacific Pte. Ltd. (a subsidiary) in Singapore.

March 1997                The Company establishes Ricoh Silicon Valley, Inc. (now known as Ricoh Innovations, Inc.)
                          in the United States.

August 1999               Ricoh Hong Kong Ltd. acquires Inchcape NRG Ltd., a Hong Kong-based office equipment sales
                          company.

March 2000                Tohoku Ricoh Co., Ltd. lists its securities on the Second Section of the Tokyo Stock
                          Exchange.

January 2001              Ricoh Corporation acquires Lanier Worldwide, Inc., an American office equipment sales
                          company.

October 2002              The Company establishes Ricoh China Co., Ltd. (a subsidiary).

April 2003                Tohoku Ricoh Co., Ltd. becomes a wholly-owned subsidiary of the Company.

October 2004              The Company acquires Hitachi Printing Solutions, Ltd. (now known as Ricoh Printing
                          Systems, Ltd.) in Japan.
</TABLE>

        Our registered office and head office are as follows:

<TABLE>
<CAPTION>
                                               Address                          Telephone number
                          ----------------------------------------------------- ----------------
<S>                       <C>                                                    <C>
Registered Head office    3-6 Naka Magome 1-chome, Ohta-ku, Tokyo 143-8555,      +81-3-3777-8111
                           Japan
Executive office          15-5, Minami Aoyama 1-chome, Minato-ku, Tokyo          +81-3-3479-3111
                           107-8544, Japan
</TABLE>

        Principal Capital Investments
        -----------------------------

        Ricoh's capital expenditures for the fiscal years 2005, 2004 and 2003
were Yen 84.7 billion, Yen 75.5 billion and Yen 73.9 billion, respectively.
Ricoh directs a significant portion of its capital expenditures towards digital
and networking equipment, such as digital plain

                                     - 11 -

paper copiers ("PPCs"), multi-functional printers ("MFPs") and laser printers,
and manufacturing facilities to maintain or enhance competitiveness in the
industry. In fiscal year 2005, Ricoh also invested a significant amount of
capital to upgrade its information systems for its back-office operations, such
as sales force automations, procurement, accounting, operations and the
management of intellectual property. With the various upgrades of the
information systems that have taken place over the last several years, Ricoh has
been implementing a new accounting system and a new intellectual property
management system since the fiscal year 2003 to better track and manage its
operations. Ricoh projects that for the fiscal year ending March 31, 2006 its
capital expenditures will amount to approximately Yen 114.0 billion, principally
for the following categories: digital and networking equipment, development of a
new polymerized toner factory and new accounting and intellectual property
management systems.

B. Business overview

        Ricoh is a leading manufacturer of office automation equipment. Ricoh's
products include copiers, printers, facsimile machines, optical drives and
discs, and related supplies and services. Ricoh is also a prominent manufacturer
of digital and advanced electronic devices. In recent years, Ricoh is rapidly
building a solid presence worldwide as a comprehensive document solutions
provider that helps its customers streamline their businesses and cut operating
costs.

PRODUCTS
--------

SALES BY PRODUCT

<TABLE>
<CAPTION>
--------------------------------------------------------------------------------------------------------------
                                                         Millions of Yen (except for percentages)
                                                             For the Year Ended March 31,
--------------------------------------------------------------------------------------------------------------
                                                 2003                    2004                    2005
                                          --------------------------------------------------------------------
    <S>                                    <C>        <C>           <C>        <C>         <C>         <C>
    OFFICE EQUIPMENT
      Imaging Solutions                      859,713   49.5%          803,574   45.1%         715,097   39.4%
      Network Input/Output Systems           463,379   26.7           558,237   31.4          670,836   37.0
      Network System Solutions               197,482   11.3           195,822   11.0          205,895   11.3
    OTHER BUSINESSES                         217,784   12.5           222,612   12.5          222,280   12.3
--------------------------------------------------------------------------------------------------------------
         Total                             1,738,358  100.0%        1,780,245  100.0%       1,814,108  100.0%
--------------------------------------------------------------------------------------------------------------
</TABLE>

OFFICE EQUIPMENT
----------------

This segment consists of products that are widely used in the office
environment, and is categorized as follows:

(1)  Imaging Solutions

        The primary function of products in this category is to produce copies
or duplications of images that are already in existence. This product category
consists of stand-alone equipment and related supplies and services. Products in
this category can be

                                     - 12 -

distinguished from products in the Network Input/Output Systems category which
can serve multiple functions with networking capabilities (e.g., MFPs that can
serve as printers and scanners).

        This category is further separated into two sub-categories: (i) Digital
Imaging Solutions, which consist of all digital imaging solutions products, and
(ii) Other Imaging Solutions, which consist of other imaging solutions products
that are not included in Digital Imaging Solutions. The principal products in
each of these sub-categories are as follows:

        Digital Imaging Solutions: Monochrome and color digital copiers, digital
        -------------------------
        duplicators and facsimile machines.

        Other Imaging Solutions: Analog plain paper copiers, diazo copiers, and
        -----------------------
        thermal paper.

        In fiscal year 2005, the Imaging Solutions product category accounted
for 39.4% of Ricoh's net sales. Ricoh has been a global leader in PPCs and a
pioneer in the development of digital machines. Ricoh manufactures a wide range
of PPCs and digital copiers with a variety of copying speeds and functions such
as double-sided printing, sorting, reducing and enlarging, and zoom adjustment
of copy sizes. PPCs use a drum or other medium coated with a photo conductive
material on which an image of the original document is projected optically and
developed by applying a dry powder form toner.

        In recent years, Ricoh has strengthened its digital PPC product lineup
with new product offerings that range from standard digital PPC models to
high-end digital PPC models. More specifically, the imagio Neo 752 series is a
high-speed model designed for customers who require outputs of 75 copies per
minute. This series is equipped with "HYBRID QSU" technology that Ricoh
developed originally in the application of the next generation electric storage
device "Capacitor", and realized the most efficient energy saving in this class.
On the other hand, the Aficio 2105 (imagio Neo 1050 pro in Japan) is designed
for customers who have high-volume copying needs. The Aficio 2105 delivers up to
105 copies per minute and has a durability of 1.5 times more than its
predecessor for an even better resolution. As such, the Aficio 2105 is
performing well in the overseas markets.

        Ricoh also supplies a comprehensive line of wide-format copiers and
duplicators. These machines have also sold well for their digital capabilities.

        With respect to facsimile equipment, Ricoh marketed the world's first
high-speed facsimile equipment in 1973 with a transmission speed of one minute
per page. Since then, Ricoh has been manufacturing various high-speed facsimile
machines, including compact, low-priced models that feature multiple functions
(such as copying capabilities) and higher memory capacities. The market for
facsimile machines continues to mature, with demand shifting to small and home
offices seeking low-cost models. Corporate users tend to prefer multifunctional,
networkable machines and printers. In addition,

                                     - 13 -

corporate users also are moving towards electronic forms of transmitting images
using portable document formats that were not widely used or available in the
past.

(2)  Network Input/Output Systems

        The primary function of products in this category is to print or produce
images using a network. This category includes products such as MFPs, laser
printers and optical discs. This category is further separated into two
sub-categories: (i) Printing Systems, which consist of all printer and related
products and (ii) Other Input/Output Systems, which consist of other products
that are not included in Printing Systems. The principal products in each of
these sub-categories are as follows:

        Printing Systems: MFPs, laser printers, and related software.
        ----------------

        Other Input/Output Systems: Optical discs (media (CD-R/RW, DVD-R,
        --------------------------
        DVD+R/RW discs), self-developed drives, key-module/parts unit) and
        systems, and scanners.

        In fiscal year 2005, the Network Input/Output Systems product category
accounted for 37.0% of Ricoh's net sales. Ricoh continues to strengthen its
capabilities in color laser printers and mid- and high-volume or high-speed
printers that can be connected to a network to meet its customer needs in the
office environment. In fiscal 2005, Ricoh had strong sales growth in these
printer categories as it greatly broadened its product lineup in this category,
reinforced its sales structure and expanded its marketing activities. In terms
of MFPs, imagio Neo C245 and imagio Neo C385, which were well received in Japan,
are equipped with enhanced communications functions such as "Scan to e-mail"
(the function which enables users to send scanned images directly to users
without a mail server), "W-net fax function" (the function which enables users
to fax through the internet and decrease communication costs); the same is true
for Aficio 2035/2045 and Aficio 2232C/2238C in overseas markets. Sales of laser
printers are also increasing, with the IPSiO NX85S and IPSiO CX6600/6100D
performing favorably in the domestic market, and the AP400/400N and Aficio
CL3000 moving well overseas. These MFPs and laser printers are designed to
provide information technology support for all types of office environment by
delivering enhanced basic features (i.e., reduction, enlargements, etc.),
simpler operation, reduced paper consumption through electronic storage, and
better connectivity with document distribution and storage systems. Moreover,
Ricoh introduced a series of color printers for office use utilizing Ricoh's
original `GEL JET' technology at prices that were lower than the suggested
retail price in Japan.

        In addition to the above, Ricoh acquired a printing company in Japan
during fiscal year 2005, which is now known as Ricoh Printing Systems, Ltd. With
this acquisition, Ricoh's printing product line-up now includes printers that
have super high-speed printing capabilities, a product line in which it
previously did not have any market share. In addition to such specialized super
high-speed printers, Ricoh Printing Systems, Ltd. also manufactures and markets
low and high speed color printers for the office environment. With Ricoh
Printing Systems, Ltd. as a group company and through the

                                     - 14 -

initiatives noted in the previous paragraph, Ricoh hopes to achieve the
strategic objectives, which is to increase the "Total Document Volume" of its
customers.

        As the office environment becomes more computer-networked to maximize
efficiency, demand for digital black-and-white copiers and digital color copiers
has been rapidly increasing. Ricoh offers a full line of PC-connective models
that draw on our expertise in digital and color technologies to respond to
customer demands, which also continues to shift towards increased printing
speed, networking capabilities, decrease in the total costs of ownership, and
enhancements to raise office productivity. Overseas, Ricoh has rapidly forged a
solid position in digital copier sales by releasing many new models under the
Aficio brand.

        In addition, in an effort to streamline its optical discs business in
the Other Input/Output Systems product category, in fiscal year 2005, Ricoh
decided to focus on its media business and withdrew from the self-developed
drive business, which used proprietary technology developed by Ricoh, and its
key-module/parts unit business.

(3)  Network System Solutions

        The primary function of products in this category is to assist in
establishing a network environment. The principal products in this category
include personal computers and servers, network systems, application software,
and related services and support.

        For fiscal year 2005, this product category accounted for 11.3% of
Ricoh's net sales. Ricoh continued to enjoy steady growth in its document
solutions software and support services, which allow customers to seamlessly
manage electronic and paper-based information. Although sales in personal
computers and servers decreased in the last few years due to constrained
corporate spending on information technology in Japan as a result of the
uncertain economic conditions, sales of personal computers and servers increased
in fiscal year 2005 as compared to the previous fiscal years because customers
replaced their personal computers or servers for the first time following Year
2000. Support services that optimized total printing costs were continuously
well received by customers throughout fiscal year 2005.

OTHER BUSINESSES
----------------

        This segment, which accounted for 12.3% of Ricoh's net sales in fiscal
year 2005, includes electronic semiconductor devices, optical equipment, such as
digital cameras and parts unit, and measuring equipment.

        Ricoh is one of the pioneers of commercializing digital cameras, which
have tremendous potential as "image capturing devices." Because of its potential
as an input tool, Ricoh expects that sales of digital cameras will continue to
grow. In addition, Ricoh offers a wide range of electronic devices used to
process images, such as mobile and cellular phones. Ricoh also makes application
specific integrated circuits (ASICs) and application specific standard products
(ASSPs) that are often used in digital copiers, printers, personal computers and
mobile phones.

                                     - 15 -

        In April 2004, Ricoh sold Hanimex Australasia Pty Ltd. and its
subsidiaries that engaged in the optical-related analog business, such as
cameras, film sales and film development services, in Australia and New Zealand.

SALES AND DISTRIBUTION
----------------------

        Ricoh's distribution to end-user customers in Japan is conducted through
three distribution channels: (1) direct sales by Ricoh to the end-user customer
through approximately 40 subsidiaries and affiliates; (2) sales through
independent office machine dealers; and (3) sales through independent stationery
wholesalers, which in turn sell Ricoh's copiers to stationery retailers. Ricoh
estimates that over one-half of its unit sales of copiers in Japan are through
direct sales to the end-user customer, with the balance being divided between
sales through independent office machine dealers and independent stationery
wholesalers. These sales channels are coordinated by Ricoh's seven regional
headquarters located in Hokkaido, Tohoku, Kanto, Chubu, Kansai, Chugoku and
Kyushu areas.

        Ricoh's overseas marketing activities can be distinguished from the
marketing channels in Japan and can be classified into two classes: (1) sales of
Ricoh brand name products by overseas sales subsidiaries, affiliates and
independent dealers, and (2) sales of products under brand names which Ricoh
purchased by acquisition (e.g., "Savin" brand, "Gestetner" brand, "Lanier"
brand). The successful acquisition of several office equipment sales companies
in the last decade in various locations around the world has enhanced Ricoh's
own marketing channel in the overseas market. Ricoh has organized sales and
distribution channels to accommodate four operating regions outside of Japan:
(1) the Americas; (2) Europe, Africa, and the Middle East; (3) Asia and Oceania;
and (4) China.

        Ricoh recognizes revenue for sales upon equipment delivery and
installation to the end-user customers. Equipment sales revenue generated under
sales-type leases accounts for approximately 15% of Ricoh's total sales
revenues. Important information regarding the methods in which Ricoh recognizes
revenue is also set forth in Item 5. Critical Accounting Policies and Note 2 to
the Consolidated Financial Statements which are a part of this annual report.

AFTER-SALES SERVICE
-------------------

        Ricoh offers maintenance and repair services for its products. Ricoh
believes that periodic and timely maintenance services are important for Ricoh
to keep its market shares. As such, Ricoh provides repair and maintenance
services to its end-user customers for its products. These maintenance services
are furnished to its customers pursuant to maintenance service contracts
normally entered into at the time the equipment is sold.

        In Japan, employees of Ricoh basically provide the repair and
maintenance services. Ricoh's service network in Japan includes service centers
operated by Ricoh and its affiliates and service outlets operated by other
companies. Recently, Ricoh began

                                     - 16 -

building nationwide capabilities for the Customer Support System to enhance
customer satisfaction and service efficiency. This system allows Ricoh to
remotely monitor copiers in the field and provide immediate service. Ricoh's
total number of sales and service personnel in Japan is approximately 22,000.
Similar to Japan, Ricoh employees and contracted maintenance providers provide
repair and maintenance services to end-user customers who own Ricoh products in
the overseas market. Overseas, Ricoh provides services through its own service
network and service outlets. Ricoh's total number of sales and service personnel
overseas is approximately 21,000.

        Additional information regarding how Ricoh accounts for after-sales
services is set forth in Item 5. Critical Accounting Policies and Note 2 to the
Consolidated Financial Statements which are a part of this annual report.

PRINCIPAL MARKETS
-----------------

        Ricoh distributes its products and competes in the following four
geographic areas: Japan, the Americas, Europe and Other. In the aggregate,
Ricoh's sales expanded in fiscal year 2005. As noted below, for the fiscal year
2005, sales in Japan, the Americas, Europe and Other as a percentage of total
sales were 53.6%, 17.9%, 22.5% and 6.0%, respectively. The table below breaks
down for each geographic area the total sales amount and percentage of such
sales amount as compared against total net sales for the last three fiscal
years.

SALES BY GEOGRAPHIC AREA

<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------------
                                            Millions of Yen (except for percentages to net sales)
                                                      For the Year Ended March 31,
                              -----------------------------------------------------------------------------
                                         2003                     2004                     2005
                              -----------------------------------------------------------------------------
<S>                               <C>        <C>           <C>        <C>           <C>        <C>
   JAPAN                            896,022   51.5%          914,060   51.3%          972,975   53.6%
   THE AMERICAS                     343,940   19.8           326,380   18.3           325,597   17.9
   EUROPE                           354,477   20.4           402,392   22.6           408,906   22.5
   OTHER                            143,919    8.3           137,413    7.8           106,630    6.0
-----------------------------------------------------------------------------------------------------------
         Total                    1,738,358  100.0%        1,780,245  100.0%        1,814,108  100.0%
-----------------------------------------------------------------------------------------------------------
</TABLE>

Note:   Sales amounts set forth in the above table are based on the location of
        the purchaser of the product. For example, if the product is
        manufactured in Japan and sold to a purchaser located in the United
        States, such sale would be recorded as a sale in the Americas geographic
        segment.

        (1) Japan

        As the outlook for the Japanese economy has turned more positive and has
become more stable as compared to prior fiscal years, information technology
investments by many Japanese companies have recovered. Despite such recovery,
market competition in the type of products that Ricoh manufactures and markets
has become more severe in recent years. In order to succeed in this environment,
Ricoh strategically strove to replace its analog stand-alone equipment with
digital networkable equipment, and its monochrome products with color products.
Another strategy used by

                                     - 17 -

Ricoh was to help customers manage their Total Document Volume ("TDV") more
effectively and offer business solutions with more functional equipment and
networking systems so as to increase efficiency in the office. To enhance its
printer business, in fiscal year 2005 Ricoh acquired a new printing company -
Ricoh Printing Systems, Ltd. - in Japan. As discussed under the heading
"PRODUCTS", Ricoh Printing Systems, Ltd. manufactures and markets low and high
speed printers for the office environment and the acquisition of this company
has reinforced Ricoh's office color printer and print-on-demand product lines.
As a result of these strategies, the sale of certain products, such as MFPs,
color PPCs and color laser printers, increased despite intense competition.

        (2) The Americas

        In fiscal year 2005, Ricoh further broadened and reinforced its sales
network, especially in North America, where the economy maintained its strength
in fiscal year 2005. The Company stepped up its sales efforts for new printing
systems to match customer demands to replace analog equipment with networked
digital products, color copiers and printers. The Company also strove to expand
sales to major corporate accounts. Further, Ricoh continues to strengthen its
marketing efforts to major corporate clients in this geographic segment by
taking advantage of Ricoh's worldwide production and distribution network, and
high-quality products. As a result of the above efforts, net sales in local
currency increased by 4.8%. However, net sales denominated in Japanese Yen
decreased by 0.2% due to the appreciation of the Japanese Yen against the U.S.
Dollar.

        (3) Europe

        With economic conditions in Europe remaining relatively stable, sales of
digital PPCs and printing systems increased as Ricoh continued in its efforts to
introduce new products in such product lines. Ricoh also strengthened its sales
network by continuously reinforcing its office equipment product offerings so
that customers may fulfill more of their office equipment needs through Ricoh.
Further, Ricoh maximized its business opportunity by increasing sales in
networked digital PPCs and color models, especially color MFPs, since these
products are able to satisfy many customer needs and bring profit to Ricoh. All
of these efforts helped Ricoh maintain its top share position in the European
market for copiers and MFPs for fiscal year 2005. Ricoh intends to solidify this
position with continuing reinforcement of the above strategies.

        (4) Other

        In China and other Asian or Oceania markets, a continuing shift during
fiscal year 2005 in business equipment from analog models to digital networked
and color models led to increased sales of printing systems, while sales in the
optical discs business decreased. Because the Chinese market is expected to
continue its expansion, Ricoh has placed significant importance on the Chinese
market not only as a production site but also as a potential market to expand
its sales share in the future. In line with this strategy, in 2002, Ricoh
established a new regional headquarters office in Shanghai to support and
reinforce its operations in the promising Chinese market. Ricoh integrated its
Chinese

                                     - 18 -

production, sales, and services during fiscal year 2004 while focusing even more
on customer needs in order to strengthen its revenues and earnings in this
geographic segment. In April 2004, Ricoh sold Hanimex Australasia Pty Ltd. and
its subsidiaries that engaged in the optical-related analog businesses, such as
cameras, film sales and film development services, in Australia and New Zealand.

COMPETITION
-----------

        Ricoh competes primarily in the office equipment industry which is
highly competitive. In each of the product categories in the office equipment
segment, Ricoh encounters intense competition. Ricoh expects competition in each
of these product categories to increase in the future as existing competitors
enhance and expand their product and service offerings. Increased competition
may result in price reductions, reduced profitability and loss of market share.
Ricoh cannot provide assurances that it will be able to compete successfully
against existing or future competitors. Some of our customers and companies with
which we have strategic business relationships also are, or may become in the
future, competitors of ours.

        The size and number of our competitors vary across our product
categories, as do the resources allocated by our competitors to the markets we
target. Our competitors may have greater financial, personnel, and other
resources than we have in a particular market or overall. Competitors with
greater financial resources may be able to offer lower prices, additional
products or services or other incentives that we cannot match or offer. These
competitors may be in a stronger position to respond quickly to new technologies
and may be able to undertake more extensive marketing campaigns. They may also
adopt more aggressive pricing policies and make more attractive offers to
potential customers, employees, and strategic partners. These competitors may
make strategic acquisitions or establish cooperative relationships among
themselves or with third parties to increase their ability to gain market share.

        Despite the intense competition in the office equipment industry,
Ricoh's management believes that we will be able to maintain and enhance our
position in the world market because of our experience, expertise and technical
capabilities as a leading provider of office equipment, and our dedication to
meet our customers' needs.

SEASONALITY
-----------

        Especially in Japan, sales for the office equipment segment generally
increase in March of each year due to the increase demand arising at the end of
the fiscal year for most Japanese companies as many Japanese companies and
government entities try to expend their allotted capital expenditure budget for
the fiscal year. Approximately 13% of Ricoh's domestic sales in Japan are
generated during the month of March each year due to this seasonality. However,
the effect of this seasonality on a consolidated basis is minimal, as
approximately 5% of Ricoh's total consolidated sales are generated during the
month of March from domestic sales in Japan.

                                     - 19 -

SOURCES OF SUPPLY
-----------------

        Ricoh procures raw materials, parts, and components to be used in the
production of its products on a global basis. Generally, Ricoh maintains
multiple suppliers for the most significant categories of raw materials, parts
and components. In light of the fact that Japan produces very few of the raw
materials Ricoh uses in its manufacturing process, most of the raw materials
used by Ricoh come from outside of Japan. Ricoh monitors the availability of raw
materials on a regular basis to ensure that it will not encounter any shortages.
Ricoh has not experienced any significant difficulty in obtaining raw materials,
parts and components and believes that it will be able to continue to obtain
comparable raw materials, parts and components in sufficient quantities to meet
its manufacturing needs in the future. Ricoh also believes that the effect of
price volatility with respect to obtaining raw materials, parts and components
that it uses in manufacturing its products can be managed.

INTELLECTUAL PROPERTY
---------------------

        Ricoh holds a large number of patents and trademark rights. While Ricoh
considers such intellectual property rights to be valuable assets and important
for its operations, it believes that its business is not dependent to any
material extent upon any single patent or trademark right, or any related group
of such rights it holds.

        Ricoh also has many licenses and technical assistance agreements
covering a wide variety of products. Such agreements grant Ricoh the right to
use certain Japanese and foreign patents or the right to receive certain
technical information. However, Ricoh is not materially dependent on any single
such agreement.

        In addition, Ricoh has granted licenses and technical assistance to
various companies located in and outside of Japan. In certain instances, Ricoh
has entered into cross-licensing agreements with other major international
electronics and electrical equipment manufacturers. None of these agreements are
likely to materially affect Ricoh's business or profitability. See Item 5.C.
Patents and Licenses.

GOVERNMENT REGULATIONS
----------------------

        Ricoh's business activities are subject to various governmental
regulations in the various countries in which it operates, including regulations
relating to business and investment approvals, export regulations, tariffs,
antitrust, intellectual property, consumer and business taxation, exchange
controls, and environmental and recycling requirements. Ricoh is also subject to
environmental regulations in the jurisdictions in which it operates,
particularly in those in which it has manufacturing, research, or similar
operations. Currently, Ricoh operates its business without having significant
difficulty complying with such government regulations, and it hopes to do so in
the future.

                                     - 20 -

C. Organizational structure

        As of March 31, 2005, the Ricoh Group is comprised of 325 subsidiaries
and 22 affiliates located worldwide. Ricoh's research and development,
manufacturing, sales, and service activities center on office equipment, optical
equipment, and other devices.

        The Company is the parent of the Ricoh Group. The Company heads the
research and development of Ricoh products with assistance from its
subsidiaries. The Company and its subsidiaries and affiliates maintain an
integrated domestic and international manufacturing and distribution structure.

The following is a list of the principal subsidiaries and affiliates of Ricoh:

<TABLE>
<CAPTION>
=======================================================================================================================
                                                              Proportion of
                                                 Country of     ownership
          Company Name                           Formation       interest               Main businesses
=======================================================================================================================
(SUBSIDIARIES)
-----------------------------------------------------------------------------------------------------------------------
<S>                                                  <C>           <C>          <C>
Ricoh Optical Industries Co., Ltd.                    Japan        100.0        Manufacturing optical equipment
-----------------------------------------------------------------------------------------------------------------------
Tohoku Ricoh Co., Ltd.                                Japan        100.0        Manufacturing office equipment
-----------------------------------------------------------------------------------------------------------------------
Ricoh Unitechno Co., Ltd.                             Japan        100.0        Manufacturing parts for office
                                                                                equipment
-----------------------------------------------------------------------------------------------------------------------
Ricoh Elemex Corporation                              Japan         55.8        Manufacturing and sales of office
                                                                                equipment and minuteness equipment
-----------------------------------------------------------------------------------------------------------------------
Ricoh Microelectronics Co., Ltd.                      Japan        100.0        Manufacturing parts for office
                                                                                equipment
-----------------------------------------------------------------------------------------------------------------------
Ricoh Keiki Co., Ltd.                                 Japan        100.0        Manufacturing parts for office
                                                                                equipment
-----------------------------------------------------------------------------------------------------------------------
Ricoh Printing Systems, Ltd.                          Japan        100.0        Manufacturing and sale of office
                                                                                equipment
-----------------------------------------------------------------------------------------------------------------------
Ricoh Tohoku Co., Ltd.                                Japan        100.0        Sale of office equipment
-----------------------------------------------------------------------------------------------------------------------
Ricoh Chubu Co., Ltd.                                 Japan        100.0        Sale of office equipment
-----------------------------------------------------------------------------------------------------------------------
Ricoh Kansai Co., Ltd.                                Japan        100.0        Sale of office equipment
-----------------------------------------------------------------------------------------------------------------------
Ricoh Chugoku Co., Ltd.                               Japan        100.0        Sale of office equipment
-----------------------------------------------------------------------------------------------------------------------
Ricoh Kyushu Co., Ltd.                                Japan        100.0        Sale of office equipment
-----------------------------------------------------------------------------------------------------------------------
Hokkaido Ricoh Co., Ltd.                              Japan         97.8        Sale of office equipment
-----------------------------------------------------------------------------------------------------------------------
Ricoh Sales Co., Ltd.                                 Japan        100.0        Sale of office equipment
-----------------------------------------------------------------------------------------------------------------------
Ricoh Technosystems Co., Ltd.                         Japan        100.0        Maintenance, service and sale of
                                                                                office equipment
-----------------------------------------------------------------------------------------------------------------------
Ricoh Logistics System Co., Ltd.                      Japan         86.2        Logistics services and custom
                                                                   (87.6)       clearances
-----------------------------------------------------------------------------------------------------------------------
Ricoh Leasing Co., Ltd.                               Japan         51.4        General leasing
                                                                   (51.1)
-----------------------------------------------------------------------------------------------------------------------
Ricoh Electronics, Inc.                              U.S.A.        100.0        Manufacturing office equipment and
                                                                                related supplies
</TABLE>

                                     - 21 -

<TABLE>
<CAPTION>
=======================================================================================================================
                                                               Proportion of
                                                 Country of      ownership
          Company Name                           Formation        interest             Main businesses
=======================================================================================================================
<S>                                             <C>                <C>          <C>
Ricoh UK Products Ltd.                                 U.K.        100.0        Manufacturing office equipment
-----------------------------------------------------------------------------------------------------------------------
Ricoh Industrie France S.A.S.                        France        100.0        Manufacturing office equipment and
                                                                                related supplies
-----------------------------------------------------------------------------------------------------------------------
Ricoh Asia Industry (Shenzhen) Ltd.                   China         91.0        Manufacturing office equipment and
                                                                  (100.0)       related supplies
-----------------------------------------------------------------------------------------------------------------------
Shanghai Ricoh Facsimile Co., Ltd.                    China         94.5        Manufacturing and sale of office
                                                                                 equipment
-----------------------------------------------------------------------------------------------------------------------
Ricoh Corporation                                    U.S.A.        100.0        Sale of office equipment
-----------------------------------------------------------------------------------------------------------------------
Lanier Worldwide, Inc.                               U.S.A.        100.0        Sale of office equipment
-----------------------------------------------------------------------------------------------------------------------
Ricoh Europe B.V.                               Netherlands        100.0        Sale of office equipment
-----------------------------------------------------------------------------------------------------------------------
NRG Group PLC                                          U.K.        100.0        Sale of office equipment
-----------------------------------------------------------------------------------------------------------------------
Ricoh Asia Industry Ltd.                         Hong Kong,         90.0        Sale of office equipment
                                                      China
-----------------------------------------------------------------------------------------------------------------------
Ricoh Asia Pacific Pte, Ltd.                      Singapore        100.0        Sale of office equipment
-----------------------------------------------------------------------------------------------------------------------
Ricoh China Co., Ltd.                                 China        100.0        Sale of office equipment
-----------------------------------------------------------------------------------------------------------------------
Ricoh Finance Nederland B.V.                    Netherlands        100.0        Corporate finance
-----------------------------------------------------------------------------------------------------------------------
                And 295 other subsidiaries
-----------------------------------------------------------------------------------------------------------------------
(AFFILIATES)
-----------------------------------------------------------------------------------------------------------------------
Coca-Cola West Japan Co., Ltd.                        Japan         22.2        Manufacturing and sale of soft drink
                                                                   (22.5)
-----------------------------------------------------------------------------------------------------------------------
Sindo Ricoh Co., Ltd.                                 Korea         20.0        Manufacturing and sale of office
                                                                                equipment
-----------------------------------------------------------------------------------------------------------------------
                And 20 other affiliates
=======================================================================================================================
</TABLE>

        Notes:

        1.      Proportion of ownership interest includes indirect ownership.
        2.      Figures in parentheses indicate portion of voting power if
                different from portion of ownership interest.
        3.      Ricoh Leasing Co., Ltd. is the only subsidiary of Ricoh that is
                a "significant subsidiary" as defined in Rule 1-02(w) of
                Regulation S-X.

D. Property, plant and equipment

        Ricoh manufactures its products primarily in fifteen plants in Japan and
six plants overseas. Ricoh owns all of the buildings and the land on which its
plants are located, with the exception of certain leases of land and floor space
of certain of its subsidiaries. None of these leased land and floor spaces have
major encumbrances on them. The following table gives certain information as of
March 31, 2005 regarding the Company's and its subsidiaries' principal
production and other facilities. With the exception of GR Advanced Materials
Ltd., the production and other facilities listed below have floor space
exceeding 10,000 square meters.

                                     - 22 -

<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------------------------
                                                                           Principal activities and products
Name (Location)                                       Floor space          manufactured
----------------------------------------------------- -----------------    ------------------------------------------
                                                      (in thousands
                                                      of square meters)
<S>                                                            <C>         <C>
Japan:
  Ricoh Company, Ltd.
     Ohmori Plant (Tokyo)                                      44          Parts relating to copiers
     Atsugi Plant (Kanagawa)                                   68          Office equipment and other products
     Numazu Plant (Shizuoka)                                   76          Paper and toner
     Ikeda Plant (Osaka)                                       17          Electronic devices
     Hatano Plant (Kanagawa)                                   15          Printed circuit boards and electronic
                                                                           components
     Fukui Plant (Fukui)                                       34          Papers and toner
     Gotenba Plant (Shizuoka)                                  70          Copiers and data processing systems
     Yashiro Plant (Hyogo)                                     31          Electronic devices
     Aoyama Head Office (Tokyo)                                 9          Marketing of office equipment and head
                                                                           office
     Research & Development Center (Kanagawa)                  17          Research and development ("R&D")
     System Center (Tokyo)                                     10          Information system center, marketing of
                                                                           office equipment and other business
     Ginza Office (Tokyo)                                      11          Marketing of office equipment and other
                                                                           business
     Shin-Yokohama office (Kanagawa)                           40          Marketing of office equipment and other
                                                                           business, related services and R&D
  Subsidiaries:
     Ricoh Optical Industries Co., Ltd. (Iwate)                18          Photographic equipment
     Tohoku Ricoh Co., Ltd. (Miyagi)                           55          Office equipment and parts relating to
                                                                           copiers
     Hasama Ricoh , Inc. (Miyagi)                              14          Parts relating to copiers and data
                                                                           processing equipment
     Ricoh Unitechno Co., Ltd. (Saitama)                       18          Facsimile and copiers
     Ricoh Elemex Corporation. (Aichi)                         47          Office equipment and measuring
                                                                           instruments
</TABLE>

                                     - 23 -

<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------------------------
                                                                           Principal activities and products
Name (Location)                                       Floor space          manufactured
----------------------------------------------------- -----------------    ------------------------------------------
                                                      (in thousands
                                                      of square meters)
<S>                                                            <C>         <C>
     Ricoh Microelectronics Co., Ltd. (Tottori)                11          Printed circuit boards

     Ricoh Keiki Co., Ltd. (Saga)                              10          Parts relating to copiers and data
                                                                           processing systems

Overseas:
  Ricoh Electronics, Inc.                                     100          Copiers, parts relating to copiers,
  (Irvine, Santa Ana and Tustin, California and                            toner and thermal paper
  Lawrenceville, Georgia, U.S.A.)

  Ricoh UK Products Ltd.                                       41          Copiers, parts relating to copiers and
  (Telford, United Kingdom)                                                toner

  Ricoh Industries France S.A.S.                               42          Copiers, facsimile equipment, parts
  (Colmar, France)                                                         relating to copiers and thermal paper

  Ricoh Asia Industry (Shenzhen) Ltd. (Shenzhen,               42          Copiers, parts relating to copiers, and
  China)                                                                   toner

  Shanghai Ricoh Facsimile Co., Ltd.                           17          Facsimile
  (Shanghai, China)

  GR Advanced Materials Ltd.                                    4          Supplies relating to duplicators
  (Scotland, United Kingdom)
---------------------------------------------------------------------------------------------------------------------
</TABLE>

        Ricoh considers its manufacturing facilities to be well maintained and
believes its plant capacity is adequate for its current needs, though successive
investment in manufacturing facilities is being made for its long-term success.

Item 5. Operating and Financial Review and Prospects
        --------------------------------------------

OVERVIEW

        Ricoh is engaged primarily in the development, manufacturing, sales and
servicing of office automation equipment, as well as digital cameras, advanced
electronic devices and measuring equipment. Ricoh supports its office equipment
business by offering customers various "solution" systems that work with
personal computers and servers, and related product support and after-purchase
services to assist customers in fully utilizing the Ricoh product that they
purchase. Ricoh's support services include assisting customers in setting up
their information technology environment or network

                                     - 24 -

administration. Ricoh also offers various supplies and peripheral products to be
used with its products and systems.

        Ricoh's operating segments consist of Office Equipment, which includes
Imaging Solutions, Network Input/Output Systems and Network System Solutions,
and Other Businesses, which include optical equipment, such as digital cameras,
electronic semiconductor devices and measuring equipment, as well as financing
and logistics services. Ricoh distributes its products and competes in the
following four geographic areas: Japan, the Americas, Europe and Other, such as
China, Asia and Oceania. For additional details on Ricoh's business, see Item
4.B. Information on the Company - Business overview.

        Because of the global nature of Ricoh's operations, Ricoh's results of
operations and financial conditions are affected both by economic and political
developments in Japan and the rest of the world, as well as by demand and
competition in its lines of business. Although the Japanese economy began to
exhibit some upswing momentum and the United States economy maintained its
strength in fiscal year 2005, the business climate in which Ricoh operates
remains unpredictable as a result of the continuing appreciation of the Japanese
Yen against the U.S. Dollar and the economic uncertainties of the emerging
markets, such as BRICs - Brazil, Russia, India and China. Management believes
that it will still take some time for the Japanese economy to make a full
recovery, due to such factors as the unlikelihood of an increase in income on an
individual basis. In addition, the level of competition in our operating
environment has increased significantly. The two most significant trends in the
office equipment market are the movement towards digital networking systems from
standalone models and the shift in customers' demand toward color products from
monochrome products. As these trends have accelerated in recent years, the level
of competition has increased significantly in the market for color products and
digital networking systems as other companies began to introduce products in
these sectors.

        Historically, Ricoh's revenues have come mainly from the manufacturing
and sale of equipment (such as copiers and printers). In the current competitive
environment, the key factor to achieving revenue growth is the expansion of
product-lines and areas of services to address the increase in customer demands
for digitization, coloring and volume. To achieve sustained growth in the
current environment, Ricoh's goal is to broaden its revenue and earnings base by
increasing the total copying or printing volume of its customers (which Ricoh
refers to as "Building Total Document Volume") and the amount of revenue per
copy or printed page. To attain this goal, Ricoh's strategies continue to
include (1) replacing monochrome products with color models at prices comparable
to those of monochrome models, (2) expanding sales of high-speed models, and (3)
deploying printing solutions so that customers can optimize the total output
costs of their copiers and printers. In fiscal year 2005, net sales of MFPs
overall increased by 29.3% as compared to fiscal year 2004. A 61.5% increase in
net sales of MFPs with color capabilities in fiscal year 2005 as compared to
fiscal year 2004 especially contributed to the 29.3% increase in net sales of
overall MFPs as compared to fiscal year 2004. In contrast, sales of other
imaging systems products (e.g., analog PPCs) for fiscal year 2005 decreased by
20.9% compared to fiscal year 2004.

                                     - 25 -

        Despite this challenging environment, Ricoh recorded revenue growth for
the 11th consecutive year in fiscal year 2005 and strove to remain competitive
and achieve sustained growth by placing a high priority on creating new customer
values and managing its operations in a highly efficient manner. To this end,
Ricoh continues to reinforce its technological strengths by making capital
investments and investments in research and development to generate new value
for its customers with Ricoh's products and services. At the same time, Ricoh is
achieving steady progress in increasing its operating efficiency through
cost-cutting measures across its business units, including the reduction of
production costs and the streamlining of its business structure, as well as
supply chain management. Ricoh is also pursuing increased efficiency in the use
of financial resources by decreasing its interest bearing debt. In fiscal year
2005, Ricoh reduced interest-bearing debt by Yen 22.6 billion, while decreasing
cash and cash equivalents at fiscal year-end 2005 by Yen 16.1 billion from the
prior fiscal year-end to Yen 186.8 billion.

        Ricoh's consolidated net sales increased by 1.9% to Yen 1,814.1 billion
for the fiscal year ended March 31, 2005, from Yen 1,780.2 billion for the
fiscal year ended March 31, 2004, due primarily to the increase in net sales of
higher-margin value-added digital-based Network Input/Output products, which was
offset in part by a decline in sales of Imaging Solutions products, as well as
to the positive effect in fiscal year 2005 of the appreciation of the Euro
relative to the Japanese Yen, which was partially offset by the depreciation of
the U.S. Dollar relative to the Japanese Yen. Ricoh's operating income decreased
9.7%, while operating income as a percentage of net sales decreased from 8.4% to
7.5%, primarily reflecting Ricoh's strategic investments in the promotional
measures used to market its color models, and research and development
activities.

        In addition, fiscal year 2005 marked the end of the 14th Medium-term
Management Plan in which Ricoh focused on (i) replacing its monochrome products
with color models, (ii) increasing sales of high-speed models and (iii)
providing various printing solutions to assist its customers in reducing costs.
Notable achievements of Ricoh during fiscal year 2003 to fiscal year 2005
include (i) the expansion of its market share in color products by continuously
releasing new products such as color MFPs and color laser printers, and (ii)
acquiring Ricoh Printing Systems, Ltd. to reinforce its printer business and
expand its customer base. In addition, during fiscal year 2005, Ricoh, as a
forward-looking company, started laying the foundation for its 15th Medium-term
Management Plan that starts from fiscal year 2006. The 15th Medium-term
Management Plan focuses on achieving growth in the following areas: (1)
printing, (2) emerging markets and (3) products used in the industrial sector,
such as products that use thermal media, semiconductors, electronic component
units and measuring equipment. As part of the foundation work, Ricoh made
strategic decisions in terms of sales, marketing, and research and development
matters in fiscal year 2005 so as to allow it to increase its market share in
color printing models. For example, Ricoh conducted various sales promotion
activities both in Japan and in overseas markets. In Japan, Ricoh provided
various sales promotions to its customers relating to its color products,
including discounting the sales price, modifying its products to meet the
specific needs of its customers, etc., to increase its market share in color
products. In the overseas market, Ricoh introduced various series of products to
its color product line-up.

                                     - 26 -

CRITICAL ACCOUNTING POLICIES

        The consolidated financial statements of Ricoh are prepared in
conformity with U.S. generally accepted accounting principles. The preparation
of these financial statements requires the use of estimates, judgments and
assumptions that affect the reported amounts of assets and liabilities at the
date of the financial statements and the reported amounts of revenues and
expenses during the periods presented. On an ongoing basis, Ricoh evaluates its
estimates which are based on historical experience and on various other
assumptions that are believed to be reasonable under the circumstances. The
results of these evaluations form the basis for making judgments about the
carrying values of assets and liabilities and the reported amounts of expenses
that are not readily apparent from other sources. Actual results may differ from
these estimates under different assumptions. Ricoh considers an accounting
policy to be critical if it is important to its financial condition and results,
and requires significant judgments and estimates on the part of management in
its application. Ricoh believes that the following represent the critical
accounting policies of the Company. For a summary of the significant accounting
policies, including the critical accounting policies discussed below, please see
Note 2 to the Consolidated Financial Statements.

        Revenue Recognition
        -------------------

        Ricoh believes that revenue recognition is critical for its financial
statements because net income is directly affected by the timing of revenue
recognition.

        Ricoh generates revenue principally through the sale of equipment,
supplies and related services under separate contractual arrangements for each.
Generally, Ricoh recognizes revenue when (1) it has a firm contract, (2) the
product has been shipped to and accepted by the customer or the service has been
provided, (3) the sales price is fixed or determinable and (4) amounts are
reasonably assured of collection.

        Most equipment sales require that Ricoh install the product. As such,
revenue is recognized at the time of delivery and installation at the customer
location. Equipment revenues are based on established prices by product type and
model and are net of discounts. A sales return is accepted only when the
equipment is defective and does not meet Ricoh's product performance
specifications. Other than installation, there are no customer acceptance
clauses in the sales contract.

        Service revenues result primarily from maintenance contracts that are
normally entered into at the time the equipment is sold. Standard service fee
prices are established depending on equipment classification and include a cost
value for the estimated services to be performed based on historical experience
plus a profit margin thereon. As a matter of policy, Ricoh does not discount
such prices. On a monthly basis, maintenance service revenues are earned and
recognized by Ricoh and billed to the customer in accordance with the contract
and include a fixed monthly fee plus a variable amount based on usage.

                                     - 27 -

The length of the contract ranges up to five years; however, most contracts can
be cancelled at any time by the customer upon a short notice period.

        Ricoh enters into contractual arrangements with multiple elements, which
may include any combination of products, equipment, installation and
maintenance. Ricoh allocates revenue to each element based on its relative fair
value if such element meets the criteria for treatment as a separate unit of
accounting as prescribed in the Emerging Issues Task Force Issue 00-21("EITF
00-21"), "Revenue Arrangements with Multiple Deliverables". Pursuant to EITF
00-21, the delivered item in a multiple element arrangement should be considered
a separate unit of accounting if all of the following criteria are met: (1) a
delivered item has value to customers on a stand-alone basis, (2) there is
objective and reliable evidence of fair value of an undelivered item, and (3)
the delivery of the undelivered item must be probable and controlled by Ricoh if
the arrangement includes the right of return. The price charged when the element
is sold separately generally determines fair value. Otherwise, revenue is
deferred until the undelivered elements are fulfilled as a single unit of
accounting.

        Allowance for Doubtful Receivables
        ----------------------------------

        Ricoh performs ongoing credit evaluations of its customers and adjusts
credit limits based upon payment history and the customer's current
creditworthiness, as determined by Ricoh's review of the customers' credit
information. Ricoh continuously monitors collections and payments from its
customers and maintains a provision for estimated credit losses based upon its
historical experience and any specific customer collection issues that Ricoh has
identified. While such credit losses have historically been within Ricoh's
expectations and the provisions established, Ricoh cannot guarantee that it will
continue to experience the same credit loss rates that it has in the past.
Changes in the underlying financial condition of our customers could result in a
material impact on Ricoh's consolidated results of operation and financial
position.

        Pension Accounting
        ------------------

        The total costs for employees' severance payments and pension plans
represented approximately 0.8%, 2.0% and 1.4% of Ricoh's total costs and
expenses for the fiscal years ended March 31, 2005, 2004 and 2003, respectively.
The amounts recognized in the consolidated financial statements relating to
employees' severance payments and pension plans are determined on an actuarial
basis utilizing certain assumptions in the calculation of such amounts. The
assumptions used in determining net periodic costs and liabilities for
employees' severance payments and pension plans include expected long-term rate
of return on plan assets, discount rate, rate of increase in compensation
levels, average remaining years of service, and other factors. Among these
assumptions, the expected long-term rate of return on assets and the discount
rate are two critical assumptions. Assumptions are evaluated at least annually,
and events may occur or circumstances may change that may have a significant
effect on the critical assumptions. In accordance with accounting principles
generally accepted in the United States of America, actual results that differ
from the assumptions are accumulated and amortized over future periods, thereby
reducing the year-to-year volatility in pension expenses. As

                                     - 28 -

of March 31, 2005, Ricoh's total amount of unrecognized net actuarial loss was
Yen 102.8 billion. The entire amount of unrecognized net actuarial loss will be
amortized over the average remaining years of employee service which is
approximately 16 years, if such amount exceeds 10% of the greater of (1) the
projected benefit obligation or (2) the fair value of the plan's assets. Such
amortization will increase future pension costs.

        For the fiscal years ended March 31, 2005, 2004 and 2003, Ricoh used
expected long-term rates of return on pension plan assets of 2.9%, 2.5% and
3.6%, respectively. In determining the expected long-term rate of return on
pension plan assets, Ricoh considers the current and projected asset
allocations, as well as expected long-term investment returns and risks for each
category of the plan assets based on Ricoh's analysis of historical results. The
projected allocation of the plan assets is developed in consideration of the
expected long-term investment returns for each category of the plan assets. To
moderate the level of volatility in pension plan asset returns and to reduce
risks, approximately 48%, 27%, 15% and 10% of the plan assets will be allocated
to equity securities, debt securities, life insurance company general accounts
and other financial instruments, respectively. As of March 31, 2005, the actual
allocation of assets was generally consistent with the projected allocation
stated above. The actual returns for fiscal years 2005, 2004 and 2003 were
approximately 4.1% (gain), 18.7% (gain) and 13.7% (loss), respectively. The
actual returns on pension plan assets may vary in future periods, depending on
market conditions. The market-related value of plan assets is measured using
fair values on the plan measurement date.

