REGULATIONS CONCERNING TERMINOLOGY, FORMS AND METHODS OF PREPARATION OF FINANCIAL STATEMENTS, ETC. Copyright Roderick Seeman

Updated January, 1998.

CONTENTS

Chapter I--GENERAL PRINCIPLES OF APPLICATION

Chapter II--BALANCE SHEET

CHAPTER--III INCOME STATEMENT

CHAPTER IV DELETED

CHAPTER V--STATEMENT OF APPROPRIATION OF RETAINED EARNINGS OR STATEMENT OF DISPOSITION OF DEFICIT

CHAPTER VI--SUPPLEMENTARY STATEMENTS

CHAPTER VII--FINANCIAL STATEMENTS OF FOREIGN CORPORATIONS

SUPPLEMENTARY PROVISIONS

Chapter I--GENERAL PRINCIPLES OF APPLICATION

Article 1. General Principles of Application

Article 2 (Application of the Regulations to Companies which Carry Out specified Businesses)

Article 3

Article 4

Article 5 (Standards for the Preparation of Financial Statements)

Article 6. Report Form

Article 8. Definitions

Article 8-2. Notation of Major Accounting Principles

Article 8-3. Notes Concerning Changes in Accounting Plans

Article 8-4. Notations of Major Late Events

Article 8-5. Notation of Supplemental Information

Article 8-6. Notations Concerning Lease Transactions

Article 8-7. Notation of Market Price of Securities

Article 8-8. Notations Concerning Derivative Transactions

Article 9. Method of Notation

Article 10

Chapter II--BALANCE SHEET

Subchapter 1. General discussion

Subchapter 2. Assets

Subchapter 3. Liabilities

Subchapter IV Capital

Subchapter 1. General discussion (Articles 11-13)

Article 11 (Method of Entry in Balance Sheets)

Article 12

Article 13

Subchapter 2. Assets

Section 1. General Discussion

Section 2. Current Assets

Section 3. Fixed Assets

Section 4. Deferred charges

Section 5. Miscellaneous

Section 1. General Discussion (Article 14)

Article 14. Classification of Assets

Section 2. Current Assets (Articles 15-21)

Article 15. Scope of Current Assets

Article 16

Article 17. Indications of Current Assets Sections

Article 18.

Article 19

Article 20

Article 21 (Notation of Discounting of Notes Receivable Trade and Notes Endorsed)

Section 3. Fixed Assets (Articles 22-35)

Article 22. The Scope of Tangible Fixed Assets

Article 23 (Indications of Divisions of Tangible Fixed Assets)

Article 24

Article 25. Indications of accumulated depreciation

Article 26

Article 27. The Scope of the Divisions of Intangible Fixed Assets

Article 28. Indications of divisions of intangible fixed assets

Article 29

Article 30

Article 31. The Scope of Investments and Other Assets

Article 31-2

Article 32. Indications of Divisions of Investments and other Assets

Article 33

Article 34

Section 4. Deferred charges (Articles 36-38)

Article 36 Deferred Charges

Article 37 (Indication of Divisions Deferred Charges)

Article 38

Section 5. Miscellaneous (Articles 39-44)

Article 39. (Indications of Divisions of Assets in Related Companies)

Article 40. Deleted

Article 41. Deleted

Article 42. Notations Concerning the Reevaluation of Fixed Assets

Article 43. Notation of assets with security interests

Article 44. (Indications Concerning Foreign Currency Denominated Assets)

Subchapter 3. Liabilities

Section 1. General Discussion (Articles 45-46)

Section 2. Current Liabilities (Articles 47-50)

Section 3. Fixed Liabilities (Articles 51-53)

Section 4. Miscellaneous (Articles 54-58)

Section 1. General Discussion (Articles 45-46)

Article 45 Classification of Liabilities

Section 2. Current Liabilities (Articles 47-50)

Article 47. Scope of Current Liabilities

Article 48

Article 49 Indication of Divisions of Current Liabilities

Article 50

Section 3. Fixed Liabilities (Articles 51-53)

Article 51 (The scope of Fixed Liabilities)

Article 52 Indications of Classifications of Fixed Liabilities

Article 53

Section 4. Miscellaneous (Articles 54-58)

Article 54. Special Reserves

Article 55. Indications of Divisions of Liabilities to Related Companies

Article 56 (Notations concerning foreign currency denominated liabilities)

Article 57. Notations of Borrowings with Security Interests

Article 58. Notations of contingent liabilities

Article 58-2. Notations of Discounted Notes Receivable and Endorsed Negotiable Notes

Subchapter IV CAPITAL

Section 1. General Discussion (Article 59)

Section 2. Paid in Capital (Articles 60-62)

Section 3. Earned Surplus and Capital Surplus (Articles 63-64)

Section 4. Other Retained Earnings and Deficits (Articles 65-68)

Section 1. General Discussion (Article 59)

Article 59. Classification of Capital

Section 2. Paid in Capital (Articles 60-62)

Article 60. Indications of Paid in Capital

Article 61. Notes relating to paid in capital

Article 62. Indications of Amount Paid in for New Shares, etc.)

