TERMINOLOGY, FORMS AND METHODS OF PREPARATION OF CONSOLIDATED FINANCIAL STATEMENTS

Translated by Roderick H. Seeman, Copyright

Updated January 1998

Chapter 1. General Provisions (Articles 1-16)

Article 1. Application of Regulations

Article 2. Definitions

Article 3. Date of Consolidated Settlement of Accounts and Consolidated Business Year

Article 4. General Principals of the Preparation of Consolidated Financial Statements

Article 5. The Scope of Consolidation

Article 6. Consolidated Balance Sheet

Article 7. Consolidated Income Statement

Article 8. Consolidated Surplus Statement

Article 9. Elimination of Mutual Items Among Consolidated Companies

Article 10. Application of the Equity Method

Article 11. Term Division of Corporate Taxes

Article 12. Subsidiaries with Differing Business Terms

Article 13. Entries in Relation to the Scope, etc. of Consolidation

Article 14. Notes Concerning Changes in Methods of Accounting Dispositions or Methods of Indication

Article 15. Additional Information Notes

Article 15-2 Notation of Segment Information

Article 15-3 Notations Concerning Lease Transactions

Article 16. Methods of Making Notes

Chapter 2. Method of Entry of Consolidated Financial Statements.

Subchapter 1. General Provisions (Article 17-20)

Article 17. Methods of Entry of Consolidated Balance Sheets

Article 18. Divided Entries of Assets, Liabilities and Capital

Article 19. Classification of Assets and Liabilities by Business

Article 20. The Order of Item Entries

Subchapter 2. Assets (Articles 21-34)

Article 21. Assets Section

Article 22. The Scope of Each Asset

Article 23. Indications of Current Assets Sections

Article 24. Bad Debt Reserves in Current Assets

Article 25. Notes Concerning Discounted Bills and Endorsed Bills

Article 26. Indications of Tangible Fixed Asset Sections.

Article 27. Indications of Depreciation Reserves.

Article 28. Indications of Intangible fixed Assets Sections

Article 29

Article 30. Indications of Investments and Other Assets Sections

Article 31. Bad Debt Reserve for Investments and Other Assets

Article 32. Indications of Deferred Assets Sections

Article 33

Article 34. Claims Against Nonconsolidated Subsidiaries, etc.

Subchapter 3 Liabilities (Articles 35-39)

Article 35 (Liabilities Sections)

Article 36. Scope of Each Type of Liability

Article 37. Indications of Current Liabilities Sections

Article 38. Indications of Fixed Liabilities Sections.

Article 39. Liabilities to Nonconsolidated Subsidiaries, etc.

Article 39-2. Notation of Notes Receivable Discounted and Endorsed Negotiable Notes.

Subchapter 4. Consolidation adjustment Accounts (Article 40)

Article 40. Indication of Consolidation Adjustment Account.

Subchapter 5. Minority Interests Portion (Article 41)

Article 41. Indication of Minority Interests

Subchapter 6. Capital (Articles 42-44)

Article 42. Capital Sections and Section Indications

Article 43. The Company's Own Shares Indications

Article 44. Notes on Contractually Based Reserves

Article 44-2 Notation of Net Assets Per Share

Subchapter 7. Miscellaneous (Articles 45-47)

Article 45. Entry of Special Reserves

Article 46. Assets and Liabilities Sections of Separately Entered Businesses

Article 46-2. Notations of Capital of Designated Corporations

Article 47. Entry of Asset and Liability Items of Separately Entered Businesses

Chapter 3. Method of Entry of Consolidated Income Statements

Subchapter 1. General Provisions (Article 48-50)

Article 48. Methods of Entry of Consolidated Income Statements.

Article 49. Earnings and Expenses Sections

Article 50. Separate Entries of Sales, etc., by Business

Subchapter 2. Sales and Cost of Sales (Articles 51-54)

Article 51. Method of Indication of Sales

Article 52. Method of Indication of Cost of Sales

Article 53. Entry of Evaluation Losses

Article 54. Entry of Gross Profit or Loss on Sales

Subchapter 3. Sales General and Administrative Expenses (Articles 55-56)

Article 55. Method of Indication of Sales, General and Administrative Expenses.

Article 56. Indications of Operating Expenses and Losses

Subchapter 4. Nonoperating Income and Nonoperating Expenses (Article 57-60)

Article 57. Methods of Indication of Nonoperating Income

Article 58. Methods of Indication of Nonoperating Expenses

Article 59. Indications of Nonoperating Income Sections Concerning Nonconsolidated Subsidiaries

Article 60. Indications of Division of Nonoperating Expenses in Relation to Nonconsolidated in Relation to Nonconsolidated Subsidiaries

Article 61. Indications of Recurring Profits of Losses.

Subchapter 5. Extraordinary Income and Extraordinary Losses (Articles 62-64)

Article 62. Methods of Entry of Extraordinary Profits

Article 63. Methods of Indication of Extraordinary Losses

Article 64. Indications of Net Term Profits Before Tax Adjustments

Article 65-2. Notation of Net Profits Per Share

Subchapter 6. Term Net Profit and Net Loss (Article 65)

Article 65. Term Net Profit or Term Net Loss

Subchapter 7. Miscellaneous. (Articles 66-69)

Article 66. Indication of the Sections of Transfers to Reserves

Article 67. Transfers to and Transfers From Special Reserves

Article 68. Divisions of Earnings and Expenses of Separately Entered Businesses

Article 69. Entry of the Items of Expenses and Earnings of Separately Entered Businesses

Chapter 4. Consolidated Disposition of Surplus

Subchapter 1. General Provisions (Articles 70-71)

Article 70. Methods of Entry of Statements of Consolidated Surplus.

Article 71. Consolidated Income and Surplus Statements

Subchapter 2. Method of Entry of Consolidated Dispositions of Surplus. (Articles 72-74)

Article 72. Entries of Sections of Statement of Consolidated Surplus.

Article 73.

Article 74. Methods of Indications of Decreases in Other Surplus or Increases in Deficits

SUPPLEMENTARY PROVISIONS

Article 75

Supplementary Provisions