        With respect to the discount rate used in the annual actuarial valuation
of the pension benefit obligations, the other critical assumptions, Ricoh's
weighted average discount rates for the fiscal years ended March 31, 2005, 2004
and 2003 were 2.9%, 2.6% and 3.3%, respectively. In determining the appropriate
discount rate, Ricoh considers available information about the current yield on
high-quality fixed-income investments that are currently available and are
expected to be available during the period corresponding to the expected
duration of the pension benefit obligations.

        The following table illustrates the sensitivity to changes in the
discount rate and the expected return on pension plan assets, while holding all
other assumptions constant, for Ricoh's pension plans as of March 31, 2005.

<TABLE>
<CAPTION>
                                                                       CHANGE IN    CHANGE IN PRE-
                                                                    PENSION BENEFIT    TAX PENSION
                       CHANGE IN ASSUMPTION                           OBLIGATIONS         EXPENSES
                       --------------------                           -----------         --------
                                                                             (Billions of Yen)
<S>                                                                     <C>                <C>
50 basis point increase / decrease in discount rate                     - / + 22           - / + 0
50 basis point increase / decrease in expected return on assets                -           - / + 1
</TABLE>

        Impairment of Long-Lived Assets and Goodwill
        --------------------------------------------

        As of March 31, 2005, the aggregate of Ricoh's property, goodwill and
intangible assets was Yen 364.3 billion, which accounted for 18.6% of the total
assets. Ricoh believes that impairment of long-lived assets and goodwill are
critical to Ricoh's financial

                                     - 29 -

statements because the recoverability of the amounts or lack thereof, could
significantly affect its results of operations.

        Ricoh periodically reviews the carrying value of its goodwill for
continued appropriateness. This review is based upon Ricoh's projections of
anticipated future cashflows and estimated fair value of the reporting units for
which goodwill is assigned. Ricoh reviews long-lived assets and acquired
intangible assets with a definite life for impairment whenever events or changes
in circumstances indicate that the carrying amount of an asset or group of
assets may not be recoverable. The recoverability of assets to be held and used
is assessed by comparing the carrying amount of an asset or asset group to the
expected future undiscounted net cashflows of the asset or group of assets. If
an asset or group of assets is considered to be impaired, the impairment charge
to be recognized is measured as the amount by which the carrying amount of the
asset or group of assets exceeds fair value. Long-lived assets meeting the
criteria to be considered as held for sale are reported at the lower of their
carrying amount or fair value less costs to sell.

        While Ricoh believes that its estimates of future cashflows are
reasonable, different assumptions regarding such cashflows could materially
affect Ricoh's evaluations.

        Impairment of Securities
        ------------------------

        Individual securities classified as available-for-sale securities are
reduced to their fair market value by a charge to income for declines in value
that are not temporary. Factors considered in assessing whether an impairment
other than a temporary impairment exists include: (i) the length of time and
extent of decline, (ii) the financial condition and near term prospects of the
issuer and (iii) the intent and ability of Ricoh to retain such investment for a
period of time sufficient to allow for any anticipated recovery in market value.
Ricoh believes that impairment of securities is critical for its financial
statements because it holds significant amounts of securities, the
recoverability of which or lack thereof, could significantly affect its results
of operations.

        Realizability of Deferred Tax Assets
        ------------------------------------

        Ricoh records deferred tax assets and liabilities using the effective
tax rate taking into consideration the effect of temporary differences between
the book and tax bases of assets and liabilities. If the effective tax rate were
to change, Ricoh would adjust its deferred tax assets and liabilities, through
the provision for income taxes in the period of change, to reflect the effective
tax rate expected to be in effect when the deferred tax items reverse.

        Ricoh records a valuation allowance to reduce Ricoh's deferred tax
assets to an amount that is more likely than not to be recoverable. Ricoh
considers future market conditions, forecasted earnings, future taxable income,
the mix of earnings in the jurisdictions in which Ricoh operates, and prudent
and feasible tax planning strategies in determining the need for a valuation
allowance. In the event Ricoh were to determine

                                     - 30 -

that Ricoh would not be able to recover any portion of Ricoh's net deferred tax
assets in the future, the unrecoverable portion of the deferred tax assets would
be charged to earnings during the period in which such determination is made.
Likewise, if Ricoh were to later determine that it is more likely than not that
the net deferred tax assets would be recoverable, the previously recovered
valuation allowance would be reversed. In order to recover its deferred tax
assets, Ricoh must be able to generate sufficient taxable income in the tax
jurisdictions in which the deferred tax assets are located.

                                     - 31 -

A. Operating results

        The following table sets forth selected consolidated financial data,
including data expressed as a percentage of total consolidated net sales for the
periods indicated, and the change in each consolidated financial line item
between the indicated fiscal years:

<TABLE>
<CAPTION>
                                            Millions of Yen (except percentages)                 Thousands of
                                                   Year Ended March 31,                        U.S. Dollars (1)    % Change
                                      2003                  2004                  2005               2005        2004     2005
---------------------------------------------------------------------------------------------------------------------------------
<S>                            <C>         <C>       <C>         <C>        <C>        <C>       <C>              <C>      <C>
Net Sales                      1,738,358   100.0%    1,780,245   100.0%     1,814,108  100.0%    $ 16,954,280     2.4      1.9
Cost of Sales                    993,009    57.1%    1,014,619    57.0%     1,059,531   58.4%       9,902,159     2.2      4.4
---------------------------------------------------------------------------------------------------------------------------------
    Gross Profit                 745,349    42.9%      765,626    43.0%       754,577   41.6%       7,052,121     2.7     (1.4)
Selling, General and
 Administrative Expenses         611,695    35.2%      623,935    35.0%       619,071   34.1%       5,785,710     2.0     (0.8)
Transfer of the
substitutional
 portion of the Employee's
 Pension Fund:
     Settlement loss                  --                48,657                     --                      --
     Subsidy from government          --               (56,972)                    --                      --
---------------------------------------------------------------------------------------------------------------------------------
    Operating income             133,654     7.7%      150,006     8.4%       135,506    7.5%       1,266,411    12.2     (9.7)
---------------------------------------------------------------------------------------------------------------------------------
Other (Income) Expenses:
     Interest and dividend
      income                      (3,772)               (1,925)                (2,240)                (20,934)
     Interest expense              6,853                 5,290                  4,684                  43,776
     Foreign currency exchange
      (gain) loss, net               566                 6,136                 (1,547)                (14,458)
     Other, net                    6,537                (2,558)                  (774)                 (7,234)
---------------------------------------------------------------------------------------------------------------------------------
    Total                         10,184     0.6%        6,943     0.4%           123    0.0%           1,150   (31.8)   (98.2)
---------------------------------------------------------------------------------------------------------------------------------
Income before Income Taxes,
  Minority Interests and
  Equity in earnings of
  Affiliates and Cumulative
  Effect of Accounting
  Change                         123,470     7.1%      143,063     8.0%       135,383    7.5%       1,265,261    15.9     (5.4)
---------------------------------------------------------------------------------------------------------------------------------
Provisions for Income Taxes:      51,984     3.0%       56,641     3.2%        50,634    2.8%         473,215     9.0    (10.6)
---------------------------------------------------------------------------------------------------------------------------------
Income before Minority
  Interests and Equity in
  Earnings of Affiliates
  and Cumulative Effect of
  Accounting Change               71,486                86,422                 84,749                 792,046
Minority Interests                 1,376                 4,094                  4,726                  44,168
Equity in Earnings of
Affiliates                         2,403                 2,065                  3,120                  29,159
---------------------------------------------------------------------------------------------------------------------------------
Income Before Cumulative
  Effect of Accounting
  Change                          72,513     4.2%       84,393     4.7%        83,143    4.6%         777,037    16.4     (1.5)
---------------------------------------------------------------------------------------------------------------------------------
Cumulative Effect of
  Accounting Change, Net of
  tax                                 --                 7,373     0.5%            --                      --      --
---------------------------------------------------------------------------------------------------------------------------------
    Net Income                    72,513     4.2%       91,766     5.2%        83,143    4.6%         777,037    26.6     (9.4)
---------------------------------------------------------------------------------------------------------------------------------
    Reference:
Exchange Rates*
         US$ 1                    121.96                113.09                 107.58                           (8.87)   (5.51)
         EURO 1                   121.00                132.65                 135.25                           11.65     2.60

*These rates are the annual average exchange rate of the daily average TTM rates
published by The Bank of Tokyo Mitsubishi, Ltd. These rates are used when
consolidating the financial results of Ricoh's overseas subsidiaries with those
of the Company.
---------------------------------------------------------------------------------------------------------------------------------
</TABLE>

(1) The above consolidated financial data set forth under the heading "Thousands
of U.S. Dollars 2005" which has been translated from Japanese Yen into U.S.
Dollar equivalents for the year ended March 31, 2005 is included solely for the
convenience of readers outside Japan and has been made using the exchange rate
of Yen 107 to US$1, the approximate rate of exchange prevailing at the Federal
Reserve Bank of New York on March 31, 2005.

                                     - 32 -

SALES BY PRODUCT

<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------------------------------------
                                           Millions of Yen (except for percentages)               Thousands of        % Change
                                  ------------------------------------------------------------ U.S. Dollars (1) -----------------
                                       2003                  2004                 2005                2005         2004     2005
---------------------------------------------------------------------------------------------------------------------------------
   <S>                            <C>        <C>      <C>        <C>       <C>        <C>        <C>            <C>      <C>
   OFFICE EQUIPMENT
     Imaging Solutions              859,713   49.5%      803,574   45.1%       715,097   39.4%      $  6,683,150   (6.5)    (11.0)
     Network Input/
      Output Systems                463,379   26.7       558,237   31.4        670,836   37.0          6,269,495   20.5      20.2
     Network System Solutions       197,482   11.3       195,822   11.0        205,895   11.3          1,924,252   (0.8)      5.1
   OTHER BUSINESSES                 217,784   12.5       222,612   12.5        222,280   12.3          2,077,383    2.2      (0.1)
         Total                    1,738,358  100.0%    1,780,245  100.0%     1,814,108  100.0%      $ 16,954,280    2.4       1.9
---------------------------------------------------------------------------------------------------------------------------------
</TABLE>

(1) The above consolidated financial data set forth under the heading "Thousands
of U.S. Dollars 2005" which has been translated from Japanese Yen into U.S.
Dollar equivalents for the year ended March 31, 2005 is included solely for the
convenience of readers outside Japan and has been made using the exchange rate
of Yen 107 to US$1, the approximate rate of exchange prevailing at the Federal
Reserve Bank of New York on March 31, 2005.

FISCAL YEAR 2005 COMPARED TO FISCAL YEAR 2004

        NET SALES. Consolidated net sales of Ricoh for the fiscal year ended
March 31, 2005 increased by 1.9% (or Yen 33.8 billion) to Yen 1,814.1 billion
from Yen 1,780.2 billion for the fiscal year ended March 31, 2004. The increase
in net sales was primarily due to the increase in net sales in the Office
Equipment segment.

        More specifically, net sales from the Office Equipment segment accounted
for 87.7% of the consolidated net sales for fiscal year 2005. A significant
portion of such net sales was derived from net sales from the Network
Input/Output Systems category, which accounted for 37.0% of consolidated total
net sales, up 5.6 percentage points from fiscal year 2004. The increase in net
sales from the Network Input/Output Systems category is because of the increase
in net sales of Printing Systems due to the acceleration of the change in
customer preference from standalone equipment to multi-functional equipment,
which can improve the customer's operations by expanding their digital color
networking capacity. In particular, sales of MFPs continued to grow in
double-digit percentage figures in both the domestic and overseas market places.
Compared to fiscal year 2004, net sales of MFPs increased by 26.3% in Japan and
31.4% overseas. Similar to the increase in net sales of MFPs, sales of laser
printers continued to grow in double-digit percentage figures in both the
domestic and overseas market places. Compared to fiscal year 2004, net sales of
laser printers increased by 35.1% in Japan and 11.9% overseas due primarily to
the continuous release of new products responding to its customer needs. In
addition, Ricoh's new subsidiary Ricoh Printing Systems, Ltd. also contributed
to the sales growth of Printing Systems.

         The increase in net sales of Printing Systems was partially offset by
the decrease in net sales of Other Input/Output Systems. The decrease in net
sales of Other Input/Output Systems was due to lower sales in the optical discs
business in Japan and overseas as Ricoh withdrew from the self-developed drive
business, which used proprietary technology developed by Ricoh, and its
key-module/parts unit business. In turn, Ricoh decided to place more focus on
its media business. Due to these factors, net sales of Other Input/Output
Systems decreased by 68.4% in fiscal year 2005 as compared to fiscal year 2004.

                                     - 33 -

        In fiscal year 2005, the increase in net sales in the Network
Input/Output Systems category was also partially offset by a decrease in the
Imaging Solutions category. As a percentage of net sales, sales in the Imaging
Solutions category accounted for 39.4% of consolidated total net sales, a
decrease of 5.7 percentage points from fiscal year 2004. Although sales of
digital PPCs decreased by 7.0% in the overseas market, they continued to account
for a major portion of the net sales derived from the overseas market. Sales of
color PPC products increased in the overseas market as Ricoh continued to
introduce a new series of products in its existing color PPC line-up, responding
to its customer needs. Sales of other products that mainly consisted of
analog-type equipment such as analog PPCs has been decreasing in recent years,
including fiscal year 2005, as Ricoh's customers and the office equipment
industry undergo a transition period from analog-type equipment to digital or
multi-functional type models such as MFPs and laser printers. The decrease in
net sales in Imaging Solutions products and the increase in net sales of Network
Input/Output Systems products is indicative of this trend.

        In the Network System Solutions category, net sales of personal
computers and servers recovered as compared to fiscal year 2004, as information
technology investments by companies increased in Japan. Support and services
relating to such products, such as document solutions software, application
software and related services and support, were continuously well received by
customers throughout fiscal year 2005, as the increase in net sales of personal
computers and servers generated sales in these products and such products
assisted Ricoh's customers in optimizing their total printing costs.

        In the Other Businesses segment, net sales decreased by 0.1% mainly due
to the decrease in demand in Japan for measuring equipment and semiconductor
devices. While net sales of optical equipment, such as digital cameras and parts
unit continued to perform favorably in fiscal year 2005, the increase in net
sales from these items was not enough to offset the decrease in net sales of
measuring equipment and semiconductor devices. In addition, Ricoh's divestiture
of its subsidiaries in the optical-related analog business, such as Hanimex
Australasia Pty Ltd. and its subsidiaries located in Australia and New Zealand,
also contributed to the decrease in net sales of this segment. Had Ricoh not
divested its subsidiaries in the optical-related analog business, net sales
would have increased by 1.4%.

        The depreciation of the U.S. Dollar in relation to the Japanese Yen also
resulted in the lower Japanese Yen equivalent of U.S. Dollar denominated
overseas net sales of Office Equipment products for fiscal year 2005. While the
increase in Euro-denominated net sales due to the appreciation of the Euro in
relation to the Japanese Yen partially offset this decrease, the depreciation of
the U.S. Dollar resulted in the lower increase of consolidated net sales as
compared to fiscal year 2004. Had the foreign currency exchange rates remained
the same as fiscal year 2004, Ricoh's consolidated net sales would have
increased by 2.4%.

        COST OF SALES. Consolidated cost of sales for the fiscal year ended
March 31, 2005 increased by 4.4% (or Yen 44.9 billion) to Yen 1,059.5 billion
from Yen 1,014.6 billion for the fiscal year ended March 31, 2004. This increase
was due primarily to the increase in net sales, which was partially offset by
Ricoh's continuous cost-cutting activities similar to fiscal year 2004, which
resulted in a reduction in net cost of sales of approximately Yen 12.0 billion.

                                     - 34 -

        GROSS PROFIT. Consolidated gross profit for the fiscal year ended March
31, 2005 decreased by 1.4% to Yen 754.5 billion from Yen 765.6 billion for the
fiscal year ended March 31, 2004. Gross profit as a percentage of net sales
decreased by 1.4 percentage points from 43.0% for the fiscal year ended March
31, 2004 to 41.6% for the fiscal year ended March 31, 2005.

        In fiscal year 2005, Ricoh's strategy of significant discounting of
certain color products resulted in lower net sales as compared to cost of sales.
As a result, gross profit as a percentage of net sales decreased despite an
increase in net sales. This strategy is one of the core strategies used by Ricoh
to facilitate the replacement of monochrome products with color models at prices
comparable to those of monochrome models and to increase its market share in
color products as noted in "OVERVIEW" under Item 5. Ricoh also used this
strategy to increase its market share in color products so as to establish the
basis for future growth in the color products business.

        SELLING, GENERAL AND ADMINISTRATIVE EXPENSES. Consolidated selling,
general and administrative expenses for the fiscal year ended March 31, 2005
decreased by 0.8% (or Yen 4.8 billion) to Yen 619.0 billion from Yen 623.9
billion for the fiscal year ended March 31, 2004. Ricoh increased its research
and development investments during fiscal year 2005 by 19.4% (or Yen 17.9
billion) to Yen 110.4 billion from Yen 92.5 billion for the fiscal year ended
March 31, 2004 for purposes of developing more advanced products with new
capabilities to maintain its high market share position in the competitive
marketplace. Despite this increase in research and development investments
during fiscal year 2005, such increase was completely offset by (i) the
depreciation of the U.S. dollar in relation to the Japanese Yen which resulted
in a decrease in selling, general and administrative expenses of approximately
Yen 2.6 billion, (ii) the divestiture of its subsidiaries in the optical-related
analog business, and (iii) the decrease in pension costs due to pension systems
restructuring, such as the transfer to the Japanese government of the
substitutional portion of the domestic employees' pension fund ("EPF"). For
additional details as to expenditures on research and development activities,
see Item 5.C.

        TRANSFER TO THE JAPANESE GOVERNMENT OF THE SUBSTITUTIONAL PORTION OF THE
EMPLOYEE'S PENSION FUND. Ricoh completed its transfer to the Japanese government
of the substitutional portion of the EPF pursuant to the Contributed Benefit
Pension Plan Law during fiscal year 2004. As set forth under the heading
"Pension Information" below, Ricoh accounted for the transfer in accordance with
EITF 03-2. Ricoh recognized a one-time gain of Yen 56.9 billion from a Japanese
government subsidy and a one-time settlement loss of Yen 48.6 billion for the
transfer of such substitutional portion of the EPF during fiscal year 2004.

        OPERATING INCOME. Consolidated operating income for the fiscal year
ended March 31, 2005 decreased by 9.7% (or Yen 14.5 billion) to Yen 135.5
billion from Yen 150.0 billion for the fiscal year ended March 31, 2004. The
decrease in operating income as compared to fiscal year 2004 was due primarily
to the decrease in gross profit. In addition, the decrease in operating income
was also due to the fact that Ricoh did not recognize during fiscal year 2005
the one-time gain that it recognized during fiscal year 2004 in connection with
the transfer to the Japanese government of the substitutional portion of the
EPF, and such non-recognition of one-time gain was not offset by the

                                     - 35 -

decrease in consolidated selling, general and administrative expenses in fiscal
year 2005 as compared to fiscal year 2004 as described above.

        INTEREST AND DIVIDEND INCOME. Consolidated interest and dividend income
for the fiscal year ended March 31, 2005 increased by Yen 0.3 billion to Yen 2.2
billion from Yen 1.9 billion for the fiscal year ended March 31, 2004. The
increase in interest and dividend income reflected the favorable financial
market conditions and the positive change in economic conditions in Japan as
dividend income from Japanese companies increased.

        INTEREST EXPENSE. Consolidated interest expense for the fiscal year
ended March 31, 2005 decreased by Yen 0.6 billion to Yen 4.6 billion from Yen
5.2 billion for the fiscal year ended March 31, 2004. This decrease in
consolidated interest expense resulted primarily from the decrease in the amount
of Ricoh's interest-bearing debt outstanding for the fiscal year ended March 31,
2005 as compared to the fiscal year ended March 31, 2004. Ricoh's
interest-bearing debt as of March 31, 2005 decreased by Yen 22.6 billion to Yen
410.0 billion from Yen 432.7 billion as of March 31, 2004. Since the
implementation of its group cash management system a few years ago, which
provided Ricoh with an alternative to borrowing funds externally, Ricoh has been
able to continuously decrease its interest-bearing debt each fiscal year.

        FOREIGN CURRENCY EXCHANGE (GAIN) LOSS, NET. Consolidated foreign
currency exchange gain, net included in other (income) expenses for the fiscal
year ended March 31, 2005 increased by Yen 7.6 billion to a gain of Yen 1.5
billion from a loss of Yen 6.1 billion for the fiscal year ended March 31, 2004.
For additional information on Ricoh's foreign exchange hedging activities, see
Item 11.

        OTHER, NET. Consolidated other, net included in other (income) expenses
decreased by Yen 1.7 billion to an income of Yen 2.5 billion for the fiscal year
ended March 31, 2004 from an income of Yen 0.7 billion for the fiscal year ended
March 31, 2005. This decrease in income of the other, net in fiscal year 2005
was due to a decrease in income derived from the sale of marketable securities
as compared to the previous corresponding period.

        TOTAL PROVISIONS FOR INCOME TAXES. Total consolidated provisions for
income taxes for the fiscal year ended March 31, 2005 decreased by 10.6% (or Yen
6.0 billion) to Yen 50.6 billion from Yen 56.6 billion for fiscal year ended
March 31, 2004. This decrease in provisions for income taxes as compared to the
provisions in income before income taxes, minority interests, equity in earnings
of affiliates and cumulative effect of accounting changes was primarily due to a
decrease in the effective tax rate.

        The effective tax rate decreased by 2.2 percentage points to 37.4% for
the fiscal year ended March 31, 2005 from 39.6% for the previous fiscal year.
This 2.6 percentage point decrease in the effective tax rate was attributable to
a tax credit being applied in Japan to (1) the increase in research and
development expenses and (2) the investments made by Ricoh in information
technologies hardware and software used by the Company. As a result of these tax
credits, the effective tax rate was lower than the Japanese statutory tax rate.
See Note 8 to the Consolidated Financial Statements for additional information.

        MINORITY INTERESTS. Consolidated minority interests for the fiscal year
ended March 31, 2005 increased by Yen 0.6 billion to Yen 4.7 billion from Yen
4.0 billion for the fiscal

                                     - 36 -

year ended March 31, 2004. This increase primarily resulted from an improvement
in the business performance of both Ricoh Leasing Co., Ltd. and Ricoh Elemex
Corporation.

        EQUITY IN EARNINGS OF AFFILIATES. Consolidated equity in earnings of
affiliates for the fiscal year ended March 31, 2005 increased by Yen 1.0 billion
to Yen 3.1 billion from Yen 2.0 billion for the fiscal year ended March 31,
2004. This increase was due primarily to an improvement in the business
performance of its affiliates.

OPERATING SEGMENTS

<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------------
                                    Millions of Yen (except for percentages)     Thousands of
                                   ------------------------------------------   U.S. Dollars (1)
                                          2004                   2005                 2005       % Change
---------------------------------------------------------------------------------------------------------
<S>                                <C>        <C>           <C>        <C>      <C>                 <C>
   OFFICE EQUIPMENT
     Net sales                     1,557,633    100.0%      1,591,828  100.0%   $    14,876,897       2.2
     Operating expenses            1,353,304     86.9       1,400,121   88.0         13,085,243       3.5
     Operating income                204,329     13.1%        191,707   12.0%   $     1,791,654      (6.2)
---------------------------------------------------------------------------------------------------------
   OTHER BUSINESSES
     Net sales                       225,074    100.0%        224,786  100.0%   $     2,100,804      (0.1)
     Operating expenses              220,391     97.9         224,241   99.8          2,095,710       1.7
     Operating income                  4,683      2.1%            545    0.2%   $         5,093     (88.4)
---------------------------------------------------------------------------------------------------------
   CORPORATE AND ELIMINATION
     Net sales                       (2,462)                   (2,506)          $       (23,420)
     Operating expenses               56,544                   54,240                   506,916
     Operating income               (59,006)                  (56,746)          $      (530,336)
---------------------------------------------------------------------------------------------------------
   CONSOLIDATED
     Net sales                     1,780,245    100.0%      1,814,108  100.0%   $    16,954,280       1.9
     Operating expenses            1,630,239     91.6       1,678,602   92.5         15,687,869       3.0
     Operating income                150,006      8.4%        135,506    7.5%   $     1,266,411      (9.7)
---------------------------------------------------------------------------------------------------------
</TABLE>

(1) The above consolidated financial data set forth under the heading "Thousands
of U.S. Dollars 2005" which has been translated from Japanese Yen into U.S.
Dollar equivalents for the year ended March 31, 2005 is included solely for the
convenience of readers outside Japan and has been made using the exchange rate
of Yen 107 to US$1, the approximate rate of exchange prevailing at the Federal
Reserve Bank of New York on March 31, 2005.

Office Equipment

        Net sales in the Office Equipment segment for the fiscal year ended
March 31, 2005 increased by 2.2% (or Yen 34.1 billion) to Yen 1,591.8 billion
from Yen 1,557.6 billion for the fiscal year ended March 31, 2004. This increase
was primarily due to the continuing increase in sales of high-margin value-added
digital-based products in Printing Systems of the Network Input/Output Systems
product category as printers with various functions, from input/output to
sharing and administration as well as color capabilities, were introduced in a
wide range of models from standard models to high-speed digital models. With
further advancements being made in digital networking, the increase in the
volume of information that is processed electronically and improvements being
made in color products, Ricoh believes that its customers strongly desire
methods through which they can effectively and efficiently conduct their
operations. In an effort to help customers manage their Total Document Volume
("TDV") more effectively and efficiently, Ricoh continued to offer solutions to
optimize the total printing costs of its customers in fiscal year 2005. As a
result of such efforts, in fiscal year 2005, domestic and overseas sales of
color PPCs, MFPs and laser printers, particularly color laser printer models,
increased. In

                                     - 37 -

addition, net sales continued to increase for support services, software, and
other solutions aimed at satisfying the diverse needs of customers while the
optical discs business was reorganized as Ricoh withdrew from the self-developed
drive business, which used proprietary technology developed by Ricoh, and its
key-module/parts unit business. The increase in net sales of the Network
Input/Output Systems products was partly offset by a decrease in net sales of
Imaging Solutions products in both Japan and the overseas markets. These net
sales results were consistent with Ricoh's efforts to support the shift in
customers' demand to digital networking and color-based products from monochrome
analog-based stand-alone products. This trend, which has been continuing for the
last six years, is also reflected in Ricoh's sales results: as a percentage of
total sales, the percentage of sales of Imaging Solutions decreased 22.6
percentage points from 62.0% to 39.4% in the past six years; conversely, the
percentage of sales of Network Input/Output Systems increased 25.0 percentage
points from 12.0% to 37.0% in the past six years.

        More specifically, sales in the Imaging Solutions product category for
the fiscal year ended March 31, 2005 decreased by 11.0% (or Yen 88.4 billion) to
Yen 715.0 billion from Yen 803.5 billion for the fiscal year ended March 31,
2004. In Digital Imaging Solutions, Ricoh strengthened its product lineup from
standard models to high-speed digital models in addition to introducing new
color PPC products. As a whole, sales of Digital Imaging Solutions as well as
Other Imaging Solutions decreased in fiscal year 2005 as compared to fiscal year
2004 due to the shift in customer preference from standalone equipment to
multi-functional equipment.

        Contrary to prior years in which Imaging Solutions was Ricoh's core
business and generated more than half of Ricoh's net sales, in recent years, the
MFP and laser printer product lines under the Network Input/Output Systems
product category have seen an increase in sales volume in both Japan and
overseas. This shift reflects the current trend towards products that are
networkable and is especially noticeable from the increase in sales of color
MFPs and color laser printers for the fiscal year ended March 31, 2005. Taking
this trend into consideration, Ricoh introduced new MFP products, such as imagio
Neo 752/602, imagio C245 and imagio Neo C385 in Japan, and Aficio 2035/2045 and
Aficio 2232C/2238C overseas. Ricoh also introduced new laser printer models,
IPSiO CX2500, IPSiO CX6100D and IPSiO CX400 in Japan, and AP410/410N and CL400DN
overseas. All of these new products performed well in each of the markets in
which they were introduced.

        While the acquisition of Ricoh Printing Systems, Ltd. has increased net
sales, cost of sales, and selling, general and administrative expenses, this
acquisition has not significantly affected operating income for the year ended
March 31, 2005.

        During the fiscal year ended March 31, 2005, Ricoh also continued its
efforts to strengthen the sales of its solutions business in the Network System
Solutions category relating to its office equipment products so as to assist its
customers in optimizing their total printing costs. The Network System Solutions
category includes sales generated from support services, document management
applications and related software. Ricoh's continuing efforts to strengthen its
Network System Solutions category business has led to an increase in domestic
and overseas sales of its solutions products over the last few years. In
particular, fiscal year 2005 was a year in which new systems solutions were in

                                     - 38 -

great demand as customers were in a transition period for replacing their
personal computers or servers following Year 2000. As a result of this increase
in demand for system solutions, net sales of Ricoh's Network System Solutions
category picked up some momentum and increased by 5.1% for the fiscal year ended
March 31, 2005 as compared to the fiscal year ended March 31, 2004.

        On the whole, the increase in sales in the Network Input/Output Systems
product category exceeded the decrease in sales in the Imaging Solutions product
category and net sales in the Office Equipment segment increased by 2.2% for the
year ended March 31, 2005 as compared to the fiscal year ended March 31, 2004.
Excluding the foreign currency exchange rate fluctuations of the U.S. Dollar and
the Euro to the Japanese Yen, sales in the Office Equipment segment would have
increased by 2.7% (or Yen 42.2 billion) for the fiscal year ended March 31, 2005
as compared to the fiscal year ended March 31, 2004.

        With respect to expenses, Ricoh continued to lower operating expenses in
the Office Equipment segment in fiscal year 2005 by engaging in the various
cost-cutting activities it employed in fiscal year 2004, such as streamlining
its supply chain management. On the other hand, Ricoh also made strategic
research and development investments during fiscal year 2005 so as to produce
new products in the upcoming fiscal year. As a result of such research and
development investments, which exceeded the decrease in expenses that resulted
from such cost-cutting activities, operating expenses in the Office Equipment
segment for the fiscal year ended March 31, 2005 increased by 3.5% (or Yen 46.8
billion) to Yen 1,400.1 billion from Yen 1,353.3 billion for the fiscal year
ended March 31, 2004.

        As a result of the above factors, operating income for the Office
Equipment segment for the fiscal year ended March 31, 2005 decreased by 6.2% (or
Yen 12.6 billion) to Yen 191.7 billion from Yen 204.3 billion for the fiscal
year ended March 31, 2004. Operating income as a percentage of net sales for the
fiscal year ended March 31, 2005 decreased by 1.1 percentage points to 12.0%
from 13.1% as compared to the fiscal year ended March 31, 2004, due primarily to
the appreciation of the Japanese Yen relative to the U.S. dollar, the increase
in research and development investments, and the various sales promotions (e.g.,
discounting, customer specific modifications, etc.) that Ricoh provided to its
customers to increase its sales volume and its market share of color products,
which was partially offset by the increase in sales of higher-margin value-added
products such as color products and MFPs.

Other Businesses

        Net sales in the Other Businesses segment for the fiscal year ended
March 31, 2005 decreased by 0.1% (or Yen 0.2 billion) to Yen 224.7 billion from
Yen 225.0 billion for the fiscal year ended March 31, 2004. While Ricoh's
optical equipment business continued to perform favorably during fiscal year
2005, the increase in net sales resulting from such business did not completely
offset the decrease in net sales resulting from Ricoh's sale of its subsidiaries
in the optical-related analog business, such as Hanimex Australasia Pty Ltd. and
its subsidiaries located in Australia and New Zealand that engaged in the
manufacture and sale of cameras, films, and the development of film. Operating

                                     - 39 -

expenses for fiscal year 2005 increased by 1.7 % compared to fiscal year 2004,
which was primarily due to the fact that net sales in the semiconductor business
were not sufficient to cover the fixed costs relating to its production costs
and organization maintenance costs. The decrease in operating income under the
Other Businesses segment was due primarily to the reorganization of its
optical-related analog business and the shortfall relating to its semiconductor
business as discussed above.

GEOGRAPHIC SEGMENTS

<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------------
                                                                                  Thousands of
                                   Millions of Yen (except for percentages)     U.S. Dollars (1)
                                   -----------------------------------------
                                          2004                    2005                2005       % Change
---------------------------------------------------------------------------------------------------------
<S>                                <C>          <C>         <C>        <C>         <C>           <C>
   JAPAN
     Net sales                     1,313,197    100.0%     1,386,715  100.0%    $    12,959,953      5.6
     Operating expenses            1,215,875     92.6      1,298,640   93.6          12,136,822      6.8
     Operating income                 97,322      7.4%        88,075    6.4%    $       823,131     (9.5)
---------------------------------------------------------------------------------------------------------
   THE AMERICAS
     Net sales                       320,753    100.0%       330,461  100.0%    $     3,088,421      3.0
     Operating expenses              305,284     95.2        316,651   95.8           2,959,356      3.7
     Operating income                 15,469      4.8%        13,810    4.2%    $       129,065    (10.7)
---------------------------------------------------------------------------------------------------------
   EUROPE
     Net sales                       404,416    100.0%       415,643  100.0%    $     3,884,514      2.8
     Operating expenses              382,383     94.6        391,271   94.1           3,656,738      2.3
     Operating income                 22,033      5.4%        24,372    5.9%    $       227,776     10.6
---------------------------------------------------------------------------------------------------------
   OTHER
     Net sales                       193,341    100.0%       173,948  100.0%    $     1,625,682    (10.0)
     Operating expenses              182,870     94.6        162,042   93.2           1,514,411    (11.4)
     Operating income                 10,471      5.4%        11,906    6.8%    $       111,271     13.7
---------------------------------------------------------------------------------------------------------
   CORPORATE AND ELIMINATION
     Net sales                      (451,462)               (492,659)           $    (4,604,290)
     Operating expenses             (456,173)               (490,002)                (4,579,458)
     Operating income                  4,711                  (2,657)           $       (24,832)
---------------------------------------------------------------------------------------------------------
   CONSOLIDATED
     Net sales                     1,780,245    100.0%     1,814,108  100.0%    $     16,954,280      1.9
     Operating expenses            1,630,239     91.6      1,678,602   92.5           15,687,869      3.0
     Operating income                150,006      8.4%       135,506    7.5%    $      1,266,411     (9.7)
---------------------------------------------------------------------------------------------------------
</TABLE>

(1) The above consolidated financial data set forth under the heading "Thousands
of U.S. Dollars 2005" which has been translated from Japanese Yen into U.S.
Dollar equivalents for the year ended March 31, 2005 is included solely for the
convenience of readers outside Japan and has been made using the exchange rate
of Yen 107 to US$1, the approximate rate of exchange prevailing at the Federal
Reserve Bank of New York on March 31, 2005.

Japan

        Sales in Japan for the fiscal year ended March 31, 2005 increased by
5.6% (or Yen 73.5 billion) to Yen 1,386.7 billion from Yen 1,313.1 billion for
the fiscal year ended March 31, 2004. In terms of sales to external customers,
Ricoh recorded an increase in sales of its Printing Systems, such as MFPs and
laser printers, in this geographic segment. This increase reflects the results
of Ricoh's strategic sales promotion activities (e.g., discounting, customer
specific modifications, etc.) and marketing strategy in the Office Equipment
segment, which focused on responding to the change in customer demands from
stand-alone monochrome products to networkable color products. Moreover, sales
from the newly consolidated subsidiary, Ricoh Printing Systems, Ltd., favorably
contributed to the sales in Japan. In addition, sales of personal computers and
servers increased during fiscal year 2005 in Japan as a result of a recovery in
corporate spending on information technology equipment. This increase in net
sales of computer hardware

                                     - 40 -

also generated sales of Ricoh's solution business products, such as support
services, document management applications and other software. Meanwhile, sales
in analog-typed equipment decreased as such equipment was replaced with MFPs and
color equipments. In the Other Businesses segment, sales for measuring equipment
and semiconductor devices decreased in Japan due to the sluggish market for such
products, although optical equipment continued to perform favorably compared to
the previous fiscal year.

        Operating expenses in this geographic segment for the fiscal year ended
March 31, 2005 increased by 6.8% (or Yen 82.7 billion) to Yen 1,298.6 billion
from Yen 1,215.8 billion for the fiscal year ended March 31, 2004. The increase
in operating expenses was primarily due to the increase in sales volume
especially exports to foreign countries. Even though net sales in this segment
only increased by 5.6% as compared to the previous fiscal year, operating
expenses increased by 6.8% as compared to the previous fiscal year. During
fiscal year 2005, Ricoh was able to decrease its operating expenses as it
performed various cost-cutting measures to streamline some of its business lines
and its pension costs decreased due to the pension systems restructuring (such
as the transfer to the Japanese government of the substitutional portion of the
EPF). Despite these factors, during fiscal year 2005 operating expenses in Japan
increased to a greater extent than the increase in net sales due to Ricoh's
strategy of providing discounts for certain color products, which resulted in
lower net sales as compared to cost of sales, and Ricoh's strategy of making
greater research and development investments geared for the development of color
products. The above strategies which resulted in increasing operating expenses
were performed to further promote Ricoh's shift in focus from black-and-white
monochrome products to color products in order to lay the foundation of the 15th
Medium-term Management Plan that starts from fiscal year 2006.

        Despite sales of value-added high-margin products increased, the
increase in operating expenses was greater than the increase in net sales and
operating income in Japan for the fiscal year ended March 31, 2005 decreased by
9.5% (or Yen 9.2 billion) to Yen 88.0 billion from Yen 97.3 billion for the
fiscal year ended March 31, 2004. Excluding net gains recognized from the
transfer to the Japanese government of the substitutional portion of the EPF,
operating income in Japan would have decreased by 1.0%.

The Americas

        Net sales in the Americas for the fiscal year ended March 31, 2005
increased by 3.0% (or Yen 9.7 billion) to Yen 330.4 billion from Yen 320.7
billion for the fiscal year ended March 31, 2004, despite the appreciation of
the Japanese Yen against the U.S. Dollar. This increase in net sales was due
primarily to Ricoh's continuing efforts to enhance and expand its existing sales
channels and increase the retail sales of MFPs, color PPCs and laser printers,
as these products are responsive to the customers' changing needs for
networking, coloration, and high speed products. In addition, Ricoh continued to
focus its marketing and promotional efforts towards major corporate clients for
the fiscal year ended March 31, 2005. In contrast to the increase in net sales
of MFPs, color PPCs and laser printers, sales in the optical discs business
decreased in the Americas due to the reorganization of this business. Excluding
foreign currency exchange fluctuations, net sales in the Americas would have
increased by 8.3%.

                                     - 41 -

        The percentage change of operating expenses as compared to the previous
fiscal year in the Americas was greater than the percentage change of net sales
as compared to the previous fiscal year in the Americas as (1) the increasingly
competitive business environment in the Americas which required Ricoh to
increase its marketing efforts to maintain its market share, (2) Ricoh made
various investments to develop and enhance its core operating systems, and (3)
the appreciation of the Japanese Yen relative to the U.S. Dollar.

Europe

        Sales in Europe for the fiscal year ended March 31, 2005 increased by
2.8% (or Yen 11.2 billion) to Yen 415.6 billion from Yen 404.4 billion for the
fiscal year ended March 31, 2004, due primarily to the depreciation of the
Japanese Yen against the Euro and an increase in sales of Printing Systems, such
as MFPs and laser printers, which reflected Ricoh's continuing efforts to
strengthen its sales networks and reinforce its brand power in this geographic
segment. Sales of products with color capability increased in fiscal year 2005
as compared to the previous fiscal year. Continuing from previous fiscal years,
Ricoh maintained its dominance in the copiers and MFP product lines in this
geographic segment and was again ranked number one in terms of market share in
the sales of copiers and MFPs in Europe.

        Operating expenses in this geographic segment for the fiscal year ended
March 31, 2005 increased by a lower percentage as compared to the percentage
increase in net sales, due primarily to (1) a greater portion of its sales being
derived from higher-margin value-added digital-based office equipment,
especially with color capabilities, (2) Ricoh's ability to relocate its
production facilities for those products closer to its customers, thereby
eliminating costs associated with transporting such finished products, and (3)
the depreciation of the Japanese Yen against the Euro.

Other

        Net sales in the Other geographic segment, such as China, Asia and
Oceania, for the fiscal year ended March 31, 2005 decreased by 10.0% (or Yen
19.3 billion) to Yen 173.9 billion from Yen 193.3 billion for the fiscal year
ended March 31, 2004. While sales of Printing Systems increased in this
geographic segment reflecting a full-fledged shift to digital, networkable and
color products from stand-alone, analog and monochrome equipment such increase
was not sufficient to offset the decrease in sales of the optical-related analog
business as Ricoh sold its subsidiaries in this business line in this geographic
segment (Hanimex Autralasia Pty Ltd. and its subsidiaries) during fiscal year
2005.

        The sales operation in China has recovered its performance.
Manufacturing subsidiaries in China, which mainly manufacture low-end digital
PPCs and MFPs, continued to contribute to the increase in net sales in this
geographic segment. The products manufactured by such subsidiaries have been
exported to sales subsidiaries in Japan, the U.S. and Europe. Ricoh maintained a
high production level in China for the fiscal year ended March 31, 2005 to
respond to an increase in demand for digital PPCs and MFPs in the various
markets around the world.

                                     - 42 -

FISCAL YEAR 2004 COMPARED TO FISCAL YEAR 2003

        NET SALES. Consolidated net sales of Ricoh for the fiscal year ended
March 31, 2004 increased by 2.4% (or Yen 41.8 billion) to Yen 1,780.2 billion
from Yen 1,738.3 billion for the fiscal year ended March 31, 2003. This was the
10th consecutive year in which Ricoh recorded revenue growth. The increase in
net sales was primarily due to an increase in net sales in the Office Equipment
segment and favorable foreign currency rates.

        The increase in net sales in the Office Equipment segment resulted from
an increase in net sales in the Network Input/Output Systems category which was
partially offset by a decrease in net sales in the Imaging Solutions category.
As a percentage of net sales, sales in the Network Input/Output Systems category
accounted for 31.4% of consolidated net sales, up 4.7 percentage points from the
fiscal year ended March 31, 2003. As many of Ricoh's customers are medium to
large institutions that have increasing needs for improving operations by
expanding their digital color networking capacity, printing systems in the
Network Input/Output System product category which have networking and color
capabilities were in high demand during fiscal year 2004. In the fiscal year
ended March 31, 2004, net sales of MFPs increased by 29.4% overall as compared
to the fiscal year ended March 31, 2003. A 76.9% increase in net sales of MFPs
with color capabilities in fiscal year 2004 as compared to fiscal year 2003
especially contributed to the 29.4% increase in net sales of overall MFPs as
compared to fiscal year 2003.

        As a percentage of net sales, sales from the Imaging Solutions category
accounted for 45.1% of consolidated net sales, down 4.4 percentage points from
the fiscal year ended March 31, 2003. While the decrease in net sales in the
Imaging Solutions category reflected the shift in customer demands towards
products that have networking capabilities, digital PPC products performed well
in the overseas markets and sales of color PPC products continued to increase in
Japan and the overseas market. Sales of the other products (e.g., analog PPC) in
the Imaging Solutions category decreased by 15.2% in the fiscal year ended March
31, 2004 compared to the fiscal year ended March 31, 2003, reflecting the recent
trend away from analog-type equipment in favor of products with networking
capabilities, such as MFPs and laser printers.

        With respect to Other Input/Output systems, net sales in this category
decreased 10.1%, due primarily to decreased demand for optical disc products,
especially in China, Asia and Oceania.

        Overall, an increase in net sales of higher-margin, value-added
digital-based office equipment in the Network Input/Output System product
category more than offset a decrease in net sales of some products in the
Imaging Solutions product category (e.g., analog PPCs and facsimile machines).
As a result, net sales in the Office Equipment segment accounted for a 1.8%
increase in net sales before giving effect to foreign currency fluctuations.

        The appreciation of the Euro in relation to the Japanese Yen also
contributed to the increase in net sales for the fiscal year ended March 31,
2004, more than offsetting

                                     - 43 -

the decrease in U.S. Dollar-denominated net sales when converted to Japanese Yen
resulting from the depreciation of the U.S. Dollar in relation to the Japanese
Yen.

        In the Other Businesses segment, where sales increased 2.2% as compared
to the fiscal year ended March 31, 2003, optical equipment, leasing and other
business performed favorably. On the other hand, sales of measuring equipment
decreased due to sluggish market demand.

        COST OF SALES. Consolidated cost of sales for the fiscal year ended
March 31, 2004 increased by 2.2% (or Yen 21.6 billion) to Yen 1,014.6 billion
from Yen 993.0 billion for the fiscal year ended March 31, 2003. This increase
was due primarily to the increase in net sales and to the appreciation of the
Euro against the Japanese Yen that resulted in higher Japanese Yen equivalents
of Euro-denominated cost of sales. As a percentage of net sales, however, cost
of sales decreased slightly due to the elimination of costs associated with
correcting the quality of Ricoh's measuring equipment, depreciation of the U.S.
Dollar against the Japanese Yen, and various cost-cutting measures taken by
Ricoh.

        The most significant factor contributing to the reduction in cost of
sales as a percentage of net sales was Ricoh's resolution of quality problems
relating to its measuring equipment during the fiscal year ended March 31, 2003.
The elimination of this cost accounted for approximately Yen 8.0 billion of the
cost of sales in fiscal year ended March 31, 2003. Ricoh did not incur any
additional costs relating to this problem during the fiscal year ended March 31,
2004.

        The various cost-cutting measures undertaken by Ricoh during the fiscal
year ended March 31, 2004 included the following: shortening the length of time
in which products are designed by standardizing various product parts thereby
allowing for the elimination of the cost of separately designing each product
part when designing new products; increased utilization of standardized product
components thereby increasing production efficiency; shifting production towards
generic products that can be sold in various countries; making efforts to manage
its supply chain by establishing a production process in which products are
assembled once an order is placed at a local factory, thereby reducing the costs
of inventory and distribution; procuring materials from suppliers at lower
costs; and providing employee training programs and opportunities to its
employees so that they obtain more experience and become more productive,
thereby allowing Ricoh to minimize production line inefficiencies.

        GROSS PROFIT. Consolidated gross profit for the fiscal year ended March
31, 2004 increased by 2.7% to Yen 765.6 billion from Yen 745.3 billion for the
fiscal year 2003. Gross margin increased by 0.1 percentage point from 42.9% of
net sales for the fiscal year ended March 31, 2003 to 43.0% of net sales for the
fiscal year ended March 31, 2004. Ricoh's gross margin increased as a result of
the shift to higher-margin products and the cost-cutting efforts described
above.