Section 3. Earned Surplus and Capital Surplus (Articles 63-64)

Article 63 Indications of Capital and Earned Surplus

Article 64. Notes on the covering of deficits with reserves

Section 4. Other Retained Earnings and Deficits (Articles 65-68)

Article 65. Method of Indication of Other Surpluses or Deficits

Article 65-2

Article 66

Article 68. Notes Relating to Dividend Restrictions

Article 68-2. Notation of Net Assets Per Share

CHAPTER III INCOME STATEMENT

Subchapter 1. General Discussion (Articles 69-71)

Subchapter 2. Gross Sales and Cost of Sales (Articles 72-83)

Subchapter 3. Sales, General and Administrative Expenses. (Articles 84-89)

Subchapter 4. Nonoperating Income and Nonoperating Expenses. (Articles 90-95)

Subchapter 4-2 Extraordinary Income and Extraordinary Losses (Article 95-2 to 95-5)

Subchapter 5. Miscellaneous (Articles 96 to 98-2)

Subchapter 1. General Discussion (Articles 69-71)

Article 69. Method of Entries in the Profit and Loss Statement

Article 70. Classifications of Income and Expense

Article 71. Method of Entry of Company Doing Multiple Business.

Subchapter 2. Gross Sales and Cost of Sales (Articles 72-83)

Article 72. Method of Notation of Sales.

Article 73 Method of Indication of Credit Sales

Article 74. Method of Classification of Sales to Related Companies

Article 75. Method of Indication of Cost of Sales

Article 76

Article 77 Attachment of Sales Costs Detailed Statements

Article 78. Detailed Statements of Specified Enterprises.

Article 79. Method of Indication of Purchases of Goods

Article 80. Notes Concerning the Standard of Evaluation of Inventory Assets and Inventory Method (LIFO, FIFO)

Article 81 Entries Relating to Lowered Evaluations of Inventory Assets, Based on the Standards of the Lower of Book or Market

Article 82

Article 83. Indications of Gross Profit or Loss on Sales.

Subchapter 3. Sales, General and Administrative Expenses. (Articles 84-89)

Article 84. Sales, General and Administrative Expenses

Article 85. Method of Indication of Sales, General and Administrative Expenses

Article 86. Methods of Indication of Research and Development Expenses

Article 87. Method of Indication of Writing off Bad Debts

Article 88. Method of Indication of Business Expenses Related to Companies

Article 89. Indications of Operating Profits and Operating Losses

Subchapter 4. Nonoperating Income and Nonoperating Expenses. (Articles 90-95)

Article 90. Method of Indication of Nonoperating Income

Article 91. Method of Indication of Classifications of Nonoperating Income Related to Related Companies.

Article 93. Method of Indication of Nonoperating Expenses

Article 94. Method of Indication of Classification of Nonoperating Expenses Related to Related Companies

Subchapter 4-2 Extraordinary Income and Extraordinary Losses (Article 95-2 to 95-5)

Article 95 Indications of Recurring Profits or Losses

Article 95-2. Method of Indication of Extraordinary Income or Extraordinary Losses

Article 95-3. Method of Indication of Extraordinary Losses

Article 95-4. Indication of Net Profits or Losses

Article 95-5

Article 95-5(b). Notation of Net Profits Per Share

Subchapter 4-3 Unappropriated Retained Earnings or Undisposed Deficit (Article 95-6)

Article 95-6. Indications of Unappropriated Retained Earnings and Undisposed Deficits.

Subchapter 5. Miscellaneous (Articles 96 to 98-2)

Article 96. Method of Indication of Cost Differences

Article 98. Indications of Classifications of Transfer into Reserves

Article 98-2. Transfers to Special Reserves or Depletion of Special Reserves

CHAPTER IV DELETED

Articles 99-109 are deleted

CHAPTER V. STATEMENT OF APPROPRIATION OF RETAINED EARNINGS OR STATEMENT OF DISPOSITION OF DEFICIT

Subchapter 1. General Discussion (Articles 110-111)

Article 110. Method of Entry in Statements of Appropriations or Dispositions of Deficits

Article 111

Subchapter 2. Statement of Appropriation of Retained Earnings (Articles 112-114)

Article 112. Method of Indication of Appropriation of Earnings

Article 113

Article 114. Indication of Classifications of Appropriation of Retained Earnings.

Subchapter 3. Statement of Disposition of Deficit (Articles 115-116)

Article 115. Method of Indication Relating to Disposition of Losses

Article 116 Indications of Classifications of Disposition of Deficit.

CHAPTER VI. SUPPLEMENTARY STATEMENTS (Articles 117-126)

Article 117. Method of Entry of Supplementary Schedules

Article 118. Varieties of Supplementary Schedules

Article 119. Supplementary Schedules of Companies which do Specified Business

Article 120 (Omission of Supplementary Schedules)

Article 121

Article 122

Article 123

Article 124

Article 125

Article 126

CHAPTER VII. FINANCIAL STATEMENTS OF FOREIGN CORPORATIONS (Article 127-130)

Article 127. Standard of Preparation of Financial Statements of Foreign Corporations

Article 128

Article 129. Method of Indication

Article 130. Indications of Monetary Amounts

Article 131. Methods of Making Notes

SUPPLEMENTARY PROVISIONS

SUPPLEMENTARY PROVISIONS