        SELLING, GENERAL AND ADMINISTRATIVE EXPENSES. Consolidated selling,
general and administrative expenses for the fiscal year ended March 31, 2004
increased by 2.0% (or Yen 12.2 billion) to Yen 623.9 billion from Yen 611.6
billion for the fiscal year ended March 31, 2003. This increase was primarily
due to the following: (1) the appreciation of the Euro against the Japanese Yen
that resulted in higher Japanese Yen equivalents of Euro-denominated expenses,
which was partially offset by the depreciation of the U.S. Dollar

                                     - 44 -

against the Japanese Yen, (2) an increase in pension costs reflecting a Yen 5.9
billion loss resulting from the liquidation of a defined benefit plan that
served as a supplemental plan for certain qualified employees, (3) a one-time
advertising cost incurred in sponsoring the " '04 Ricoh Major League Baseball
Opening Series" held in Tokyo in March 2004, (4) various advertising costs
associated with the new release of ink-jet printers that use Ricoh's unique `GEL
JET' technology in an effort to cultivate a market for ink-jet printers intended
for business usage, and (5) strategic spending on research and development and
back-office information systems development continuing from the previous fiscal
year. Research and development expenses for the fiscal year ended March 31, 2004
increased by 10.7% (or Yen 8.9 billion) to Yen 92.5 billion from Yen 83.5
billion for the fiscal year ended March 31, 2003. For additional details as to
expenditures on research and development activities, see Item 5.C.

        TRANSFER TO THE JAPANESE GOVERNMENT OF THE SUBSTITUTIONAL PORTION OF THE
EMPLOYEE'S PENSION FUND. Ricoh completed its transfer to the Japanese government
of the substitutional portion of the EPF pursuant to the Contributed Benefit
Pension Plan Law during fiscal year 2004. As set forth under the heading
"Pension Information" below, Ricoh accounted for the transfer in accordance with
EITF 03-2. In applying EITF 03-2, Ricoh recognized a one-time gain of Yen 56.9
billion as a subsidy from the Japanese government. In addition, Ricoh recognized
a one-time net loss of Yen 48.6 billion for the transfer of such substitutional
portion of the EPF in accordance with EITF 03-2.

        OPERATING INCOME. Consolidated operating income for the fiscal year
ended March 31, 2004 increased by 12.2% (or Yen 16.3 billion) to Yen 150.0
billion from Yen 133.6 billion for the fiscal year ended March 31, 2003. This
increase was mainly due to (1) the higher rate of increase in gross profit
relative to selling, general and administrative expenses between the fiscal
years ended March 31, 2003 and 2004, and (2) a net gain of Yen 8.3 billion on
the transfer of the substitutional portion of the EPF to the Japanese
government, which consisted of the subsidy from the government and the
recognized net loss related to the transfer of the substitutional portion of the
EPF to the Japanese government. Excluding the net effect of the transfer to the
Japanese government of the substitutional portion of the EPF, operating income
would have increased by 6.0%.

        INTEREST AND DIVIDEND INCOME. Consolidated interest and dividend income
for the fiscal year ended March 31, 2004 decreased by Yen 1.8 billion to Yen 1.9
billion from Yen 3.7 billion for the fiscal year ended March 31, 2003. This
decrease in consolidated interest and dividend income resulted primarily from
lower interest rates and lower dividend income from Japanese companies whose
performance has been adversely affected by difficult economic conditions in
Japan. As dividend income that Ricoh received during fiscal year 2004 was based
upon the financial results for the fiscal year 2003, dividend income did not
increase despite improved economic conditions in Japan during the latter half of
fiscal year 2004.

        INTEREST EXPENSE. Consolidated interest expense for the fiscal year
ended March 31, 2004 decreased by Yen 1.5 billion to Yen 5.2 billion from Yen
6.8 billion for the fiscal year ended March 31, 2003. This decrease in
consolidated interest expense resulted primarily from the decrease in the amount
of Ricoh's interest-bearing debt outstanding for the fiscal year ended March 31,
2004 as compared to the fiscal year ended March 31, 2003. Ricoh was able to
decrease its outstanding interest-bearing debt for fiscal year 2004 as it

                                     - 45 -

continued to utilize its group cash management systems in Japan, the United
States and Europe as an alternative to external borrowings. As a result, Ricoh's
interest-bearing debt as of March 31, 2004 decreased by Yen 51.8 billion to Yen
432.7 billion from Yen 484.6 billion as of March 31, 2003.

        FOREIGN CURRENCY EXCHANGE (GAIN) LOSS, NET. Consolidated foreign
currency exchange loss, net included in other (income) expenses for the fiscal
year ended March 31, 2004 increased by Yen 5.5 billion to a loss of Yen 6.1
billion from a loss of Yen 0.5 billion for the fiscal year ended March 31, 2003.
This increase was primarily due to foreign exchange losses resulting from the
appreciation of the Japanese Yen relative to the U.S. Dollar. While Ricoh uses
foreign exchange currency forward contracts to manage the effects of foreign
currency exchange risks, the U.S. Dollar depreciated relative to the Japanese
Yen more rapidly than Ricoh expected throughout the fiscal year ended March 31,
2004 and Ricoh's hedging activities, which are short-term in nature, were not
able to sufficiently cover such losses. The most significant monetary assets
that caused the gain or loss were foreign currency denominated receivables. For
additional information on Ricoh's foreign exchange hedging activities, see Item
11.

        OTHER, NET. Consolidated other, net included in other (income) expenses
was income of Yen 2.5 billion for the fiscal year ended March 31, 2004 as
compared to an expense of Yen 6.5 billion for the fiscal year ended March 31,
2003. A gain was recognized for the fiscal year ended March 31, 2004 primarily
due to a realization of gains resulting from employee pension contributions by
Ricoh of equity securities for the fiscal year ended March 31, 2004, while a
loss was recognized for the fiscal year ended March 31, 2003 primarily due to
the valuation loss of investment securities.

        TOTAL PROVISIONS FOR INCOME TAXES. Total consolidated provisions for
income taxes for the fiscal year ended March 31, 2004 increased by 9.0% (or Yen
4.6 billion) to Yen 56.6 billion from Yen 51.9 billion for fiscal year ended
March 31, 2003. This lower percentage increase in provisions for income taxes as
compared to the percentage increase in income before income taxes, minority
interests and equity in earnings of affiliates was primarily due to a decrease
in the effective tax rate.

        The effective tax rate decreased by 2.5 percentage points to 39.6% for
the fiscal year ended March 31, 2004 from 42.1% for the fiscal year ended March
31, 2003. This 2.5 percentage points decrease in the effective tax rate was
attributable to a tax credit being applied in Japan to (1) the increase in
research and development expense and (2) investment in information technologies
used by Ricoh. As a result, the effective tax rate was lower than the Japanese
statutory tax rate. See Note 8 to the Consolidated Financial Statements.

        MINORITY INTERESTS. Consolidated minority interests for the fiscal year
ended March 31, 2004 increased by Yen 2.7 billion to Yen 4.0 billion from Yen
1.3 billion for the fiscal year ended March 31, 2003. This increase primarily
reflected an improvement in the business performance of Ricoh Elemex Corporation
as it resolved the quality problems it faced with respect to its measuring
equipment.

        EQUITY IN EARNINGS OF AFFILIATES. Consolidated equity in earnings of
affiliates for the fiscal year ended March 31, 2004 decreased by Yen 0.3 billion
to Yen 2.0 billion from Yen 2.4 billion for the fiscal year ended March 31,
2003. This decrease was primarily due to the

                                     - 46 -

conversion of Shanghai Ricoh Facsimile Co., Ltd. from an affiliate to a
subsidiary in fiscal year 2004 through the purchase of the outstanding stock of
such entity not already owned by Ricoh. As a result, Ricoh consolidated its
interest in Shanghai Ricoh Facsimile Co., Ltd. for fiscal year 2004 rather than
using the equity method as in the fiscal year ended March 31, 2003.

        CUMULATIVE EFFECT OF ACCOUNTING CHANGE. The cumulative effect of
accounting change represents gains on marketable securities transferred to a
pension trust in fiscal year 2000. In connection with a similar transfer made in
fiscal year 2004, Ricoh changed its method of accounting for such transfers to
reflect the realized gain upon transfer to the pension trust. For additional
detail as to the accounting change that resulted in a recognition of gain, see
Note 5 to the Consolidated Financial Statements.

OPERATING SEGMENTS

<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------------
                                                                                 Thousands of
                                   Millions of Yen (except for percentages)     U.S. Dollars (1)
                                   -----------------------------------------
                                          2003                   2004                 2004       % Change
---------------------------------------------------------------------------------------------------------
<S>                                <C>        <C>            <C>        <C>         <C>            <C>
   OFFICE EQUIPMENT
     Net sales                     1,520,574    100.0%     1,557,633  100.0%    $   14,977,240      2.4
     Operating expenses            1,329,776     87.5      1,353,304   86.9         13,012,538      1.8
     Operating income                190,798     12.5%       204,329   13.1%    $    1,964,702      7.1
---------------------------------------------------------------------------------------------------------
   OTHER BUSINESSES
     Net sales                       220,539    100.0%       225,074  100.0%    $    2,164,173      2.1
     Operating expenses              222,772    101.0        220,391   97.9          2,119,144     (1.1)
     Operating income                 (2,233)   (1.0%)        4,683    2.1%     $       45,029        -
---------------------------------------------------------------------------------------------------------
   CORPORATE AND ELIMINATION
     Net sales                        (2,755)               (2,462)             $      (23,673)
     Operating expenses               52,156                56,544                     543,693
     Operating income                (54,911)              (59,006)             $     (567,366)
---------------------------------------------------------------------------------------------------------
   CONSOLIDATED
     Net sales                     1,738,358    100.0%     1,780,245  100.0%    $   17,117,740      2.4
     Operating expenses            1,604,704     92.3      1,630,239   91.6         15,675,375      1.6
     Operating income                133,654      7.7%       150,006    8.4%    $    1,442,365     12.2
---------------------------------------------------------------------------------------------------------
</TABLE>

(1) The above consolidated financial data set forth under the heading "Thousands
of U.S. Dollars 2004" which has been translated from Japanese Yen into U.S.
Dollar equivalents for the year ended March 31, 2004 is included solely for the
convenience of readers outside Japan and has been made using the exchange rate
of Yen 104 to US$1, the approximate rate of exchange prevailing at the Federal
Reserve Bank of New York on March 31, 2004.

Office Equipment

        Sales in the Office Equipment segment for the fiscal year ended March
31, 2004 increased by 2.4% (or Yen 37.0 billion) to Yen 1,557.6 billion from Yen
1,520.5 billion for the fiscal year ended March 31, 2003. This increase was
primarily due to a boost in sales of high-margin, value-added digital-based
products in the Printing Systems category as printers with various functions,
from input/output to sharing and administration as well as color capabilities,
were introduced in a wide range of models from standard models to high-speed
digital models. In fiscal year 2004, domestic and overseas sales of color PPCs
and MFPs grew, and the retail volume for laser printers increased, particularly
in terms of color models. Sales continued to increase for support services,
software, and other solutions aimed at satisfying the diverse needs of
customers. However, sales from

                                     - 47 -

the optical disc business decreased, as compared to a gain during fiscal year
2003. The increase in sales of Network Input/Output Systems products was partly
offset by a decrease in sales of Imaging Solutions products in both Japan and
the overseas markets. These sales results were consistent with Ricoh's efforts
to support the shift in customers' demand to digital networking and color-based
products from monochrome analog-based stand-alone products. This trend, which
has been continuing in the last five years, is also reflected in Ricoh's sales
results: as a percentage of total sales, the percentage of sales of Imaging
Solutions decreased 16.9 percentage points from 62.0% to 45.1% in the past five
years; conversely, the percentage of sales of Input/Output Systems increased
19.4 percentage points from 12.0% to 31.4% in the past five years.

         Sales in the Imaging Solutions product category for the fiscal year
ended March 31, 2004 decreased by 6.5% (or Yen 56.1 billion) to Yen 803.5
billion from Yen 859.7 billion for the fiscal year ended March 31, 2003. In
Digital Imaging Solutions, Ricoh strengthened its product lineup from standard
models to high-speed digital models, in addition to introducing new color PPC
products. Digital PPC products performed well in the overseas market and sales
of color PPC products increased in both Japan and overseas. In Other Imaging
Solutions, the decrease in sales reflected the shift from analog-type equipment
to digital-type equipment and MFPs.

        In contrast to the above product lines that historically have been
Ricoh's core business, the MFP and laser printer product lines under the Network
Input/Output Systems product category have seen an increase in their sales
volume in both Japan and overseas. This trend is especially noticeable from the
increase in sales of color MFPs and color laser printers for the fiscal year
ended March 31, 2004. To respond to this trend, Ricoh introduced new MFP
products, such as Imagio Neo 352/452 and Imagio Neo C385/C325 in Japan, and
Aficio 2035/2045 and Aficio 1224C/1232C overseas. Ricoh also introduced new
laser printer models, IPSiO NX85S and IPSiO CX7200 in the domestic market, and
AP400/400N and Aficio CL3000 in the overseas market. All of these new products
performed well in each of the markets where they were introduced.

        During the fiscal year ended March 31, 2004, Ricoh also continued its
efforts to strengthen its sales in the Network Systems Solutions category of the
solutions business relating to its office equipment products so as to assist its
customers in optimizing their total printing costs. Such network system
solutions include support services, document management applications and related
software. These continuing efforts by Ricoh have led to an increase in domestic
and overseas sales of its solutions products. Despite this increase in sales in
the solutions business, sales of personal computers and servers, which are also
included in the Network System Solutions category, continued to decline in Japan
for the fiscal year ended March 31, 2004, reflecting sluggish information
technology spending. As a result, overall sales within the Network System
Solutions product category decreased for the fiscal year ended March 31, 2004 as
compared to the fiscal year ended March 31, 2003.

        On the whole, the increase in sales in the Network Input/Output Systems
product category exceeded the decrease in sales in the Imaging Solutions product
category and the net sales in the Office Equipment segment increased by 2.4% for
the year ended March 31, 2004 as compared to the fiscal year ended March 31,
2003. Excluding the exchange rate fluctuations of the U.S. Dollar and the Euro
to the Japanese Yen, sales in

                                     - 48 -

the Office Equipment segment would have increased by 1.8% (or Yen 27.6 billion)
for the fiscal year ended March 31, 2004 as compared to the fiscal year ended
March 31, 2003.

        Ricoh was able to lower operating expenses in the Office Equipment
segment for the fiscal year ended March 31, 2004 by engaging in various cost
reduction activities, such as streamlining its supply chain management. On the
other hand, Ricoh increased strategic expenditures in its research and
development activities and invested in enhancing its back-office information
systems. As a result, operating expenses in the Office Equipment segment for the
fiscal year ended March 31, 2004 increased by 1.8% (or Yen 23.5 billion) to Yen
1,353.3 billion from Yen 1,329.7 billion for the fiscal year ended March 31,
2003.

        As a result of the above factors, operating income for the Office
Equipment segment for the fiscal year ended March 31, 2004 increased by 7.1% (or
Yen 13.5 billion) to Yen 204.3 billion from Yen 190.7 billion for the fiscal
year ended March 31, 2003. The operating income as a percentage of net sales for
the fiscal year ended March 31, 2004 rose by 0.6 percentage point to 13.1% from
12.5% as compared to the fiscal year ended March 31, 2003, due primarily to the
depreciation of the Japanese Yen relative to the Euro and an increase in the
sale of higher-margin value-added products, which favorably affected
profitability.

Other Businesses

        Sales in the Other Businesses segment for the fiscal year ended March
31, 2004 increased by 2.1% (or Yen 4.5 billion) to Yen 225.0 billion from Yen
220.5 billion for the fiscal year ended March 31, 2003. This increase in sales
was due primarily to the favorable performance of optical equipment and leasing
activities despite the fact that sales of measuring equipment became stagnant
due to the sluggish market for such equipment as it entered a period of low
demand. The increase in sales in the Other Businesses segment was also helped by
the fact that no additional expenses were incurred to resolve the quality
problems in measuring equipment, as compared to the fiscal year ended March 31,
2003.

                                     - 49 -

GEOGRAPHIC SEGMENTS

<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------------

                                   Millions of Yen (except for percentages)       Thousands of
                                   -----------------------------------------    U.S. Dollars (1)
                                            2003                  2004                2004       % Change
---------------------------------------------------------------------------------------------------------
<S>                                <C>          <C>        <C>        <C>       <C>                 <C>
   JAPAN
     Net sales                     1,274,906    100.0%     1,313,197  100.0%    $   12,626,894        3.0
     Operating expenses            1,188,760     93.2      1,215,875   92.6         11,691,106        2.3
     Operating income                 86,146      6.8%        97,322    7.4%    $      935,788       13.0
---------------------------------------------------------------------------------------------------------
   THE AMERICAS
     Net sales                       339,555    100.0%       320,753  100.0%    $    3,084,163       (5.5)
     Operating expenses              325,228     95.8        305,284   95.2          2,935,423       (6.1)
     Operating income                 14,327      4.2%        15,469    4.8%    $      148,740        8.0
---------------------------------------------------------------------------------------------------------
   EUROPE
     Net sales                       355,962    100.0%       404,416  100.0%    $    3,888,615       13.6
     Operating expenses              337,693     94.9        382,383   94.6          3,676,759       13.2
     Operating income                 18,269      5.1%        22,033    5.4%    $      211,856       20.6
---------------------------------------------------------------------------------------------------------
   OTHER
     Net sales                       169,834    100.0%       193,341  100.0%    $    1,859,048       13.8
     Operating expenses              159,864     94.1        182,870   94.6          1,758,365       14.4
     Operating income                  9,970      5.9%        10,471    5.4%    $      100,683        5.0
---------------------------------------------------------------------------------------------------------
   CORPORATE AND ELIMINATION
     Net sales                      (401,899)               (451,462)           $   (4,340,980)
     Operating expenses             (406,841)               (456,173)               (4,386,278)
     Operating income                  4,942                   4,711            $       45,298
---------------------------------------------------------------------------------------------------------
   CONSOLIDATED
     Net sales                     1,738,358    100.0%     1,780,245  100.0%    $   17,117,740        2.4
     Operating expenses            1,604,704     92.3      1,630,239   91.6         15,675,375        1.6
     Operating income                133,654      7.7%       150,006    8.4%    $    1,442,365       12.2
---------------------------------------------------------------------------------------------------------
</TABLE>

(1) The above consolidated financial data set forth under the heading "Thousands
of U.S. Dollars 2004" which has been translated from Japanese Yen into U.S.
Dollar equivalents for the year ended March 31, 2004 is included solely for the
convenience of readers outside Japan and has been made using the exchange rate
of Yen 104 to US$1, the approximate rate of exchange prevailing at the Federal
Reserve Bank of New York on March 31, 2004.

Japan

        Sales in Japan for the fiscal year ended March 31, 2004 increased by
3.0% (or Yen 38.2 billion) to Yen 1,313.1 billion from Yen 1,274.9 billion for
the fiscal year ended March 31, 2003. Sales to other Ricoh companies located
outside of this geographic segment increased by 9.5% (or Yen 30.4 billion)
between the fiscal years ended March 31, 2004 and 2003, due primarily to the
depreciation of the Japanese Yen against the Euro and increased exports of
products from Japan. In terms of sales to external customers, Ricoh recorded an
increase in sales of its Printing Systems, such as MFPs and laser printers. This
increase reflected the results of Ricoh's strategic promotion activities and
marketing strategy in the Office Equipment segment, which focused on responding
to the change in customer demand from stand-alone monochrome products to
networkable color products. In addition, sales of solution business products
such as support services, document management applications and other software
increased in this geographic segment. The increase in sales of MFPs, laser
printers and solution business products is a trend that has continued in fiscal
year 2004. Meanwhile, sales in analog equipment decreased as such equipment was
replaced with MFPs and color equipment, and sales of personal computers and
servers declined as a result of restrained spending on information technology
equipment in Japan. In the Other Businesses segment, sales for measuring

                                     - 50 -

equipment decreased due to the sluggish market for such equipment, although
leasing and other businesses performed favorably compared to the fiscal year
ended March 31, 2003.

        Operating expenses in this geographic segment for the fiscal year ended
March 31, 2004 increased by 2.3% (or Yen 27.1 billion) to Yen 1,215.8 billion
from Yen 1,188.7 billion for the fiscal year ended March 31, 2003. This increase
in operating expenses was primarily due to an increase in sales volume,
especially in exports to foreign countries. Even though net sales in this
segment increased by 3.0% as compared to the fiscal year ended March 31, 2003,
operating expenses increased by only 2.3% as compared to the fiscal year ended
March 31, 2003. This was primarily due to (1) the increase in sales of
value-added high-margin products, such as MFPs and products with color
capabilities, (2) no additional expenses being incurred during fiscal year 2004
to resolve the quality problems that arose with respect to measuring equipment
during the fiscal year ended March 31, 2003, and (3) the net gain of Yen 8.3
billion recognized from the transfer to the Japanese government of the
substitutional portion of the EPF in respect of this geographic segment for the
fiscal year ended March 31, 2004.

        Because the increase in sales was greater than the increase in operating
expenses, operating income in Japan for the fiscal year ended March 31, 2004
increased by 13.0% (or Yen 11.1 billion) to Yen 97.3 billion from Yen 86.1
billion for the fiscal year ended March 31, 2003. Excluding net gains recognized
from the transfer to the Japanese government of the substitutional portion of
the EPF, operating income in Japan would have increased by 3.3%.

The Americas

        Sales in the Americas for the fiscal year ended March 31, 2004 decreased
by 5.5% (or Yen 18.8 billion) to Yen 320.7 billion from Yen 339.5 billion for
the fiscal year ended March 31, 2003, primarily due to the appreciation of the
Japanese Yen against the U.S. Dollar. Despite repercussions from the Iraq war,
turmoil in the Middle East, and severe competition in the Americas, Ricoh
enhanced its existing sales channels and devoted significant effort to the
retail of MFPs, color PPCs and color laser printers as these products are
responsive to customers' changing needs for networking, coloration, and high
speed products. In addition, Ricoh focused on marketing and promotional efforts
towards major corporate clients for the fiscal year ended March 31, 2004.
Nevertheless, the decrease in net sales due to the appreciation of the Japanese
Yen against the U.S. Dollar exceeded the increase in net sales in the local
currency. Without foreign currency fluctuations, net sales in the Americas would
have increased by 1.9%.

        Although sales in the Americas decreased as mentioned above, operating
expenses in this geographic segment for the fiscal year ended March 31, 2004
decreased by a greater percentage due to (1) a greater percentage of sales being
derived from higher-margin value-added digital-based office equipment such as
MFPs, color PPCs and color laser printers, which share similar parts thereby
allowing Ricoh to achieve cost efficiencies, and (2) on-going cost-cutting
efforts through the management of the supply chain and other activities.

                                     - 51 -

Europe

        Sales in Europe for the fiscal year ended March 31, 2004 increased by
13.6% (or Yen 48.4 billion) to Yen 404.4 billion from Yen 355.9 billion for the
fiscal year ended March 31, 2003, due primarily to the depreciation of the
Japanese Yen against the Euro and an increase in sales of Printing Systems, such
as MFPs and laser printers, reflecting Ricoh's efforts to strengthen its sales
networks and continuously reinforce its brand power. In Europe, sales of
products with color capability increased greatly compared to the fiscal year
ended March 31, 2003. Continuing the trend from previous fiscal years, Ricoh
extended in fiscal year 2004 its number one ranking in terms of market share in
the sales of copiers and MFPs in Europe.

        Despite the increase in sales in this geographic segment, as noted
above, operating expenses in this geographic segment for the fiscal year ended
March 31, 2004 increased by a lower percentage as compared to the percentage
increase in sales, due to (1) a greater portion of its sales being derived from
higher-margin value-added digital-based office equipment, especially equipment
with color capabilities, (2) Ricoh' ability to relocate its production
facilities for those products closer to its customers, thereby eliminating costs
associated with transporting such finished products, and (3) the depreciation of
the Japanese Yen against the Euro.

Other

        Sales in the Other geographic segment, which includes China, Asia and
Oceania for the fiscal year ended March 31, 2004 increased by 13.8% (or Yen 23.5
billion) to Yen 193.3 billion from Yen 169.8 billion for the fiscal year ended
March 31, 2003. Sales of Printing Systems increased, reflecting a full-fledged
shift to digital, networkable and color products from stand-alone, analog and
monochrome equipment in this geographic segment, while demand for optical discs
and semiconductor sales decreased. The increase in sales of Printing Systems
exceeded the decrease in sales of optical discs and semiconductors.

        Ricoh Asia Industry (Shenzhen), Ltd., a manufacturing subsidiary in
China which mainly manufactures low-end digital PPCs and MFPs, continued to
contribute to increased sales in this geographic segment. This subsidiary also
provided Ricoh with access to lower labor costs in China. The products
manufactured by this subsidiary have been exported to marketing operations in
Japan, the U.S. and Europe. Ricoh maintained a high production level at this
subsidiary for the fiscal year ended March 31, 2004 to respond to an increase in
demand for digital PPCs and MFPs in the various markets around the world.

PENSION INFORMATION

        Ricoh, like many large corporations in Japan, had an Employee Pension
Fund ("EPF"), which was a defined benefit pension fund established under the
Japanese Welfare Pension Insurance Law ("JWPIL"). This fund was composed of (i)
a substitutional portion based on the pay-related part of the old-age pension
benefits prescribed by JWPIL (similar to social security benefits in the United
States) and (ii) a

                                     - 52 -

corporate portion based on a contributory defined benefit pension arrangement
established by Ricoh. The fund assets of the EPF are invested and managed as a
single portfolio for the entire EPF and were not statutorily attributed to the
substitutional and corporate portions. The substitutional portion represented
39% of the total projected benefit obligation of Ricoh's EPF as of March 31,
2003.

        On June 15, 2001, the JWPIL was amended to permit an employer to elect
to separate the substitutional portion from the EPF and transfer the
substitutional portion to the Japanese government. Upon completion of the
separation and transfer, the employer and the EPF are released from paying the
substitutional portion of the benefits to EPF beneficiaries. Pursuant to the
Contributed Benefit Pension Plan Law, Ricoh received from the Minister of
Health, Labor and Welfare, effective January 1, 2003, an exemption from its
obligation to contribute to the substitutional portion of its EPF for future
employee services. In January 2004, Ricoh received from the Japanese government
an exemption from its obligation to contribute to the substitutional portion of
its EPF relating to past employee services. The transfer to the Japanese
government of the substitutional portion of the EPF was completed on March 16,
2004.

        With respect to the accounting treatment of this transfer under
accounting principles generally accepted in the United States of America, Ricoh
accounted for the transfer in accordance with Emerging Issues Task Force Issue
No. 03-02 "ACCOUNTING FOR THE TRANSFER TO THE JAPANESE GOVERNMENT OF THE
SUBSTITUTIONAL PORTION OF EMPLOYEE PENSION FUND LIABILITIES" ("EITF 03-02"). As
specified in EITF 03-02, the entire separation process and transfer is to be
accounted for at the time of completion of the transfer to the government of the
substitutional portion of the benefit obligation and related plan assets in
accordance with Statement of Financial Accounting Standards No. 88 "EMPLOYERS'
ACCOUNTING FOR SETTLEMENTS AND CURTAILMENTS OF DEFINED BENEFIT PENSION PLANS AND
FOR TERMINATION BENEFITS". As a result of the transfer in March 2004, Ricoh
recognized as a subsidy from the Japanese government the difference between the
fair value of the obligation deemed "settled" with the Japanese government and
the assets required to be transferred to the government. The subsidy that Ricoh
recognized amounted to Yen 56.9 billion. In addition, Ricoh recognized as a
settlement loss the amount calculated as the ratio of the obligation settled to
the total EPF obligation immediately prior to settlement, both of which exclude
the effect of future salary progression relating to the substitutional portion,
times the net unrecognized gain/loss immediately prior to settlement, which
amounted to Yen 48.6 billion.

        In addition, during the fiscal year ended March 31, 2004, the Company
modified its pension plan system from a seniority-based system wherein benefits
increase relative to the number of years of employment to a performance-based
system in which benefits reflect the individual employee's performance. By
implementing this new pension plan system, Ricoh believes that it can limit
future retirement benefit expenses. While the Company has implemented a pension
plan system that limits future retirement benefit expenses, Ricoh believes that
changing to a performance-based system in which each employee's performance
rather than seniority is evaluated will maintain employee morale and motivation.
Employees of the Company who retired or left the Company prior to the

                                     - 53 -

implementation of this new pension plan system will still receive benefits based
on the previous seniority-based system.

B. Liquidity and capital resources

Cashflows
---------

        The following summarizes our cashflows for each of the three fiscal
years ended March 31, 2003, 2004 and 2005, as reported in our Consolidated
Statements of Cashflows in the accompanying Consolidated Financial Statements.

<TABLE>
<CAPTION>
                                                                                  (Billions of Yen)
                                                                           For the year ended March 31,
                                                                      ----------------------------------------
                                                                       2003             2004             2005
                                                                       ----             ----             ----
<S>                                                                   <C>              <C>              <C>
Net cash provided by operating activities                             185.7            154.9            132.7
Net cash used in investing activities                                 (98.1)           (63.3)           (96.1)
Net cash used in financing activities                                 (67.1)           (74.8)           (56.4)
Increase (Decrease) in cash and cash equivalents                       19.0             13.7            (18.6)
Cash and cash equivalents at beginning of year                        170.1            189.2            203.0
Adjustment for Change in Fiscal Year-end of
 Consolidated Subsidiaries                                                -                -              2.4
Cash and cash equivalents at end of year                              189.2            203.0            186.8
</TABLE>

        Operating Cashflows

        For fiscal year 2005, net cash provided by operating activities
consisted primarily of net income of Yen 83.1 billion and depreciation and
amortization of Yen 78.2 billion and an increase in trade payables of Yen 27.2
billion, which was partially offset by an increase in finance receivables of Yen
30.2 billion, an increase in trade receivables of Yen 26.4 billion, an increase
in inventories of Yen 12.8 billion, and a decrease in accrued income taxes and
accrued expenses and other of Yen 13.7 billion. As compared to fiscal year 2004,
net cash provided by operating income decreased mainly because (1) the increase
in net sales in Japan from Ricoh's sales promotions resulted in an increase in
trade receivables for fiscal year 2005 and (2) the increase in net sales also
resulted in an increase in inventories as compared to fiscal year 2004.

        For fiscal year 2004, net cash provided by operating activities
consisted primarily of net income of Yen 91.7 billion, depreciation and
amortization of Yen 76.9 billion and an increase in trade payables of Yen 21.3
billion, which was offset by an increase in trade receivables of Yen 11.3
billion, an increase in finance receivables of Yen 32.6 billion, as well as a
decrease in accrued income taxes and other of Yen 5.9 billion. As compared to
fiscal year 2003, net cash provided from operating activities decreased because
(1) the increase in

                                     - 54 -

net sales in the United States and Japan during the fourth quarter as compared
to such period during fiscal year 2003 resulted in an increase in Ricoh's trade
receivables for fiscal year 2004 and (2) the decrease in demand for optical
discs resulted in an increase in the volume of such products being held as
inventory.

        For fiscal year 2003, net cash provided by operating activities
consisted primarily of net income of Yen 72.5 billion, depreciation and
amortization of Yen 76.5 billion and a decrease in trade receivables of Yen 22.1
billion, which was offset in part by an increase in finance receivables of Yen
33.1 billion. As compared to fiscal year 2002, net cash provided from operating
activities increased for fiscal year 2003 because (1) the decrease in net sales
during the fourth quarter as compared to such period during fiscal year 2002
resulted in a decrease in Ricoh's trade receivables for fiscal year 2003 and (2)
the decrease in inventory held by Lanier and Ricoh's efforts to streamline its
supply chain by establishing a production process by which products are
assembled once an order is placed at a local factory resulted in decreases in
inventory.

        Investing Cashflows

        For fiscal year 2005, net cash used in investing activities consisted
mainly of Yen 84.0 billion of expenditures for property, plant and equipment,
Yen 79.4 billion in payments for purchases of available-for-sale securities and
Yen 43.2 billion for acquisitions of new subsidiaries, net of cash acquired.
Ricoh realized Yen 118.1 billion from the sale of available-for-sale securities
that were held by the Company and certain subsidiaries. In fiscal year 2005,
Ricoh reinforced its production lines to manufacture new products, which
resulted in an increase in expenditure on property, plant and equipment. As
compared to fiscal year 2004, net cash used in investing activities increased in
fiscal year 2005 as the Company used cash to acquire Ricoh Printing Systems,
Ltd.

        For fiscal year 2004, net cash used in investing activities consisted
mainly of Yen 75.4 billion of expenditures for property, plant and equipment and
Yen 35.5 billion in payments for the purchase of available-for-sale securities,
as well as Yen 8.0 billion of other, net. Ricoh realized Yen 45.4 billion from
sales of available-for-sale securities that were held by the Company and certain
subsidiaries and Yen 9.9 billion from a decrease in time deposits. As compared
to fiscal year 2003, net cash used in investing activities decreased for fiscal
year 2004 because Ricoh disposed of certain of its available-for-sale securities
that were not performing as expected and did not make alternative investments.

        For fiscal year 2003, net cash used in investing activities consisted
primarily of Yen 71.9 billion of expenditures for property, plant and equipment
and Yen 52.2 billion in payments for purchases of available-for-sale securities.
Ricoh realized Yen 24.5 billion on sales of available-for-sale securities that
were held by the Company and certain subsidiaries as a result of the repayment
of such securities, and Yen 0.9 billion from a decrease in time deposits due to
such time deposits reaching maturity. Net cash used in investing activities for
fiscal year 2003 increased from fiscal year 2002 as Ricoh purchased additional
available-for-sale securities, taking advantage of favorable market conditions.
These additional purchases were funded in part by the cash provided by the sale
of available-for-sale securities.

                                     - 55 -

        Financing Cashflows

        For fiscal year 2005, net cash used in financing activities consisted
primarily of Yen 60.6 billion spent for the repayment of long-term indebtedness,
Yen 38.0 billion used to reduce short-term borrowings, Yen 22.0 billion used to
repay long-term debt securities, Yen 14.7 billion used for dividend payments and
Yen 10.6 billion used for the purchase of treasury stock. Ricoh encouraged group
companies to use the group cash management system to satisfy their cash needs
rather than borrowing from external sources. As compared to fiscal year 2004,
net cash used in financing activities decreased for fiscal year 2005 as proceeds
received by Ricoh from its long-term indebtedness exceeded its repayments of
long-term indebtedness.

        For fiscal year 2004, net cash used in financing activities consisted
primarily of Yen 31.5 billion spent for the repayment of long-term loans, Yen
23.9 billion used for the repayment of long-term debt securities, Yen 10.7
billion used to reduce short-term borrowings, Yen 11.4 billion used for the
purchase of treasury stock and Yen 11.1 billion used for dividend payment. Ricoh
received Yen 13.3 billion as proceeds from long-term loans and Yen 1.0 billion
from the issuance of long-term debt securities. During fiscal year 2004, Ricoh
focused on reducing its long-term borrowings provided by external parties as its
group cash management system developed. As compared to fiscal year 2003, net
cash used in financing activities increased for fiscal year 2004 as Ricoh
continued to reduce its external borrowings.

        For fiscal year 2003, net cash used in financing activities consisted
primarily of Yen 73.3 billion used to reduce short-term borrowings, Yen 23.1
billion spent for the repayment of long-term loans, Yen 17.2 billion used for
the purchase of treasury stock, Yen 11.7 billion used for the repayment of
long-term debt securities and Yen 10.1 billion used for dividend payment. Ricoh
received Yen 58.1 billion as proceeds from long-term loans and Yen 11.0 billion
from the issuance of long-term debt securities. As previously discussed, Ricoh
used significant amounts of cash during fiscal year 2003 to repay both
short-term and long-term borrowings provided by external parties as it continued
to use its group cash management system to satisfy its cash management needs.
Long-term debt securities noted above were issued by Ricoh Leasing Co., Ltd.,
which issued such securities as part of its ordinary fund-raising activities as
a finance company. Ricoh Leasing Co., Ltd. issued such securities during fiscal
year 2003 to take advantage of favorable market conditions. As compared to
fiscal year 2002, Ricoh used significant amounts of cash during fiscal year 2003
to reduce its external borrowings as it fully utilized its group cash management
system as a means to satisfy cash needs previously fulfilled by external
parties.

        Cash and Asset-Liability Management

        It is Ricoh's policy to ensure adequate financing and liquidity for its
operations and growth, and to maintain the strength of its balance sheet.
Pursuant to this policy, Ricoh has in recent years tried to achieve greater
efficiencies in the utilization of cash balances held by its subsidiaries. One
method that Ricoh has implemented to achieve greater efficiency is to build up
its cash management system in each of its geographic

                                     - 56 -

segments. With finance companies located within each geographic segment as the
center of this cash management system, Ricoh has established a group
pooling-of-funds arrangement in which cash resources are lent and borrowed from
one group company to another group company. As a result of this pooling-of-funds
arrangement, Ricoh has succeeded in reducing the occurrence of excess
accumulation of cash in one group company and the unnecessary borrowing from
third party institutions by another group company. As such, the pooling-of-funds
arrangement has reduced interest expense and related costs which were previously
paid to third parties. For the fiscal years ended March 31, 2004 and 2005, Ricoh
managed to reduce interest-bearing debt by Yen 51.8 billion and Yen 22.6
billion, respectively, on a consolidated basis.

        Ricoh also enters into various derivative financial instrument contracts
in the normal course of business and in connection with the management of its
assets and liabilities. Ricoh enters into foreign exchange contracts and foreign
currency options to hedge against the potentially adverse impacts of foreign
currency fluctuations on assets and liabilities denominated in foreign
currencies. Ricoh enters into interest rate swap agreements to hedge against the
potential adverse impacts of fair value or cashflow fluctuations on the
interests in its outstanding debt. Ricoh uses derivative instruments to reduce
risk and protect market value of assets and liabilities in conformity with
Ricoh's policy. Ricoh does not use derivative financial instruments for trading
or speculative purposes, nor is it a party to leveraged derivatives. Detailed
discussion of these derivative contracts is provided in Item 11. Quantitative
and Qualitative Disclosures About Market Risk.

        Ricoh also engages in securitization activities through its domestic
leasing affiliate. For a discussion of such activities, please see Item 5.E.
Off-balance sheet arrangements below.

        Sources of Funding

        Ricoh's principal sources of funding are a combination of cash and cash
equivalents on hand, various lines of credit and the issuance of commercial
paper and medium-term notes. In assessing its liquidity and capital resources
needs, Ricoh places importance on the net income figure in the income statement,
balances of cash and cash equivalents in the balance sheet and operating
cashflows in the cashflow statements.

         Lines of credit and short-term and medium-term borrowings were as
follows as of March 31, 2005:

                                                               (Billions of Yen)
-------------------------------------------------------------------------------
                                Average
                           Interest Rate (%)            Amount Available
                      ---------------------------- ----------------------------
Bank borrowings                   3.5                         342.3
Commercial paper                  2.9                         219.2
Medium-term notes                 0.3                         128.3
-------------------------------------------------------------------------------

                                     - 57 -

        As of March 31, 2005, Ricoh had Yen 186.8 billion in cash and cash
equivalents and Yen 822.1 billion in aggregate borrowing facilities. Of the Yen
822.1 billion in aggregate borrowing facilities, Yen 689.9 billion was available
to be borrowed by Ricoh as of the fiscal year ended March 31, 2005. The Company
has no committed lines of credit with financial institutions. Ricoh Leasing Co.,
Ltd., however, has a Yen 74.0 billion committed credit line with several banks
having credit ratings satisfactory to Ricoh, which amount is included in the Yen
822.1 billion figure for aggregate borrowing facilities. Under such borrowing
facilities, the Company and its subsidiaries are able to borrow from financial
institutions at local market-based interest rates. Such local market-based
interest rates ranged from 0% to 8.25% during the fiscal year ended March 31,
2005. Almost all such borrowings from financial institutions and outstanding
securities are unsecured.

        The Company, Ricoh Leasing Co., Ltd. and certain overseas subsidiaries
raise capital by issuing commercial paper and medium-term notes. Ricoh Leasing
Co., Ltd. and certain foreign subsidiaries of the Company issue commercial paper
to meet their short-term funding requirements. Of the Yen 689.9 billion
available under the borrowing facilities as of March 31, 2005, capacity
available under commercial paper programs and medium-term note programs
consisted of Yen 219.2 billion and Yen 128.3 billion, respectively. Utilization
of such capacity depends on Ricoh's financing needs, investor demand and market
conditions, as well as the ratings outlook for Ricoh's securities, as discussed
below. Interest rates for commercial paper and medium-term notes issued by the
Company and its subsidiaries ranged from 0.01% to 2.90% and 0.14% to 0.46%,
respectively during the fiscal year ended March 31, 2005. As discussed in "Cash
and Asset-Liability Management," Ricoh has decreased its outstanding
interest-bearing debt in recent years by using its cash management systems in
Japan, the United States and Europe.

        The Company obtains ratings from the following major rating agencies:
Standard & Poor's Rating Services, a division of McGraw-Hill Companies, Inc.
("S&P"), Moody's Investors Services ("Moody's"), and another local rating agency
in Japan. As of March 31, 2005, the long-term and short-term credit ratings for
the Company were A+ and A-1, respectively, by S&P, and A1 and P-1, respectively
by Moody's.

As is customary in Japan, substantially all of the bank borrowings are subject
to general agreements with each bank which provide, among other things, that the
bank may request additional security for loans if there is reasonable and
probable cause for the necessity of such additional security and the bank may
treat any security furnished as well as cash deposited in such bank as security
for all present and future indebtedness. The Company has never been requested to
submit such additional security. In some cases, the Company's long-term debt
securities contain customary covenants, including a "limitation on liens"
covenant. The Company was in compliance with the covenants in its bank
agreements and securities at March 31, 2005. The Company is not subject to any
covenants limiting its ability to incur additional indebtedness. For additional
detail regarding these securities, see Note 10 to the Consolidated Financial
Statements.

                                     - 58 -

        Cash Requirements and Commitments

        Ricoh believes that its cash and cash equivalents and funds expected to
be generated from its operations are sufficient to meet its cash requirements at
least through fiscal year 2006. Even if there were a decrease in cashflow from
operations as a result of fluctuations in customer demands from one year to
another, Ricoh believes current funds on hand along with funds available under
existing borrowing facilities would be sufficient to finance its foreseeable
operations. In addition, Ricoh believes that it is able to secure adequate
resources to fund ongoing operating requirements and investments related to the
expansion of existing businesses and the development of new projects through its
access to the financial and capital markets. As the Japanese and U.S. economies
begin to exhibit some upswing momentum, the interest rates for long-term debt
are expected to rise. Though it is possible that the rise in interest rates will
affect Ricoh's ability to maintain liquidity, Ricoh believes that the effect of
such increase will not significantly affect Ricoh's liquidity mainly because
Ricoh has sufficient amounts of cash and cash equivalents on hand as well as a
continuous cashflow generated from its operating activity.

        Ricoh expects that its capital expenditures for fiscal year 2006 will
amount to approximately Yen 114.0 billion, principally for the following
categories: research and development of digital and networking equipment and the
implementation of new accounting and intellectual property management systems.
In addition, Ricoh is obligated to repay long-term debt in the aggregate
principal amount of Yen 144.5 billion during fiscal year 2006, and in the
aggregate principal amount of Yen 188.6 billion during fiscal years 2007 through
2009.

        The Company and certain of its subsidiaries have various employee
pension plans covering all of their employees. As described in Note 11 to the
Consolidated Financial Statements, the unfunded portion of these employee
pension plans amounted to Yen 103.0 billion, as of March 31, 2005. The unfunded
portion decreased significantly by Yen 189.9 billion during fiscal year 2004 as
compared to fiscal year 2003 due to the transfer of the substitutional portion
of the EPF to the government. The unfunded amount of Yen 87.9 billion was
recorded as a liability on the consolidated balance sheet of Ricoh, as of March
31, 2005. The Company introduced a cash balance plan in fiscal year 2004, which
is a form of a defined contribution pension plan provided for in the Contributed
Benefit Pension Law. In a cash balance plan, contributed amounts are managed on
an individual basis but the Company guarantees a fixed rate yield. The Company
and certain of its subsidiaries have contributed to this new plan in conformity
with Japanese governmental regulations. Although Ricoh does not expect its cash
funding requirements to increase significantly in the medium- or short-term,
Ricoh's cash funding requirements may be affected by possible changes in
interest rates, actual returns on plan assets and governmental regulations on a
long-term basis. The amounts contributed for pension plans for the fiscal years
ended March 31, 2005, 2004 and 2003 were Yen 12.3 billion, Yen 16.4 billion and
Yen 14.2 billion, respectively.

                                     - 59 -

        Ricoh believes that its free cashflow (from operating and investing
activities) together with existing lines of credit and borrowing facilities
provide sufficient means to satisfy its liquidity needs and future obligations
as described above.

C. Research and development, patents and licenses

Research and Development
------------------------

        Since its formation, Ricoh has devoted its resources to research and
development ("R&D") activities. As such, Ricoh has established a tradition of
technological innovation and product development. It is this tradition and
Ricoh's continuing emphasis on the importance of R&D activities that allows
Ricoh to produce competitive and high quality products.

        Many of Ricoh's R&D activities are conducted by the Research and
Development Group and the Software R&D Group that have their main R&D facilities
in Japan. The R&D activities include research on technological investigations,
elemental technologies, application for products and manufacturing technologies
applied to the environment. The Research and Development Group conducts research
and development in connection with optics, new materials, mechatronics, computer
simulation and environmental technologies. Ricoh also conducts various
specialized and peripheral R&D activities at its other facilities located
throughout Japan. In addition to the R&D facilities in Japan, Ricoh Innovations,
Inc., located in the United States and founded in March 1997, conducts market
research to assist in the marketing of information technologies for the
digitally networked office. Ricoh Innovations, Inc. also conducts extensive
research and makes strategic investments in promising new business fields. In
February 2004, Ricoh established Ricoh Software Research Center (Beijing) Co.,
Ltd. in an effort to further establish its global R&D infrastructure. Ricoh
Software Research Center (Beijing) Co., Ltd. focuses on employing and educating
talented young researchers, cooperating with other research organizations,
conducting research in China to foresee the needs of the Chinese market and
providing consultation services.

        In fiscal year 2005, Ricoh spent Yen 83.1 billion in R&D activities
related to the Office Equipment segment. Some of the more significant R&D
achievements for the Office Equipment segment for fiscal year 2005 include the
following: the development and production of MFPs with special security
functions such as requiring authentication of the user to prevent invalid
access, using encryptions to prevent leaks and cryptographic protection to
prevent unauthorized copying, and automatically removing data stored on the hard
disc of the printer upon completion of printing; and the development and
production of color laser printers that feature high-speed printing capabilities
which can output 25 color pages (A4 size horizontal line) per minute, which is
the fastest in the industry of color laser printers for A4 size paper. In
addition, Ricoh's R&D achievements have led to the following improvements: the
installation of a polymeric toner technology that enables full-color toners to
consistently produce higher quality images, and the utilization of functions
that decrease the environmental burden associated with the manufacturing process
of grinded toners and the utilization of a drying oven exhaust heat recovery
technology in the production process of photoreceptors to reduce CO2

                                     - 60 -

emissions. To reduce costs, Ricoh also developed a non-classification technique
for its grinded toners. At the same time, with respect to printers that use 'GEL
JET' technology, Ricoh completed its development of ultra-fine particle pigment
dispersion technology to produce images with better quality and to reduce
over-all production costs. In the optical discs business, DVD+RW media applying
8x recording speed was released to the market in fiscal year 2005.

        In fiscal year 2005, Ricoh spent Yen 10.2 billion on R&D activities
relating to the Other Businesses segment. In the Other Businesses segment,
Ricoh's R&D activities continued to include designing ASIC (Application Specific
Integrated Circuit) and ASSP (Application Specific Standard Product) for
purposes of imaging, audio and communication; developing methods to utilize EDA
(Electronic Design Automation), and developing ICD (Image Capturing Device)
technology for digital cameras and ways in which to apply such new technology.
More specifically, through its R&D activities relating to ICD technology, Ricoh
developed a method which allowed it to produce the smallest IC package and IC
chips in the industry in fiscal year 2005. Using such method, Ricoh started
producing IC voltage regulators which are now installed in its SON 1408 package
(1.4mm x 0.8mm in size). In addition, Ricoh also developed a new digital camera
with a 4.8x optical zoom lens, which is able to enlarge images to a size that
would be produced if a 28-135mm telephoto lens was to be placed on a regular
35mm camera.

        In addition, Ricoh also continues to engage in the development of its
fundamental research fields, which focus on research and development activities
that can be applied to various products. For fiscal year 2005, Ricoh spent Yen
17.0 billion on R&D activities in its fundamental research fields. Such R&D
activities include R&D in nanotechnology, micro-machining, photonics technology,
and technology to create the next generation of office system and office
solutions.

        Ricoh's total research and development expenses for fiscal years 2003,
2004 and 2005 were Yen 83.5 billion, Yen 92.5 billion and Yen 110.4 billion,
respectively. For a summary of Ricoh's research and development expenditures
during each of the last three fiscal years, see Note 19 to the Consolidated
Financial Statements.

Patents and Licenses
--------------------

        Ricoh owns approximately 21,000 patents on a worldwide basis, and has a
large number of licenses under various agreements with Japanese and foreign
companies. Although patents and licenses are important to Ricoh, it does not
believe that the expiration of any single patent or group of related patents or
of any license agreements will materially affect its business.

        The following table lists some of the important patent and licensing
agreements which the Company is currently a party to:

                                     - 61 -


<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------------------------
      Counterparty       Country             Summary of the Contract                       Contract Term
---------------------------------------------------------------------------------------------------------------------
<S>                       <C>      <C>                                            <C>
                           USA     Cross license patent agreement relating to     October 7, 1980 to expiration
Xerox Corporation                  the digital photography area (reciprocal       date of the patent subject to
                                   agreement)                                     the agreement
---------------------------------------------------------------------------------------------------------------------
International              USA     Comprehensive cross license patent             April 1, 1999 to expiration
Business Machines                  agreement relating to the information          date of the patent subject to
Corporation                        processing technology area (reciprocal         the agreement
                                   agreement)
---------------------------------------------------------------------------------------------------------------------
Lemelson Medical,          USA     Patent licensing agreement relating to         March 31, 1993 to expiration
Education & Research               computer image analysis and other products     date of the patent subject to
Foundation Limited                 (the Company as the licensee)                  the agreement
Partnership
---------------------------------------------------------------------------------------------------------------------
Texas Instruments          USA     Comprehensive cross license agreement          October 11, 1996 to October 10,
Incorporated                       relating to copiers, etc. (reciprocal          2006
                                   agreement)
---------------------------------------------------------------------------------------------------------------------
Sharp Corporation         Japan    Patent licensing agreement relating to         April 1, 1997 to March 31, 2002
                                   facsimile machines (the Company as             with automatic renewal every 5
                                   licensor)                                      years thereafter
---------------------------------------------------------------------------------------------------------------------
Canon Inc.                Japan    Patent licensing agreement relating to         October 1, 1998 to expiration
                                   office equipment (reciprocal agreement)        date of the patent subject to
                                                                                  the agreement
---------------------------------------------------------------------------------------------------------------------
Brother Industries,       Japan    Patent licensing agreement relating to         December 20, 1999 to December
Ltd.                               digital photography (reciprocal agreement)     19, 2005
---------------------------------------------------------------------------------------------------------------------
</TABLE>

D. Trend Information

        See "Overview" above and "Cautionary Statement with Respect to
Forward-Looking Statements" elsewhere in this Annual Report.

E. Off-balance sheet arrangements

        As disclosed in Note 4 to the Consolidated Financial Statements, Ricoh,
through its domestic leasing affiliate, has a certain procedure to sell lease
receivables through securitization, however, no lease receivables were sold for
the last three fiscal years. Securitization involves the creation of SPEs
(Special Purpose Entities) to hold the pooled assets. The SPEs are designed to
place the pooled assets beyond the reach of Ricoh and its creditors in the event
of bankruptcy and when structured in this manner (and subject to certain other
conditions), the pooled assets are removed from Ricoh's consolidated balance
sheets. The SPEs are also designed so that investors have no recourse to Ricoh
in the event of any failure of payment on the pooled assets. Therefore, when
securitizing assets in this manner, Ricoh does not have any exposed assets or
contingent liabilities other than those recognized as subordinated residual
interests on Ricoh's consolidated balance sheets. As of March 31, 2005, Ricoh
had one such SPE that held assets it had sold in a securitization totaling Yen
44.1 billion.

                                     - 62 -

        Ricoh does not dispose of troubled leases, loans or other problem assets
by means of nonconsolidated SPEs. None of our officers, directors or employees
hold any equity interests in our SPEs or receives any direct or indirect
compensation from the SPEs. The SPEs do not own shares or equity interests in
Ricoh or any of Ricoh's affiliates, and there are no agreements in place to do
so.

F. Contractual Obligations

        The following table sets forth Ricoh's contractual obligations as of
March 31, 2005.

<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------------------------
                                                                        Millions of yen
CONTRACTUAL OBLIGATION                                               Payments due by period
---------------------------------------------------------------------------------------------------------------------
                                                              Less than 1                                More than 5
                                                   Total          year         1-3 years     3-5 years      years
---------------------------------------------------------------------------------------------------------------------
<S>                                               <C>            <C>            <C>            <C>             <C>
Long-term Debt Obligations                        365,549        143,307        152,909        68,293          1,040
---------------------------------------------------------------------------------------------------------------------
Capital (Finance) Lease Obligations                 3,804          1,265          1,614           373            552
---------------------------------------------------------------------------------------------------------------------
Purchase Obligations                               12,550         12,550              -             -              -
---------------------------------------------------------------------------------------------------------------------
TOTAL                                             381,903        157,122        154,523        68,666          1,592
---------------------------------------------------------------------------------------------------------------------
</TABLE>

        Ricoh also had operating lease commitments with rental payments totaling
Yen 39.0 billion for the fiscal year ended March 31, 2005. Ricoh is unable to
disclose additional details with respect to its operating lease obligations
because Ricoh's material operating leases consist primarily of leases that may
be cancelled with short notice.

        In addition to the above, Ricoh acts as a guarantor for some of its
employees' housing loans. As of March 31, 2005, the total amount of such
guarantees was Yen 230 million.

G. New Accounting Standards

        In March 2004, the EITF reached a consensus on EITF 03-1, "The Meaning
of Other-Than-Temporary Impairment and Its Application to Certain Investments."
EITF 03-1 provides guidance on other than temporary impairment models for debt
and marketable equity securities accounted for under SFAS No. 115, "Accounting
for Certain Investments in Debt and Equity Securities," and non-marketable
securities accounted for under the cost method. The EITF developed a basic
three-step model to evaluate whether an investment is other-than-temporarily
impaired. The Financial Accounting Standards Board ("FASB") issued FASB Staff
Position EITF 03-1-1 in September 2004 which delayed the effective date of the
recognition and measurement provisions of EITF 03-1. The adoption of EITF 03-1
is not expected to have a material effect on the Company's consolidated results
of operations and financial position.

        In November 2004, the FASB issued SFAS No.151, "Inventory Costs, an
amendment of ARB No. 43, Chapter 4" to clarify the accounting for abnormal
amounts of idle facility expense, freight, handling costs, and wasted material
(spoilage). Among other provisions, the new rule requires that items such as
idle facility expense, excessive spoilage, double freight, and rehandling cost
be recognized as current period charges

                                     - 63 -

regardless of whether they meet the criterion of "so abnormal" as stated in ARB
No. 43. In addition, SFAS 151 requires that the allocation of fixed production
overheads to the costs of conversion be based on the normal capacity of the
production facilities. SFAS 151 is effective for fiscal years beginning after
June 15, 2005 and is required to be adopted by Ricoh in the first quarter
beginning April 1, 2006. Ricoh is currently determining the effect of SFAS 151
on the Ricoh's consolidated financial statements but does not expect the effect
to be material.

Item 6. Directors, Senior Management and Employees
        ------------------------------------------

A. Directors and senior management

        Directors and Corporate Auditors of the Company as of June 28, 2005 were
as follows:

<TABLE>
<CAPTION>
           Name                      Current Position
     (Date of Birth)             (Function/Business area)            Date                  Business Experience
---------------------------    ------------------------------    ------------    ----------------------------------------
<S>                            <C>                                 <C>           <C>
Masamitsu Sakurai              Chairman of the Board and           Apr. 1966     Joined the Company
(January 8, 1942)               Representative Director            Apr. 1990     General Manager of Procurement Division
                                                                   June 1992     Director
                                                                   June 1994     Managing Director
                                                                   Apr. 1996     President (Current)
                                                                   Apr. 1996     Representative Director (Current)
                                                                   June 2004     Chairman of the Board (Current)
                                                                   June 2004     Chief Executive Officer (Current)

                               Principal business activities and other principal directorships performed outside Ricoh:
                                  Vice Chairperson of Japan Association of Corporate Executives
                                  President of Japan Business Machine and Information System Industries Association
                                  Representative of Asahi Insurance Company
                                  Corporate Auditor of San-Ai Oil Co., Ltd.
                                  Director of Millea Holdings, Inc.
                                  Chairman of Coca-Cola West Japan Co., Ltd.

---------------------------    ------------------------------    ------------    ----------------------------------------
Tatsuo Hirakawa                Representative Director            Apr.  1960     Joined the Company
(November 17, 1937)                                               Jan.  1982     Deputy General Manager of Accounting
                                                                                  and Management Division
                                                                  June  1983     Director
                                                                  June  1990     Managing Director
                                                                  June  1994     Executive Managing Director
                                                                  June  2000     Executive Vice President
                                                                  Oct.  2001     Deputy President (Current)
                                                                  Oct.  2001     Representative Director (Current)
                                                                  June  2005     Chief Strategy Officer and Chief Human
                                                                                  Resource Officer  (Current)

                               Principal business activities and other principal directorships performed outside Ricoh:
                                  Corporate Auditor of Coca-Cola West Japan Co., Ltd.
</TABLE>

                                     - 64 -

<TABLE>
<CAPTION>
           Name                      Current Position
     (Date of Birth)             (Function/Business area)            Date                  Business Experience
---------------------------    ------------------------------    ------------    ----------------------------------------
<S>                            <C>                                 <C>           <C>
Koichi Endo                    Director                            Apr. 1966     Joined the Company
(February 16, 1944)                                                Oct. 1990     General Manager of Component Division
                                                                   June 1992     Director
                                                                   June 1997     Managing Director
                                                                   Apr. 1998     General Manager of Production Business
                                                                                  Group
                                                                   June 2000     Executive Managing Director
                                                                   June 2000     Executive Vice President
                                                                   Apr. 2004     General Manager of Fact Base
                                                                                  Management Innovation Office
                                                                                  (Current)
                                                                   June 2005     Director (Current)
                                                                   June 2005     Corporate Executive Vice President,
                                                                                  Chief Innovation Officer and Chief
                                                                                  Information Officer (Current)

                               Principal business activities and other principal directorships performed outside Ricoh:
                                  Director of Sindo Ricoh Co., Ltd.
                                  Director of San-Ai Plant Construction Co., Ltd.
                                  Corporate Auditor of TOYO KANETSU K.K.

---------------------------    ------------------------------    ------------    ----------------------------------------
Masayuki Matsumoto             Director                            Apr. 1970     Joined the Company
(December 10, 1944)                                                July 1993     General Manager of General Manager
                                                                                  Staff Office in Tokyo Branch
                                                                   June 1994     Director
                                                                   Oct. 1998     Managing Director
                                                                   Oct. 1998     General Manager of Marketing Group
                                                                   June 2000     Executive Vice President
                                                                   June 2002     Executive Managing Director
                                                                   Apr. 2005     General Manager of Corporate Social
                                                                                  Responsibility Division (Current)
                                                                   June 2005     Director (Current)
                                                                   June 2005     Corporate Executive Vice President and
                                                                                  Chief Marketing Officer (Japan)
                                                                                  (Current)
</TABLE>

                                     - 65 -

<TABLE>
<CAPTION>
           Name                      Current Position
     (Date of Birth)             (Function/Business area)            Date                  Business Experience
---------------------------    ------------------------------    ------------    ----------------------------------------
<S>                            <C>                                 <C>           <C>
Katsumi Yoshida                Director                            Apr. 1967     Joined the Company
(August 20, 1944)                                                  Apr. 1989     General Manager of Product Division
                                                                   Feb. 1996     Chairman of Ricoh Electronics, Inc.
                                                                   Apr. 2000     President of Ricoh Corporation
                                                                   Apr. 2001     Executive Vice President
                                                                   June 2002     Managing Director
                                                                   Jan. 2003     Chairman of Ricoh Corporation
                                                                   Oct. 2003     General Manager of International
                                                                                  Marketing Group
                                                                   Oct. 2003     Chairman of Ricoh China Co., Ltd.
                                                                                  (Current)
                                                                   Apr. 2004     General Manager of International
                                                                                  Business Group (Current)
                                                                   June 2004     Executive Managing Director
                                                                   Apr. 2005     General Manager of Ricoh Global
                                                                                  Service Business Center (Current)
                                                                   June 2005     Director (Current)
                                                                   June 2005     Corporate Executive Vice President
                                                                                  and Chief Marketing Officer (Overseas)
                                                                                  (Current)

---------------------------    ------------------------------    ------------    ----------------------------------------
Takashi Nakamura               Director                            Apr. 1972     Joined the Company
(September 2, 1946)                                                Apr. 1990     President of Ricoh UK Products Ltd.
                                                                   Jan. 1995     President of Ricoh Europe B.V.
                                                                   June 1998     Director
                                                                   June 2000     Senior Vice President
                                                                   June 2002     President of Ricoh Elemex Corporation
                                                                                  (Current)
                                                                   June 2004     Managing Director
                                                                   June 2005     Director (Current)
                                                                   June 2005     Corporate Executive Vice President
                                                                                  (Current)

---------------------------    ------------------------------    ------------    ----------------------------------------
Shiroh Kondoh                  Director                            Apr. 1973     Joined the Company
(October 7, 1949)                                                  Apr. 1998     Manager of Printing Division of
                                                                                  Imaging System Business Group
                                                                   June 2000     Senior Vice President
                                                                   Oct. 2000     General Manager of Imaging System
                                                                                  Business Group
                                                                   June 2002     Executive Vice President
                                                                   June 2003     Managing Director
                                                                   Oct. 2004     General Manager of MFP Business Group
                                                                                  (Current)
                                                                   June 2005     General Manager of Designing Center of
                                                                                  MFP Business Group (Current)
                                                                   June 2005     Director (Current)
                                                                   June 2005     Corporate Executive Vice President
                                                                                  (Current)

                               Principal business activities and other principal directorships performed outside Ricoh:
                                  Director of Sindo Ricoh Co., Ltd.
</TABLE>

                                     - 66 -

<TABLE>
<CAPTION>
           Name                      Current Position
     (Date of Birth)             (Function/Business area)            Date                  Business Experience
---------------------------    ------------------------------    ------------    ----------------------------------------
<S>                            <C>                                 <C>           <C>
Kazunori Azuma                 Director                            Apr. 1971     Joined the Company
(February 11, 1949)                                                Oct. 1994     President of Hokkaido Ricoh Co., Ltd.
                                                                   June 2000     Senior Vice President
                                                                   Oct. 2000     President of Ricoh Technosystems Co.,
                                                                                  Ltd.
                                                                   June 2003     Managing Director
                                                                   June 2003     Executive Vice President
                                                                   Oct. 2003     Chairman of Ricoh Technosystems Co.,
                                                                                  Ltd. (Current)
                                                                   Oct. 2003     Deputy General Manager of Marketing
                                                                                  Group
                                                                   Nov. 2003     General Manager of Marketing Group
                                                                                  (Current)
                                                                   June 2005     Director (Current)
                                                                   June 2005     Corporate Executive Vice President
                                                                                  (Current)

---------------------------    ------------------------------    ------------    ----------------------------------------
Zenji Miura                    Director                            Apr. 1976     Joined the Company
(January 5, 1950)                                                  Jan. 1993     President of Ricoh France S.A.
                                                                   Aug. 1993     Chairman of Ricoh France S.A.
                                                                   Oct. 2000     Senior Vice President
                                                                   Oct. 2000     General Manager of Finance and
                                                                                  Accounting Division (Current)
                                                                   June 2003     Executive Vice President
                                                                   June 2004     Managing Director
                                                                   June 2005     Director (Current)
                                                                   June 2005     Corporate Executive Vice President and
                                                                                  Chief Financial Officer (Current)

---------------------------    ------------------------------    ------------    ----------------------------------------
Nobuo Mii                      Director                            Apr. 1955     Joined the Nippon Hoso Kyokai (Japan
(July 4, 1931)                                                                    Broadcasting Corporation)
                                                                   Jan. 1969     Joined IBM Japan Ltd.
                                                                   Jan. 1969     Joined IBM Corporation
                                                                   Mar. 1977     Director of IBM Japan Ltd.
                                                                   Apr. 1990     Vice President of IBM Japan Ltd.
                                                                   Oct. 1997     Managing Partner of IGNITE Group
                                                                                  (Current)
                                                                   June 2000     Director (Current)
</TABLE>

                                     - 67 -

<TABLE>
<CAPTION>
           Name                      Current Position
     (Date of Birth)             (Function/Business area)            Date                  Business Experience
---------------------------    ------------------------------    ------------    ----------------------------------------
<S>                            <C>                                 <C>           <C>
Takaaki Wakasugi               Director                            Jan. 1972     Assistant Professor, Faculty of
(March 11, 1943)                                                                  Commerce, Yokohama City University
                                                                   Apr. 1974     Assistant Professor, Faculty of
                                                                                  Economics, Tohoku University
                                                                   June 1985     Professor, Faculty of Economics, the
                                                                                  University of Tokyo
                                                                   Sep. 1990     Co-Director of Mitsui Life Financial
                                                                                  Research Center, University of
                                                                                  Michigan Business School (Current)
                                                                   Apr. 2003     Director and General Manager of Japan
                                                                                  Corporate Governance Research
                                                                                  Institute (Current)
                                                                   Apr. 2004     Professor, Faculty of Business
                                                                                  Administration, Tokyo Keizai
                                                                                  University (Current)
                                                                   June 2004     Professor Emeritus, the University of
                                                                                  Tokyo
                                                                   June 2005     Director (Current)

---------------------------    ------------------------------    ------------    ----------------------------------------
Hisaaki Koga                   Corporate Auditor                   Apr. 1967     Joined the Company
(April 5, 1943)                                                    Oct. 1991     Deputy General Manager of Personnel
                                                                                  Division
                                                                   Jan. 1996     General Manager of Sendai Branch
                                                                   Oct. 1997     General Manager of General Manager
                                                                                  Staff Office of Marketing Group
                                                                   June 1998     Corporate Auditor (Current)

---------------------------    ------------------------------    ------------    ----------------------------------------
Kohji Tomizawa                 Corporate Auditor                   Apr. 1971     Joined the Company
(May 25, 1946)                                                     July 1988     President of Ricoh Finance Ltd.
                                                                   June 1997     Managing Director of Ricoh Logistics
                                                                                  System Co., Ltd.
                                                                   July 2001     Director of Tokyo Ricoh Co., Ltd.
                                                                   June 2004     Corporate Auditor (Current)

---------------------------    ------------------------------    ------------    ----------------------------------------
Kenji Matsuishi                Corporate Auditor                   Apr. 1965     Graduated from the National Legal
(July 24, 1937)                                                                   Training and Research Institute.
                                                                   Apr. 1965     Legal registration as a Japanese
                                                                                  attorney
                                                                   Apr. 1965     Joined Takano & Higuchi Legal Services
                                                                   Feb. 1972     General Manager of Matsuishi Legal
                                                                                  Services (Current)
                                                                   June 1994     Corporate Auditor (Current)

---------------------------    ------------------------------    ------------    ----------------------------------------
Takehiko Wada                  Corporate Auditor                   Apr. 1958     Joined San-Ai Oil Co., Ltd.
(October 24, 1935)                                                 June 1985     Director of said company
                                                                   June 1990     Managing Director of said company
                                                                   July 1994     Executive Managing Director of said
                                                                                  company
                                                                   July 1999     President of said company (Current)
                                                                   June 2001     Corporate Auditor (Current)
</TABLE>

                                     - 68 -

        Directors and Corporate Auditors are elected at a general meeting of
shareholders for two and three years terms, respectively, and may serve any
number of consecutive terms.

        The Board of Directors has appointed from among its members a Chairman,
a President, and one or more Vice Presidents, Executive Managing Directors and
Managing Directors, in accordance with Japanese commercial law. As of June 28,
2005, the Company maintains an executive officer system and under such system
there are 47 such officers each with one of the following roles:

        .       Executive officers: Oversee operations under the authority
                granted from the president and report to the president.

        .       Group executive officers: Assist the president with the
                management of Ricoh Group.

        Executive Officers of the Company as of June 28, 2005 were as follows:

<TABLE>
<CAPTION>
                                       Current Position
           Name                    (Function/Business area)             Date                 Business Experience
---------------------------    ---------------------------------    ------------    ---------------------------------------
<S>                            <C>                                  <C>
Masamitsu Sakurai              President and                        See above for his business experience and other
                               Chief Executive Officer               information.
---------------------------    ---------------------------------    ------------    ---------------------------------------
Tatsuo Hirakawa                Deputy President                     See above for his business experience and other
                               (Chief Strategy Officer)              information.
                               (Chief Human Resource Officer)

---------------------------    ---------------------------------    ------------    ---------------------------------------
Koichi Endo                    Corporate Executive Vice             See above for his business experience and other
                                President                            information.
                               (Chief Innovation Officer)
                               (Chief Information Officer)
                               (Office Business Strategic
                                Planning)
                               (General Manager of Fact Base
                                Management Innovation Office)

---------------------------    ---------------------------------    ------------    ---------------------------------------
Masayuki Matsumoto             Corporate Executive Vice             See above for his business experience and other
                                President                            information.
                               (Chief Marketing Officer for Japan)
                               (General Manager of Corporate
                                Social Responsibility Division)
</TABLE>

                                     - 69 -

<TABLE>
<CAPTION>
                                       Current Position
           Name                    (Function/Business area)             Date                 Business Experience
---------------------------    ---------------------------------    ------------    ---------------------------------------
<S>                            <C>                                  <C>
Katsumi Yoshida                Corporate Executive Vice             See above for his business experience and other
                                President                            information.
                               (Chief Marketing Officer for
                                Overseas)
                               (General Manager of
                                International Business Group)
                               (General Manager of Ricoh
                                Global Service Business Center)
                               (Chairman of Ricoh China Co.,
                                Ltd.)

---------------------------    ---------------------------------    ------------    ---------------------------------------
Shiroh Kondoh                  Corporate Executive Vice             See above for his business experience and other
                                President                            information.
                               (Imaging Engine Solution
                                Development)
                               (General Manager of MFP
                                Business Group)
                               (General Manager of Designing
                                Center of MFP Business Group)

---------------------------    ---------------------------------    ------------    ---------------------------------------
Kazunori Azuma                 Corporate Executive Vice             See above for his business experience and other
                               President                             information.
                               (General Manager of Marketing
                               Group)
                               (Chairman of Ricoh
                               Technosystems Co., Ltd.)

---------------------------    ---------------------------------    ------------    ---------------------------------------
Zenji Miura                    Corporate Executive Vice             See above for his business experience and other
                                President                            information.
                               (Chief Financial Officer)
                               (Investor Relation)
                               (General Manager of Finance and
                                Accounting Division)

---------------------------    ---------------------------------    ------------    ---------------------------------------
Kiyoshi Sakai                  Corporate Senior Vice President      Apr. 1970       Joined the Company
(December 25, 1945)            (Corporate Environment)              Jan. 1996       General Manager of Corporate Planning
                               (General Manager of Research                          Division
                                and Development Group)              June 1996       Director
                               (General Manager of Corporate        Apr. 1999       General Manager of Research and
                                Technology Planning Division)                        Development Group (Current)
                                                                    June 2000       Senior Vice President
                                                                    June 2002       Managing Director
                                                                    June 2002       Executive Vice President
                                                                    June 2002       General Manager of Corporate
                                                                                     Technology Planning Division
                                                                                     (Current)
                                                                    June 2005       Corporate Senior Vice President
                                                                                     (Current)
</TABLE>

                                     - 70 -

<TABLE>
<CAPTION>
                                       Current Position
           Name                    (Function/Business area)             Date                 Business Experience
---------------------------    ---------------------------------    ------------    ---------------------------------------
<S>                            <C>                                  <C>             <C>
Kazuo Togashi                  Corporate Senior Vice President      Apr. 1972       Joined the Company
(November 28, 1949)            (Chairman of Ricoh Europe B.V.)      Apr. 1998       President of Ricoh Europe B.V.
                               (Chairman of NRG Group PLC)          June 2000       Senior Vice President
                                                                    Apr. 2002       Chairman of said company (Current)
                                                                    Apr. 2002       Chairman of NRG Group PLC (Current)
                                                                    June 2002       Executive Vice President
                                                                    June 2003       Managing Director
                                                                    June 2005       Corporate Senior Vice President
                                                                                     (Current)

---------------------------    ---------------------------------    ------------    ---------------------------------------
Terumoto Nonaka                Corporate Senior Vice President      Jan. 1988       Joined the Company
(October 28, 1947)             (President of Electronic             Jan. 1990        Deputy General Manager of Electronic
                                Devices Company)                                     Devices Division
                                                                    June 2000       Senior Vice President
                                                                    Oct. 2000       President of Electronic Devices
                                                                                     Company (Current)
                                                                    June 2002       Executive Vice President
                                                                    June 2005       Corporate Senior Vice President
                                                                                     (Current)

---------------------------    ---------------------------------    ------------    ---------------------------------------
Tadatoshi Sakamaki             Corporate Senior Vice President      Apr. 1967       Joined the Company
(April 23, 1942)               (President of Personal               June 2000       Senior Vice President
                                MultiMedia Products Company)        Oct. 2000       General Manager of  MultiMedia
                                                                                     Printer Division of Personal
                                                                                     MultiMedia Products Company
                                                                    June 2003       President of Personal MultiMedia
                                                                                     Products Company (Current)
                                                                    June 2003       Executive Vice President
                                                                    June 2005       Corporate Senior Vice President
                                                                                     (Current)

---------------------------    ---------------------------------    ------------    ---------------------------------------
Etsuo Kobayashi                Corporate Senior Vice President      Apr. 1970       Joined the Company
(July 4, 1947)                 (General Manager of Personnel        Apr. 1998       General Manager of Personnel Division
                                Division)                                            (Current)
                                                                    June 2000       Senior Vice President
                                                                    June 2003       Executive Vice President
                                                                    June 2005       Corporate Senior Vice President
                                                                                     (Current)
</TABLE>

                                     - 71 -

<TABLE>
<CAPTION>
                                       Current Position
           Name                    (Function/Business area)             Date                 Business Experience
---------------------------    ---------------------------------    ------------    ---------------------------------------
<S>                            <C>                                  <C>             <C>
Hiroshi Tategami               Corporate Senior Vice President      Apr. 1962       Joined the Company
(March 31, 1941)               (General Manager of Imaging          June 2000       Senior Vice President
                                System Production Business          Oct. 2000       General Manager of RS Products
                                Group)                                               Division
                               (General Manager of Imaging          June 2003       General Manager of Production
                                System Quality Assurance System                      Business Group
                                Center)                             June 2003       Executive Vice President
                                                                    Oct. 2004       General Manager of Imaging System
                                                                                     Production Business Group (Current)
                                                                    Oct. 2004       General Manager of Imaging System
                                                                                     Quality Assurance System Center
                                                                                     (Current)
                                                                    June 2005       Corporate Senior Vice President
                                                                                     (Current)

---------------------------    ---------------------------------    ------------    ---------------------------------------
Haruo Nakamura                 Corporate Senior Vice President      Aug. 2000       Joined the Company
(April 29, 1952)               (General Manager of GJ (GEL          Nov. 2000       Leader of Alpha Task Force
                                JET) Business Division)             Apr. 2004       Executive Vice President
                                                                    Apr. 2004       General Manager of GJ (GEL JET)
                                                                                     Business Division (Current)
                                                                    June 2005       Corporate Senior Vice President
                                                                                     (Current)

---------------------------    ---------------------------------    ------------    ---------------------------------------
Kenji Hatanaka                 Corporate Senior Vice President      Apr. 1969       Joined the Company
(July 1, 1946)                 (General Manager of Tokyo            June 2000       Senior Vice President
                                Branch)                             June 2003       General Manager of Tokyo Branch
                               (General Manager of Kanto                             (Current)
                                Branch)                             June 2003       General Manager of Kanto Branch
                               (President of Ricoh Sales Co.,                        (Current)
                                Ltd.)                               June 2004       Executive Vice President
                                                                    Jan. 2005       President of Ricoh Sales Co., Ltd.
                                                                                     (Current)
                                                                    June 2005       Corporate Senior Vice President
                                                                                     (Current)

---------------------------    ---------------------------------    ------------    ---------------------------------------
Hideko Kunii                   Corporate Senior Vice President      May  1982       Joined the Company
(December 13, 1947)            (General Manager of Software R&D     Oct. 1999       General Manager of Software Research
                                Group)                                               Center
                               (Chairman of Ricoh Software          June 2000       Senior Vice President
                                Research Center (Beijing) Co.,      Oct. 2000       Deputy General Manager of P&S
                                Ltd.)                                                Products Division
                                                                    June 2002       Chairman of Ricoh Software Technology
                                                                                     (Shanghai) Co., Ltd.
                                                                    Oct. 2002       General Manager of Software R&D Group
                                                                                     (Current)
                                                                    Feb. 2004       Chairman of Ricoh Software Research
                                                                                     Center (Beijing) Co., Ltd. (Current)
                                                                    June 2004       Executive Vice President
                                                                    June 2005       Corporate Senior Vice President
                                                                                     (Current)
</TABLE>

                                     - 72 -

<TABLE>
<CAPTION>
                                       Current Position
           Name                    (Function/Business area)             Date                 Business Experience
---------------------------    ---------------------------------    ------------    ---------------------------------------
<S>                            <C>                                  <C>             <C>
Hiroshi Kobayashi              Corporate Senior Vice President      Apr. 1974       Joined the Company
(July 2, 1948)                 (General Manager of LP Business      Apr. 2002       General Manager of Corporate Planning
                                Group)                                               Division
                                                                    June 2002       Senior Vice President
                                                                    Apr. 2003       General Manager of Corporate
                                                                                     Communication Center
                                                                    June 2004       Executive Vice President
                                                                    Oct. 2004       General Manager of LP Business Group
                                                                                     (Current)
                                                                    June 2005       Corporate Senior Vice President
                                                                                     (Current)

---------------------------    ---------------------------------    ------------    ---------------------------------------
Susumu Ichioka                 Corporate Senior Vice President      Apr. 1971       Joined the Company
(April 23, 1948)               (Chairman of Ricoh Corporation)      Oct. 2003       Senior Vice President
                                                                    June 2004       Executive Vice President
                                                                    June 2004       Chairman of Ricoh Corporation
                                                                                     (Current)
                                                                    June 2005       Corporate Senior Vice President
                                                                                     (Current)

---------------------------    ---------------------------------    ------------    ---------------------------------------
Kunio Taniguchi                Corporate Vice President             Apr. 1972       Joined the Company
(December 18, 1948)            (General Manager of Osaka            June 2000       Senior Vice President
                                Branch)                             June 2003       General Manager of Osaka Branch
                               (President of Ricoh Kansai Co.,                       (Current)
                                Ltd.)                               June 2003       President of Ricoh Kansai Co., Ltd.
                                                                                     (Current)
                                                                    June 2005       Corporate Vice President (Current)

---------------------------    ---------------------------------    ------------    ---------------------------------------
Kiyoto Nagasawa                Corporate Vice President             Apr. 1973       Joined the Company
(August 16, 1948)              (General Manager of Quality of       Apr. 2001       General Manager of C&F Business
                                Management Division)                                 Division 2
                                                                    May  2002       Director of Ricoh Creative
                                                                                     Development Co., Ltd.
                                                                    June 2002       Senior Vice President
                                                                    June 2005       General Manager of Quality of
                                                                                     Management Division (Current)
                                                                    June 2005       Corporate Vice President (Current)

---------------------------    ---------------------------------    ------------    ---------------------------------------
Yutaka Ebi                     Corporate Vice President             Apr. 1972       Joined the Company
(October 20, 1949)             (General Manager of Legal &          Apr. 2001       General Manager of Imaging Technology
                                Intellectual Property)                               Division
                                                                    June 2002       Senior Vice President
                                                                    Oct. 2004       General Manager of Legal &
                                                                                     Intellectual Property (Current)
                                                                    June 2005       Corporate Vice President (Current)
</TABLE>

                                     - 73 -

<TABLE>
<CAPTION>
                                       Current Position
           Name                    (Function/Business area)             Date                 Business Experience
---------------------------    ---------------------------------    ------------    ---------------------------------------
<S>                            <C>                                  <C>             <C>
Hiroo Matsuda                  Corporate Vice President             Apr. 1972       Joined the Company
(April 19, 1948)               (General Manager of Solution         Apr. 2002       General Manager of Major Accounts
                                Partner Sales Center of LP                           Marketing Division
                                Business Group)                     June 2002       Senior Vice President
                                                                    Apr. 2004       General Manager of Solution Partner
                                                                                     Sales Division of Marketing Group
                                                                    Oct. 2004       General Manager of Solution Partner
                                                                                     Sales Center of LP Business Group
                                                                                     (Current)
                                                                    June 2005       Corporate Vice President (Current)

---------------------------    ---------------------------------    ------------    ---------------------------------------
Hiroshi Adachi                 Corporate Vice President             Apr. 1968       Joined the Company
(January 8, 1946)              (President of Thermal Media          Oct. 2000       President of Thermal Media Company
                                Company)                                             (Current)
                               (Chairman of Ricoh Electronic        Nov. 2001       Chairman of Ricoh Electronic
                                Technology (Beijing) Co., Ltd.)                      Technology (Beijing) Co., Ltd.
                                                                                     (Current)
                               (Chairman of Ricoh                   June 2002       Senior Vice President
                                International (Shanghai) Co.,       June 2004       Chairman of Ricoh International
                                Ltd.)                                                (Shanghai) Co., Ltd. (Current)
                                                                    June 2005       Corporate Vice President (Current)

---------------------------    ---------------------------------    ------------    ---------------------------------------
Kohji Sawa                     Corporate Vice President             Apr. 1971       Joined the Company
(June 5, 1948)                 (General Manager of Information      Apr. 1998       General Manager of Imaging System
                                Technology and Solution                              Component Production Division
                                Division)                           Apr. 2000       General Manager of Procurement
                                                                                     Control Center
                                                                    July 2001       General Manager of Optical Component
                                                                                     Development Center
                                                                    June 2002       Senior Vice President
                                                                    June 2005       General Manager of Information
                                                                                     Technology and Solution Division
                                                                                     (Current)
                                                                    June 2005       Corporate Vice President (Current)

---------------------------    ---------------------------------    ------------    ---------------------------------------
Yoshimasa Matsuura             Corporate Vice President             Apr. 1971       Joined the Company
(June 23, 1947)                (General Manager of Office           May  1999       General Manager of Supply Chain
                                Business Planning Center)                            Management Planning Division
                               (Deputy General Manager of MFP       Apr. 2004       General Manager of Imaging System
                                Business Group)                                      Business Strategy Center
                               (General Manager of Business         June 2004       Senior Vice President
                                Strategy Center of MFP              Oct. 2004       General Manager of Office Business
                                Business Group)                                      Planning Center (Current)
                                                                    June 2005       Deputy General Manager of MFP
                                                                                     Business Group (Current)
                                                                    June 2005       General Manager of Business Strategy
                                                                                     Center of MFP Business Group
                                                                                     (Current)
                                                                    June 2005       Corporate Vice President (Current)
</TABLE>

                                     - 74 -

<TABLE>
<CAPTION>
                                       Current Position
           Name                    (Function/Business area)             Date                 Business Experience
---------------------------    ---------------------------------    ------------    ---------------------------------------
<S>                            <C>                                  <C>             <C>
Sadahiro Arikawa               Corporate Vice President             Apr. 1971       Joined the Company
(March 31, 1949)               (General Manager of Major            Dec. 2001       President of Ricoh Kyusyu Co., Ltd.
                                Accounts Marketing Division)        Apr. 2004       General Manager of Major Accounts
                                                                                     Marketing Division (Current)
                                                                    June 2004       Senior Vice President
                                                                    June 2005       Corporate Vice President (Current)

---------------------------    ---------------------------------    ------------    ---------------------------------------
Norio Tanaka                   Corporate Vice President             Feb. 1978       Joined the Company
(March 22, 1948)               (Deputy General Manager of MFP       Apr. 2004       Deputy General Manager of Imaging
                                Business Group)                                      System Business Strategy Center
                               (General Manager of Products         Apr. 2004       General Manager of Imaging Products
                                Management & Planning Center                         Business Center of International
                                of MFP Business Group)                               Business Center
                               (General Manager of Marketing        June 2004       Senior Vice President
                                Center of MFP Business Group)       June 2004       Deputy General Manager of
                                                                                     International Business Group
                                                                    Oct. 2004       Deputy General Manager of MFP
                                                                                     Business Group (Current)
                                                                    Oct. 2004       General Manager of Products
                                                                                     Management & Planning Center of MFP
                                                                                     Business Group (Current)
                                                                    Oct. 2004       General Manager of Marketing Center
                                                                                     of MFP Business Group (Current)
                                                                    June 2005       Corporate Vice President (Current)

---------------------------    ---------------------------------    ------------    ---------------------------------------
Kenichi Kanemaru               Corporate Vice President             Apr. 1973       Joined the Company
(November 19, 1952)            (Deputy General Manager of           Apr. 1998       General Manager of Production
                                Imaging System Production                            Strategic Center
                                Business Group)                     June 1999       President of Ricoh UK Products Ltd.
                               (General Manager of Procurement      June 2004       Senior Vice President
                                Control Center)                     June 2005       Deputy General Manager of Imaging
                                                                                     System Production Business Group
                                                                                     (Current)
                                                                    June 2005       General Manager of Procurement
                                                                                     Control Center (Current)
                                                                    June 2005       Corporate Vice President (Current)

---------------------------    ---------------------------------    ------------    ---------------------------------------
Daisuke Segawa                 Corporate Vice President             Mar. 1980       Joined the Company
(July 21, 1954)                (Corporate Communication)            Dec. 1998       General Manager of Treasury Department
                               (Management of Group Companies)      Oct. 2004       General Manager of Corporate Planning
                               (General Manager of Corporate                         Division (Current)
                                Planning Division)                  June 2005       Corporate Vice President (Current)
</TABLE>

                                     - 75 -

<TABLE>
<CAPTION>
                                       Current Position
           Name                    (Function/Business area)             Date                 Business Experience
---------------------------    ---------------------------------    ------------    ---------------------------------------
<S>                            <C>                                  <C>             <C>
Hisashi Takata                 Corporate Vice President             Apr. 1974       Joined the Company
(May 20, 1951)                 (Deputy General Manager of GJ        Apr. 1999       General Manager of Business Strategy
                                (GEL JET) Business Division)                         Division of International Marketing
                               (General Manager of Marketing                         Group
                                Center of GJ (GEL JET)              Oct. 2004       Deputy General Manager of GJ (GEL
                                Business Division)                                   JET) Business Division (Current)
                                                                    Oct. 2004       General Manager of Marketing Center
                                                                                     of GJ (GEL JET) Business Division
                                                                                     (Current)
                                                                    June 2005       Corporate Vice President (Current)

---------------------------    ---------------------------------    ------------    ---------------------------------------
Kenichi Matsubayashi           Corporate Vice President             Apr. 1971       Joined the Company
(June 5, 1948)                 (General Manager of RS Products      Apr. 1995       Manager of RS Business Planning
                                Division)                                            Department
                                                                    Oct. 2003       General Manager of RS Products
                                                                                     Division (Current)
                                                                    June 2005       Corporate Vice President (Current)

---------------------------    ---------------------------------    ------------    ---------------------------------------
Kunihiko Satoh                 Corporate Vice President             Mar. 1979       Joined the Company
(October 21, 1956)             (General Manager of Solution         Apr. 2002       President of Hokkaido Ricoh Co., Ltd.
                                Marketing Center)                   Apr. 2004       General Manager of Solution Marketing
                               (General Manager of Customer                          Center (Current)
                                Contact Center)                     June 2004       General Manager of Customer Contact
                                                                                     Center (Current)
                                                                    June 2005       Corporate Vice President (Current)

                   Group Executive Officers of the Company as of June 28, 2005 were as follows:

---------------------------    ---------------------------------    ------------    ---------------------------------------
Makoto Hashimoto               Corporate Executive Vice             Nov. 1972       Joined the Company
(August 26, 1945)               President                           Apr. 1993       General Manager of PPC Division of
                               (Chairman of Ricoh Elemex                             Imaging System Business Group
                                Corporation)                        June 1994       Director
                                                                    Apr. 1998       General Manager of Imaging System
                                                                                     Business Group
                                                                    June 1998       Managing Director
                                                                    June 2000       Executive Vice President
                                                                    Oct. 2000       President of Personal MultiMedia
                                                                                     Products Company
                                                                    June 2003       General Manager of CSM (Customer
                                                                                     Satisfaction Management) Division
                                                                    June 2005       Chairman of Ricoh Elemex Corporation
                                                                                     (Current)
                                                                    June 2005       Corporate Executive Vice President
                                                                                     (Current)
</TABLE>

                                     - 76 -

<TABLE>
<CAPTION>
                                       Current Position
           Name                    (Function/Business area)             Date                 Business Experience
---------------------------    ---------------------------------    ------------    ---------------------------------------
<S>                            <C>                                  <C>             <C>
Takashi Nakamura               Corporate Executive Vice President   See above for his business experience and other
                               (Legal & Intellectual Property )      information.
                               (President of Ricoh Elemex
                                Corporation)

---------------------------    ---------------------------------    ------------    ---------------------------------------
Yuji Inoue                     Corporate Senior Vice President      Apr. 1971       Joined the Company
(April 4, 1948)                (President of Ricoh Leasing          Apr. 1998       General Manager of Finance and
                                Co., Ltd.)                                           Accounting Division
                                                                    Apr. 2000       President of Ricoh Leasing Co., Ltd.
                                                                                     (Current)
                                                                    June 2000       Senior Vice President
                                                                    June 2004       Managing Director
                                                                    June 2005       Corporate Senior Vice President
                                                                                     (Current)

---------------------------    ---------------------------------    ------------    ---------------------------------------
Peter E. Hart                  Corporate Vice President             Mar. 1997       President of Ricoh Silicon Valley,
(February 27, 1941)            (Chairman and President of Ricoh                      Inc. (now Ricoh Innovations, Inc.)
                                Innovations, Inc.)                  Feb. 2000       Chairman and President of Ricoh
                                                                                     Silicon Valley, Inc. (now Ricoh
                                                                                     Innovations, Inc.) (Current)
                                                                    June 2000       Senior Vice President
                                                                    June 2005       Corporate Vice President (Current)

---------------------------    ---------------------------------    ------------    ---------------------------------------
Bernard Decugis                Corporate Vice President             Aug. 1993       President of Ricoh France S.A.
(October 23, 1942)             (President of Ricoh France S.A.)                      (Current)
                                                                    Apr. 2001       Senior Vice President
                                                                    June 2005       Corporate Vice President (Current)

---------------------------    ---------------------------------    ------------    ---------------------------------------
Yoichi Shirahata               Corporate Vice President             Mar. 1962       Joined the Company
(December 20, 1943)            (President of Tohoku Ricoh Co.,      June 2002       President of Tohoku Ricoh Co., Ltd.
                                Ltd.)                                                (Current)
                                                                    June 2002       Senior Vice President
                                                                    June 2005       Corporate Vice President (Current)

---------------------------    ---------------------------------    ------------    ---------------------------------------
Hiroshi Tsuruga                Corporate Vice President             Apr. 1971       Joined the Company
(November 18, 1948)            (Deputy President of Tohoku          Apr. 1999       General Manager of Information
                                Ricoh Co., Ltd.)                                     Technology and Solution Division
                                                                    June 2002       Senior Vice President
                                                                    June 2005       Deputy President of Tohoku Ricoh Co.,
                                                                                     Ltd. (Current)
                                                                    June 2005       Corporate Vice President (Current)

---------------------------    ---------------------------------    ------------    ---------------------------------------
Norihisa Goto                  Corporate Vice President             Apr. 1972       Joined the Company
(March 8, 1949)                (President of Lanier Worldwide,      Oct. 1997       President of Ricoh Deutschland GmbH
                                Inc. )                              Mar. 2001       Chairman of Lanier Worldwide, Inc.
                                                                    Jan. 2003       President of Lanier Worldwide, Inc.
                                                                                     (Current)
                                                                    June 2003       Senior Vice President
                                                                    June 2005       Corporate Vice President (Current)
</TABLE>

                                     - 77 -

<TABLE>
<CAPTION>
                                       Current Position
           Name                    (Function/Business area)             Date                 Business Experience
---------------------------    ---------------------------------    ------------    ---------------------------------------
<S>                            <C>                                  <C>             <C>
---------------------------    ---------------------------------    ------------    ---------------------------------------
Shunsuke Nakanishi             Corporate Vice President             Apr. 1972       Joined the Company
(October 12, 1948)             (President of Ricoh Electronics      May  1999       General Manager of Production
                                Inc.)                                                Strategic Center
                                                                    July 2001       President of Ricoh Electronics Inc.
                                                                                     (Current)
                                                                    June 2004       Senior Vice President
                                                                    June 2005       Corporate Vice President (Current)

---------------------------    ---------------------------------    ------------    ---------------------------------------
Shiroh Sasaki                  Corporate Vice President             Apr. 1972       Joined the Company
(December 23, 1949)            (President of NRG Group PLC)         Apr. 2000       President of Gestetner Holdings PLC
                                                                    Apr. 2002       President of NRG Group PLC (Current)
                                                                    June 2004       Senior Vice President
                                                                    June 2005       Corporate Vice President (Current)

---------------------------    ---------------------------------    ------------    ---------------------------------------
Mitsuhiko Ikuno                Corporate Vice President             May  1975       Joined the Company
(March 26, 1953)               (President of Shanghai Ricoh         June 2000       President of Ricoh Asia Industry Ltd.
                                Facsimile Co., Ltd.)                June 2004       President of Shanghai Ricoh Facsimile
                                                                                     Co., Ltd. (Current)
                                                                    June 2004       Senior Vice President
                                                                    June 2005       Corporate Vice President (Current)

---------------------------    ---------------------------------    ------------    ---------------------------------------
Yoshihiro Niimura              Corporate Vice President             Apr. 1975       Joined the Company
(May 22, 1951)                 (President of Ricoh China Co.,       June 2004       President of Ricoh China Co., Ltd.
                                Ltd.)                                                (Current)
                               (Chairman and President of           June 2004       Chairman and President of Ricoh
                                Ricoh Electronic Technology                          Electronic Technology (China) Co.,
                                (China) Co., Ltd.)                                   Ltd. (Current)
                                                                    June 2004       Senior Vice President
                                                                    June 2005       Corporate Vice President (Current)

---------------------------    ---------------------------------    ------------    ---------------------------------------
Michel De Bosschere            Corporate Vice President             1990            Managing Director of Nashua/tec
(June 16, 1948)                (President of NRG Benelux B.V.)                       Benelux
                                                                    2000            President of NRG Benelux B.V.
                                                                                     (Current)
                                                                    June 2004       Senior Vice President
                                                                    June 2005       Corporate Vice President (Current)

---------------------------    ---------------------------------    ------------    ---------------------------------------
Toshiaki Katayama              Corporate Vice President             Oct. 2004       President of Ricoh Printing Systems,
(November 28,1947)             (President of Ricoh Printing                          Ltd. (Current)
                                Systems, Ltd.)                      June 2005       Corporate Vice President (Current)

</TABLE>

        There are no family relationships between any Director, Corporate
Auditor or Executive Officer and any other Director, Corporate Auditor or
Executive Officer of the Company. There are no arrangements or understandings
with major shareholders, customers, suppliers or others pursuant to which any
person named above was selected as a Director, Corporate Auditor, or an
Executive Officer.

                                     - 78 -

B. Compensation

        The aggregate remuneration, including bonuses but excluding retirement
allowances, paid by the Company for the fiscal year ended March 31, 2005 to all
Directors, Corporate Auditors and Executive Officers of the Company who served
during the fiscal year ended March 31, 2005 was Yen 1,140 million.

        In accordance with customary Japanese business practice, annual bonuses
are paid to the Directors and Corporate Auditors of the Company out of the
profit of the Company available for dividends, as such profit is determined in
accordance with the Japanese Commercial Code. Such bonuses are approved at the
annual shareholders meeting customarily held in June of each year. Bonuses so
paid are not deductible by the Company for tax purposes. Included in the figure
for aggregate remuneration set forth above is a total of Yen 178 million in
bonuses paid to Directors and Corporate Auditors as a group in their capacity as
such (excluding bonuses for their services as employees) in respect of fiscal
year 2004, as approved by the Company's shareholders at the General Meeting of
Shareholders held on June 25, 2004.

        In accordance with customary Japanese business practice, when a Director
or Corporate Auditor retires, a proposal to pay a lump-sum retirement allowance
is submitted to the shareholders for their approval. After shareholders'
approval is obtained, the amount of the retirement allowance for a Director or
Corporate Auditor is fixed by the Board of Directors or Board of Corporate
Auditors and generally reflects his remuneration and position at the time of
retirement, the length of his service as a Director or Corporate Auditor and his
contribution to the Company's performance.

C. Board practices

        Under the Japanese Commercial Code, all Directors and Corporate Auditors
shall be elected at the General Meeting of Shareholders. In general, under the
Articles of Incorporation of the Company, the terms of office of Directors shall
expire at the conclusion of the Ordinary General Meeting of Shareholders held
with respect to the last closing of accounts within two years after their
assumption of office, and the terms of office of Corporate Auditors shall expire
at the conclusion of the Ordinary General Meeting of Shareholders held with
respect to the last closing of accounts within four years after their assumption
of office. However, both the Directors and Corporate Auditors may serve any
number of consecutive terms.

        From among the Directors, the Board of Directors shall elect one or more
Representative Directors. Each of the Representative Directors has the statutory
authority to represent the Company in the conduct of its affairs.

        The Corporate Auditors of the Company are not required to be and are not
certified public accountants. However, at least one of the Corporate Auditors
must be a person who has not been a Director, general manager, or employee of
the Company or any of its subsidiaries during the five-year period immediately
prior to his assumption of office as a Corporate Auditor. The Corporate Auditors
may not at the same time be

                                     - 79 -

Directors, managers, or employees of the Company or any of its subsidiaries.
Each Corporate Auditor has the statutory duty to examine the financial
statements and business reports to be submitted by the Board of Directors at the
General Meeting of Shareholders and also to supervise the administration by the
Directors of the Company's affairs. Corporate Auditors are entitled and
obligated to participate in meetings of the Board of Directors but are not
entitled to vote. Under the "Law concerning Special Measures to the Commercial
Code with respect to Audit," the Board of Corporate Auditors has a statutory
duty to prepare and submit its audit report to the Board of Directors each year.
A Corporate Auditor may note his opinion in the audit report if it is different
from the opinion of the Board of Corporate Auditors that is expressed in the
audit report. The Board of Corporate Auditors is empowered to establish audit
principles, the method of examination by the Corporate Auditors of the Company's
affairs and financial position, and other matters concerning the performance of
the Corporate Auditors' duties. The Company does not have an audit committee.

        There are no Director's service contracts with Ricoh providing for
benefits upon termination of service.

D. Employees

        The table below provides information about employees.

<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------------------
                                                                            As of March 31,
                                                             2003                2004                 2005
                                                       -----------------   -----------------    -----------------
<S>                                                              <C>                 <C>                  <C>
Categorized by Operating Segment
     Office Equipment                                            66,422              65,878               69,018
     Other                                                        6,899               6,152                5,130
     Headquarters                                                 1,286               1,107                  949
     Total                                                       74,607              73,137               75,097

Categorized by Geographic Location
     Domestic                                                    39,482              38,772               40,107
     Overseas                                                    35,125              34,365               34,990
     Total                                                       74,607              73,137               75,097
-----------------------------------------------------------------------------------------------------------------
</TABLE>

        Ricoh believes it is one of the few companies with a base in Japan with
a large labor force which is not unionized. There has been no significant labor
dispute in the fiscal year 2005 and Ricoh knows of no efforts to organize a
union. Ricoh generally believes its employee relations to be good.

                                     - 80 -

E. Share ownership

        The following table lists the number of Common Stock owned by each
Director, Corporate Auditor and Executive Officer of the Company as of June 28,
2005. None of the Company's Directors, Corporate Auditors or Executive Officers
is a beneficial owner of more than 1% of the Company's Common Stock.
Collectively, the Directors, Corporate Auditors and Executive Officers
beneficially own approximately 0.03% of the total Company Common Stock issued.

<TABLE>
<CAPTION>
             Name                                    Position                          Number of Shares
--------------------------------    --------------------------------------------    -----------------------
<S>                                 <C>                                                             <C>
Masamitsu Sakurai                   Chairman of the Board and Representative                         8,000
                                     Director
Tatsuo Hirakawa                     Representative Director                                         17,379
Koichi Endo                         Director                                                        12,747
Masayuki Matsumoto                  Director                                                         4,000
Katsumi Yoshida                     Director                                                         5,100
Takashi Nakamura                    Director                                                         6,693
Shiroh Kondoh                       Director                                                         4,000
Kazunori Azuma                      Director                                                         6,000
Zenji Miura                         Director                                                         6,000
Takaaki Wakasugi                    Director                                                         3,000
Hisaaki Koga                        Corporate Auditor                                                5,253
Koji Tomizawa                       Corporate Auditor                                                3,000
Makoto Hashimoto                    Corporate Executive Vice President                              11,000
Kiyoshi Sakai                       Corporate Senior Vice President                                  5,000
Yuji Inoue                          Corporate Senior Vice President                                 10,000
Kazuo Togashi                       Corporate Senior Vice President                                  4,000
Terumoto Nonaka                     Corporate Senior Vice President                                  7,050
Tadatoshi Sakamaki                  Corporate Senior Vice President                                  7,211
Etsuo Kobayashi                     Corporate Senior Vice President                                  7,000
Hiroshi Tategami                    Corporate Senior Vice President                                  5,000
Kenji Hatanaka                      Corporate Senior Vice President                                  3,000
Hideko Kunii                        Corporate Senior Vice President                                  5,000
Hiroshi Kobayashi                   Corporate Senior Vice President                                  2,000
Susumu Ichioka                      Corporate Senior Vice President                                  3,000
Kunio Taniguchi                     Corporate Vice President                                         1,000
Kiyoto Nagasawa                     Corporate Vice President                                         3,000
Yutaka Ebi                          Corporate Vice President                                         2,000
Hiroshi Adachi                      Corporate Vice President                                         7,000
Kohji Sawa                          Corporate Vice President                                         3,000
Yoshimasa Matsuura                  Corporate Vice President                                         3,000
Sadahiro Arikawa                    Corporate Vice President                                         2,000
Norio Tanaka                        Corporate Vice President                                         1,000
Kenichi Kanemaru                    Corporate Vice President                                         3,000
Yoichi Shirahata                    Corporate Vice President                                        10,496
Hiroshi Tsuruga                     Corporate Vice President                                         2,000
Norihisa Goto                       Corporate Vice President                                         3,000
                                                                                    ----------------------
             Total                                                                                 190,929
                                                                                    ======================
</TABLE>

                                     - 81 -

        All shares of Common Stock of the Company carry the same voting rights.

        No options to purchase securities from the Company or any of its
subsidiaries were outstanding on June 28, 2005.

Item 7.  Major Shareholders and Related Party Transactions
         -------------------------------------------------

A. Major shareholders

        Major shareholders that are beneficial owners of 5% or more of the
Common Stock as of March 31, 2005 are as follows:

<TABLE>
<CAPTION>
                                                        Number of        Percentage of
                                                        Shares Owned     Outstanding
Title of Class   Name                                   (in thousands)   Shares Owned
---------------  ------------------------------------   ---------------  --------------
<S>                                                         <C>               <C>
Common Stock     The Master Trust Bank of Japan, Ltd.       89,150           12.13%
Common Stock     Japan Trustee Services Bank, Ltd.          61,447            8.36%
</TABLE>

        The Mitsubishi Trust and Banking Corporation, the second largest
shareholder of Ricoh as of March 31, 2002, transferred its shares in Ricoh to
The Master Trust Bank of Japan, Ltd. during the fiscal year 2003. As a result,
The Master Trust Bank of Japan, Ltd. was Ricoh's second largest shareholder as
of March 31, 2003.

        The Master Trust Bank of Japan, Ltd. is a joint venture managed by the
Mitsubishi Trust and Banking Corporation, Nippon Life Insurance Company, UFJ
Trust Bank Limited, Meiji Yasuda Life Insurance Company and Deutsche Bank.

As far as is known to the Company, there has not been any significant change in
the percentage ownership held by any major shareholders during fiscal year 2005.
The major shareholders do not have different voting rights.

        American Depositary Receipts ("ADRs") evidencing American Depositary
Shares are issued by The Bank of New York. The normal trading unit is 5 American
Depositary Shares. As of March 31, 2005, 247,043 American Depositary Shares were
held of record by two institutional registered holders in the United States of
America.

        As far as is known to the Company as of this date, it is not directly or
indirectly owned or controlled by any other corporation or by the Japanese or
any foreign government. As far as is known to the Company as of this date, there
is no arrangement, the operation of which may at a subsequent date result in a
change in control of the Company.

                                     - 82 -

B. Related party transactions

        Ricoh sells or purchases products, materials, supplies and services to
or from affiliated companies on normal commercial terms and conditions. See Note
6 to the Consolidated Financial Statements.

        No Directors, Corporate Auditors or Executive Officers were indebted to
the Company or its subsidiaries at any time during the latest three fiscal
years. Neither the Company nor its subsidiaries expect to make any loans to
Directors, Corporate Auditors or Executive Officers in the future.

C. Interest of experts and counsel

        Not applicable.

Item 8.  Financial Information
         ---------------------

A. Consolidated statements and other information

        See Item 18. Financial Statements and pages F-1 through F-45.

        Legal or arbitration proceedings
        --------------------------------

        There are no material pending legal or arbitration proceedings to which
Ricoh is a party.

        Dividend Policy
        ---------------

        Ricoh endeavors to provide stable dividends to its shareholders by
boosting profitability. At the same time, Ricoh undertakes to increase retained
earnings to reinforce its corporate structure and to cultivate new businesses.
Ricoh uses such retained earnings to strengthen its core businesses and invest
in new fields with medium- and long-term perspectives. See Item 10 "Dividends"
for important information on the Company's dividend payment procedure and
restrictions.

B. Significant changes

        No significant changes have occurred since the date of the Consolidated
Financial Statements included in this report.

Item 9.  The Offer and Listing
         ---------------------

A. Offer and listing details

        The primary market for the Company's Common Stock is the Tokyo Stock
Exchange (the "TSE") in the form of original Common Stock.

                                     - 83 -

        The Company's Common Stock has been listed on the TSE since 1949, and in
Japan it is also listed on the Osaka Stock Exchange, the Nagoya Stock Exchange,
the Fukuoka Stock Exchange and the Sapporo Stock Exchange. In addition, the
Company's Common Stock is listed outside of Japan on the following stock
exchanges: Amsterdam, Frankfurt and Paris.

        In the United States, the Company's American Depositary Shares are
traded on the Over-the-Counter Market in the form of ADRs and are issued and
exchanged by The Bank of New York, as depositary. The following table sets forth
for the periods indicated the reported high and low sales prices of the
Company's Common Stock on the TSE and the reported high and low sales prices per
share of the Company's ADSs on the Over-the-Counter Market.

                                     - 84 -

<TABLE>
<CAPTION>
                                                                      Over-the-Counter Market Price Per
                                Tokyo Stock Exchange Price Per    American Depositary Share (5 shares
                                     Share of Common Stock                  of Common Stock)
                                        (Japanese Yen)                       (U.S. Dollars)
                                ------------------------------    -------------------------------------
                                   High                Low           High                      Low
                                -----------        -----------    ------------              -----------
<S>                                  <C>                 <C>            <C>                       <C>
Annual highs and lows
---------------------
Fiscal Year 2001                     2,495               1,627          113.46                    75.85
Fiscal Year 2002                     2,735               1,563          108.00                    77.50
Fiscal Year 2003                     2,470               1,637           95.75                    62.50
Fiscal Year 2004                     2,365               1,607          104.50                    68.55
Fiscal Year 2005                     2,345               1,782          107.50                    84.80

Quarterly highs and lows
------------------------
Fiscal Year 2004
1st quarter                          2,035               1,607           83.75                    68.55
2nd quarter                          2,330               1,945           96.75                    81.99
3rd quarter                          2,160               1,805           99.25                    83.47
4th quarter                          2,365               1,885          104.50                    90.50

Fiscal Year 2005
1st quarter                          2,345               2,045          107.50                    92.50
2nd quarter                          2,325               1,970          105.45                    89.85
3rd quarter                          2,255               1,782          102.40                    85.97
4th quarter                          2,010               1,802           96.50                    84.80

Monthly highs and lows
----------------------
December 2004                        1,990               1,782           96.50                    85.97
January 2005                         1,989               1,802           96.50                    88.50
February 2005                        1,993               1,822           93.55                    89.25
March 2005                           2,010               1,808           96.00                    84.80
April 2005                           1,897               1,653           87.30                    82.25
May 2005                             1,818               1,646           83.00                    78.70
</TABLE>

Notes: (1) Price per share of Common Stock is as reported by the TSE.
       (2) Price per ADSs is based upon one ADS representing 5 shares of
           Common Stock as reported by the Over-the-Counter Market Bulletin
           Board(R).

B. Plan of distribution

        Not applicable.

                                     - 85 -

C. Markets

        See Item 9.A. for a list of the stock exchanges on which the securities
are listed.

        See Item 10.B. for certain information relating to the Common Stock of
the Company.

D. Selling shareholders

        Not applicable.

E. Dilution

        Not applicable.

F. Expenses of the issue

        Not applicable.

Item 10. Additional Information
         ----------------------

A. Share Capital

        Not applicable.

B. Memorandum and articles of association

ORGANIZATION

        Ricoh Company, Ltd. was incorporated in Japan under the Commercial Code
of Japan. It is registered in the Commercial Register (SHOGYO TOKIBO) maintained
by the Tokyo Legal Affairs Bureau of the Ministry of Justice.

OBJECTIVES AND PURPOSES

        Article 3 of the Articles of Incorporation of the Company provides that
its purpose is to engage in the following business activities:

        1.      Manufacture, sale and installation work and electrical
                communication work of optical, office, audio, electric and
                measuring equipment, other general machinery and equipment and
                accessories and supplies therefor.
        2.      Manufacture and sale of photographic sensitive materials and
                duplicating papers.
        3.      Manufacture and sale of various raw materials for photographic
                sensitive materials, and various chemical materials for chemical
                industries.
        4.      Manufacture, processing and sale of papers, pulps, textiles,
                general merchandise and by-products thereof.
        5.      Investment in, or sale of the products of, other companies.

                                     - 86 -

        6.      Import and Export of the goods described in any of the foregoing
                items and other goods of every kind and description.
        7.      Brokerage business for casualty insurance and insurance
                brokerage under the Automobile Liability Security Law of Japan.
        8.      Direct marketing through the Internet, facsimile, telephone,
                etc.
        9.      Any and all business incidental or relating to any of the
                foregoing items.

DIRECTORS

        Under the Commercial Code, the Board of Directors has executive powers
and duties to manage the affairs of the Company and each Representative
Director, who is elected from among the Directors by the Board of Directors, has
the statutory authority to represent the Company in all respects. Under the
Commercial Code, the Directors must refrain from engaging in any business
competing with the Company unless approved by the Board of Directors and any
Director who has a material interest in the subject matter of a resolution to be
taken by the Board of Directors cannot vote in such resolution. The total amount
of remuneration to Directors and to Corporate Auditors is subject to approval at
the General Meeting of Shareholders. Within such authorized amounts the Board of
Directors and the Board of Corporate Auditors respectively determine the
compensation to each Director and Corporate Auditor.

        Except as stated below, neither the Commercial Code nor the Company's
Articles of Incorporation make a special provision as to the Director's or
Corporate Auditor's power to vote in connection with their compensation,
borrowing powers exercisable by a Representative Director (or a Director who is
given power by a Representative Director to exercise such powers), their
retirement age or requirement to hold any shares of capital stock of the
Company. The Commercial Code specifically requires the resolution of the Board
of Directors for a corporation to acquire or dispose of material assets; to
borrow substantial amounts of money; to employ or discharge from employment
important employees, such as executive officers; and to establish, change or
abolish a material corporate organization such as a branch office. The
Regulations of the Board of Directors of the Company require a resolution of the
Board of Directors for the Company's borrowing or lending of a significant
amount of money or giving of a guarantee in a large amount.

        Set forth below is certain information relating to the Common Stock of
the Company, including brief summaries of certain provisions of the Company's
Articles of Incorporation and Share Handling Regulations, as currently in
effect, and of the Commercial Code of Japan relating to a joint stock company
(KABUSHIKI KAISHA) and certain related legislation.

GENERAL

        The presently authorized capital stock of the Company is 1,500,000,000
shares, which was most recently increased from 993,000,000 pursuant to a
shareholders' resolution adopted at the 105th Ordinary General Meeting of
Shareholders held on June 28, 2005. Under the Commercial Code shares are
transferable by delivery of share

                                     - 87 -

certificates, but in order to assert shareholders' rights against the Company,
the transferee must generally have his name registered in the Company's register
of shareholders. Shareholders are required to file their names, addresses and
seals with The Chuo Mitsui Trust & Banking Co., Ltd., the transfer agent for the
Company's Common Stock, and shareholders not resident in Japan are required to
file a mailing address in Japan or appoint a resident proxy in Japan. These
requirements do not apply to the holders of ADRs.

        The central clearing system of share certificates under the Law
Concerning Central Clearing of Share Certificates and Other Securities of Japan
applies to the shares of Common Stock of the Company. Pursuant to this system a
holder of shares of Common Stock is able to choose, at his discretion, to
participate in this system and all certificates of shares of Common Stock
elected to be put into this system are deposited with the central clearing
system and all such shares are registered in the name of the clearing house in
the Company's register of shareholders. Each participating shareholder is in
turn registered in the register of beneficial shareholders and treated the same
way as shareholders registered in the Company's register of shareholders.

DIVIDENDS

        The Articles of Incorporation of the Company provide that the accounts
shall be closed on March 31 of each year and that dividends, if any, shall be
paid to the shareholders of record as of the end of such fiscal period. After
the close of the fiscal period, the Board of Directors prepares, among other
things, a proposed allocation of profits for dividends and other purposes; this
proposal is submitted to the Corporate Auditors of the Company and to
independent certified public accountants and then submitted for approval to the
ordinary general meeting of shareholders, which is normally held in June of each
year. In addition to provisions for dividends, if any, and for the legal reserve
and other reserves, the allocation of profits customarily includes bonuses to
Directors and Corporate Auditors. In addition to a distribution of annual
dividends, the Board of Directors of the Company may by its resolution declare a
cash distribution pursuant to Article 293-5 of the Commercial Code (an "interim
dividend") to shareholders who are registered in the Company's register of
shareholders at the end of each September 30, subject to the limitations
described below.

        The Commercial Code provides that, until the aggregate amount of the
Company's legal reserve and additional paid-in capital is at least one-quarter
of the Company's stated capital, the Company may not make any distribution of
profits by way of dividends in cash unless it has set aside in its legal reserve
an amount equal to at least one-tenth of any amount paid out as an appropriation
of retained earnings (including any payment by way of annual dividend and
bonuses to Directors and Corporate Auditors) or equal to one-tenth of any
interim dividend. The Commercial Code permits the Company to distribute profits
by way of dividends out of the excess of its net assets, on a non-consolidated
basis, over the aggregate of (i) its stated capital, (ii) its additional paid-in
capital, (iii) its accumulated legal reserve, (iv) the legal reserve to be set
aside in respect of the dividends concerned and any other proposed payment by
way of appropriation of retained earnings, (v) the excess, if any, of
unamortized expenses incurred in preparation

                                     - 88 -

for commencement of business and in connection with research and development
over the aggregate of the amounts referred to in (ii), (iii) and (iv) above, and
(vi) the increased amount of net assets in its balance sheet due to the
assignment of market value to certain assets when the aggregate market value so
assigned exceeds the aggregate acquisition value of such assets. In the case of
interim dividends, the net assets are calculated by reference to the balance
sheet as at the end of the last fiscal year of the Company, and adjustments are
made to such net assets to reflect (1) a subsequent decrease due to (a) a
payment by way of an appropriation of retained earnings and the related transfer
to legal reserve, (b) a transfer of retained earnings to stated capital, (c) the
allocation of the aggregate purchase price of shares determined by a resolution
of the ordinary general meeting of shareholders or by a resolution of the Board
of Directors authorizing the Company to acquire its shares, and (d) other
amounts as provided for by enforcement regulations of the Ministry of Justice
("Enforcement Regulations"), and (2) a subsequent increase due to (a) a
reduction of paid-in capital or legal reserve, (b) a reduction of stated capital
and (c) other amounts as provided for by Enforcement Regulations. Interim
dividends may not be paid where there is a risk that at the end of the fiscal
year net assets might be less than the aggregate of the amounts referred to in
(i), (ii), (iii), (iv), (v) and (vi) above.

        The Commercial Code, currently in effect, does not provide for "stock
dividends." However, under the Commercial Code, the shareholders may by
resolution transfer any amount which is distributable as dividends to stated
capital and the Board of Directors may by resolution issue additional shares by
way of a stock split, thus the same effect as a stock dividend can be achieved.

        In Japan, the "ex-dividend" date and the record date for dividends
precede the date of determination of the amount of the dividend to be paid.

TRANSFER OF CAPITAL SURPLUS AND LEGAL RESERVE TO STATED CAPITAL AND STOCK SPLITS
(FREE SHARE DISTRIBUTIONS)

        When the Company issues new shares of Common Stock, the entire amount of
the issue price of such new shares is required to be accounted for as stated
capital, although the Company may account for an amount not exceeding one-half
of such issue price as capital surplus. The Board of Directors may transfer the
whole or any part of capital surplus and legal reserve to stated capital and
grant to shareholders additional shares of Common Stock free of charge by way of
a stock split with reference to the whole or any part of the amount of capital
surplus and legal reserve so transferred to stated capital.

GENERAL MEETING OF SHAREHOLDERS

        The ordinary general meeting of shareholders to settle accounts of the
Company for each fiscal period is normally held in June each year in Ota-ku,
Tokyo, Japan. In addition, the Company may hold an extraordinary general meeting
of shareholders whenever necessary by giving at least two weeks' advance notice
to shareholders.

                                     - 89 -

        Notice of a shareholders' meeting setting forth the place, time and
purpose thereof, must be mailed to each shareholder having voting rights (or, in
the case of a non-resident shareholder, to his resident proxy or mailing address
in Japan) at least two weeks prior to the date set for the meeting. Such notice
may also be furnished to shareholders by electronic means with such
shareholders' consent.

        Any shareholder holding at least 300 voting shares or 1% of the total
number of outstanding voting shares for six months or more may propose a matter
to be considered at a general meeting of shareholders by submitting a written
request to a Representative Director at least eight weeks prior to the date set
for such meeting. Such request may be submitted by electronic means with the
Company's consent.

VOTING RIGHTS

        A shareholder is entitled to one vote per share subject to the
limitations on voting rights set forth in the following paragraph below and in
the sections entitled "'Unit' share system" through "Voting rights of a holder
of shares representing less than one unit" below. Except as otherwise provided
by law or by the Company's Articles of Incorporation, a resolution can be
adopted at a general meeting of shareholders by a majority of the shares having
voting rights represented at the meeting. Special resolutions provided for in
Article 343 of the Commercial Code shall be adopted by the vote of the
shareholders not less than two-thirds (2/3) of those present at a meeting
whereby one-third (1/3) of voting rights of all of the shareholders shall
constitute a quorum. The Commercial Code and the Company's Articles of
Incorporation provide, however, that the quorum for the election of Directors
and Corporate Auditors shall not be less than one-third of the total number of
outstanding shares having voting rights. The Company's shareholders are not
entitled to cumulative voting in the election of Directors. A corporate
shareholder, more than one-quarter of whose outstanding voting shares are
directly or indirectly owned by the Company, may not exercise its voting rights
in respect of the shares of the Company. The Company has no voting rights with
respect to its own Common Stock. Shareholders may exercise their voting rights
through proxies provided that the proxies are also shareholders holding voting
rights. The Company's shareholders also may cast their votes in writing.

        The Commercial Code provides that in order to amend the Articles of
Incorporation and in certain other instances, including an increase in the total
number of shares authorized to be issued, a reduction of the stated capital, the
removal of a Director or Corporate Auditor, dissolution, merger (with an
exception of a merger with a company of significantly small business) or
consolidation of a corporation, the transfer of the whole or an important part
of the business, the taking over of the whole of the business of any other
corporation (with an exception of a merger with a company of significantly small
business), any offering of new shares at a "specially favorable" price (or any
offering of convertible bonds or debentures with "specially favorable"
conversion conditions or of bonds or debentures with warrants or rights to
subscribe for new shares with "specially favorable" conditions) to persons other
than shareholders, the quorum shall be one-third of the total number of shares
having voting rights outstanding and the

                                     - 90 -

approval of the holders of at least two-thirds of the shares having voting
rights represented at the meeting is required (the "special shareholders
resolution").

SUBSCRIPTION RIGHTS

        Holders of the Company's Common Stock have no preemptive rights under
its Articles of Incorporation. Authorized but unissued shares may be issued at
such times and upon such terms as the Board of Directors determines, subject to
the limitations as to the offering of new shares at a "specially favorable"
price mentioned above. The Board of Directors may, however, determine that
shareholders shall be given subscription rights regarding a particular issue of
new shares, in which case such rights must be given on uniform terms to all
shareholders as at a record date of which not less than two weeks' public notice
must be given. Each of the shareholders to whom such rights are given must also
be given notice of the expiry thereof at least two weeks prior to the date on
which such rights expire.

        Rights to subscribe for new shares may be made generally transferable by
the Board of Directors. Whether the Company will make subscription rights
generally transferable in future rights offerings will depend upon the
circumstances at the time of such offerings. If subscription rights are not made
generally transferable, transfers by a non-resident of Japan or a corporation
organized under the laws of a foreign country or whose principal office is
located in a foreign country will be enforceable against the Company and third
parties if the Company's consent to each such transfer is obtained. When such
consent is necessary in the future for the transfer of subscription rights, the
Company intends to consent, on request, to all such transfers by such a
non-resident or foreign corporation.

DILUTION

        In the future it is possible that market conditions and other factors
might make a rights offering to shareholders substantially below the market
price of shares of Common Stock desirable. If the number of shares offered in a
rights offering is substantial in relation to the number of shares outstanding
and the market price exceeds the subscription price at the time of the offering,
a shareholder who does not exercise and is unable otherwise to realize the full
value of his subscription rights would suffer economic dilution of his equity
interest in the Company.

LIQUIDATION RIGHTS

        In the event of a liquidation of the Company, the assets remaining after
payment of all debts and liquidation expenses and taxes will be distributed
among the shareholders in proportion to the respective numbers of shares held.

LIABILITY TO FURTHER CALLS OR ASSESSMENTS

        All the Company's presently outstanding shares of Common Stock including
shares represented by the American Depository Shares are fully paid and
non-assessable.

                                     - 91 -

TRANSFER AGENT

        The Chuo Mitsui Trust and Banking Co., Ltd. is the transfer agent for
the Company's Common Stock; as such transfer agent, it keeps the Company's
register of shareholders and register of the lost share certificates in its
office at 7-1,Kyobashi 1-chome, Chuo-ku, Tokyo, Japan, and makes transfer of
record ownership upon presentation of the certificates representing the
transferred shares.

RECORD DATE

        March 31 is the record date for the Company's year-end dividends. The
shareholders who are registered as the holders of 1,000 shares or more in the
Company's register of shareholders at the end of each March 31 are also entitled
to exercise shareholders' rights at the ordinary general meeting of shareholders
with respect to the fiscal period ending on such March 31. September 30 is the
record date for interim dividends. In addition, the Company may set a record
date for determining the shareholders entitled to other rights and for other
purposes by giving at least two weeks' public notice.

        The price of the shares generally goes ex-dividend or ex-rights on
Japanese stock exchanges on the third business day prior to a record date (or if
the record date is not a business day, the fourth business day prior thereto),
for the purpose of dividends or rights offerings.

REPURCHASE BY THE COMPANY OF ITS COMMON STOCK

        The Company may repurchase shares (i) through the Tokyo Stock Exchange
or other stock exchange on which the shares are listed or by way of tender
offer, if authorized by an ordinary resolution of an ordinary general meeting of
shareholders or by a resolution of the Board of Directors, (ii) from a specific
party, if authorized by a special resolution of an ordinary general meeting of
shareholders, or (iii) from the Company's own subsidiary, if authorized by a
resolution of the Board of Directors.

        When a repurchase is made by the Company from a specified party pursuant
to an authorization by a special resolution of an ordinary general meeting of
shareholders as noted above, shareholders may make a demand to a Representative
Director, five days or more prior to the relevant shareholders' meeting, that
the Company also repurchase the shares held by that shareholder. Repurchase of
shares pursuant to an authorization of the ordinary general meeting of
shareholders must satisfy certain requirements, including the requirement that
the total amount of the repurchase price may not exceed the amount of the
retained earnings available for annual dividend payments after taking into
account any reduction, if any, of the stated capital, additional paid-in capital
or legal reserve (if such reduction of the stated capital, additional paid-in
capital or legal reserve has been authorized pursuant to a resolution of the
relevant ordinary general meeting of shareholders), minus the amount to be paid
by way of appropriation of retained earnings for the relevant fiscal year and
the amount to be transferred to stated capital. Repurchase of shares pursuant to
an authorization of the Board of Directors must satisfy certain

                                     - 92 -

requirements, including the requirement that the total amount of the repurchase
price may not exceed the amount of the retained earnings available for interim
dividend payments minus the amount of interim dividends, if paid. If it is
anticipated that the net assets on the balance sheet as at the end of the
relevant fiscal year will be less than the aggregate amount of the stated
capital, additional paid-in capital and other items as described in (i) through
(vi) in "Dividends" above, the Company may not repurchase shares. The Company
may hold its own shares so repurchased without restriction. The Company may
cancel its own shares that it holds by a resolution of the Board of Directors.
The Company may otherwise dispose of its own shares by a resolution of the Board
of Directors.

"UNIT" SHARE SYSTEM (TANGENKABU SEIDO)

        Pursuant to the Commercial Code the Company has adopted 1,000 shares as
one unit of shares.

TRANSFERABILITY OF SHARES REPRESENTING LESS THAN ONE UNIT

        As adopted in the Company's Articles of Incorporation, the Company will
not issue certificates for shares representing less than one unit. Since the
transfer of shares normally requires delivery of the certificates therefor,
fractions of a unit for which no share certificates are issued are not
transferable. Shares representing less than one unit for which share
certificates have been issued continue to be transferable.

RIGHT OF A HOLDER OF SHARES REPRESENTING LESS THAN ONE UNIT TO REQUIRE THE
COMPANY TO PURCHASE SUCH SHARES

        A holder of shares representing less than one unit may at any time
require the Company to purchase such shares at their last reported sale price on
the Tokyo Stock Exchange on the day when such request is made less applicable
brokerage commission. The usual securities transfer tax is applicable to such
transactions.

RIGHT OF THE HOLDER OF SHARES TO DEMAND THE PURCHASE OF SHARES REPRESENTING LESS
THAN ONE UNIT

        As adopted in the Company's Articles of Incorporation and set forth in
the Share Handling Regulations, a holder of shares of less-than-one-unit may
request the Company to sell additional shares so that their less-than-one-unit
can share constitute one unit of shares.

OTHER RIGHTS OF A HOLDER OF SHARES REPRESENTING LESS THAN ONE UNIT

        A holder of shares representing less than one unit has certain rights in
respect of such shares, including the following: (i) the right to receive
dividends (including interim dividends), (ii) the right to receive shares and/or
cash by way of a stock split or upon consolidation or subdivision of shares or
upon a capital decrease or merger of the Company, (iii) the right to be allotted
subscription rights with respect to new shares, convertible bonds and bonds with
warrants to subscribe for shares when such rights are

                                     - 93 -

granted to shareholders, (iv) the right to participate in the distribution of
surplus assets in the event of the liquidation of the Company, (v) the right to
request to inspect certain corporate documents, including minutes of the Board
of Directors meetings, (vi) the right to file a derivative action on behalf of
the Company and (vii) the right to file an action seeking to invalidate certain
events, including issuance of new shares and corporate mergers. Other rights,
including voting rights, cannot be exercised with respect to shares representing
less than one unit.

VOTING RIGHTS OF A HOLDER OF SHARES REPRESENTING LESS THAN ONE UNIT

        A holder of shares representing less than one unit cannot exercise any
voting rights with respect to such shares. A holder of shares representing one
or more whole units will have one vote for each such unit, except as stated in
"Voting rights" above.

C. Material contracts

        All contracts entered into by Ricoh or any member of the Ricoh Group
during the two years preceding this report were entered into in the ordinary
course of business.

D. Exchange controls

        The Foreign Exchange and Foreign Trade Law of Japan, as amended, and the
cabinet orders and ministerial ordinances thereunder (the "Exchange Law") govern
certain matters relating to the issuance of equity-related securities by the
Company and the acquisition and holding of shares of Common Stock or ADSs
representing such shares by "exchange non-residents" and by "foreign investors"
as hereinafter defined. The Exchange Law currently in effect does not affect the
right of an exchange non-resident to purchase or sell an ADS outside Japan.

        "Exchange non-residents" are defined under the Exchange Law as
individuals who are not resident in Japan and corporations whose principal
offices are located outside Japan. Generally branches and other offices of
Japanese corporations located outside Japan are regarded as exchange
non-residents, but branches and other offices located within Japan of
non-resident corporations are regarded as residents of Japan. "Foreign
investors" are defined to be (i) individuals not resident in Japan, (ii)
corporations which are organized under the laws of foreign countries or whose
principal offices are located outside Japan, and (iii) corporations of which (a)
50% or more of the shares are held by (i) and/or (ii) above, (b) a majority of
officers consists of non-resident individuals or (c) a majority of the officers
having the power of representation consists of non-resident individuals.

        Dividends and Proceeds of Sales

        Under the Exchange Law, dividends paid on, and the proceeds of sales in
Japan of, shares of Common Stock held by exchange non-residents in general may
be converted into any foreign currency and repatriated abroad. The acquisition
of shares of Common Stock by exchange non-resident shareholders by way of stock
splits is not subject to any requirements under the Exchange Law.

                                     - 94 -

        Acquisition of Shares

        Under the Exchange Law, acquisition of shares of a Japanese company
listed on any Japanese stock exchange or traded on the over-the-counter market
in Japan ("listed shares") by an exchange non-resident from a resident of Japan
is generally not subject to a prior filing requirement. In case a foreign
investor acquires listed shares (whether from a resident of Japan or an exchange
non-resident, from another foreign investor or from or through a designated
securities company) and as a result of such acquisition the number of shares
held directly or indirectly by such foreign investor would become 10% or more of
the total outstanding shares of the company, the foreign investor is required to
make a subsequent report on such acquisition to the Minister of Finance and
other Ministers having jurisdiction over the business of the subject company
(the "Competent Ministers"). In certain exceptional cases, a prior filing is
required and the Competent Ministers may recommend the modification or
abandonment of the proposed acquisition and, if the foreign investor does not
accept the recommendation, order its modification or prohibition. The deposit of
shares of Common Stock by an exchange non-resident of Japan, the issuance of
ADRs in exchange therefor and the withdrawal of the underlying shares of Common
Stock by an exchange non-resident upon surrender of ADRs are not subject to any
requirements under the Exchange Law, except where as a result of such deposit or
withdrawal the aggregate number of shares of Common Stock held by the Depositary
(or its nominee) or the holder surrendering ADRs, as the case may be, would be
10% or more of the total outstanding shares of Common Stock, in which event a
subsequent reporting may be required as described above.

E. Taxation

JAPANESE TAXATION

        Generally, a non-resident of Japan or a non-Japanese corporation is
subject to Japanese withholding tax on dividends paid by a Japanese corporation.
Generally, stock splits are not subject to Japanese income tax. According to the
Income Tax Law of Japan, the rate of Japanese national withholding tax
applicable to dividends paid on listed shares issued by the Company to
non-residents of Japan or non-Japanese corporations is (i) 7% for the period
from January 1, 2004 to March 31, 2008, and (ii) 15% thereafter, except for
dividends paid to any individual shareholder who holds 5% or more of the
outstanding total of the shares issued by the Company, for which the applicable
rate is 20%. Under the new income tax convention between the U.S. and Japan (the
"Convention") ratified in March 2004, the maximum rate of Japanese withholding
tax that may be imposed on dividends paid to a U.S. resident or corporation not
having a "permanent establishment" (as defined therein) in Japan is generally
10%. This 10% withholding tax rate is applicable to dividends declared on or
after July 1, 2004. The 15% withholding tax rate under the old income tax
convention is still applicable to dividends declared before July 1, 2004. If the
tax rate under the domestic tax law is lower than that under the Convention, the
domestic tax rate is still applicable.

        Gains derived by a non-resident of Japan or a non-Japanese corporation
from the sale of Common Stock or ADRs outside Japan, or from the sale of Common
Stock within
                                     - 95 -

Japan by a non-resident of Japan or by a non-Japanese corporation not having a
permanent establishment in Japan, are in general not subject to Japanese income
or corporation tax. Japanese inheritance or gift tax at progressive rates may be
payable by an individual who has acquired Common Stock or ADRs as a legatee,
heir or donee.

        For purposes of the Convention and the U.S. Internal Revenue Code of
1986, as amended (the "Code"), U.S. holders of ADRs will be treated as the
owners of the Common Stock underlying the American Depositary Shares evidenced
by the ADRs.

U.S. TAXATION

        This summary describes the material U.S. federal income tax consequences
for a U.S. holder (as defined below) of owning and disposing of shares of Common
Stock or American Depositary Shares evidenced by the ADRs. This summary applies
to you only if you hold shares of Common Stock or American Depositary Shares as
capital assets for U.S. federal income tax purposes. This summary does not apply
to you if you are a member of a class of holders subject to special rules, such
as:

..       a dealer in securities or currencies;

..       a trader in securities that elects to use a mark-to-market method of
        accounting for securities holdings;

..       a bank;

..       a life insurance company;

..       a tax-exempt organization;

..       a person that holds shares of Common Stock or American Depositary Shares
        that are a hedge or that are hedged against interest rate or currency
        risks;

..       a person that is subject to the alternative minimum tax;

..       a person that holds shares of Common Stock or American Depositary Shares
        as part of a straddle or conversion transaction for tax purposes;

..       a person whose functional currency for U.S. federal income tax purposes
        is not the U.S. Dollar; or

..       a person that actually or constructively owns or is deemed to own 10% or
        more of any class of our stock.

        This summary is based on laws, treaties, and regulatory interpretations
in effect on the date hereof, all of which are subject to change, possibly on a
retroactive basis. Moreover, this summary assumes that the Company will not be
treated as a passive foreign investment company (a "PFIC") for U.S. federal
income tax purposes. See the summary below under the heading "PFIC Rules."

                                     - 96 -

        Please consult your own tax advisers concerning the U.S. federal, state,
local, and other tax consequences of purchasing, owning, and disposing of shares
of Common Stock or American Depositary Shares in your particular circumstances.

        For purposes of this summary, you are a "U.S. holder" if you are a
beneficial owner of a share of Common Stock or an American Depositary Share that
is for U.S. federal income tax purposes: (i) a citizen or a resident of the
United States, (ii) a corporation or a partnership (including an entity treated
as a corporation or a partnership for U.S. federal income tax purposes) created
or organized in or under the laws of the United States, any state thereof or the
District of Columbia (unless, in the case of a partnership, Treasury regulations
are adopted that provide otherwise), (iii) an estate whose income is subject to
U.S. federal income tax regardless of its source, or (iv) a trust if a court
within the United States is able to exercise primary supervision over the
administration of the trust and one or more United States persons have the
authority to control all substantial decisions of the trust. Certain trusts not
described in clause (iv) above in existence on August 20, 1996 that elect to be
treated as a United States person will also be a U.S. holder for purposes of
this discussion.

        In general, if you hold ADRs evidencing American Depositary Shares, you
will be treated as the owner of the shares of Common Stock represented by those
American Depositary Shares for U.S. federal income tax purposes, and no gain or
loss will be recognized if you exchange an American Depositary Share for the
shares of Common Stock represented by that American Depositary Share.

        DIVIDENDS

        The gross amount of cash dividends paid out of the Company's current or
accumulated earnings and profits, as determined for U.S. federal income tax
purposes, that a U.S. holder receives (prior to deduction of Japanese taxes)
generally will be subject to U.S. federal income taxation as foreign source
ordinary dividend income. However, in certain circumstances, all or a portion of
the cash dividends paid by the Company may be treated as U.S. source dividend
income. You should consult your tax advisers regarding the U.S. federal income
tax consequences of all or a portion of the cash dividends paid by the Company
being treated as U.S. source dividend income.

        Dividends paid in Japanese Yen will be included in your income in a U.S.
Dollar amount calculated by reference to the exchange rate in effect on the date
of your (or, in the case of American Depositary Shares, the depositary's)
receipt of the dividend, regardless of whether the payment is in fact converted
into U.S. Dollars. If such a dividend is converted into U.S. Dollars on the date
of receipt, you generally should not be required to recognize a foreign currency
gain or loss in respect of the dividend income. You should consult your own tax
adviser regarding the treatment of any foreign currency gain or loss realized
with respect to any Japanese Yen received by you (or, in the case of American
Depositary Shares, the depositary) that are converted into U.S. Dollars on a
date subsequent to receipt. Dividends paid by the Company generally will not be
eligible for the dividends-received deduction allowed to corporations that are
U.S. holders.

                                     - 97 -

        Notwithstanding the foregoing, pursuant to recently enacted legislation,
certain dividends received by individual U.S. holders that constitute "qualified
dividend income" will be subject to a reduced maximum marginal U.S. federal
income tax rate. Qualified dividend income generally includes, among other
dividends, dividends received during the taxable year from "qualified foreign
corporations." In general, the term "qualified foreign corporation" includes a
foreign corporation that is eligible for the benefits of a comprehensive income
tax treaty with the United States which the U.S. Treasury Department determines
to be satisfactory, and which includes an exchange of information program. In
addition, a foreign corporation is treated as a qualified foreign corporation
with respect to any dividend paid by the corporation with respect to stock of
the corporation that is readily tradable on an established securities market in
the United States. Notwithstanding this previous rule, dividends received from a
foreign corporation that was a foreign investment company (as defined in section
1246(b) of the Code), a passive foreign investment company (as defined in
section 1297 of the Code), or a foreign personal holding company (as defined in
section 552 of the Code) in either the taxable year of the corporation in which
the dividend was paid or the preceding taxable year will not constitute
qualified dividend income. In addition, the term qualified dividend income will
not include, among other dividends, any (i) dividends on any share of stock
which is held by a taxpayer for 60 days or less during the 121-day period
beginning on the date which is 60 days before the date on which such share
becomes ex-dividend with respect to such dividends (as measured under section
246(c) of the Code) or (ii) dividends to the extent that the taxpayer is under
an obligation (whether pursuant to a short sale or otherwise) to make related
payments with respects to positions in substantially similar or related
property. Moreover, special rules apply in determining a taxpayer's foreign tax
credit limitation under section 904 of the Code in the case of qualified
dividend income. Individual U.S. holders should consult their own tax advisors
to determine whether or not amounts received as dividends from the Company will
constitute qualified dividend income subject to a reduced maximum marginal U.S.
federal income tax rate and, in such case, the effect, if any, on the individual
U.S. holder's foreign tax credit.

        In addition to the foregoing, you should consult your own tax advisers
to determine whether any rules limit your ability to make effective use of
foreign tax credits, including the possible adverse impact of failing to take
advantage of benefits under the income tax treaty between the United States and
Japan. If no such rules apply, you generally may claim a credit against your
U.S. federal income tax liability for Japanese taxes withheld from dividends on
shares of Common Stock or American Depositary Shares, so long as you have owned
the shares of Common Stock or American Depositary Shares (and not entered into
specified kinds of hedging transactions) for at least a 16-day period that
includes the ex-dividend date. Instead of claiming a credit, you may, at your
election, deduct such Japanese taxes in computing your taxable income, subject
to generally applicable limitations under U.S. federal income tax law. The
calculation of foreign tax credits and, in the case of a U.S. holder that elects
to deduct foreign taxes, the availability of deductions involve the application
of complex rules that depend, in part, on a U.S. holder's particular
circumstances. You should consult your own tax advisers regarding the
creditability or deductibility of such taxes.

                                     - 98 -

        SALES AND OTHER DISPOSITIONS

        A U.S. holder will recognize a gain or loss on the sale or other
disposition of shares of Common Stock or American Depositary Shares evidenced by
ADRs in an amount equal to the difference between the U.S. Holder's adjusted tax
basis in such shares of Common Stock or American Depositary Shares (in U.S.
Dollars) and the amount realized on the disposition (in U.S. Dollars, generally
determined at the spot rate on the date of disposition if the amount realized is
denominated in a foreign currency). For U.S. federal income tax purposes, a gain
or loss realized by a U.S. holder on a sale or other disposition of shares of
Common Stock or American Depositary Shares will be a capital gain or loss, and
will be a long-term capital gain or loss if the shares of Common Stock or
American Depositary Shares were held for more than one year. Such gain or loss
generally will be treated as U.S. source gain or loss for U.S. foreign tax
credit purposes. Your ability to offset capital losses against ordinary income
is limited. Long-term capital gain recognized by an individual U.S. holder
generally is subject to taxation at a reduced maximum marginal U.S. federal
income tax rate.

        PFIC RULES

        The Company believes that it will not be treated as a PFIC for U.S.
federal income tax purposes. However, that is a factual determination made
annually and therefore may be subject to change. If the Company was treated as a
PFIC, a U.S. holder of shares of Common Stock or American Depositary Shares
evidenced by ADRs would be subject to certain adverse U.S. federal income tax
consequences.

U.S. INFORMATION REPORTING AND BACKUP WITHHOLDING RULES

        Payments in respect of the shares of Common Stock or American Depositary
Shares that are made within the United States or through certain U.S.-related
financial intermediaries are subject to information reporting and may be subject
to backup withholding unless the holder (i) is a corporation or other exempt
recipient or (ii) provides a taxpayer identification number and certifies that
no loss of exemption from backup withholding has occurred (and certain other
conditions are met).

F. Dividends and paying agents

        Not applicable.

G. Statement by experts

        Not applicable.

H. Documents on display

        The Company is subject to the informational requirements of the
Securities and Exchange Act of 1934, as amended. In accordance with these
requirements, the Company files reports and other information with the U.S.
Securities and Exchange Commission (the "SEC"). These materials, including this
annual report and exhibits

                                     - 99 -

thereto, may be inspected and copied at the SEC's Public Reference Room at 100 F
Street, N.E., Washington, D.C. 20549. Copies of the materials may be obtained
from the SEC's Public Reference Room at 100 F Street, N.E., Washington, D.C.
20549 at prescribed rates. The public may obtain information on the operation of
the Public Reference Room by calling the SEC in the U.S. at 1-800-SEC-0330. The
documents filed via the Electronic Data Gathering, Analysis, and Retrieval
system are also available for inspection on the SEC's website
(http://www.sec.gov).

I. Subsidiary information

        Not Applicable.

Item 11. Quantitative and Qualitative Disclosures About Market Risk
         ----------------------------------------------------------

        Ricoh is exposed to market risks primarily from changes in foreign
currency exchange rates and interest rates, which affect outstanding debt and
certain assets and liabilities denominated in foreign currencies. To a lesser
extent, Ricoh is also exposed to equity price risk. In order to manage these
risks that arise in the normal course of business, Ricoh enters into various
hedging transactions pursuant to its policies and procedures covering such areas
as counterparty exposure and hedging practices. Ricoh does not hold or issue
derivative financial instruments for trading purposes or to generate income.

        Ricoh regularly assesses these market risks based on the policies and
procedures established to protect against adverse effects of these risks and
other potential exposures, primarily by reference to the market value of the
financial instruments. As a result of the latest assessment, Ricoh does not
anticipate any material losses in these areas for the fiscal year 2005, and
there are no material quantitative changes in market risk exposure at March 31,
2005 when compared to March 31, 2004. In the normal course of business, Ricoh
also faces risks that are either non-financial or nonquantifiable. Such risks
principally include credit risk and legal risk, and are not represented in the
following tables.

FOREIGN CURRENCY RISK

        In the ordinary course of business, Ricoh uses foreign exchange forward
contracts to manage the effects of foreign currency exchange risk on monetary
assets and liabilities denominated in foreign currencies. The contracts with
respect to the operating activities generally have maturities of less than six
months, while the contracts with respect to the financing activities have the
same maturities as the underlying assets and liabilities.

        The table below provides information about Ricoh's material derivative
financial instruments that are sensitive to foreign currency exchange rates. The
table below relating to foreign exchange forward contracts presents the notional
amounts, weighted average exchange rates and estimated fair value. These
notional amounts generally are used to calculate the contractual payments to be
exchanged under the contracts.

                                     - 100 -

Foreign Exchange Forward Contracts (Year ended March 31, 2005)

<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------
                                       Year Ended March 31, 2005
            ---------------------------------------------------------------------------
                                           Contract amounts       Estimated fair value
            Average contractual rates      (Millions of Yen)        (Millions of Yen)
---------------------------------------------------------------------------------------
<S>                    <C>                          <C>                     <C>
US$/ YEN               107.41                          537                     1
EUR/ YEN               137.28                       31,066                  (253)
---------------------------------------------------------------------------------------
</TABLE>

INTEREST RATE RISK

        In the ordinary course of business, Ricoh enters into interest rate swap
agreements to reduce interest rate risk and to modify the interest rate
characteristics of its outstanding debt. These agreements primarily involve the
exchange of fixed and floating rate interest payments over the life of the
agreement without the exchange of the underlying principal amounts.

        The below table provides information about Ricoh's major derivative and
other financial instruments that are sensitive to changes in interest rates,
including interest rate swaps and debt obligations. For debt obligations, the
table presents principal cash flows by expected maturity date, related weighted
average interest rates and estimated fair value. For interest rate swaps, the
table presents notional amounts by expected maturity date, weighted average
interest rates. Notional amounts are generally used to calculate the contractual
payments to be exchanged under the contract.

<TABLE>
<CAPTION>
---------------------------------------------------------------------------------------------------------------------
LONG-TERM INDEBTEDNESS                                           Year ended March 31, 2005
---------------------------------------------------------------------------------------------------------------------
                                                                      Millions of Yen
                                         ----------------------------------------------------------------------------
(Excluding Capital Lease                                               Expected maturity date
Obligations and SFAS No. 133                        -----------------------------------------------------------------
fair value adjustment)
                                Average                                                                        Fair
                               pay rate   Total     2006      2007      2008     2009      2010    Thereafter  Value
---------------------------------------------------------------------------------------------------------------------
<S>                               <C>    <C>       <C>       <C>       <C>      <C>       <C>         <C>     <C>
Bonds                             1.40%  130,000   40,000    45,000    10,000   25,000    10,000          -   132,353

Medium-Term Notes                 0.30    22,000   11,000    10,000         -        -         -      1,000    22,010

Loans                             1.37   213,549   92,307    44,294    43,615    8,946    24,347         40   213,458
---------------------------------------------------------------------------------------------------------------------
Total                                    365,549   143,307   99,294    53,615    33,946   34,347      1,040   367,821
---------------------------------------------------------------------------------------------------------------------
</TABLE>

                                     - 101 -

<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------------------------
INTEREST RATE SWAPS                                              Year ended March 31, 2005
----------------------------------------------------------------------------------------------------------------------
                                                                      Millions of Yen
                                               -----------------------------------------------------------------------
                                                                       Expected maturity date
                                                         -------------------------------------------------------------
  Notional                  Average  Average
  amounts                   receive    pay                                                                       Fair
 (Millions)   Type of swap   rate     rate     Total     2006     2007     2008     2009     2010    Thereafter  Value
----------------------------------------------------------------------------------------------------------------------
<S>                           <C>      <C>      <C>      <C>      <C>      <C>          <C>       <C>      <C>   <C>
              Receive
              floating
      84,000  /Pay fixed      0.30%    0.06%    84,000   52,000   22,000   10,000       -         -        -     1,694

              Receive
              fixed /Pay
      45,000  floating        2.20     0.11     45,000   19,000    1,000    6,000        -   10,000    9,000      (124)
----------------------------------------------------------------------------------------------------------------------
              Receive
              fixed /Pay
US$      183  fixed           3.90%    2.85%    19,601        -        -   19,601        -        -        -      113
----------------------------------------------------------------------------------------------------------------------
</TABLE>

CREDIT RISK

        Ricoh is also exposed to credit-related losses in the event of
nonperformance by counterparties to the financial instrument; however, credit
risk arising from the nonperformance of counterparties to meet the terms of
financial instrument contracts is generally limited to the amounts by which the
counterparties' obligations exceed the obligations of Ricoh. It is Ricoh's
policy to only enter into financial instrument contracts with a diversified
group of financial institutions having credit ratings satisfactory to Ricoh to
minimize the concentration of credit risk. Therefore, Ricoh does not expect to
incur material credit losses on its financial instruments.

DEBT/EQUITY PRICE RISK

        Ricoh has a relatively small portion of marketable securities which are
subject to equity price risk arising from changes in their market prices.
Marketable securities consist of a diversified pool of Japanese equity
securities. Ricoh's overall investment policy is to invest in highly-liquid, low
risk investments.

        The table below provides information about contractual maturities for
available-for-sale securities and the fair values for market risk sensitive
securities as of March 31, 2005.

                                                       Millions of Yen
                                              For the Year ended March 31, 2005
                                              ---------------------------------
                                                    Cost            Fair Value
                                              ---------------    --------------
Debt Securities
   Due within one year                                   137               137
   Due after one year through five years               6,000             6,045
Equity Securities                                      7,479            16,451
Investment Trusts*                                     1,230             1,710
                                              ---------------    --------------
Total                                                 14,846            24,343
                                              ---------------    --------------

*Investment trusts consist of investments in marketable debt and equity
securities.

                                     - 102 -

Item 12. Description of Securities Other Than Equity Securities
         ------------------------------------------------------

        Not applicable.

                                     PART II

Item 13. Defaults, Dividend Arrearages and Delinquencies
         -----------------------------------------------

        None.

Item 14. Material Modifications to the Rights of Security Holders and Use of
         -------------------------------------------------------------------
         Proceeds
         --------

        None.

Item 15. Controls and Procedures
         -----------------------

        As of March 31, 2005, Ricoh performed an evaluation of the effectiveness
of the design and operation of its disclosure controls and procedures under the
supervision and with the participation of Ricoh's management, including the
Chief Executive Officer and the Chief Financial Officer. Based on that
evaluation, Ricoh's management, including the Chief Executive Officer and the
Chief Financial Officer, concluded that its disclosure controls and procedures
were effective as of the date of such evaluation.

        No significant changes in Ricoh's internal controls or in other factors
have occurred that could significantly affect these controls subsequent to the
date the Chief Executive Officer and the Chief Financial Officer completed their
evaluation.

Item 16. [RESERVED]

Item 16.A. Audit Committee Financial Expert
           --------------------------------

        The Board of Directors of the Company has determined that it does not
have an "audit committee financial expert" as defined in Item 16.A. of Form 20-F
serving on the Board of Corporate Auditors.

        The Company is considering the issues related to and the ramifications
of such a designation. In Japan, there are limited numbers of qualified persons
who meet all of the criteria established by the SEC for financial experts to be
designated by issuers. Accordingly, it is taking some time for the Company to
identify such a qualified person. Although the Board of Directors is satisfied
that that members of the Board of Corporate Auditors possess the appropriate
skills and experience, as a group, to carry out their duties as members of the
Board of Corporate Auditors, the Company will continue to strive to identify
potential candidates that might qualify for this position. The Board of

                                     - 103 -

Corporate Auditors will keep under active review the financial expert matter
during the 2006 fiscal year as part of their overall risk management and
compliance program.

Item 16.B. Code of Ethics
           --------------

        Ricoh has adopted a code of ethics that applies to its employees,
including the President, Chief Executive Officer, Chief Operating Officer, and
the senior management of accounting and finance. Such code of ethics of Ricoh is
provided hereto as Exhibit 11.

Item 16.C. Principal Accountant Fees and Services
           --------------------------------------

        The aggregate fees for professional services rendered to Ricoh by KPMG
AZSA & Co. and the related parties of KPMG for the years ended March 31, 2004
and 2005, were:

                                        Millions of Yen
                                      Year Ended March 31,
                     -------------------------------------------------
Type of Fees                    2004                    2005
----------------------------------------------  ----------------------
Audit Fees                       689                     697
Audit-related Fees                 3                     404
Tax Fees                          33                      53
All Other Fees                    16                      16
                     -------------------------  ----------------------
TOTAL                            741                   1,170
                     -------------------------  ----------------------

        Audit Fees consist of fees for the annual audit of Ricoh's consolidated
financial statements, and statutory and subsidiary audits, assistance with the
review of documents filed with the SEC, consents, comfort letters and other
assistance that are normally provided by our independent accountants.

        Audit-related Fees consist of fees for assurance and related services
that are reasonably related to the performance of the audit or review of Ricoh's
financial statements or that are traditionally performed by the independent
accountants and include employee benefit plan audits, due diligence related to
mergers and acquisitions, accounting consultations and audits in connection with
acquisitions, attest services that are not required by statute or regulations,
consultation concerning financial accounting and reporting standards, internal
control reviews and assistance with internal control reporting requirements and
review of the effectiveness of the internal audit function.

        Tax Fees consist of fees for tax compliance, tax advice and tax planning
services, including preparation of original and amended tax returns, claims for
refund and tax payment-planning services, assistance with tax audits and
appeals, tax advice related to mergers and acquisitions, and transfer pricing
documentation.

        All Other Fees consists of fees for all other services not included in
any of the categories noted above.

                                     - 104 -

AUDIT COMMITTEE PRE-APPROVAL POLICIES AND PROCEDURES

        In accordance with Japanese law, the Company's independent accountants
(KAIKEI KANSANIN) ("Accounting Auditors") are appointed by the shareholders at
the Ordinary General Meeting of Shareholders with the consent of the Company's
Board of Corporate Auditors. In addition, the Board of Corporate Auditors may,
by its resolution, request the Company's Board of Directors to submit a proposal
as to the appointment of Accounting Auditors at the Ordinary General Meeting of
Shareholders. Subsequent to the appointment of the Accounting Auditors, the
Board of Corporate Auditors is responsible, among other matters, for the
oversight of the Accounting Auditors, subject to the requirements of Japanese
law. No proposal was submitted to discharge KPMG AZSA & Co. as the Company's
Accounting Auditors at the most recent Ordinary General Meeting of Shareholders
held on June 28, 2005.

        The Board of Corporate Auditors has adopted policies and procedures to
pre-approve all audit and permissible non-audit services provided by the
Accounting Auditor ("Pre-approval Policies"). Under the Pre-approval Policies,
proposed services either (i) may be pre-approved by the Board of Corporate
Auditors without specific consideration on a case-by-case basis if such services
do not exceed pre-approved fee levels ("general pre-approval"), or (ii) require
the specific pre-approval of the Board of Corporate Auditors ("specific
pre-approval"). The Board of Corporate Auditors may delegate its specific
pre-approval authority to one or more of its independent members who shall be
designated by the Board of Corporate Auditors. Under the Pre-approval Policies,
the Accounting Auditors are not allowed to perform any non-audit services which
may impair the auditors independence under the rules of the SEC. The appendices
to the Pre-approval Policies set out the audit, audit-related, tax and other
services, including those described above, that have received the general
pre-approval of the Board of Corporate Auditors.

        The term of any general pre-approval is twelve months from the date of
pre-approval, unless the Board of Corporate Auditors specifically provides for a
different period and sets forth such different period in the relevant appendix
to the Pre-approval Policies. The Board of Corporate Auditors will annually
review the Pre-approval Policies and revise the list of services that it has
provided general pre-approval. Requests or applications to provide services that
require specific pre-approval by the Board of Corporate Auditors will be
submitted to the Board of Corporate Auditors by the Chief Officer of a company
or division to which services are provided, accompanied by a draft engagement
letter from the Accounting Auditor.

        During fiscal year 2005, none of the services provided to the Company by
KPMG AZSA & Co. were approved by the Board of Corporate Auditors pursuant to the
de minimis exception to the pre-approval requirement provided by paragraph
(c)(7)(i)(C) of Rule 2-01 of Regulation S-X.

Item 16.D. Exemptions from the Listing Standards for Audit Committees
           ----------------------------------------------------------

        Not applicable.

                                     - 105 -

Item 16. E. Purchases of Equity Securities by the Issuer and Affiliated
            -----------------------------------------------------------
            Purchasers
            ----------

        Not applicable.

                                    PART III

Item 17. Financial Statements
         --------------------

        Not applicable.

Item 18. Financial Statements
         --------------------

        See Consolidated Financial Statements and Schedule attached hereto.

Item 19. Exhibits
         --------

        Documents filed as exhibits to this annual report:

        1.1        Articles of Incorporation, as amended (English translation)

        1.2        Share Handling Regulations, as amended (English translation)

        1.3        Regulations of the Board of Directors, as amended (English
                   translation)

        1.4        Regulation of the Board of Corporate Auditors, as amended
                   (English translation)

        8.1        List of Significant Subsidiaries (See "Organizational
                   structure" in Item 4.C. of this Form 20-F)

        11         Code of Ethics (English translation)

        12.1       Certification Pursuant to Rule 13a-14(a)/15d-14(a)

        12.2       Certification Pursuant to Rule 13a-14(a)/15d-14(a)

        13.(a)(1)  Certification Pursuant to Section 1350 of Chapter 63 of Title
                   18 of the United States Code

        13.(a)(2)  Certification Pursuant to Section 1350 of Chapter 63 of Title
                   18 of the United States Code

                                     - 106 -

                                   SIGNATURES
                                   ----------

        Pursuant to the requirements of Section 12 of the Securities Exchange
Act of 1934, the Company hereby certifies that it meets all of the requirements
for filing on Form 20-F and that it has duly caused and authorized the
undersigned to sign this annual report on its behalf.


                                        RICOH COMPANY, LTD.
                                        -------------------
                                        (Registrant)


                                          By: /s/ Zenji Miura
                                              -------------------------------
                                              Zenji Miura
                                              Director,
                                              Corporate Executive Vice President
                                              and Chief Financial Officer

Date: June 29, 2005


--------------------------------------------------------------------------------

RICOH COMPANY, LTD.

Consolidated Financial Statements and Schedule
For the years ended March 31, 2003, 2004 and 2005
With Report of Independent Registered Public Accounting Firm Thereon


RICOH COMPANY, LTD. AND CONSOLIDATED SUBSIDIARIES
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

                                                                            Page
================================================================================

 Report of Independent Registered Public Accounting Firm ....................F-2

 Consolidated Balance Sheets as of
       March 31, 2004 and 2005 .......................................F-3 to F-4

 Consolidated Statements of Income
       for the years ended March 31, 2003, 2004 and 2005 ....................F-5

 Consolidated Statements of Shareholders' Investment
       for the years ended March 31, 2003, 2004 and 2005 ....................F-6

 Consolidated Statements of Cash Flows
       for the years ended March 31, 2003, 2004 and 2005 ....................F-7

 Notes to Consolidated Financial Statements .........................F-8 to F-44

 Schedule:

       II. Valuation and Qualifying Accounts and Reserves ..................F-45

All schedules not listed have been omitted because they are not applicable, or
the required information has been otherwise supplied in the consolidated
financial statements or the notes thereto.
================================================================================

                                      F-1

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Shareholders and the Board of Directors
of Ricoh Company, Ltd.:

We have audited the consolidated financial statements of Ricoh Company, Ltd. (a
Japanese corporation) and subsidiaries as listed in the accompanying index. In
connection with our audits of the consolidated financial statements, we have
also audited the financial statement schedule as listed in the accompanying
index. These consolidated financial statements and financial statement schedule
are the responsibility of the Company's management. Our responsibility is to
express an opinion on these consolidated financial statements and financial
statement schedule based on our audits.

We conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the financial position of Ricoh Company, Ltd.
and subsidiaries as of March 31, 2004 and 2005, and the results of their
operations and their cash flows for each of the years in the three-year period
ended March 31, 2005, in conformity with U.S. generally accepted accounting
principles. Also in our opinion, the related financial statement schedule, when
considered in relation to the basic consolidated financial statements taken as a
whole, presents fairly, in all material respects, the information set forth
therein.

The accompanying consolidated financial statements as of and for the year ended
March 31, 2005, have been translated into United States dollars solely for the
convenience of the reader. We have audited the translation and, in our opinion,
the consolidated financial statements, expressed in Yen, have been translated
into dollars on the basis set forth in Note 2 to the consolidated financial
statements.


/s/ KPMG AZSA & Co.
Tokyo, Japan
April 27, 2005

                                      F-2

RICOH COMPANY, LTD. AND CONSOLIDATED SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
MARCH 31, 2004 AND 2005

<TABLE>
<CAPTION>
                                                                                       Thousands of
                                                                   Millions of Yen     U.S. Dollars
                                                                ---------------------  ------------
A S S E T S                                                         2004        2005        2005
---------------------------------------------------------------------------------------------------
<S>                                                             <C>         <C>        <C>
Current Assets:
   Cash and cash equivalents                                      203,039     186,857   $ 1,746,327
   Time deposits                                                      962       1,454        13,589
   Marketable securities                                           45,124         138         1,290
   Trade receivables-
     Notes                                                         76,499      75,233       703,112
     Accounts                                                     362,784     396,150     3,702,336
     Less- Allowance for doubtful receivables                     (17,039)    (17,451)     (163,093)
   Current maturities of long-term finance receivables, net       154,122     166,636     1,557,346
   Inventories-
     Finished goods                                               100,154     109,224     1,020,785
     Work in process and raw materials                             45,215      58,141       543,374
   Deferred income taxes and other                                 55,079      53,365       498,738
---------------------------------------------------------------------------------------------------
         Total current assets                                   1,025,939   1,029,747     9,623,804
---------------------------------------------------------------------------------------------------

Property, Plant and Equipment, at cost:
   Land                                                            43,423      43,077       402,589
   Buildings                                                      200,844     203,537     1,902,215
   Machinery and equipment                                        653,467     643,386     6,012,953
   Construction in progress                                        10,629      18,720       174,953
---------------------------------------------------------------------------------------------------
                                                                  908,363     908,720     8,492,710
   Less- Accumulated depreciation                                (669,651)   (661,310)   (6,180,467)
---------------------------------------------------------------------------------------------------
                                                                  238,712     247,410     2,312,243
---------------------------------------------------------------------------------------------------

Investments and Other Assets:
   Long-term finance receivables, net                             359,925     391,947     3,663,056
   Investment securities                                           21,871      31,154       291,159
   Investments in and advances to affiliates                       46,967      49,316       460,897
   Goodwill                                                        25,298      47,502       443,944
   Other intangible assets                                         43,233      69,414       648,729
   Lease deposits and other                                        90,848      87,179       814,757
---------------------------------------------------------------------------------------------------
                                                                  588,142     676,512     6,322,542
---------------------------------------------------------------------------------------------------
                                                                1,852,793   1,953,669   $18,258,589
---------------------------------------------------------------------------------------------------
</TABLE>

                                      F-3

<TABLE>
<CAPTION>
                                                                                       Thousands of
                                                                 Millions of Yen       U.S. Dollars
                                                                ---------------------  ------------
LIABILITIES AND SHAREHOLDERS' INVESTMENT                          2004        2005          2005
---------------------------------------------------------------------------------------------------
<S>                                                             <C>         <C>        <C>
Current Liabilities:
   Short-term borrowings                                         68,952      38,710     $   361,776
   Current maturities of long-term indebtedness                  82,210     144,808       1,353,346
   Trade payables-
     Notes                                                       29,937      29,686         277,439
     Accounts                                                   267,735     306,813       2,867,411
   Accrued income taxes                                          25,050      24,074         224,991
   Accrued expenses and other                                   133,544     127,423       1,190,869
---------------------------------------------------------------------------------------------------
         Total current liabilities                              607,428     671,514       6,275,832
---------------------------------------------------------------------------------------------------

Long-term Liabilities:
   Long-term indebtedness                                       281,570     226,567       2,117,449
   Accrued pension and severance costs                           83,492      92,672         866,093
   Deferred income taxes                                         36,295      48,767         455,766
---------------------------------------------------------------------------------------------------
                                                                401,357     368,006       3,439,308
---------------------------------------------------------------------------------------------------

Minority Interests                                               48,877      51,151         478,047
---------------------------------------------------------------------------------------------------

Commitments and Contingent Liabilities (Note 16)

Shareholders' Investment:
   Common stock;
     Authorized - 993,000,000 shares in 2004 and 2005
       Issued and outstanding - 744,912,078 shares and 738,894,891
       shares in 2004 and 744,912,078 shares and 734,045,879
       shares in 2005                                           135,364     135,364       1,265,084
   Additional paid-in capital                                   186,599     186,551       1,743,467
   Retained earnings                                            515,372     584,515       5,462,757
   Accumulated other comprehensive income (loss)                (30,272)    (21,963)       (205,261)
   Treasury stock at cost; 6,017,187 shares in 2004 and
     10,866,199 shares in 2005                                  (11,932)    (21,469)       (200,645)
---------------------------------------------------------------------------------------------------
         Total shareholders' investment                         795,131     862,998       8,065,402
---------------------------------------------------------------------------------------------------
                                                              1,852,793   1,953,669     $18,258,589
---------------------------------------------------------------------------------------------------
</TABLE>

THE ACCOMPANYING NOTES TO CONSOLIDATED FINANCIAL STATEMENTS ARE AN INTEGRAL PART
OF THESE BALANCE SHEETS.

                                      F-4

RICOH COMPANY, LTD. AND CONSOLIDATED SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
FOR THE YEARS ENDED MARCH 31, 2003, 2004 AND 2005

<TABLE>
<CAPTION>
                                                                                                          Thousands of
                                                                         Millions of Yen                  U.S. Dollars
                                                               ---------------------------------------  --------------
                                                                   2003         2004          2005            2005
----------------------------------------------------------------------------------------------------------------------
<S>                                                              <C>          <C>           <C>          <C>
Net Sales                                                        1,738,358    1,780,245     1,814,108    $  16,954,280
Cost of Sales                                                      993,009    1,014,619     1,059,531        9,902,159
----------------------------------------------------------------------------------------------------------------------
         Gross profit                                              745,349      765,626       754,577        7,052,121
Selling, General and Administrative Expenses                       611,695      623,935       619,071        5,785,710
Transfer to the government of the substitutional portion
   of Employees' Pension Fund:
   Settlement loss                                                       -       48,657             -                -
   Subsidy from government                                               -      (56,972)            -                -
----------------------------------------------------------------------------------------------------------------------
         Operating income                                          133,654      150,006       135,506        1,266,411
----------------------------------------------------------------------------------------------------------------------
Other (Income) Expenses:
   Interest and dividend income                                     (3,772)      (1,925)       (2,240)         (20,934)
   Interest expense                                                  6,853        5,290         4,684           43,776
   Foreign currency exchange (gain) loss, net                          566        6,136        (1,547)         (14,458)
   Other, net                                                        6,537       (2,558)         (774)          (7,234)
----------------------------------------------------------------------------------------------------------------------
         Total                                                      10,184        6,943           123            1,150
----------------------------------------------------------------------------------------------------------------------
Income before Income Taxes, Minority Interests, Equity in          123,470      143,063       135,383        1,265,261
   Earnings of Affiliates and Cumulative Effect of
   Accounting Change
Provision for Income Taxes:
   Current                                                          63,183       53,303        39,281          367,112
   Deferred                                                        (11,199)       3,338        11,353          106,103
----------------------------------------------------------------------------------------------------------------------
         Total                                                      51,984       56,641        50,634          473,215
----------------------------------------------------------------------------------------------------------------------
Income before Minority Interests, Equity in Earnings of             71,486       86,422        84,749          792,046
   Affiliates and Cumulative Effect of Accounting Change
Minority Interests                                                   1,376        4,094         4,726           44,168
Equity in Earnings of Affiliates                                     2,403        2,065         3,120           29,159
----------------------------------------------------------------------------------------------------------------------
Income before Cumulative Effect of Accounting Change                72,513       84,393        83,143          777,037
Cumulative Effect of Accounting Change, net of tax                       -        7,373             -                -
----------------------------------------------------------------------------------------------------------------------

         Net Income                                                 72,513       91,766        83,143    $     777,037
----------------------------------------------------------------------------------------------------------------------

                                                                                Yen                      U.S. Dollars
                                                                  ------------------------------------  --------------
Per Share of Common Stock:
----------------------------------------------------------------------------------------------------------------------
   Basic:
     Income before cumulative effect of accounting change            99.79       113.69        112.64            $1.05
     Cumulative effect of accounting change                              -         9.94             -                -
     Net income                                                      99.79       123.63        112.64             1.05
   Diluted:
     Income before cumulative effect of accounting change            96.81       113.69        112.64             1.05
     Cumulative effect of accounting change                              -         9.94             -                -
     Net income                                                      96.81       123.63        112.64             1.05
----------------------------------------------------------------------------------------------------------------------
   Cash dividends per share                                          14.00        15.00         20.00            $0.19
----------------------------------------------------------------------------------------------------------------------
Per American Depositary Share, each representing 5 shares of common stock:
----------------------------------------------------------------------------------------------------------------------
   Basic:
     Income before cumulative effect of accounting change           498.95       568.45        563.20            $5.26
     Cumulative effect of accounting change                              -        49.70             -                -
     Net income                                                     498.95       618.15        563.20             5.26
   Diluted:
     Income before cumulative effect of accounting change           484.05       568.45        563.20             5.26
     Cumulative effect of accounting change                              -        49.70             -                -
     Net income                                                     484.05       618.15        563.20             5.26
----------------------------------------------------------------------------------------------------------------------
   Cash dividends per share                                          70.00        75.00        100.00            $0.93
----------------------------------------------------------------------------------------------------------------------
</TABLE>

THE ACCOMPANYING NOTES TO CONSOLIDATED FINANCIAL STATEMENTS ARE AN INTEGRAL PART
OF THESE STATEMENTS.

                                      F-5

RICOH COMPANY, LTD. AND CONSOLIDATED SUBSIDIARIES
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' INVESTMENT
FOR THE YEARS ENDED MARCH 31, 2003, 2004 AND 2005

<TABLE>
<CAPTION>
                                                                                                     Thousands of
                                                                     Millions of Yen                 U.S. Dollars
                                                            -------------------------------------  --------------
                                                               2003         2004         2005             2005
-----------------------------------------------------------------------------------------------------------------
<S>                                                           <C>          <C>          <C>          <C>
Common Stock:
    Beginning balance                                         120,461      135,364      135,364      $  1,265,084
    Conversion of convertible bonds; 24,633,822
     shares in 2003                                            14,903            -            -                 -
-----------------------------------------------------------------------------------------------------------------
    Ending balance                                            135,364      135,364      135,364      $  1,265,084
-----------------------------------------------------------------------------------------------------------------

Additional Paid-in Capital:
    Beginning balance                                         171,628      186,521      186,599      $  1,743,916
    Conversion of convertible bonds                            14,893            -            -                 -
    Gain (Loss) on disposal of treasury stock in
     exchange for subsidiary's stock                                -           78          (48)             (449)
-----------------------------------------------------------------------------------------------------------------
    Ending balance                                            186,521      186,599      186,551      $  1,743,467
-----------------------------------------------------------------------------------------------------------------

Retained Earnings:
    Beginning balance                                         385,741      434,748      515,372      $  4,816,561
    Adjustment for change in fiscal year end of
     consolidated subsidiaries                                      -            -          777             7,262
    Net income for the year                                    72,513       91,766       83,143           777,037
    Dividends declared and approved                           (10,178)     (11,142)     (14,777)         (138,103)
    Retirement of treasury stock; 7,000,000 shares in
     2003                                                     (13,328)           -            -                 -
-----------------------------------------------------------------------------------------------------------------
    Ending balance                                            434,748      515,372      584,515      $  5,462,757
-----------------------------------------------------------------------------------------------------------------

Accumulated other comprehensive income (loss):
    Beginning balance                                         (44,376)     (94,733)     (30,272)     $   (282,916)
    Adjustment for change in fiscal year end of
     consolidated subsidiaries                                      -            -       (1,665)          (15,560)
    Foreign currency translation adjustments                    1,007       (5,393)       9,041            84,495
    Unrealized gains (losses) on securities, net of
     reclassification adjustment                               (1,984)      (4,556)         765             7,150
    Unrealized gains on derivatives, net of
     reclassification adjustment                                   29          154          141             1,318
    Minimum pension liability adjustments                     (49,409)      74,256           27               252
-----------------------------------------------------------------------------------------------------------------
    Ending balance                                            (94,733)     (30,272)     (21,963)     $   (205,261)
-----------------------------------------------------------------------------------------------------------------

Treasury stock:
    Beginning balance                                            (434)      (4,386)     (11,932)     $   (111,514)
    Purchase of treasury stock; 9,111,925 shares in
     2003, 5,731,150 shares in 2004 and 6,179,522
     shares in 2005                                           (17,280)     (11,411)     (12,178)         (113,813)
    Sales of treasury stock; 6,873 shares in 2004 and
     24,810 shares in 2005                                          -           13           49               458
    Retirement of treasury stock; 7,000,000 shares in
      2003                                                     13,328            -            -                 -
    Issuance of treasury stock in exchange for
     subsidiary's stock; 2,010,533 shares in 2004
     and 1,305,700 shares in 2005                                   -        3,852        2,592            24,224
-----------------------------------------------------------------------------------------------------------------
    Ending balance                                             (4,386)     (11,932)     (21,469)     $   (200,645)
-----------------------------------------------------------------------------------------------------------------

Comprehensive income:
    Net income for the year                                    72,513       91,766       83,143      $    777,037
    Other comprehensive income (loss) for the year,
     net of tax                                               (50,357)      64,461        9,974            93,215
-----------------------------------------------------------------------------------------------------------------
    Total comprehensive income for the year                    22,156      156,227       93,117      $    870,252
-----------------------------------------------------------------------------------------------------------------
</TABLE>

THE ACCOMPANYING NOTES TO CONSOLIDATED FINANCIAL STATEMENTS ARE AN INTEGRAL PART
OF THESE STATEMENTS.

                                      F-6

RICOH COMPANY, LTD. AND CONSOLIDATED SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED MARCH 31, 2003, 2004 AND 2005

<TABLE>
<CAPTION>
                                                                                                       Thousands of
                                                                              Millions of Yen          U.S. Dollars
                                                                      ------------------------------  -------------
                                                                        2003       2004       2005          2005
-------------------------------------------------------------------------------------------------------------------
<S>                                                                    <C>        <C>        <C>        <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
   Net income                                                           72,513     91,766     83,143    $   777,037
   Adjustments to reconcile net income to net cash provided by
     operating activities-
     Depreciation and amortization                                      76,551     76,968     78,201        730,851
     Equity in earnings of affiliates, net of dividends received        (1,167)    (1,001)    (1,966)       (18,374)
     Deferred income taxes                                              (9,289)     3,338     11,353        106,103
     Losses on disposals and sales of property, plant and
       equipment                                                         1,975      2,035      4,056         37,907
     Cumulative effect of accounting change, net of tax                      -     (7,373)         -              -
     Changes in assets and liabilities, net of effects from
       acquisition-
       (Increase) decrease in trade receivables                         22,176    (11,367)   (26,429)      (247,000)
       (Increase) decrease in inventories                               14,983     (4,317)   (12,885)      (120,421)
       Increase in finance receivables                                 (33,109)   (32,650)   (30,294)      (283,121)
       Increase in trade payables                                        5,632     21,316     27,276        254,916
       (Decrease) increase in accrued income taxes and
         accrued expenses and other                                     11,173     (5,913)   (13,719)      (128,215)
       (Decrease) increase in accrued pension and severance
         costs                                                           7,806       (609)     4,307         40,252
     Other, net                                                         16,498     22,718      9,737         91,000
-------------------------------------------------------------------------------------------------------------------
         Net cash provided by operating activities                     185,742    154,911    132,780      1,240,935
-------------------------------------------------------------------------------------------------------------------

CASH FLOWS FROM INVESTING ACTIVITIES:
   Proceeds from sales of property, plant and equipment                    245        190        721          6,738
   Expenditures for property, plant and equipment                      (71,984)   (75,432)   (84,076)      (785,757)
   Payments for purchases of available-for-sale securities             (52,219)   (35,518)   (79,431)      (742,346)
   Proceeds from sales of available-for-sale securities                 24,513     45,464    118,120      1,103,925
   (Increase) decrease in time deposits                                    944      9,915       (511)        (4,776)
   Acquisitions of subsidiaries, net of cash acquired                   (1,438)         -    (43,214)      (403,869)
   Other, net                                                            1,740     (8,002)    (7,807)       (72,962)
-------------------------------------------------------------------------------------------------------------------
         Net cash used in investing activities                         (98,199)   (63,383)   (96,198)      (899,047)
-------------------------------------------------------------------------------------------------------------------

CASH FLOWS FROM FINANCING ACTIVITIES:
   Proceeds from long-term indebtedness                                 58,194     13,349     72,206        674,823
   Repayment of long-term indebtedness                                 (23,133)   (31,509)   (60,613)      (566,477)
   Decrease in short-term borrowings, net                              (73,393)   (10,728)   (38,052)      (355,626)
   Proceeds from issuance of long-term debt securities                  11,000      1,000     18,000        168,224
   Repayment of long-term debt securities                              (11,723)   (23,910)   (22,000)      (205,607)
   Dividend paid                                                       (10,176)   (11,136)   (14,793)      (138,252)
   Payment for purchase of treasury stock                              (17,281)   (11,411)   (10,624)       (99,290)
   Other, net                                                             (631)      (490)      (563)        (5,262)
-------------------------------------------------------------------------------------------------------------------
         Net cash used in financing activities                         (67,143)   (74,835)   (56,439)      (527,467)
-------------------------------------------------------------------------------------------------------------------

EFFECT OF EXCHANGE RATE CHANGES ON CASH AND CASH EQUIVALENTS            (1,329)    (2,897)     1,200         11,215
-------------------------------------------------------------------------------------------------------------------
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS                    19,071     13,796    (18,657)      (174,364)
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR                         170,172    189,243    203,039      1,897,561
ADJUSTMENT FOR CHANGE IN FISCAL YEAR END OF CONSOLIDATED
   SUBSIDIARIES                                                              -          -      2,475         23,130
-------------------------------------------------------------------------------------------------------------------
CASH AND CASH EQUIVALENTS AT END OF YEAR                               189,243    203,039    186,857    $ 1,746,327
-------------------------------------------------------------------------------------------------------------------

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
   CASH PAID DURING THE YEAR FOR-
     Interest                                                            7,300      6,479      5,402     $   50,486
     Income taxes                                                       52,154     66,914     40,803        381,336
-------------------------------------------------------------------------------------------------------------------
</TABLE>

THE ACCOMPANYING NOTES TO CONSOLIDATED FINANCIAL STATEMENTS ARE AN INTEGRAL PART
OF THESE STATEMENTS.

                                      F-7

RICOH COMPANY, LTD. AND CONSOLIDATED SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1.      NATURE OF OPERATIONS

Ricoh Company, Ltd. (the "Company") was established in 1936 and is headquartered
in Tokyo, Japan. The Company and its consolidated subsidiaries ("Ricoh" as a
consolidated group) is a world-wide supplier of office automation equipment,
including copiers, facsimile machines, data processing systems, printers and
related supplies. Ricoh is also well known for its state-of-the-art electronic
devices, digital photographic equipment and other products.

Ricoh distributes its products primarily through domestic (Japanese) and foreign
sales subsidiaries. Overseas, Ricoh owns and distributes not only Ricoh brand
products but also other brands, such as Gestetner, Lanier and Savin.

Ricoh manufactures its products primarily in 15 plants in Japan and 6 plants
overseas, which are located in the United States, United Kingdom, France and
China.

2.      SIGNIFICANT ACCOUNTING AND REPORTING POLICIES

The accompanying consolidated financial statements of Ricoh have been prepared
in conformity with U.S. generally accepted accounting principles. Significant
accounting and reporting policies are summarized below:

(a)     BASIS OF PRESENTATION

The accompanying consolidated financial statements for the three years ended
March 31, 2005 are presented in Japanese Yen, the functional currency of the
Company and its domestic subsidiaries. The translation of Japanese Yen into U.S.
Dollar equivalents for the year ended March 31, 2005 is included solely for the
convenience of readers outside Japan and has been made using the exchange rate
of Yen 107 to US$1, the approximate rate of exchange prevailing at the Federal
Reserve Bank of New York on March 31, 2005.

The books of the Company and its domestic subsidiaries are maintained in
conformity with Japanese accounting principles and practices, while foreign
subsidiaries maintain their books in conformity with the standards of their
country of domicile.

The accompanying consolidated financial statements reflect necessary
adjustments, not recorded in the books, to present them in conformity with U.S.
generally accepted accounting principles.

(b)     PRINCIPLES OF CONSOLIDATION

The accompanying consolidated financial statements include the accounts of
Ricoh. Investments in entities in which Ricoh has the ability to exercise
significant influence over the entities' operating and financial policies
(generally 20 to 50 percent ownership) are accounted for on an equity basis. All
significant intercompany balances and transactions have been eliminated in
consolidation.

The accounts of certain consolidated subsidiaries have been included on the
basis of fiscal periods ended within three months prior to March 31.

                                      F-8

At the beginning of fiscal 2005, the Company changed the year end of certain
overseas subsidiaries from December 31 to March 31. As a result, unappropriated
retained earnings increased by Yen 777 million ($7,262 thousand) and accumulated
other comprehensive income (loss) in shareholders' investment decreased by Yen
1,665 million ($15,560 thousand).

(c)     REVENUE RECOGNITION

Ricoh generates revenue principally through the sale of equipment, supplies and
related services under separate contractual arrangements for each. Ricoh
recognizes revenue when (1) it has a firm contract, (2) the product has been
shipped to and accepted by the customer or the service has been provided, (3)
the sales price is fixed or determinable and (4) amounts are reasonably assured
of collection.

Most equipment sales require that Ricoh install the product. As such, revenue is
recognized at the time of delivery and installation at the customer location.
Equipment revenues are based on established prices by product type and model and
are net of discounts. A sales return is accepted only when the equipment is
defective and does not meet Ricoh's product performance specifications. Other
than installation, there are no customer acceptance clauses in the sales
contract.

Service revenues result primarily from maintenance contracts that are normally
entered into at the time the equipment is sold. Standard service fee prices are
established depending on equipment classification and include a cost value for
the estimated services to be performed based on historical experience plus a
profit margin thereon. As a matter of policy, Ricoh does not discount such
prices. On a monthly basis, maintenance service revenues are earned and
recognized by Ricoh and billed to the customer in accordance with the contract
and include a fixed monthly fee plus a variable amount based on usage. The
length of the contract ranges up to five-years, however, most contracts are
cancelable at any time by the customer upon a short notice period.

Ricoh enters into arrangements with multiple elements, which may include any
combination of products, equipment, installation and maintenance. Ricoh
allocates revenue to each element based on its relative fair value if such
element meets the criteria for treatment as a separate unit of accounting as
prescribed in the Emerging Issues Task Force Issue 00-21("EITF 00-21"), "Revenue
Arrangements with Multiple Deliverables". Pursuant to EITF 00-21, the delivered
item in a multiple element arrangement should be considered a separate unit of
accounting if all of the following criteria are met: 1) a delivered item has
value to customers on a stand-alone basis, 2) there is objective and reliable
evidence of fair value of an undelivered item, and 3) the delivery of the
undelivered item must be probable and controlled by Ricoh if the arrangement
includes the right of return. The price charged when the element is sold
separately generally determines fair value. Otherwise, revenue is deferred until
the undelivered elements are fulfilled as a single unit of accounting. EITF
00-21 was effective for revenue arrangements entered into after June 30, 2003.
EITF 00-21 did not have a material effect on Ricoh's financial position or
results of operations.

(d)      FOREIGN CURRENCY TRANSLATION

For foreign operations with functional currencies other than the Japanese Yen,
assets and liabilities are translated at the exchange rates in effect at each
fiscal year-end, and income and expenses are translated at the average rates of
exchange prevailing during each fiscal year. The resulting translation
adjustments are included as a part of accumulated other comprehensive income
(loss) in shareholders' investment.

All foreign currency transaction gains and losses are included in other income
and expenses in the period incurred.

                                      F-9

(e)      CASH EQUIVALENTS

Cash and cash equivalents include highly liquid investments with maturities of
three months or less at the date of purchase such as time deposits and
short-term investment securities which are available-for sale at any time,
present insignificant risk of changes in value due to being readily convertible
into cash and have an original maturity of three months or less, such as money
management funds and free financial funds.

(f)     DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES

As discussed further in Note 15, Ricoh manages its exposure to certain market
risks, primarily foreign currency and interest rate risks, through the use of
derivative instruments. As a matter of policy, Ricoh does not enter into
derivative contracts for trading or speculative purposes.

In accordance with Statement of Financial Accounting Standards ("SFAS") No.133,
Ricoh, when it enters into a derivative contract, makes a determination as to
whether or not for accounting purposes the derivative is part of a hedging
relationship. In general, a derivative may be designated as either (1) a hedge
of the fair value of a recognized asset or liability or an unrecognized firm
commitment ("fair value hedge"), (2) a hedge of the variability of the expected
cash flows associated with an existing asset or liability or a forecasted
transaction ("cash flow hedge"), or (3) a foreign currency fair value or cash
flow hedge ("foreign currency hedge"). Ricoh formally documents all
relationships between hedging instruments and hedged items, as well as its
risk-management objective and strategy for undertaking various hedge
transactions. This process includes linking all derivatives that are designated
as fair value, cash flow, or foreign currency hedges to specific assets and
liabilities on the consolidated balance sheet or to specific firm commitments or
forecasted transactions.

For derivative contracts that are designated and qualify as fair value hedges
including foreign currency fair value hedges, the derivative instrument is
marked-to-market with gains and losses recognized in current period earnings to
offset the respective losses and gains recognized on the underlying exposure.
For derivative contracts that are designated and qualify as cash flow hedges
including foreign currency cash flow hedges, the effective portion of gains and
losses on these contracts is reported as a component of accumulated other
comprehensive income (loss) and reclassified into earnings in the same period
the hedged item or transaction affects earnings. Any hedge ineffectiveness on
cash flow hedges is immediately recognized in earnings. For all derivative
instruments that are not designated as part of a hedging relationship and for
designated derivative instruments that do not qualify for hedge accounting, the
contracts are recorded at fair value with the gain or loss recognized in current
period earnings.

(g)     ALLOWANCE FOR DOUBTFUL TRADE RECEIVABLES AND FINANCE RECEIVABLES

Ricoh records allowances for doubtful receivables that are based upon historical
experience and specific customer collection issues. The estimated amount of
probable credit losses in its existing receivables is determined from write-off
history adjusted to reflect current economic conditions and specific allowances
for receivables including nonperforming leases, impaired loans or other accounts
of which Ricoh has concluded it will be unable to collect all amounts due
according to original terms of the lease or loan agreement. Account balances net
of expected recovery from available collateral are charged-off against the
allowances when collection is considered remote.

                                      F-10

(h)     SECURITIES

Ricoh conforms with SFAS No.115, "Accounting for Certain Investments in Debt and
Equity Securities" which requires all investments in debt and marketable equity
securities to be classified as either held-to-maturity, trading, or
available-for-sale securities. As of March 31, 2004 and 2005, all of Ricoh's
investments in debt and marketable equity securities are classified as
available-for-sale securities. Those available-for-sale securities are reported
at fair value with unrealized gains and losses, net of related taxes, excluded
from earnings and reported in accumulated other comprehensive income (loss).
Available-for-sale securities, which mature or are expected to be sold in one
year, are classified as current assets.

Individual securities classified as available-for-sale securities are reduced to
fair market value by a charge to income for other than temporary declines in
value. Factors considered in assessing whether an indication of other than
temporary impairment exists with respect to available-for-sale securities
include: length of time and extent of decline, financial condition and near term
prospects of issuer and intent and ability of the Company to retain its
investments for a period of time sufficient to allow for any anticipated
recovery in market value.

The cost of the securities sold is computed based on the average cost of each
security held at the time of sale.

Non-marketable equity securities owned by Ricoh primarily relate to less than
20% owned companies and are stated at cost.

As discussed further in Note 5, Ricoh changed its accounting policy with respect
to the recognition of unrealized gains and losses as realized in the statements
of income on transfers of marketable equity securities. In relation to this
change, Ricoh has recognized in its fiscal 2004 consolidated statement of income
a cumulative effect of accounting change, net of tax, of Yen 7,373 million.

(i)     INVENTORIES

Inventories are mainly stated at the lower of average cost or net realizable
values. Inventory costs include raw materials, labor and manufacturing
overheads.

(j)     PROPERTY, PLANT AND EQUIPMENT

For the Company and its domestic subsidiaries, depreciation of property, plant
and equipment is computed principally by using the declining-balance method over
the estimated useful lives. Most of the foreign subsidiaries have adopted the
straight-line method for computing depreciation, which currently accounts for
approximately 38% of the consolidated depreciation expense. The depreciation
period generally ranges from 5 years to 50 years for buildings and 2 years to 12
years for machinery and equipment.

Effective rates of depreciation for the years ended March 31, 2003, 2004 and
2005 are summarized below:

                                                  2003       2004       2005
 -------------------------------------------------------------------------------
 Buildings                                         8.1%        8.1%      8.5%
 Machinery and equipment                          41.0        42.9      43.8
 -------------------------------------------------------------------------------

                                      F-11

Certain leased buildings, machinery and equipment are accounted for as capital
leases in conformity with SFAS No.13, "Accounting for Leases." The aggregate
cost included in property, plant and equipment and related accumulated
depreciation as of March 31, 2004 and 2005 were as follows:

                                                                  Thousands of
                                            Millions of Yen       U.S. Dollars
                                       ------------------------  ---------------
                                         2004          2005            2005
 -------------------------------------------------------------------------------
 Aggregate cost                          7,151         7,051          $65,897
 Accumulated depreciation                4,504         4,615           43,131
 -------------------------------------------------------------------------------


The related future minimum lease payments and the present value of the net
minimum lease payments as of March 31, 2005 were Yen 4,020 million ($37,570
thousand) and Yen 3,804 million ($35,551 thousand), respectively.

Ordinary maintenance and repairs are charged to expense as incurred. Major
replacements and improvements are capitalized. When properties are retired or
otherwise disposed of, the property and related accumulated depreciation
accounts are relieved of the applicable amounts, and any differences are
included in earnings.

(k)     GOODWILL AND OTHER INTANGIBLE ASSETS

SFAS No.141, "Business Combinations" requires the use of only the purchase
method of accounting for business combinations and refines the definition of
intangible assets acquired in a purchase business combination. SFAS No.142,
"Goodwill and Other Intangible Assets" eliminates the amortization of goodwill
and instead requires annual impairment testing thereof. SFAS 142 also requires
acquired intangible assets with a definite useful life to be amortized over
their respective estimated useful lives and reviewed for impairment in
accordance with SFAS No.144, "Accounting for the Impairment or Disposal of
Long-Lived Assets". Any acquired intangible asset determined to have an
indefinite useful life is not amortized, but instead is tested for impairment
based on its fair value until its life would be determined to no longer be
indefinite.

Ricoh adopted the provisions of SFAS 141 and SFAS 142 as of April 1, 2002. In
connection with the transitional impairment evaluation, SFAS 142 required Ricoh
to perform an assessment of whether there was an indication that goodwill was
impaired as of April 1, 2002. To accomplish this, Ricoh (1) identified its
reporting units, (2) determined the carrying value of each reporting unit by
assigning the assets and liabilities, including the existing goodwill and
intangible assets, to those reporting units, and (3) determined the fair value
of each reporting unit. Ricoh completed the transitional assessment by September
30, 2002, and determined there was no indication that goodwill had been impaired
as of April 1, 2002. Ricoh also completed the annual assessment for the years
ended March 31, 2003, 2004 and 2005 and determined that no goodwill impairment
charge was necessary.

                                      F-12

(l)     PENSION AND RETIREMENT ALLOWANCES PLANS

The measurement of pension costs and liabilities is determined in accordance
with SFAS No.87, "Employers' Accounting for Pensions." Under SFAS 87, changes in
the amount of either the projected benefit obligation or plan assets resulting
from actual results different from that assumed and from changes in assumptions
can result in gains and losses not yet recognized in the consolidated financial
statements. Amortization of an unrecognized net gain or loss is included as a
component of the net periodic benefit plan cost for a year if, as of the
beginning of the year, that unrecognized net gain or loss exceeds 10 percent of
the greater of (1) the projected benefit obligation or (2) the fair value of
that plan's assets. In such case, the amount of amortization recognized is the
resulting excess divided by the average remaining service period of active
employees expected to receive benefits under the plan. The expected long-term
rate of return on plan assets used for pension accounting is determined based on
the historical long-term rate of return on plan assets. The discount rate is
determined based on the rates of return of high-quality fixed-income investments
currently available and expected to be available during the period to maturity
of the pension benefits.

In December 2003, the FASB issued SFAS No.132 (revised), "Employers' Disclosures
about Pensions and Other Postretirement Benefits." SFAS 132 (revised) prescribes
employers' disclosures about pension plans and other postretirement benefit
plans; it does not change the measurement or recognition of those plans. The
Statement retains and revises the disclosure requirements contained in the
original SFAS 132. It also requires additional disclosures about the assets,
obligations, cash flows, and net periodic benefit cost of defined benefit
pension plans and other postretirement benefit plans. The Statement generally is
effective for fiscal years ending after December 15, 2003. Ricoh's disclosures
in Note 11 incorporate the requirements of SFAS 132 (revised).

(m)     INCOME TAXES

Income taxes are accounted for under the asset and liability method. Deferred
tax assets and liabilities are recognized for the future tax consequences
attributable to differences between the financial statement carrying amounts of
existing assets and liabilities and their respective tax bases and operating
loss and tax credit carryforwards. Deferred tax assets and liabilities are
measured using enacted tax rates expected to apply to taxable income in the
years in which those temporary differences and carryforwards are expected to be
realized or settled. The effect on deferred tax assets and liabilities of a
change in tax rates is recognized in income in the period that includes the
enactment date.

(n)     RESEARCH AND DEVELOPMENT EXPENSES AND ADVERTISING COSTS

Research and development expenses and advertising costs are expensed as
incurred.

(o)     SHIPPING AND HANDLING COSTS

Shipping and handling costs, which mainly include transportation to customers,
are included in selling, general and administrative expenses on the consolidated
statements of income.

(p)     IMPAIRMENT OR DISPOSAL OF LONG-LIVED ASSETS

Long-lived assets and acquired intangible assets with a definite life are
reviewed for impairment whenever events or changes in circumstances indicate
that the carrying amount of an asset or group of assets may not be recoverable.
Recoverability of assets to be held and used is assessed by comparing the
carrying amount of an asset or asset group to the expected future undiscounted
net cash flows of the asset or group of assets.

                                      F-13

If an asset or group of assets is considered to be impaired, the impairment
charge to be recognized is measured as the amount by which the carrying amount
of the asset or group of assets exceeds fair value. Long-lived assets meeting
the criteria to be considered as held for sale are reported at the lower of
their carrying amount or fair value less costs to sell.

(q)     EARNINGS PER SHARE

Basic net income per common share is calculated by dividing net income by the
weighted-average number of shares outstanding during the period. The calculation
of diluted net income per common share is similar to the calculation of basic
net income per share, except that the weighted-average number of shares
outstanding includes the additional dilution from potential common stock
equivalents such as convertible bonds.

Ricoh has no dilutive securities outstanding as of and for the years ended March
31, 2004 and 2005, and therefore there is no difference between basic and
diluted net income per share.

(r)      NON-CASH TRANSACTIONS

The following non-cash transactions have been excluded from the consolidated
statements of cash flows:

<TABLE>
<CAPTION>
                                                                                     Thousands of
                                                             Millions of Yen         U.S. Dollars
                                                   -------------------------------  -------------
                                                     2003       2004       2005         2005
-------------------------------------------------------------------------------------------------
<S>                                                  <C>         <C>        <C>      <C>
 Conversion of convertible bonds                     32,905          -          -    $       -
 Capital lease obligations incurred                   1,697         75        865        8,084
 Retirement of treasury stock                        13,328          -          -            -
 Issuance of treasury stock in exchange for
     subsidiary's stock                                   -      3,930      2,545       23,785
 Transfer of marketable equity securities to
     employee retirement benefit trust                    -      3,648          -            -
-------------------------------------------------------------------------------------------------
</TABLE>

(s)     USE OF ESTIMATES

Management of the Company has made a number of estimates and assumptions that
affect the reported amounts of assets, liabilities, revenues and expenses,
including impairment losses of long-lived assets and the disclosures of fair
value of financial instruments and contingent assets and liabilities, to prepare
these financial statements in conformity with generally accepted accounting
principles. Actual results could differ from those estimates.

The Company has identified five areas where it believes assumptions and
estimates are particularly critical to the consolidated financial statements.
These are determination of the allowance for doubtful receivables, impairment of
securities, impairment of long-lived assets and goodwill, realizability of
deferred tax assets and pension accounting.

                                      F-14

(t)     RECLASSIFICATION TO PRIOR YEARS' CONSOLIDATED FINANCIAL STATEMENTS

The accompanying consolidated balance sheet for the year ended March 31,2004,
reflects the reclassification of finance receivables expected to be collected
within one year from the balance sheet date, or the current portion, previously
included in investments and other assets to current assets to conform with the
presentation used for the year ended March 31, 2005. The effect of this
reclassification was to increase total current assets by Yen 154,122 million
from Yen 871,817 million to Yen 1,025,939 million at March 31, 2004. This
reclassification had no effect on the consolidated statements of income and cash
flows.

(u)     NEW ACCOUNTING STANDARDS

In March 2004, the EITF reached a consensus on EITF 03-1, "The Meaning of
Other-Than-Temporary Impairment and Its Application to Certain Investments."
EITF 03-1 provides guidance on other than temporary impairment models for debt
and marketable equity securities accounted for under SFAS No. 115, "Accounting
for Certain Investments in Debt and Equity Securities," and non-marketable
securities accounted for under the cost method. The EITF developed a basic
three-step model to evaluate whether an investment is other-than-temporarily
impaired. The Financial Accounting Standards Board ("FASB") issued FASB Staff
Position EITF 03-1-1 in September 2004 which delayed the effective date of the
recognition and measurement provisions of EITF 03-1. The adoption of EITF 03-1
is not expected to have a material effect on the Company's consolidated results
of operations and financial position.

In November 2004, the FASB issued SFAS No.151, "Inventory Costs, an amendment of
ARB No. 43, Chapter 4" to clarify the accounting for abnormal amounts of idle
facility expense, freight, handling costs, and wasted material (spoilage). Among
other provisions, the new rule requires that items such as idle facility
expense, excessive spoilage, double freight, and rehandling cost be recognized
as current period charges regardless of whether they meet the criterion of "so
abnormal" as stated in ARB No. 43. In addition, SFAS 151 requires that the
allocation of fixed production overheads to the costs of conversion be based on
the normal capacity of the production facilities. SFAS 151 is effective for
fiscal years beginning after June 15, 2005 and is required to be adopted by
Ricoh in the first quarter beginning April 1, 2006. Ricoh is currently
determining the effect of SFAS 151 on the Ricoh's consolidated financial
statements but does not expect the effect to be material.

3.      ACQUISITION

In October 2004, the Company acquired all of the issued and outstanding capital
stock of Hitachi Printing Solutions, Ltd. for total cash consideration of Yen
44,085 million including direct acquisition costs. The company made the
acquisition to strengthen and expand its printing operations. The acquired
company was a non-public manufacturer and a subsidiary of Hitachi, Ltd. and was
renamed Ricoh Printing Systems, Ltd. ("RPS") upon acquisition by the Company.

The Company used the purchase method of accounting to account for the
acquisition of RPS and, accordingly, the purchase price has been allocated to
the tangible and intangible net assets of RPS based on the estimated fair value
of such net assets. The amount of consideration paid in excess of the estimated
fair value of the net assets acquired of Yen 19,583 million was recorded as
goodwill. Assets, liabilities and operations of RPS have been included in the
accompanying consolidated financial statements since the acquisition date.

                                      F-15

The following table reflects the October 1, 2004 condensed balance sheet of RPS,
as adjusted to give effect to the purchase method accounting adjustments:

                                                                   Thousands of
                                            Millions of Yen        U.S. dollars
 -------------------------------------------------------------------------------
 Cash and cash equivalents                        2,412              $   22,542
 Receivables and other assets                    31,463                 294,047
 Property and equipment                          10,404                  97,233
 Identifiable intangible assets                  20,400                 190,654
 Goodwill                                        19,583                 183,019
 Liabilities                                    (40,177)               (375,486)
 -------------------------------------------------------------------------------
                                                 44,085              $  412,009
 -------------------------------------------------------------------------------

Identifiable intangible assets of RPS primarily comprise customer relationships
of Yen 13,900 million ($129,907 thousand), which are estimated to have a
remaining useful life of 5 to 12 years. Goodwill arising from the acquisition of
RPS has all been allocated to the office equipment segment.

Furthermore, Ricoh acquired other immaterial entities during the year ended
March 31, 2005 for a consideration of Yen 1,541 million ($14,402 thousand), net
of cash acquired.

In April 2003, the Company acquired all of the minority interests of its
existing consolidated subsidiary, Tohoku Ricoh Co., Ltd. ("Tohoku Ricoh")
through the issuance of 2,010,533 shares of treasury stock in exchange for all
the outstanding shares of Tohoku Ricoh's common stock not then owned by Ricoh.
The cost of acquired minority interests was Yen 5,579 million determined based
on the fair value of the treasury shares issued. The Company has used the
purchase method of accounting to record the transactions in conformity with SFAS
141 and accordingly, has allocated the purchase price based on estimated fair
values of acquired net assets.

4.      FINANCE RECEIVABLES

Finance receivables as of March 31, 2004 and 2005 are comprised primarily of
lease receivables and installment loans.

Ricoh's products are leased to domestic customers primarily through Ricoh
Leasing Company, Ltd., a majority-owned domestic subsidiary and to overseas
customers primarily through certain overseas subsidiaries. These leases are
qualified and are accounted for as sales-type leases in conformity with SFAS 13.
Sales revenue from sales-type leases is recognized at the inception of the
leases.

Information pertaining to Ricoh's lease receivables as of March 31, 2004 and
2005 is as follows:

<TABLE>
<CAPTION>
                                                                                    Thousands of
                                                              Millions of Yen       U.S. Dollars
                                                         -------------------------  -------------
                                                             2004          2005           2005
-------------------------------------------------------------------------------------------------
<S>                                                        <C>           <C>         <C>
 Minimum lease payments receivable                          522,056       568,911    $  5,316,925
 Estimated non-guaranteed residual value                      2,432         3,030          28,318
 Unearned income                                            (47,492)      (48,290)       (451,308)
 Allowance for doubtful receivables                         (14,404)      (15,199)       (142,047)
-------------------------------------------------------------------------------------------------
 Lease receivables, net                                     462,592       508,452       4,751,888
-------------------------------------------------------------------------------------------------
 Less: Current portion of lease receivable, net            (151,616)     (165,295)     (1,544,813)
-------------------------------------------------------------------------------------------------
 Amounts due after one year, net                            310,976       343,157    $  3,207,075
-------------------------------------------------------------------------------------------------
</TABLE>

                                      F-16

As of March 31, 2005, the minimum lease payments receivable due in each of the
next five years and thereafter are as follows:

                                                                   Thousands of
 Years ending March 31                       Millions of Yen       U.S. Dollars
--------------------------------------------------------------------------------
 2006                                                 181,272        $ 1,694,131
 2007                                                 156,743          1,464,888
 2008                                                 118,513          1,107,598
 2009                                                  73,263            684,701
 2010                                                  32,161            300,570
 2011 and thereafter                                    6,959             65,037
--------------------------------------------------------------------------------
 Total                                                568,911        $ 5,316,925
--------------------------------------------------------------------------------

Ricoh Leasing Company, Ltd. has also extended certain other types of loans as
part of its business activity, which are primarily residential housing loans to
individuals in Japan secured by the underlying real estate properties. Loan
terms range from 15 years to 30 years with monthly repayments. The total balance
of these loans, net of allowance for doubtful receivables, as of March 31, 2004
and 2005 was Yen 51,455 million and Yen 50,131 million ($468,514 thousand),
respectively. The current portions of loan receivables were Yen 2,506 million
and Yen 1,341 million ($12,533 thousand), respectively, as of March 31, 2004 and
2005, and are included in short-term finance receivables, net in the
accompanying balance sheet. Loan activity for the years ended March 31, 2003,
2004 and 2005 is as follow:

                                                                    Thousands of
                                              Millions of Yen       U.S. Dollars
                                       ---------------------------  ------------
                                         2003      2004      2005       2005
--------------------------------------------------------------------------------
 Extension of new loans                 11,559    13,686    12,456    $  116,411
 Repayment of outstanding loans          9,993    12,706    13,001       121,505
--------------------------------------------------------------------------------

Ricoh sold finance lease receivables in prior years through securitization
transactions. Servicing assets or liabilities related to securitization
transactions initiated were not recorded, because the servicing fees adequately
compensate Ricoh. Ricoh's retained interests are subordinate to the investor's
interests. Their value is subject to credit and interest rate risk on the sold
financial assets. The investors and Special Purpose Entities that hold the lease
receivables have limited recourse to Ricoh's other assets for failure of debtors
to pay. Ricoh recognizes gains or losses attributable to the change in the fair
value of the retained interests, which are recorded at estimated fair value and
accounted for as "trading" securities. Ricoh determines the value of the
retained interests by discounting the future cash flows. Those cash flows are
estimated based on credit losses and other information as available and are
discounted at a rate which Ricoh believes is commensurate with the risk free
rate plus a risk premium.

Key economic assumptions used in measuring the fair value of retained interests
related to securitization transactions completed during the years ended March
31, 2004 and 2005 were as follows:

                                                       2004             2005
--------------------------------------------------------------------------------
 Expected credit losses                            0.75% - 1.35%   0.75% - 1.35%
 Discount rate                                     0.90% - 3.00%   2.00% - 3.00%
--------------------------------------------------------------------------------

                                      F-17

The impacts of 10% and 20% adverse changes to the key economic assumptions on
the fair value of retained interests as of March 31, 2005 are presented below.

<TABLE>
<CAPTION>
                                                                             Thousands of
                                                           Millions of Yen   U.S. Dollars
                                                          -----------------  ------------
                                                                    2005          2005
-----------------------------------------------------------------------------------------
<S>                                                                 <C>       <C>
 Carrying value of retained interests (included in lease            5,373     $  50,215
    deposits and other in the consolidated balance sheet)
 Expected credit losses:
    +10%                                                               84           785
    +20%                                                              168         1,570
 Discount rate:
    +10%                                                               20           187
    +20%                                                               40           374
-----------------------------------------------------------------------------------------
</TABLE>

The hypothetical scenario does not reflect expected market conditions and should
not be used as a prediction of future performance. As the figures indicate,
changes in fair value may not be linear. Also, in the above table, the effect of
a variation in a particular assumption on the fair value of the retained
interest is calculated without changing any other assumption; in reality,
changes in one factor may result in changes in another, which might magnify or
counteract the sensitivities.

The following table summarizes certain cash flows received from and paid to the
Special Purpose Entities for all securitization activity for the years ended
March 31, 2003, 2004 and 2005:

<TABLE>
<CAPTION>
                                                                                  Thousands of
                                                           Millions of Yen        U.S. Dollars
                                                    ----------------------------  ------------
                                                      2003      2004      2005         2005
----------------------------------------------------------------------------------------------
<S>                                                   <C>       <C>       <C>      <C>
 Servicing fees received                                 37        25        22    $     206
 Repurchases of delinquent or ineligible assets       5,750     4,643     4,060       37,944
----------------------------------------------------------------------------------------------
</TABLE>

Amounts of delinquencies, net credit losses, and components of all receivables
managed and securitized as of March 31, 2004 and 2005, and for the years then
ended, are as follows:

<TABLE>
<CAPTION>
                                                                      Millions of Yen
                                    ----------------------------------------------------------------------------------
                                                     2004                                      2005
                                    ----------------------------------------  ----------------------------------------
                                                    Principal                                 Principal
                                                    amount of                                 amount of
                                        Total      receivables                    Total      receivables
                                      principal    4 months or                  principal    4 months or
                                      amount of     more past   Net credit      amount of     more past   Net credit
                                     receivables       due        losses       receivables       due        losses
----------------------------------------------------------------------------------------------------------------------
<S>                                      <C>            <C>          <C>           <C>            <C>          <C>
 Principal amount outstanding            524,981        1,025        3,284         567,795        1,016        2,746
    Less: Receivables securitized        (47,985)                                  (44,145)
                                     -----------                               -----------
 Receivables held in portfolio           476,996                                   523,650
----------------------------------------------------------------------------------------------------------------------

                                                                                    Thousands of U.S. dollars
                                                                              ----------------------------------------
                                                                                               2005
                                                                              ----------------------------------------
                                                                                              Principal
                                                                                              amount of
                                                                                  Total      receivables
                                                                                principal    4 months or
                                                                                amount of     more past   Net credit
                                                                               receivables       due        losses
 ---------------------------------------------------------------------------------------------------------------------
 Principal amount outstanding                                                   $5,306,495       $9,495      $25,664
    Less: receivables securitized                                                 (412,570)
                                                                               ------------
 Receivables held in portfolio                                                  $4,893,925
 ---------------------------------------------------------------------------------------------------------------------
</TABLE>

                                      F-18

5.       SECURITIES

Marketable securities and investment securities as of March 31, 2004 and 2005
consist of the following:

                                                                Thousands of
                                           Millions of Yen      U.S. Dollars
                                         --------------------  -------------
                                           2004        2005          2005
----------------------------------------------------------------------------
 Marketable securities:
    Available-for-sale securities         45,124        138       $    1,290
----------------------------------------------------------------------------
 Investment securities:
    Available-for-sale securities         14,766     24,205       $  226,215
    Non-marketable equity securities       7,105      6,949           64,944
----------------------------------------------------------------------------
                                          21,871     31,154       $  291,159
----------------------------------------------------------------------------

The current and noncurrent security types of available-for-sale securities, and
the respective cost, gross unrealized holding gains, gross unrealized holding
losses and fair value as of March 31, 2004 and 2005 are as follows:

<TABLE>
<CAPTION>
                                              Millions of Yen                                   Thousands of U.S. Dollars
                 ------------------------------------------------------------------------- -----------------------------------------
                                  2004                                2005                                  2005
                 ------------------------------------- ----------------------------------- -----------------------------------------
                            Gross      Gross                    Gross      Gross                       Gross      Gross
                          unrealized unrealized               unrealized unrealized                  unrealized unrealized
                           holding     holding   Fair          holding     holding   Fair             holding    holding     Fair
                    Cost    gains      losses    value  Cost    gains      losses    value   Cost      gains      losses     value
------------------------------------------------------------------------------------------------------------------------------------
<S>                <C>        <C>        <C>    <C>    <C>         <C>          <C> <C>    <C>        <C>        <C>       <C>
Current:
  Corporate debt
   securities      45,139         6      22     45,123    137          -         -     137 $   1,281  $       -  $      -  $   1,281
  Other                 1         -       -          1      1          -         -       1         9          -         -          9
------------------------------------------------------------------------------------------------------------------------------------
                   45,140         6      22     45,124    138          -         -     138 $   1,290  $       -  $      -  $   1,290
------------------------------------------------------------------------------------------------------------------------------------
Non-current:
  Equity
   securities       5,053     8,080      33     13,100  7,479      9,021        49  16,451 $  69,897  $  84,309  $    458  $ 153,748
  Corporate debt
   securities           -         -       -          -  6,000         45         -   6,045    56,075        420         -     56,495
  Other             1,174       492       -      1,666  1,229        480         -   1,709    11,486      4,486         -     15,972
------------------------------------------------------------------------------------------------------------------------------------
                    6,227     8,572      33     14,766 14,708      9,546        49  24,205 $ 137,458  $  89,215  $    458  $ 226,215
------------------------------------------------------------------------------------------------------------------------------------
</TABLE>

Other non-current securities mainly include investment trusts consisting of
investment in marketable debt and equity securities.

                                      F-19

Gross unrealized holding losses on available-for-sale securities and the fair
value of the related securities, aggregated by investment category and length of
time that individual securities have been in a continuous unrealized loss
position at March 31, 2005 were as follows:

                                                Millions of Yen
                             ---------------------------------------------------
                                 Less than 12 months       12 months or longer
                             -------------------------  ------------------------
                                               Gross                    Gross
                                            unrealized                unrealized
                                              holding                  holding
                               Fair value      losses    Fair value     losses
--------------------------------------------------------------------------------
 2005:
   Noncurrent:
     Available-for-sale:
       Equity securities              157           49            -            -
--------------------------------------------------------------------------------

                                        Thousands of U.S. Dollars
                             ---------------------------------------------------
                                 Less than 12 months       12 months or longer
                             -------------------------  ------------------------
                                              Gross                     Gross
                                            unrealized                unrealized
                                              holding                  holding
                               Fair value     losses     Fair value     losses
 -------------------------------------------------------------------------------
 2005:
   Noncurrent:
     Available-for-sale:
       Equity securities       $    1,467   $      458            -            -
 -------------------------------------------------------------------------------

The contractual maturities of debt securities classified as available-for-sale
as of March 31, 2005, regardless of their balance sheet classification, are as
follows:

<TABLE>
<CAPTION>
                                                                    Thousands of
                                            Millions of Yen         U.S. Dollars
                                        --------------------  ----------------------
                                          Cost   Fair value      Cost     Fair value
------------------------------------------------------------------------------------
<S>                                      <C>          <C>     <C>         <C>
Due within one year                        137          137   $   1,281   $    1,281
Due after one year through five years    6,000        6,045      56,075       56,495
------------------------------------------------------------------------------------
------------------------------------------------------------------------------------
                                         6,137        6,182   $  57,356   $   57,776
------------------------------------------------------------------------------------
</TABLE>

Proceeds from the sales of available-for-sale securities were Yen 24,513
million, Yen 45,464 million and Yen 118,120 million ($1,103,925 thousand) for
the years ended March 31, 2003, 2004 and 2005, respectively.

There were no significant realized gains or losses of available-for-sale
securities for the three years ended March 31, 2005 except for the contributed
marketable equity securities to the Company's employee benefit trust as
discussed below. The loss on securities of Yen 2,260 million for the year ended
March 31, 2003 was charged to other expense for declines in market value of
available-for-sale securities where the decline was determined to be other than
temporary.

In March 2000, the Company contributed certain marketable equity securities, not
including those of its subsidiaries and affiliated companies, to its employee
retirement benefit trust (the "Trust") fully administered and controlled by an
independent bank trustee, with no cash proceeds thereon (the "2000 Transfer").
The 2000 Transfer of the available-for-sale securities was accounted for as a
sale in accordance with SFAS No.125, "Accounting for Transfer and Servicing of
Financial Assets and Extinguishments of Liabilities" and accordingly the
recorded pension liability was reduced by the fair market value amount of the
transferred securities. The fair value of these securities at the time of
transfer was Yen 20,760 million. The net unrealized gains on these
available-for-sale securities amounting to Yen 13,095 million were initially

                                      F-20

included in "Accumulated other comprehensive income (loss)" on the consolidated
balance sheets with the expectation of being reflected in realized gains in the
statements of income upon the future sale of the transferred securities by the
trustee.

In March 2004, the Company contributed certain additional marketable equity
securities, not including those of its subsidiaries and affiliated companies to
the Trust, with no cash proceeds thereon (the "2004 Transfer"). The fair value
and net unrealized gains on these available-for-sale securities at the time of
transfer were Yen 3,648 million and Yen 2,658 million, respectively.

In fiscal 2004, Ricoh changed its accounting policy with respect to the
recognition of unrealized gains and losses as realized in the statements of
income on transfers of marketable equity securities to its employee retirement
benefit trusts. Ricoh concluded that it is preferable to recognize in the
statements of income unrealized gains or losses associated with marketable
equity securities transferred to the Trust when Ricoh has effectively given up
the economic rewards of ownership, that is, when the assets are no longer
considered corporate assets and when the Trust has the irrevocable and
unrestricted right to realize those benefits as and when it chooses. This
generally occurs at the time the assets are transferred to the Trust and not
upon future sale of the assets by the trustee.

Accordingly, Ricoh recognized realized gains in the consolidated statement of
income on the transfer of marketable equity securities to the Trust for fiscal
2004 of Yen 2,658 million. In addition, Ricoh recognized in its fiscal 2004
consolidated statement of income a cumulative effect of accounting change, net
of tax, of Yen 7,373 million associated with the 2000 Transfer.

6.      INVESTMENTS IN AND ADVANCES TO AFFILIATES

The investments in and advances to affiliates primarily relate to 20% to 50%
owned companies. Included in these companies is COCA-COLA WEST JAPAN COMPANY,
LIMITED, a 21.3% owned affiliate. The common stock of this company is publicly
traded. The carrying value of the investment in this company was equal to its
underlying book value and amounted to Yen 36,603 million ($342,084 thousand) as
of March 31, 2005. The quoted market value of Ricoh's investment in this company
was Yen 41,650 million ($389,252 thousand) as of March 31, 2005.

Ricoh's equity in the underlying net book values of the other 20% to 50% owned
companies is approximately equal to their individual carrying values of Yen
10,239 million and Yen 12,713 million ($118,813 thousand) at March 31, 2004 and
2005 respectively.

Summarized financial information for all affiliates as of March 31, 2004 and
2005 and for the years ended March 31, 2003, 2004 and 2005 is as follows:

                                      F-21

<TABLE>
<CAPTION>
                                                                            Thousands of
                                                         Millions of Yen    U.S. Dollars
                                                       -------------------  ------------
 FINANCIAL POSITION                                      2004      2005         2005
 ---------------------------------------------------------------------------------------
<S>                                                     <C>       <C>       <C>
 Assets-
    Current assets                                      104,916   116,247   $  1,086,421
    Other assets                                        155,081   164,170      1,534,299
 ---------------------------------------------------------------------------------------
                                                        259,997   280,417   $  2,620,720
 ---------------------------------------------------------------------------------------
 Liabilities and shareholders' investment-
    Current liabilities                                  37,954    37,426   $    349,776
    Other liabilities                                    12,170    18,512        173,009
    Shareholders' investment                            209,873   224,479      2,097,935
 ---------------------------------------------------------------------------------------
                                                        259,997   280,417   $  2,620,720
 ---------------------------------------------------------------------------------------

                                                                            Thousands of
                                                     Millions of Yen        U.S. Dollars
                                             -----------------------------  ------------
OPERATIONS                                      2003     2004      2005         2005
----------------------------------------------------------------------------------------
Sales                                         338,035   317,512   330,362   $  3,087,495
Costs and expenses                            327,139   307,665   315,729      2,950,738
----------------------------------------------------------------------------------------
Net income                                     10,896     9,847    14,633   $    136,757
----------------------------------------------------------------------------------------
</TABLE>

The significant transactions of Ricoh with these affiliates for the years ended
March 31, 2003, 2004 and 2005, and the related account balances at March 31,
2004 and 2005 are summarized as follows:

                                                                    Thousands of
                                              Millions of Yen       U.S. Dollars
                                        --------------------------  ------------
                                         2003      2004     2005        2005
--------------------------------------------------------------------------------
Transactions-
   Sales                                 26,510   19,534   19,365    $   180,981
   Purchases                             19,808   18,714   27,286        255,009
   Dividend income                        1,236    1,064    1,154         10,785
 -------------------------------------------------------------------------------

Unrealized profits regarding the above transactions were eliminated in the
consolidated financial statements.

                                                             Thousands of
                                          Millions of Yen    U.S. Dollars
                                        -------------------  ------------
                                          2004     2005          2005
-------------------------------------------------------------------------
 Account balances-
    Receivables                           3,530    3,416     $     31,925
    Payables                              2,217    2,964           27,701
-------------------------------------------------------------------------

As of March 31, 2005, consolidated retained earnings included undistributed
earnings of 20% to 50% owned companies accounted for by the equity method in the
amount of Yen 42,900 million ($400,935 thousand).

                                      F-22

7.      GOODWILL AND OTHER INTANGIBLE ASSETS

The information for intangible assets subject to amortization and for intangible
assets not subject to amortization is as follows:

<TABLE>
<CAPTION>
                                                                 Millions of Yen
                              ------------------------------------------------------------------------------
                                              2004                                  2005
                              -------------------------------------------------------------------------------
                               Gross                                    Gross
                              carrying    Accumulated   Net carrying   carrying   Accumulated    Net carrying
                               amount    amortization      amount       amount    amortization      amount
-------------------------------------------------------------------------------------------------------------
<S>                             <C>            <C>            <C>       <C>             <C>            <C>
Other intangible assets
 subject to amortization:
    Software                    44,844        (20,286)        24,558     58,681        (28,277)        30,404
    Trade name and
     customer base              12,699         (4,382)         8,317     29,937         (6,877)        23,060
    Other                       13,733         (4,802)         8,931     18,287         (3,848)        14,439
-------------------------------------------------------------------------------------------------------------
    Total                       71,276        (29,470)        41,806    106,905        (39,002)        67,903

Other intangible assets
  not subject to
  amortization                                                 1,427                                    1,511
                                                        ------------                             ------------
Total other intangible                                        43,233                                   69,414
  assets

<CAPTION>
-------------------------------------------------------------------------------------------------------------
                                                                            Thousands of U.S. Dollars
                                                                  -------------------------------------------
                                                                                      2005
                                                                  -------------------------------------------
                                                                      Gross
                                                                     carrying    Accumulated    Net carrying
                                                                      amount     amortization      amount
------------------------------------------------------------------------------------------------------------
<S>                                                                 <C>          <C>            <C>
Other intangible assets
 subject to amortization:
    Software                                                        $  548,421   $   (264,271)  $     284,150
    Trade name and
     customer base                                                     279,785        (64,271)        215,514
    Other                                                              170,906        (35,963)        134,943
                                                                    -----------------------------------------
    Total                                                              999,112       (364,505)        634,607

Other intangible assets
  not subject to
  amortization                                                                                         14,122
                                                                                                -------------
Total other intangible                                                                          $     648,729
  assets
-------------------------------------------------------------------------------------------------------------
</TABLE>

Gross carrying amount of software was increased for the year ended March 31,
2005 mainly due to back-office information systems development. Other intangible
assets subject to amortization other than software was increased for the year
ended March 31, 2005 mainly due to acquisition as described in Note 3.

The aggregate amortization expense of other intangible assets subject to
amortization for the years ended March 31, 2003, 2004 and 2005 were Yen 6,993
million, Yen 9,284 million and Yen 11,405 million ($106,589 thousand). The
future amortization expense for each of the five years relating to intangible
assets currently recorded in the consolidated balance sheets is estimated to be
the following at March 31, 2005:

<TABLE>
<CAPTION>
                                                                                                 Thousands of
 Years ending March 31                                                        Millions of Yen    U.S. Dollars
-------------------------------------------------------------------------------------------------------------
        <S>                                                                            <C>       <C>
        2006                                                                           15,313    $    143,112
        2007                                                                           12,038         112,504
        2008                                                                            9,531          89,075
        2009                                                                            7,643          71,430
        2010                                                                            2,993          27,972
-------------------------------------------------------------------------------------------------------------
</TABLE>

                                      F-23

The changes in the carrying amounts of goodwill for the year ended March 31,
2004 and 2005, were as follows:

<TABLE>
<CAPTION>
                                                                                                  Thousands of
                                                                                Millions of Yen   U.S. Dollars
                                                                             -------------------  ------------
                                                                                2004      2005        2005
--------------------------------------------------------------------------------------------------------------
<S>                                                                            <C>       <C>      <C>
Balance at beginning of year                                                   28,109    25,298   $    236,430
Goodwill acquired during the year                                                 383    21,722        203,009
Foreign exchange impact                                                        (3,194)      482          4,505
--------------------------------------------------------------------------------------------------------------
Balance at end of year                                                         25,298    47,502   $    443,944
--------------------------------------------------------------------------------------------------------------
</TABLE>

As of March 31, 2005, the carrying value of all goodwill was allocated to the
office equipment segment.

8.      INCOME TAXES

Income before income taxes, minority interests, equity in earnings of affiliates
and cumulative effect of accounting change and provision for income taxes for
the years ended March 31, 2003, 2004 and 2005 are as follows:

<TABLE>
<CAPTION>
                                                                                                 Thousands of
                                                                     Millions of Yen             U.S. Dollars
                                                       ---------------------------------------  -------------
                                                          2003          2004          2005             2005
-------------------------------------------------------------------------------------------------------------
<S>                                                      <C>           <C>           <C>          <C>
Income before income taxes, minority interests,
 equity in earnings of   affiliates and cumulative
  effect of accounting change:
   Domestic                                              84,946        98,162        88,562       $   827,682
   Foreign                                               38,524        44,901        46,821           437,579
-------------------------------------------------------------------------------------------------------------
                                                        123,470       143,063       135,383       $ 1,265,261
-------------------------------------------------------------------------------------------------------------
 Provision for income taxes- Current:
      Domestic                                           50,103        38,908        28,081       $   262,439
      Foreign                                            13,080        14,395        11,200           104,673
-------------------------------------------------------------------------------------------------------------
                                                         63,183        53,303        39,281           367,112
-------------------------------------------------------------------------------------------------------------
    Deferred:
      Domestic                                           (9,043)        1,951         8,737            81,654
      Foreign                                            (2,156)        1,387         2,616            24,449
-------------------------------------------------------------------------------------------------------------
                                                        (11,199)        3,338        11,353           106,103
-------------------------------------------------------------------------------------------------------------
 Consolidated provision for income taxes                 51,984        56,641        50,634       $   473,215
-------------------------------------------------------------------------------------------------------------
</TABLE>

                                      F-24

Total income taxes are allocated as follows:

<TABLE>
<CAPTION>
                                                                                                 Thousands of
                                                                    Millions of Yen              U.S. Dollars
                                                       ---------------------------------------  -------------
                                                          2003          2004          2005             2005
-------------------------------------------------------------------------------------------------------------
<S>                                                      <C>           <C>           <C>          <C>
 Provision for income taxes                              51,984        56,641        50,634       $   473,215
 Shareholders' investment:
    Foreign currency translation adjustments               (826)       (1,334)        3,378            31,570
    Unrealized gains (losses) on securities              (1,130)       (3,617)          407             3,804
    Unrealized gains (losses) on derivatives                 (9)          109            97               906
    Minimum pension liability adjustment                (30,811)       49,733           129             1,206
 Cumulative effect of accounting change                       -         5,722             -                 -
-------------------------------------------------------------------------------------------------------------
                                                         19,208       107,254        54,645       $   510,701
-------------------------------------------------------------------------------------------------------------
</TABLE>

The Company and its domestic subsidiaries are subject to a National Corporate
tax of 30%, an inhabitant tax of approximately 6% and a deductible Enterprise
tax approximately 8%, which in the aggregate resulted in the normal statutory
tax rate of approximately 41%. Based on an enacted change in the Japanese tax
laws in March 2003, the normal statutory tax rate was reduced to approximately
41% effective April 1, 2004, and such rate has been used in calculating the
future expected tax effects of temporary differences and carryforwards expected
to be settled or realized on or after April 1, 2004. The normal statutory tax
rate differs from the effective tax rate for the years ended March 31, 2003,
2004 and 2005 as a result of the following:

<TABLE>
<CAPTION>
                                                                               2003         2004         2005
-------------------------------------------------------------------------------------------------------------
<S>                                                                             <C>          <C>          <C>
Normal statutory tax rate                                                       42%          42%          41%
Nondeductible expenses                                                           1            1            1
Tax benefits not recognized on operating losses of certain consolidated
 subsidiaries                                                                    3            2            1
Utilization of net operating loss carryforward not previously recognized        (4)          (1)          (2)
Tax credit for increased research and development expense                       (1)          (3)          (3)
Effect of change in enacted tax rate                                             2            1            -
Other, net                                                                      (1)          (2)          (1)
------------------------------------------------------------------------------------------------------------
Effective tax rate                                                              42%          40%          37%
------------------------------------------------------------------------------------------------------------
</TABLE>

Nondeductible expenses include directors' bonuses and entertainment expenses.

The tax effects of temporary differences and carryforwards giving rise to the
consolidated deferred income tax assets and liabilities as of March 31, 2004 and
2005 are as follows:

                                      F-25

<TABLE>
<CAPTION>
                                                                                                 Thousands of
                                                                          Millions of Yen        U.S. Dollars
                                                                    --------------------------  -------------
                                                                        2004         2005           2005
-------------------------------------------------------------------------------------------------------------
<S>                                                                    <C>           <C>          <C>
Assets:
   Accrued expenses                                                    22,165        20,717       $  193,617
   Property, plant and equipment                                        3,316         3,458           32,318
   Accrued pension and severance costs                                 31,372        33,781          315,710
   Net operating loss carryforwards                                    10,778         5,993           56,009
   Other                                                               29,655        27,400          256,075
------------------------------------------------------------------------------------------------------------
                                                                       97,286        91,349          853,729
   Less- Valuation allowance                                           (9,010)       (7,079)         (66,159)
------------------------------------------------------------------------------------------------------------
                                                                       88,276        84,270       $  787,570
------------------------------------------------------------------------------------------------------------
Liabilities:
   Sales-type leases                                                   (6,853)       (6,548)      $  (61,196)
   Undistributed earnings of foreign subsidiaries and
    affiliates                                                        (15,602)      (17,092)        (159,738)
   Net unrealized holding gains on available-for-sale
    securities                                                         (4,390)       (4,592)         (42,916)
   Basis difference of acquired intangible assets                      (2,930)      (11,482)        (107,308)
   Other                                                               (7,039)      (13,765)        (128,646)
------------------------------------------------------------------------------------------------------------
                                                                      (36,814)      (53,479)      $ (499,804)
------------------------------------------------------------------------------------------------------------
Net deferred tax assets                                                51,462        30,791       $  287,766
------------------------------------------------------------------------------------------------------------
</TABLE>

Net deferred tax assets as of March 31, 2004 and 2005 are included in the
consolidated balance sheets as follows:

<TABLE>
<CAPTION>
                                                                                                 Thousands of
                                                                         Millions of Yen         U.S. Dollars
                                                                    --------------------------  -------------
                                                                        2004         2005           2005
-------------------------------------------------------------------------------------------------------------
<S>                                                                   <C>           <C>           <C>
Deferred income taxes and other (Current Assets)                       41,213        37,812       $  353,383
Lease deposits and other (Non-current Assets)                          47,122        42,393          396,196
Accrued expenses and other (Current Liabilities)                         (578)         (647)          (6,047)
Deferred income taxes (Long-Term Liabilities)                         (36,295)      (48,767)        (455,766)
-------------------------------------------------------------------------------------------------------------
                                                                       51,462        30,791       $  287,766
-------------------------------------------------------------------------------------------------------------
</TABLE>

The net changes in the total valuation allowance for the years ended March 31,
2003, 2004 and 2005 was decreases of Yen 2,107 million, Yen 183 million and Yen
1,931 million ($18,047 thousand), respectively. The valuation allowance
primarily relates to deferred tax assets of the consolidated subsidiaries with
net operating loss carryforwards for tax purposes that are not expected to be
realized.

In assessing the realizability of deferred tax assets, Ricoh considers whether
it is more likely than not that some portion or all of the deferred tax assets
will not be realized. The ultimate realization of deferred tax assets is
dependent upon the generation of future taxable income during the periods in
which those temporary differences become deductible and whether loss
carryforwards are utilizable. Ricoh considers the scheduled reversal of deferred
tax liabilities, projected future taxable income, and tax planning strategies in
making this assessment. Based upon the level of historical taxable income and
projections for future taxable income over the periods in which the deferred tax
assets are deductible, Ricoh believes it is

                                      F-26

more likely than not that the benefits of these deductible differences, net of
the existing valuation allowance will be realized. The amount of the deferred
tax asset considered realizable, however, would be reduced if estimates of
future taxable income during the carryforward period are reduced.

As of March 31, 2005, certain subsidiaries had net operating losses carried
forward for income tax purposes of approximately Yen 17,530 million ($163,832
thousand) which were available to reduce future income taxes, if any.
Approximately Yen 1,293 million ($12,084 thousand) of the operating losses will
expire within 3 years and Yen 9,595 million ($89,673 thousand) will expire
within 4 to 7 years. The remainder principally have an indefinite carryforward
period.

The Company has not recognized a deferred tax liability for certain portion of
the undistributed earnings of its foreign subsidiaries of Yen 157,159 million
($1,468,776 thousand) as of March 31, 2005 because the Company currently does
not expect those unremitted earnings to reverse and become taxable to the
Company in the foreseeable future. A deferred tax liability will be recognized
when the Company no longer plans to permanently reinvest undistributed earnings.
Calculation of related unrecognized deferred tax liability is not practicable.

9.      SHORT-TERM BORROWINGS

Short-term borrowings as of March 31, 2004 and 2005 consist of the following:

<TABLE>
<CAPTION>
                                             Weighted average                                      Thousands of
                                               interest rate               Millions of Yen         U.S. Dollars
                                          ------------------------ ----------------------------- --------------
                                               2004      2005              2004          2005           2005
---------------------------------------------------------------------------------------------------------------
<S>                                            <C>        <C>             <C>           <C>           <C>
Borrowings, principally from banks             1.7%       3.5%            19,359         8,641        $  80,757
Commercial paper                               0.8        2.9             49,593        30,069          281,019
---------------------------------------------------------------------------------------------------------------
                                                                          68,952        38,710         $361,776
---------------------------------------------------------------------------------------------------------------
</TABLE>

The Company and certain of its subsidiaries enter into the contracts with
financial institutions regarding lines of credit and overdrawing. Those same
financial institutions hold the issuing programs of commercial paper and
medium-term notes. Unused lines of credit amounted to Yen 634,273 million and
Yen 689,993 million ($6,448,533 thousand) as of March 31, 2004 and 2005,
respectively, of which Yen 182,764 million and Yen 219,291 million ($2,049,449
thousand) related to commercial paper and Yen 131,966 million and Yen 128,346
million ($1,199,495 thousand) related to medium-term notes programs at
prevailing interest rates.

                                      F-27

10.     LONG-TERM INDEBTEDNESS

Long-term indebtedness as of March 31, 2004 and 2005 consists of the followings:

<TABLE>
<CAPTION>
                                                                                                   Thousands of
                                                                          Millions of Yen          U.S. Dollars
                                                                 ------------------------------- -----------------
                                                                         2004           2005             2005
------------------------------------------------------------------------------------------------------------------
<S>                                                                    <C>           <C>            <C>
Bonds-
   2.075%, straight bonds, payable in yen, due April 2005               40,000         40,000       $   373,832
   0.87%, straight bonds, payable in yen, due March 2007                35,000         35,000           327,103
   1.34%, straight bonds, payable in yen, due March 2009                25,000         25,000           233,645
   1.17%, straight bonds, payable in yen, due June 2004 issued
     by a consolidated subsidiary                                       10,000              -                 -
   0.73%, straight bonds, payable in yen, due June 2006 issued
     by a consolidated subsidiary                                       10,000         10,000            93,458
   0.70%, straight bonds, payable in yen, due June 2007 issued
     by a consolidated subsidiary                                       10,000         10,000            93,458
   2.10%, straight bonds, payable in yen, due October 2009
     issued by a consolidated subsidiary                                10,000         10,000            93,458
   Medium-term notes, 0.30% weighted average, due through 2015
     issued by a consolidated subsidiary                                16,000         22,000           205,607
------------------------------------------------------------------------------------------------------------------
         Total bonds                                                   156,000        152,000         1,420,561
------------------------------------------------------------------------------------------------------------------
Unsecured loans-
   Banks and insurance companies,
     1.37% weighted average, due through 2011                          200,361        212,416         1,985,196
------------------------------------------------------------------------------------------------------------------
Secured loans-
   Banks, insurance companies and other financial institution,
     1.09% weighted average, due through 2013                            1,410          1,133            10,589
------------------------------------------------------------------------------------------------------------------
Capital lease obligations (see Note 2(j))                                3,141          3,804            35,551
------------------------------------------------------------------------------------------------------------------
         Total                                                         360,912        369,353         3,451,897
SFAS 133 fair value adjustment                                           2,868          2,022            18,898
Less- Current maturities included in current liabilities               (82,210)      (144,808)       (1,353,346)
------------------------------------------------------------------------------------------------------------------
                                                                       281,570        226,567       $ 2,117,449
------------------------------------------------------------------------------------------------------------------
</TABLE>

Secured loans are collateralized by land, buildings and lease receivables with a
book value of Yen 3,312 million ($30,953 thousand) as of March 31, 2005.

All bonds outstanding as of March 31, 2005 are redeemable at the option of Ricoh
at 100% of the principal amounts under certain conditions as provided in the
applicable agreements.

Bonds are subject to certain covenants such as restrictions on certain
additional secured indebtedness, as defined in the agreements. Ricoh presently
is in compliance with such covenants as of March 31, 2005.

Certain loan agreements provide, among other things, that the lender may request
the Company to submit proposals for appropriations of earnings (including
payment of dividends) to the lender for its review and approval prior to
presentation to the shareholders. The Company has never been requested to submit
such proposals for approval. In addition, as is customary in Japan,
substantially all of the bank borrowings are subject to general agreements with
each bank which provide, among other things, that the banks may request
additional security for these loans if there is reasonable and probable cause
and may treat any security furnished to the banks as well as cash deposited as
security for all present and future indebtedness. The Company has never been
requested to submit such additional security.

                                      F-28

The aggregate annual maturities of long-term indebtedness subsequent to March
31, 2005 are as follows:

                                                                   Thousands of
Years ending March 31                    Millions of Yen           U.S. Dollars
-------------------------------------------------------------------------------
2006                                          144,572              $  1,351,140
2007                                          100,418                   938,486
2008                                           54,105                   505,654
2009                                           34,105                   318,738
2010                                           34,561                   323,000
2011 and thereafter                             1,592                    14,879
-------------------------------------------------------------------------------
Total                                         369,353              $  3,451,897
-------------------------------------------------------------------------------

11.     PENSION AND RETIREMENT ALLOWANCE PLANS

The Company and certain of its subsidiaries have various trusted contributory
and noncontributory employees' pension fund plans covering substantially all of
their employees. Under the plans, employees are entitled to lump-sum payments at
the time of termination or retirement, or to pension payments. Under the terms
of the domestic employee's pension fund ("EPF") plan, the government mandated
welfare pension insurance benefit was included and commingled with the primary
corporate benefit provided by Ricoh. These contributory and non contributory
plans were funded in conformity with governmental regulations which basically
require an employer to contribute the unfunded benefit over 20 years.

As noted above, the domestic EPF plan was composed of (1) a corporate defined
benefit portion established by Ricoh and (2) a substitutional portion based on
benefits prescribed by the government (similar to social security benefits in
the United States). Ricoh had been exempted from contributing to the Japanese
Pension Insurance ("JPI") program that would otherwise have been required if it
had not elected to fund the government substitutional portion of the benefit
through an EPF arrangement. The plan assets of the EPF were invested and managed
as a single portfolio for the entire EPF and were not separately attributed to
the substitutional and corporate portions. In June 2001, Contributed Benefit
Pension Plan Law was newly enacted and permits an employer to elect to transfer
the entire substitutional portion benefit obligation from the EPF to the
government together with a specified amount of plan assets pursuant to a
government formula. After such transfer, the employer would be required to make
periodic contributions to JPI, and the Japanese government would be responsible
for all benefit payments. The corporate portion of the EPF would continue to
exist exclusively as a corporate defined benefit pension plan.

Pursuant to the new law, Ricoh received an approval of exemption from the
Minister of Health, Labor and Welfare, effective January 1, 2003, from the
obligation for benefits related to future employee service with respect to the
substitutional portion of its EPF. Ricoh received government approval of
exemption from the obligation for benefits related to past employee service in
January 2004 with respect to the substitutional portion of its domestic
contributory plan. The transfer to the government was completed on March 16,
2004.

Ricoh accounted for the transfer in accordance with EITF Issue No. 03-2
"Accounting for the Transfer to the Japanese Government of the Substitutional
Portion of Employee Pension Fund Liabilities" ("EITF 03-2"). As specified in
EITF 03-2, the entire separation process is to be accounted for at the time of
completion of the transfer to the government of the substitutional portion of
the benefit obligation and related plan assets as a settlement in accordance
with SFAS No. 88 "Employers' Accounting for Settlements and Curtailments of
Defined Benefit Pension Plans and for Termination Benefits". As a result of the
transfer, Ricoh recognized as a subsidy from the Japanese government an amount
equal to the

                                      F-29

difference between the fair value of the obligation deemed "settled" with the
Japanese government and the assets required to be transferred to the government.
The subsidy that Ricoh recognized amounted to Yen 56,972 million. In addition,
Ricoh recognized as a settlement loss equal to the amount calculated as the
ratio of the obligation settled to the total EPF obligation immediately prior to
settlement, both of which exclude the effect of future salary progression
relating to the substitutional portion, times the net unrecognized gain/loss
immediately prior to settlement, which amounted to Yen 48,657 million. These
gains and losses were included in operating income.

In addition to the EPF plan, the Company had maintained a defined benefit plan
for certain qualified employees. Effective January 1, 2004, the Company
liquidated this plan and recorded a settlement loss of Yen 5,958 million which
was included in selling, general and administrative expenses in the consolidated
statement of income.

The changes in the benefit obligation and plan assets of the pension plans for
the years ended March 31, 2004 and 2005 are as follows:

<TABLE>
<CAPTION>
                                                                                                    Thousands of
                                                                           Millions of Yen          U.S. Dollars
                                                                   -----------------------------  --------------
                                                                          2004          2005            2005
----------------------------------------------------------------------------------------------------------------
<S>                                                                     <C>           <C>            <C>
Change in benefit obligation:
     Benefit obligation at beginning of year                             522,275       308,004       $ 2,878,542
     Service cost                                                         15,694        14,762           137,963
     Interest cost                                                        12,719         9,218            86,150
     Plan participants' contributions                                        171           457             4,271
     Amendments                                                          (53,563)          (91)             (851)
     Actuarial loss (benefit)                                             (7,420)        2,697            25,205
     Settlement                                                         (164,522)       (4,316)          (40,336)
     Benefits paid                                                       (15,378)      (19,818)         (185,215)
     Foreign exchange impact                                              (1,972)        3,572            33,383
     Benefit obligation assumed in connection with business
      acquisition                                                              -        23,716           221,645
----------------------------------------------------------------------------------------------------------------
     Benefit obligation at end of year                                   308,004       338,201       $ 3,160,757
----------------------------------------------------------------------------------------------------------------
Change in plan assets:
     Fair value of plan assets at beginning of year                      235,346       210,976       $ 1,971,738
     Actual return on plan assets                                         43,980         9,401            87,860
     Employer contribution                                                16,472        12,359           115,505
     Plan participants' contributions                                        171           457             4,271
     Settlement                                                          (72,812)       (3,192)          (29,832)
     Benefits paid                                                       (10,960)      (13,534)         (126,486)
     Foreign exchange impact                                              (1,221)        2,783            26,009
     Plan assets acquired in connection with business acquisition              -        15,911           148,701
----------------------------------------------------------------------------------------------------------------
     Fair value of plan assets at end of year                            210,976       235,161       $ 2,197,766
----------------------------------------------------------------------------------------------------------------
Funded status                                                            (97,028)     (103,040)      $  (962,990)
Unrecognized net actuarial loss                                          111,528       102,851           961,224
Unrecognized prior service cost                                          (61,599)      (57,134)         (533,963)
Unrecognized net asset at transition, net of amortization                 (1,435)         (984)           (9,196)
----------------------------------------------------------------------------------------------------------------
     Net amount recognized                                               (48,534)      (58,307)      $  (544,925)
----------------------------------------------------------------------------------------------------------------
</TABLE>

                                      F-30

<TABLE>
<CAPTION>
                                                                                                    Thousands of
                                                                           Millions of Yen          U.S. Dollars
                                                                   -----------------------------  --------------
                                                                          2004          2005            2005
----------------------------------------------------------------------------------------------------------------
<S>                                                                     <C>           <C>            <C>
Amounts recognized in the balance sheets consist of:
     Prepaid benefit cost                                                      -            28       $       262
     Accrued benefit liability                                           (78,851)      (87,939)         (821,860)
     Intangible assets                                                        92           111             1,037
     Accumulated other comprehensive income, gross of tax                 30,225        29,493           275,636
-----------------------------------------------------------------------------------------------------------------
     Net amount recognized                                               (48,534)      (58,307)      $  (544,925)
-----------------------------------------------------------------------------------------------------------------
Accumulated benefit obligations                                          283,548       313,715       $ 2,931,916
-----------------------------------------------------------------------------------------------------------------
</TABLE>

Weighted-average assumptions used to determine benefit obligations at March 31,
2004 and 2005 were as follows:

                                                   2004           2005
-----------------------------------------------------------------------
Discount rate                                      2.9%           3.0%
Rate of compensation increase                      3.4%           3.5%
-----------------------------------------------------------------------

Weighted-average assumptions used to determine the net periodic benefit cost for
the years ended March 31, 2003, 2004 and 2005 were as follows:

                                              2003       2004      2005
-----------------------------------------------------------------------
Discount rate                                 3.3%       2.6%      2.9%
Rate of compensation increase                 3.4%       3.4%      3.4%
Expected long-term return on plan assets      3.6%       2.5%      2.9%
-----------------------------------------------------------------------

The net periodic benefit costs of the pension plans for the three years ended
March 31, 2005 consisted of the following components:

<TABLE>
<CAPTION>
                                                                                  Thousands of
                                                     Millions of Yen              U.S. Dollars
                                      ----------------------------------------- ---------------
                                             2003          2004          2005           2005
-----------------------------------------------------------------------------------------------
<S>                                         <C>           <C>           <C>           <C>
Service cost                                16,943        15,694        14,762        $137,963
Interest cost                               14,292        12,719         9,218          86,150
Expected return on plan assets              (9,763)       (5,872)       (6,571)        (61,412)
Net amortization                             5,081        10,805         1,648          15,402
Settlement loss (benefit)                      (35)       (2,537)         (980)         (9,159)
-----------------------------------------------------------------------------------------------
Total net periodic pension cost             26,518        30,809        18,077        $168,944
-----------------------------------------------------------------------------------------------
</TABLE>

In accordance with the provisions of SFAS 87, Ricoh has recorded an adjustment
for minimum pension liability at March 31, 2004 and 2005. This liability
represents the excess of the accumulated benefit obligations over the fair value
of plan assets and severance costs already recognized before recording the
minimum pension liability. This excess is primarily attributable to a
substantial reduction in the discount rate used in pension calculation and loss
on plan assets. A corresponding amount was recognized as an intangible asset to
the extent of the unrecognized prior service cost, and the balance was recorded
as a component of accumulated other comprehensive income (loss), net of tax.

                                      F-31

The projected benefit obligations and the fair value of plan assets for the
pension plans with projected benefit obligations in excess of plan assets, and
the accumulated benefit obligations and the fair value of plan assets for the
pension plans with accumulated benefit obligations in excess of plan assets are
as follows:

<TABLE>
<CAPTION>
                                                                                                    Thousands of
                                                                         Millions of Yen            U.S. Dollars
                                                                   -----------------------------  -----------------
                                                                          2004          2005              2005
-------------------------------------------------------------------------------------------------------------------
<S>                                                                      <C>           <C>            <C>
Plans with projected benefit obligations in excess of plan assets:
     Projected benefit obligations                                       308,004       338,201        $3,160,757
     Fair value of plan assets                                           210,976       235,161         2,197,766
Plans with accumulated benefit obligations in excess of plan assets:
     Accumulated benefit obligations                                     229,387       228,695        $2,137,336
     Fair value of plan assets                                           194,654       196,723         1,838,533
-------------------------------------------------------------------------------------------------------------------
</TABLE>

Ricoh's benefit plan asset allocation at March 31, 2004 and 2005 are as follows:

                                                      2004            2005
---------------------------------------------------------------------------
Equity securities                                     50.3%           48.5%
Debt securities                                       14.6%           27.1%
Life insurance company general accounts               15.4%           14.8%
Other                                                 19.7%            9.6%
---------------------------------------------------------------------------
Total                                                100.0%          100.0%
---------------------------------------------------------------------------

As discussed in Note 5, Ricoh contributed certain marketable equity securities
to an employee retirement benefit trust. The securities held in this trust are
qualified as plan assets under SFAS 87.

Common stock and bonds of the Company and certain of its domestic subsidiaries
included in plan assets were immaterial at March 31, 2004 and 2005.

Ricoh's investment policies and strategies for the pension benefits do not use
target allocations for the individual asset categories. Ricoh's investment goals
are to maximize returns subject to specific risk management policies. Its risk
management policies permit investments in mutual funds and debt and equity
securities and prohibit direct investment in derivative financial instruments.
Ricoh addresses diversification by the use of mutual fund investments whose
underlying investments are in domestic and international fixed income securities
and domestic and international equity securities. These mutual funds are readily
marketable and can be sold to fund benefit payment obligations as they become
payable.

Ricoh uses a December 31 measurement date for the pension plans.

Ricoh expects to contribute Yen 12,260 million ($114,579 thousand) to its
pension plans for the year ended March 31, 2006.

                                      F-32

The following benefit payments, which reflect expected future service, as
appropriate, are expected to be paid:

                                                                 Thousands of
Years ending March 31                     Millions of Yen        U.S. Dollars
------------------------------------------------------------------------------
2006                                           11,559                 $108,028
2007                                           13,342                  124,691
2008                                           16,382                  153,103
2009                                           17,151                  160,290
2010                                           17,657                  165,019
2011 - 2015                                    84,421                  788,981
------------------------------------------------------------------------------

Employees of certain domestic subsidiaries not covered by the EPF plan and
directors of the Company are primarily covered by unfunded retirement allowances
plans. The payments to directors are subject to shareholders' approval.

12.     SHAREHOLDERS' INVESTMENT

The Japanese Commercial Code provides that an amount equal to at least 10% of
cash dividends and other distributions from retained earnings paid by the
Company and its domestic subsidiaries be appropriated as a legal reserve. No
further appropriation is required when the total amount of the legal reserve and
additional paid-in capital equals 25% of common stock. The Japanese Commercial
Code also provides that to the extent that the sum of the additional paid-in
capital and the legal reserve exceeds 25% of the stated capital, the amount of
the excess (if any) is available for appropriations by the resolution of the
shareholders. Certain foreign subsidiaries are also required to appropriate
their earnings to legal reserves under the laws of the respective countries.
Legal reserves included in retained earnings as of March 31, 2004 and 2005 were
Yen 16,894 million and Yen 17,053 million ($159,374 thousand), respectively, and
are restricted from being used as dividends.

Semiannual cash dividends are approved by the shareholders after the end of each
fiscal period or are declared by the Board of Directors after the end of each
interim six-month period. Such dividends are payable to shareholders of record
at the end of each such fiscal or interim six-month period. At the general
meeting to be held on June 28, 2005, the shareholders will be asked to approve
the declaration of a cash dividend (Yen 10 per share) on the common stock
totaling Yen 7,348 million ($68,673 thousand), which will be paid to
shareholders of record as of March 31, 2005. The declaration of this dividend
has not been reflected in the consolidated financial statements as of March 31,
2005.

The Japanese Commercial Code provides that at least one-half of the proceeds
from shares issued is included in common stock. In conformity therewith, the
Company has divided the principal amount of bonds converted into common stock
between common stock and additional paid-in capital.

The amount of retained earnings legally available for dividend distribution is
that recorded in the Company's non-consolidated books and amounted to Yen
325,534 million ($3,042,374 thousand) as of March 31, 2005.

                                      F-33

13.     OTHER COMPREHENSIVE INCOME (LOSS)

Tax effects allocated to each component of other comprehensive income (loss) are
as follows:

<TABLE>
<CAPTION>
                                                                                       Millions of Yen
                                                                       -------------------------------------------
                                                                         Before-tax        Tax        Net-of-tax
                                                                           amount        expense        amount
------------------------------------------------------------------------------------------------------------------
<S>                                                                          <C>            <C>           <C>
2003:
      Foreign currency translation adjustments                                   181           826          1,007
      Unrealized gains (losses) on securities:
        Unrealized holding gains (losses) arising during the year             (5,348)        2,065         (3,283)
        Less- Reclassification adjustment for (gains) losses
           realized in net income                                              2,234          (935)         1,299
      Net unrealized gains (losses)                                           (3,114)        1,130         (1,984)
      Unrealized gains (losses) on derivatives:
        Unrealized holding gains (losses) arising during the year               (634)          277           (357)
        Less- Reclassification adjustment for (gains) losses
           realized in net income                                                654          (268)           386
      Net unrealized gains (losses)                                               20             9             29
      Minimum pension liability adjustment                                   (80,220)       30,811        (49,409)
------------------------------------------------------------------------------------------------------------------
      Other comprehensive income (loss)                                      (83,133)       32,776        (50,357)
------------------------------------------------------------------------------------------------------------------

 2004:
      Foreign currency translation adjustments                                (6,727)        1,334         (5,393)
      Unrealized gains (losses) on securities:
        Cumulative effect of accounting change                               (13,095)        5,722         (7,373)
        Unrealized holding gains (losses) arising during the year              7,688        (3,227)         4,461
        Less- Reclassification adjustment for (gains) losses
           realized in net income                                             (2,766)        1,122         (1,644)
      Net unrealized gains (losses)                                           (8,173)        3,617         (4,556)
      Unrealized gains (losses) on derivatives:
        Unrealized holding gains (losses) arising during the year               (105)           42            (63)
        Less- Reclassification adjustment for (gains) losses
           realized in net income                                                368          (151)           217
      Net unrealized gains (losses)                                              263          (109)           154
      Minimum pension liability adjustment                                   123,989       (49,733)        74,256
------------------------------------------------------------------------------------------------------------------
      Other comprehensive income (loss)                                      109,352       (44,891)        64,461
------------------------------------------------------------------------------------------------------------------
</TABLE>

                                      F-34

<TABLE>
<CAPTION>
                                                                                       Millions of Yen
                                                                       -------------------------------------------
                                                                         Before-tax        Tax        Net-of-tax
                                                                           amount        expense        amount
------------------------------------------------------------------------------------------------------------------
<S>                                                                           <C>           <C>             <C>
2005:
     Foreign currency translation adjustments                                 12,419        (3,378)         9,041
     Unrealized gains (losses) on securities:
       Unrealized holding gains (losses) arising during the year               1,024          (347)           677
       Less- Reclassification adjustment for (gains) losses
          realized in net income                                                 148           (60)            88
     Net unrealized gains (losses)                                             1,172          (407)           765
     Unrealized gains (losses) on derivatives:
       Unrealized holding gains (losses) arising during the year                  45           (17)            28
       Less- Reclassification adjustment for (gains) losses
          realized in net income                                                 193           (80)           113
     Net unrealized gains (losses)                                               238           (97)           141
     Minimum pension liability adjustment                                        156          (129)            27
------------------------------------------------------------------------------------------------------------------
     Other comprehensive income (loss)                                        13,985        (4,011)         9,974
------------------------------------------------------------------------------------------------------------------

                                                                                Thousands of U.S. Dollars
                                                                       -------------------------------------------
2005:
     Foreign currency translation adjustments                               $116,065      $(31,570)       $84,495
     Unrealized gains (losses) on securities:
       Unrealized holding gains (losses) arising during the year               9,570        (3,243)         6,327
       Less- Reclassification adjustment for (gains) losses
        realized in net income                                                 1,383          (560)           823
     Net unrealized gains (losses)                                            10,953        (3,803)         7,150
     Unrealized gains (losses) on derivatives:
       Unrealized holding gains (losses) arising during the year                 421          (159)           262
       Less- Reclassification adjustment for (gains) losses
        realized in net income                                                 1,804          (748)         1,056
     Net unrealized gains (losses)                                             2,225          (907)         1,318
     Minimum pension liability adjustment                                      1,458        (1,206)           252
------------------------------------------------------------------------------------------------------------------
     Other comprehensive income (loss)                                      $130,701      $(37,486)       $93,215
------------------------------------------------------------------------------------------------------------------
</TABLE>

                                      F-35

Changes in accumulated other comprehensive income (loss) are as follows:

<TABLE>
<CAPTION>
                                                                  Millions of Yen
                               --------------------------------------------------------------------------------
                                                                                                      Total
                                   Foreign        Unrealized      Unrealized        Minimum        Accumulated
                                   currency         gains           gains           pension           other
                                 translation     (losses) on     (losses) on       liability      comprehensive
                                 adjustments      securities     derivatives      adjustment      income (loss)
---------------------------------------------------------------------------------------------------------------
<S>                                <C>               <C>              <C>           <C>              <C>
2003:
     Beginning balance               (15,025)         10,566            (207)         (39,710)         (44,376)
     Change during the year            1,007          (1,984)             29          (49,409)         (50,357)
---------------------------------------------------------------------------------------------------------------
     Ending balance                  (14,018)          8,582            (178)         (89,119)         (94,733)
---------------------------------------------------------------------------------------------------------------
2004:
     Beginning balance               (14,018)          8,582            (178)         (89,119)         (94,733)
     Cumulative effect of
      accounting change                    -          (7,373)              -                -           (7,373)
     Change during the year           (5,393)          2,817             154           74,256           71,834
---------------------------------------------------------------------------------------------------------------
     Ending balance                  (19,411)          4,026             (24)         (14,863)         (30,272)
---------------------------------------------------------------------------------------------------------------
2005:
     Beginning balance               (19,411)          4,026             (24)         (14,863)         (30,272)
     Adjustment for change in
      fiscal year end of
      consolidated
      subsidiaries                    (1,849)              -               -              184           (1,665)
     Change during the year            9,041             765             141               27            9,974
---------------------------------------------------------------------------------------------------------------
     Ending balance                  (12,219)          4,791             117          (14,652)         (21,963)
---------------------------------------------------------------------------------------------------------------

                                                           Thousands of U.S. Dollars
                               --------------------------------------------------------------------------------
2005:
     Beginning balance             $(181,411)        $37,626          $ (224)       $(138,907)       $(282,916)
     Adjustment for change in
      fiscal year end of
      consolidated
      subsidiaries                   (17,280)              -               -            1,720          (15,560)
     Change during the year           84,495           7,150           1,318              252           93,215
---------------------------------------------------------------------------------------------------------------
     Ending balance                $(114,196)        $44,776          $1,094        $(136,935)       $(205,261)
---------------------------------------------------------------------------------------------------------------
</TABLE>

                                      F-36

14.     PER SHARE DATA

Dividends per share shown in the consolidated statements of income are computed
based on dividends paid for the year.

A reconciliation of the numerator and the denominators of the basic and diluted
per share computations for income before cumulative effect of accounting change,
cumulative effect of accounting change, net of tax and net income is as follows:

<TABLE>
<CAPTION>
                                                                 Thousands of shares
                                                     ---------------------------------------
                                                        2003          2004          2005
--------------------------------------------------------------------------------------------
<S>                                                   <C>           <C>             <C>
Weighted average common shares outstanding            726,660       742,293       738,160

Effect of dilutive securities:
   Convertible bonds-
    0.35%, payable in yen, due March 2003              23,250             -             -
--------------------------------------------------------------------------------------------
Diluted common shares outstanding                     749,910       742,293       738,160
--------------------------------------------------------------------------------------------
</TABLE>

<TABLE>
<CAPTION>
                                                                                                   Thousands of
                                                                   Millions of Yen                 U.S. Dollars
                                                     ------------------------------------------- ---------------
                                                          2003          2004          2005             2005
----------------------------------------------------------------------------------------------------------------
<S>                                                      <C>           <C>           <C>               <C>
Income before cumulative effect of accounting change     72,513        84,393        83,143            $777,037
 applicable to common shareholders
Effect of dilutive securities:
    Convertible bonds-
     0.35%, payable in yen, due March 2003                   86             -             -                   -
----------------------------------------------------------------------------------------------------------------
Diluted income before cumulative effect of               72,599        84,393        83,143            $777,037
 accounting change
----------------------------------------------------------------------------------------------------------------
Cumulative effect of accounting change, net of tax            -         7,373             -            $      -
----------------------------------------------------------------------------------------------------------------
Net income applicable to common shareholders             72,513        91,766        83,143            $777,037
Effect of dilutive securities:
    Convertible bonds-
     0.35%, payable in yen, due March 2003                   86             -             -                   -
----------------------------------------------------------------------------------------------------------------
Diluted net income                                       72,599        91,766        83,143            $777,037
----------------------------------------------------------------------------------------------------------------

                                                                       Yen                         U.S. Dollars
                                                     ------------------------------------------- ---------------
                                                          2003          2004          2005             2005
----------------------------------------------------------------------------------------------------------------
Earnings per share:
   Basic
      Income before cumulative effect of
       accounting change                                  99.79        113.69        112.64            $   1.05
      Cumulative effect of accounting change                  -          9.94             -                   -
      Net income                                          99.79        123.63        112.64                1.05
   Diluted:
      Income before cumulative effect of
       accounting change                                  96.81        113.69        112.64                1.05
      Cumulative effect of accounting change                  -          9.94             -                   -
      Net income                                          96.81        123.63        112.64                1.05

----------------------------------------------------------------------------------------------------------------
</TABLE>

                                      F-37

15.     DERIVATIVE FINANCIAL INSTRUMENTS

RISK MANAGEMENT POLICY

Ricoh enters into various derivative financial instrument contracts in the
normal course of business in connection with the management of its assets and
liabilities.

Ricoh uses derivative instruments to reduce risk and protect market value of
assets and liabilities in conformity with the Ricoh's policy. Ricoh does not use
derivative financial instruments for trading or speculative purposes, nor is it
a party to leveraged derivatives.

All derivative instruments are exposed to credit risk arising from the inability
of counterparties to meet the terms of the derivative contracts. However, Ricoh
does not expect any counterparties to fail to meet their obligations because
these counterparties are financial institutions with satisfactory credit
ratings. Ricoh utilizes a number of counterparties to minimize the concentration
of credit risk.

FOREIGN EXCHANGE RISK MANAGEMENT

Ricoh conducts business on a global basis and holds assets and liabilities
denominated in foreign currencies. Ricoh enters into foreign exchange contracts
and foreign currency options to hedge against the potentially adverse impacts of
foreign currency fluctuations on those assets and liabilities denominated in
foreign currencies.

INTEREST RATE RISK MANAGEMENT

Ricoh enters into interest rate swap agreements to hedge against the potential
adverse impacts of changes in fair value or cash flow fluctuations on interest
of its outstanding debt.

FAIR VALUE HEDGES

Changes in the fair value of derivative instruments and the related hedged items
designated and qualifying as fair value hedges are included in other (income)
expenses on the consolidated statements of income. There is no hedging
ineffectiveness nor are net gains or losses excluded from the assessment of
hedge effectiveness for the years ended March 31, 2003, 2004 and 2005 as the
critical terms of the interest rate swap match the terms of the hedged debt
obligations.

CASH FLOW HEDGES

Changes in the fair value of derivative instruments designated and qualifying as
cash flow hedges are included in accumulated other comprehensive income (loss)
on the consolidated balance sheets. These amounts are reclassified into earnings
as interest on the hedged loans is paid. There is no hedging ineffectiveness nor
are net gains or losses excluded from the assessment of hedge effectiveness for
the years ended March 31, 2003, 2004 and 2005 as the critical terms of the
interest rate swap match the terms of the hedged debt obligations. Ricoh expects
that it will reclassify into earnings through other (income) expenses during the
next 12 months approximately Yen 32 million ($299 thousand) of the balance of
accumulated other comprehensive income as of March 31, 2005.

                                      F-38

UNDESIGNATED DERIVATIVE INSTRUMENTS

Derivative instruments not designated as hedging instruments are held to reduce
the risk relating to the variability in exchange rates on assets and liabilities
denominated in foreign currencies. Changes in the fair value of these
instruments are included in other (income) expenses on the consolidated
statement of income.

16.     COMMITMENTS AND CONTINGENT LIABILITIES

As of March 31, 2005, Ricoh had outstanding contractual commitments for
acquisition or construction of plant, equipment and other assets aggregating Yen
12,550 million ($117,290 thousand).

As of March 31, 2005, Ricoh was also contingently liable as guarantor for
employees' housing loans of Yen 230 million ($2,150 thousand), all of which were
issued before January 1, 2003.

Ricoh made rental payments totaling Yen 41,024 million, Yen 40,339 million and
Yen 39,000 million ($364,486 thousand) for the years ended March 31, 2003, 2004
and 2005, respectively, under operating lease agreements for office space and
machinery and equipment, which are primarily cancelable and renewable.

As of March 31, 2005, the Company and certain of its subsidiaries were parties
to litigation involving routine matters, such as patent rights. In the opinion
of management, the ultimate liability, if any, resulting from such litigation
will not materially affect the consolidated financial position or the results of
operations of Ricoh.

17.     DISCLOSURES ABOUT THE FAIR VALUE OF FINANCIAL INSTRUMENTS

(a)     CASH AND CASH EQUIVALENTS, TIME DEPOSITS, TRADE RECEIVABLES, SHORT-TERM
        BORROWINGS, CURRENT MATURITIES OF LONG-TERM INDEBTEDNESS, TRADE PAYABLES
        AND ACCRUED EXPENSES

The carrying amounts approximate fair values because of the short maturities of
these instruments.

(b)     MARKETABLE SECURITIES AND INVESTMENT SECURITIES

The fair value of the marketable securities and investment securities is
principally based on quoted market price.

(c)     INSTALLMENT LOANS

The fair value of installment loans is based on the present value of future cash
flows using the current rate for similar instruments of comparable maturity.

(d)     LONG-TERM INDEBTEDNESS

The fair value of each of the long-term indebtedness instruments is based on the
quoted price in the most active market or the present value of future cash flows
associated with each instrument discounted using the current borrowing rate for
similar instruments of comparable maturity.

                                      F-39

(e)     INTEREST RATE SWAP AGREEMENTS

The fair value of interest rate swap agreements is estimated by obtaining quotes
from brokers.

(f)     FOREIGN CURRENCY CONTRACTS AND FOREIGN CURRENCY OPTIONS

The fair value of foreign currency contracts and foreign currency options is
estimated by obtaining quotes from brokers.

The estimated fair value of the financial instruments as of March 31, 2004 and
2005 is summarized as follows:

<TABLE>
<CAPTION>
                                                      Millions of Yen                    Thousands of U.S. Dollars
                                  ----------------------------------------------------- ---------------------------
                                            2004                       2005                         2005
                                  -------------------------- -------------------------- ---------------------------
                                    Carrying    Estimated      Carrying    Estimated       Carrying     Estimated
                                     Amount     Fair Value      Amount     Fair Value       Amount      Fair Value
-------------------------------------------------------------------------------------------------------------------
<S>                                  <C>          <C>           <C>          <C>           <C>           <C>
Marketable securities and
 Investment securities                 66,995       66,995        31,292       31,292      $  292,449   $   292,449
Installment loans                      51,455       51,626        50,131       50,292         468,514       470,019
Long-term indebtedness               (281,570)    (284,528)     (226,567)    (228,839)     (2,117,449)   (2,138,682)
Interest rate swap agreements, net      2,266        2,266         1,683        1,683          15,729        15,729
Foreign currency contracts, net         1,876        1,876           181          181           1,692         1,692
Foreign currency options, net            (145)        (145)         (813)        (813)         (7,598)       (7,598)
-------------------------------------------------------------------------------------------------------------------
</TABLE>

Limitations

Fair value estimates are made at a specific point in time, based on relevant
market information and information about the financial instrument. These
estimates are subjective in nature and involve uncertainties and matters of
significant judgment and therefore cannot be determined with precision. Changes
in assumptions could significantly affect the estimates.

18.     SEGMENT INFORMATION

The operating segments presented below are the segments of Ricoh for which
separate financial information is available and for which a measure of profit or
loss is evaluated regularly by Ricoh's management in deciding how to allocate
resources and in assessing performance. The accounting policies of the segments
are substantially the same as those described in the summary of significant
accounting policies, as discussed in Note 2.

Ricoh's operating segments are comprised of office equipment, including copiers
and related supplies, communications and information systems, and others,
including optical equipment and electronic devices.

The following tables present certain information regarding Ricoh's operating
segments and operations by geographic areas for the years ended March 31, 2003,
2004 and 2005.

                                      F-40

(a)     OPERATING SEGMENT INFORMATION

<TABLE>
<CAPTION>
                                                                                                  Thousands of
                                                                 Millions of Yen                  U.S. Dollars
                                                ----------------------------------------------  ------------------
                                                       2003           2004           2005               2005
------------------------------------------------------------------------------------------------------------------
<S>                                                  <C>            <C>            <C>               <C>
Sales-
    Office equipment                                 1,520,574      1,557,633      1,591,828         $14,876,897
    Other                                              220,539        225,074        224,786           2,100,803
    Intersegment transaction                            (2,755)        (2,462)        (2,506)            (23,420)
------------------------------------------------------------------------------------------------------------------
    Consolidated                                     1,738,358      1,780,245      1,814,108         $16,954,280
------------------------------------------------------------------------------------------------------------------
Operating Expenses-
    Office equipment                                 1,329,776      1,353,304      1,400,121         $13,085,243
    Other                                              222,772        220,391        224,241           2,095,710
    Intersegment transaction                            (2,726)        (2,494)        (2,475)            (23,131)
    Unallocated expense                                 54,882         59,038         56,715             530,047
------------------------------------------------------------------------------------------------------------------
    Consolidated                                     1,604,704      1,630,239      1,678,602         $15,687,869
------------------------------------------------------------------------------------------------------------------
Operating Income-
    Office equipment                                   190,798        204,329        191,707         $ 1,791,654
    Other                                               (2,233)         4,683            545               5,093
    Elimination and unallocated expense                (54,911)       (59,006)       (56,746)           (530,336)
------------------------------------------------------------------------------------------------------------------
    Consolidated                                       133,654        150,006        135,506         $ 1,266,411
------------------------------------------------------------------------------------------------------------------
Other Expenses                                         (10,184)        (6,943)          (123)        $    (1,150)
------------------------------------------------------------------------------------------------------------------
Income before Income Taxes, Minority
 Interests, Equity in Earnings of
 Affiliates and Cumulative Effect of
 Accounting Change                                     123,470        143,063        135,383         $ 1,265,261
------------------------------------------------------------------------------------------------------------------

<CAPTION>
                                                                                                  Thousands of
                                                                 Millions of Yen                  U.S. Dollars
                                                ----------------------------------------------  ------------------
                                                       2003           2004           2005               2005
------------------------------------------------------------------------------------------------------------------
<S>                                                  <C>            <C>            <C>               <C>
Total Assets-
    Office equipment                                 1,198,706      1,220,747      1,391,483         $13,004,514
    Other                                              176,296        182,532        164,337           1,535,860
    Elimination                                         (6,908)        (8,047)       (10,174)            (95,084)
    Corporate assets                                   516,828        457,561        408,023           3,813,299
------------------------------------------------------------------------------------------------------------------
    Consolidated                                     1,884,922      1,852,793      1,953,669         $18,258,589
------------------------------------------------------------------------------------------------------------------
Expenditure for segment assets-
    Office equipment                                    65,720         65,366         72,923         $   681,523
    Other                                                7,213          8,712          9,675              90,421
    Corporate assets                                     1,023          1,429          2,103              19,654
------------------------------------------------------------------------------------------------------------------
    Consolidated                                        73,956         75,507         84,701         $   791,598
------------------------------------------------------------------------------------------------------------------
Depreciation-
    Office equipment                                    60,687         57,956         57,020         $   532,897
    Other                                                6,917          7,774          6,504              60,785
    Corporate assets                                     1,954          1,954          3,272              30,580
------------------------------------------------------------------------------------------------------------------
    Consolidated                                        69,558         67,684         66,796         $   624,262
------------------------------------------------------------------------------------------------------------------
</TABLE>

                                      F-41

Unallocated expense represents expenses for corporate headquarters.

Intersegment sales are not separated by operating segment because they are
immaterial.

Corporate assets consist primarily of cash and cash equivalents and marketable
securities maintained for general corporate purposes.

(b)     GEOGRAPHIC INFORMATION

Sales which are attributed to countries based on location of customers and
long-lived assets by location for the years ended March 31, 2003, 2004 and 2005
are as follows:

<TABLE>
<CAPTION>
                                                                                                  Thousands of
                                                                 Millions of Yen                  U.S. Dollars
                                                ----------------------------------------------  -----------------
                                                        2003           2004           2005              2005
-----------------------------------------------------------------------------------------------------------------
<S>                                                  <C>            <C>            <C>               <C>
Sales-
    Japan                                              896,022        914,060        972,975         $ 9,093,224
    The Americas                                       343,940        326,380        325,597           3,042,963
    Europe                                             354,477        402,392        408,906           3,821,551
    Other                                              143,919        137,413        106,630             996,542
-----------------------------------------------------------------------------------------------------------------
    Consolidated                                     1,738,358      1,780,245      1,814,108         $16,954,280
-----------------------------------------------------------------------------------------------------------------
Long-Lived Assets-
    Japan                                              251,214        248,277        298,192         $ 2,786,841
    The Americas                                        71,850         62,617         65,634             613,402
    Europe                                              34,062         31,000         34,844             325,645
    Other                                               11,742         10,093         10,539              98,495
-----------------------------------------------------------------------------------------------------------------
    Consolidated                                       368,868        351,987        409,209         $ 3,824,383
-----------------------------------------------------------------------------------------------------------------
</TABLE>

Ricoh's long-lived assets comprise property, plant and equipment, goodwill,
other intangible assets, lease deposits and other.

(c)     ADDITIONAL INFORMATION

The following information shows net sales and operating income recognized by
geographic origin for the years ended March 31, 2003, 2004 and 2005. In addition
to the disclosure requirements under SFAS No. 131, "Disclosure about Segments of
an Enterprise and Related Information", Ricoh discloses this information as
supplemental information in light of the disclosure requirements of the Japanese
Securities and Exchange Law, which a Japanese public company is subject to.

                                      F-42


<TABLE>
<CAPTION>
                                                                                                   Thousands of
                                                                 Millions of Yen                   U.S. Dollars
                                                ----------------------------------------------  ----------------
                                                        2003           2004           2005               2005
----------------------------------------------------------------------------------------------------------------
<S>                                                  <C>            <C>            <C>              <C>
Sales-
    Japan
       External customers                              954,310        962,127        994,499        $  9,294,383
       Intersegment                                    320,596        351,070        392,216           3,665,570
----------------------------------------------------------------------------------------------------------------
           Total                                     1,274,906      1,313,197      1,386,715          12,959,953
----------------------------------------------------------------------------------------------------------------
    The Americas
       External customers                              333,935        315,504        322,975           3,018,458
       Intersegment                                      5,620          5,249          7,486              69,963
----------------------------------------------------------------------------------------------------------------
           Total                                       339,555        320,753        330,461           3,088,421
----------------------------------------------------------------------------------------------------------------
    Europe
       External customers                              352,943        400,646        412,333           3,853,579
       Intersegment                                      3,019          3,770          3,310              30,935
----------------------------------------------------------------------------------------------------------------
           Total                                       355,962        404,416        415,643           3,884,514
----------------------------------------------------------------------------------------------------------------
    Other
       External customers                               97,170        101,968         84,301             787,860
       Intersegment                                     72,664         91,373         89,647             837,822
----------------------------------------------------------------------------------------------------------------
           Total                                       169,834        193,341        173,948           1,625,682
----------------------------------------------------------------------------------------------------------------
    Elimination of intersegment sales                 (401,899)      (451,462)      (492,659)         (4,604,290)
----------------------------------------------------------------------------------------------------------------
    Consolidated                                     1,738,358      1,780,245      1,814,108        $ 16,954,280
----------------------------------------------------------------------------------------------------------------
Operating Expenses-
    Japan                                            1,188,760      1,215,875      1,298,640        $ 12,136,822
    The Americas                                       325,228        305,284        316,651           2,959,356
    Europe                                             337,693        382,383        391,271           3,656,738
    Other                                              159,864        182,870        162,042           1,514,411
----------------------------------------------------------------------------------------------------------------
    Elimination of intersegment sales                 (406,841)      (456,173)      (490,002)         (4,579,458)
----------------------------------------------------------------------------------------------------------------
    Consolidated                                     1,604,704      1,630,239      1,678,602        $ 15,687,869
----------------------------------------------------------------------------------------------------------------
Operating Income-
    Japan                                               86,146         97,322         88,075        $    823,131
    The Americas                                        14,327         15,469         13,810             129,065
    Europe                                              18,269         22,033         24,372             227,776
    Other                                                9,970         10,471         11,906             111,271
----------------------------------------------------------------------------------------------------------------
    Elimination of intersegment profit                   4,942          4,711         (2,657)            (24,832)
----------------------------------------------------------------------------------------------------------------
    Consolidated                                       133,654        150,006        135,506        $  1,266,411
----------------------------------------------------------------------------------------------------------------
Other Expenses                                         (10,184)        (6,943)          (123)       $     (1,150)
----------------------------------------------------------------------------------------------------------------
Income before Income Taxes, Minority
 Interests, Equity in Earnings of
 Affiliates and Cumulative Effect of
 Accounting Change                                     123,470        143,063        135,383        $  1,265,261
----------------------------------------------------------------------------------------------------------------
Total Assets-
    Japan                                            1,064,857      1,071,297      1,187,190        $ 11,095,234
    The Americas                                       201,359        188,644        206,979           1,934,382
    Europe                                             174,541        188,184        228,568           2,136,150
    Other                                               70,458         63,701         66,319             619,804
    Elimination                                       (143,121)      (116,594)      (143,410)         (1,340,280)
    Corporate assets                                   516,828        457,561        408,023           3,813,299
----------------------------------------------------------------------------------------------------------------
    Consolidated                                     1,884,922      1,852,793      1,953,669        $ 18,258,589
----------------------------------------------------------------------------------------------------------------
</TABLE>

                                      F-43

Intersegment sales between geographic areas are made at cost plus profit.
Operating income by geographic area is sales less expense related to the area's
operating revenue.

No single customer accounted for 10% or more of the total revenues for the
periods ended as of March 31, 2003, 2004 and 2005.

19.     SUPPLEMENTARY INFORMATION TO THE STATEMENT OF INCOME

The following amounts were charged to selling, general and administrative
expenses for the years ended March 31, 2003, 2004 and 2005:

<TABLE>
<CAPTION>
                                                                                            Thousands of
                                                              Millions of Yen               U.S. Dollars
                                              ------------------------------------------- --------------
                                                     2003          2004          2005            2005
--------------------------------------------------------------------------------------------------------
<S>                                                 <C>           <C>          <C>            <C>
Research and development costs                      83,551        92,515       110,478        $1,032,505
Advertising costs                                   16,958        17,950        16,442           153,664
Shipping and handling costs                         12,582        12,352        14,043           131,243
--------------------------------------------------------------------------------------------------------
</TABLE>

                                      F-44

RICOH COMPANY, LTD. AND CONSOLIDATED SUBSIDIARIES
SCHEDULE II. - VALUATION AND QUALIFYING ACCOUNTS AND RESERVES
FOR THE THREE YEARS ENDED MARCH 31, 2005

<TABLE>
<CAPTION>
                                                                                                        (Millions of Yen)
                                                             Additions
                                                    ----------------------------
                                        Balance at   Charged to    Charged to     Deduction                    Balance at
                                       beginning of   costs and      other          from           Translation   end of
              Description                 period      expenses      accounts      reserves(2)(3)    adjustment   period
-------------------------------------------------------------------------------------------------------------------------
<S>                                         <C>           <C>                       <C>                <C>         <C>
For the year ended March 31, 2003:
   Allowance for doubtful
    receivables(1)-
     Trade receivables                      18,943        1,000            -        (1,674)            (420)       17,849
     Finance receivables                    13,571        4,147            -        (3,412)             (78)       14,228
   Deferred tax asset valuation
    allowance                               11,300        3,312            -        (4,920)            (499)        9,193

For the year ended March 31, 2004:
   Allowance for doubtful
    receivables(1)-
     Trade receivables                      17,849        1,933            9        (2,179)            (573)       17,039
     Finance receivables                    14,228        3,920            -        (2,823)             (86)       15,239
   Deferred tax asset valuation
     allowance                               9,193        2,280            -        (2,133)            (330)        9,010

For the year ended March 31, 2005:
   Allowance for doubtful
    receivables(1)-
     Trade receivables                      17,039        1,822          (65)       (1,729)             384        17,451
     Finance receivables                    15,239        3,584            -        (2,280)              23        16,566
   Deferred tax asset valuation
    allowance                                9,010        1,212          (23)       (3,298)             178         7,079
-------------------------------------------------------------------------------------------------------------------------
</TABLE>

Notes:

(1)  See Note 2(g) to Consolidated Financial Statements.

(2)  Receivables - Write-offs.

(3)  Deferred tax - Realization of tax benefits

                                      F-45