BALANCE SHEET (Translation) As of March 31, 2013 (Millions of yen)

Full text

(1)

BALANCE SHEET (Translation)

As of March 31, 2013

(Millions of yen)

Account item Amount Account item Amount

ASSETS LIABILITIES

Current assets 1,006,437 Current liabilities 587,913

Cash and deposits 15,778 Notes payable-trade 4,387

Notes receivable-trade 43 Accounts payable-trade 19,593

Installment contract receivables 109,489 Short-term borrowings 50,912 Lease receivables 99,056 Current portion of long-term debt 121,906

Lease investment assets 479,645 Commercial paper 329,920

Loan receivables from customers 111,958 Payables under fluidity lease

receivables 23,218

Other loan receivables from customers 46,760 Lease payables 1,485

Lease contract receivables 1,344 Accounts payable 8,848

Other operating assets 6,852 Accrued income taxes 216

Securities 9 Accrued expenses 1,231

Advance on contracts 1,252 Advances received on lease

contracts 7,338

Prepaid expenses 1,420 Deposits received 5,294

Accrued income 433 Deferred income 31

Short-term loan receivables 124,578 Unrealized gross profits on

installment contracts 12,321

Deferred tax assets 9,041 Provision for bonuses 819

Other current assets 13,626 Other current liabilities 386

Allowance for doubtful receivables (14,855)

Long-term liabilities 482,200

Fixed assets 207,282 Long-term debt 433,608

Tangible assets 18,475 Long-term payables under fluidity

lease receivables 37,499

Property for lease and rent 17,978 Guarantee deposits received 6,320 Property for lease and rent 18,047 Provision for employees

retirement benefits 2,486 Allowance for loss on disposal of

property for lease and rent (69) Other long-term liabilities 2,285

Own-used assets 497

Total liabilities 1,070,114

Intangible assets 3,732 NET ASSETS

Property for lease and rent 451 Stockholders’ equity 142,322

Property for lease and rent 452 Capital stock 32,000

Allowance for loss on disposal of

property for lease and rent (1) Capital surplus 66,264

Software 2,847 Legal capital surplus 30,000

Other intangible assets 433 Other capital surplus 36,264

Retained earnings 44,057 Investments and other assets 185,074 Earned surplus reserve 412 Investment securities 13,122 Other retained earnings 43,645 Investments in affiliated companies 27,520 Unappropriated 43,645 Long-term loan receivables 140,687 Valuation and translation

adjustments 1,283

Claims provable in bankruptcy, in

rehabilitation and other 2,297

Net unrealized gain on

available-for-sale securities 2,482

Long-term prepaid expenses 121 Deferred gains (losses) on hedges (1,198)

Long-term deferred tax assets 6,515 Long-term money deposited 1,864

Other investments 2,005

Allowance for doubtful receivables (9,059) Total net assets 143,606

(2)

STATEMENT OF INCOME (Translation)

For the year ended March 31, 2013

(Millions of yen)

Account item Amount

Revenues Lease revenue 237,228 Installment sales 31,600 Finance revenue 3,633 Other revenue 8,439 280,902 Costs Cost of lease 211,748

Cost of installment sales 28,159

Cost of finance 299

Cost of other sales 7,188

Financing costs 4,878 252,273

Gross profit 28,629

Selling, general and administrative expenses 15,217

Operating income 13,412

Non-operating income

Interest and dividends received 5,212

Other 243 5,456 Non-operating expenses Interest expense 1,738 Other 175 1,913 Ordinary income 16,955 Special gains

Gain on sales of fixed assets 39

Subsidy income 1

Gain on sales of investment securities 116 158

Special losses

Loss on retirement of fixed assets 36

Impairment losses 15

Loss on sales of investment securities 11

Loss on valuation of investment securities 404 Loss on sales of investments in affiliated

companies 994

Loss on liquidation of investments in affiliated

companies 4

Loss on valuation of investments in affiliated

companies 13 1,480

Income before income taxes 15,632

Income taxes-current 5,367

Income taxes-deferred (1,198)

(3)

STATEMENT OF CHANGES IN NET ASSETS (Translation)

For the year ended March 31, 2013

(Millions of yen) Stockholders equity

Capital surplus Capital stock

Legal capital surplus Other capital surplus Total capital surplus Balance at beginning of the

year 32,000 30,000 36,264 66,264

(Changes during the year) Dividends from surplus Net income

Changes during the year for items other than

stockholders equity (net) Total of changes during the year

Balance at end of the year 32,000 30,000 36,264 66,264

Stockholders equity Retained earnings Other retained earnings Earned surplus reserve Unappropriated Total retained earnings Total stockholders equity

Balance at beginning of the

year 412 34,618 35,031 133,296

(Changes during the year)

Dividends from surplus (2,436) (2,436) (2,436)

Net income 11,462 11,462 11,462

Changes during the year for items other than

stockholders equity (net) Total of changes during the

year 9,026 9,026 9,026

(4)

Valuation and translation adjustments Net unrealized gain on available-for-sale securities Deferred gains (losses) on hedges

Total valuation and translation adjustments

Total net assets

Balance at beginning of the

year 1,407 (1,060) 347 133,643

(Changes during the year)

Dividends from surplus (2,436)

Net income 11,462

Changes during the year for items other than

stockholders equity (net)

1,074 (138) 935 935

Total of changes during the

year 1,074 (138) 935 9,962

(5)

NOTES TO FINANCIAL STATEMENTS (Translation)

For the year ended March 31, 2013

(Notes to Significant Accounting Policies)

1. Valuation basis and methods applied for assets (1) Securities

① Held-to-maturity debt securities . At amortized cost or accumulated cost

② Investments in subsidiaries and associates. At cost determined by the moving-average method ③ Available-for-sale securities

Those with determinable fair values... At fair value based on market price etc., as of the

balance-sheet date. (All valuation differences are reported as a component of net assets. The cost of securities sold is determined by the moving-average method.)

Those without determinable fair values... At cost determined by the moving-average method (2) Derivative financial instruments... At fair value

2. Methods of depreciation and amortization applied for fixed assets (1) Property for lease and rent

Property for lease and rent is depreciated under the straight-line method within the estimated lease and rent period, assuming that useful lives are the same as the estimated lease and rent period, and that residual values are the disposal price estimable at the end of the estimated lease and rent period.

In some of the property for lease and rent, tangible assets are depreciated under the declining-balance method. Intangible assets are amortized under the straight-line method.

(2) Other fixed assets

Of the other fixed assets, tangible assets are depreciated under the declining-balance method while intangible assets are amortized under the straight-line method.

Software for internal use is amortized under the straight-line method over internal useful lives (5 years). 3. Significant allowance and provisions

(1) Allowance for doubtful receivables

For general receivables, allowance for estimated uncollectible receivables is provided for at an adequate rate calculated based on the probability of bankruptcy, while allowance for certain categories including seriously doubtful receivables is provided for based on case-by-case collectability assessment.

(2) Allowance for loss on disposal of property for lease and rent

Allowance for estimated loss is provided for potential losses associated with disposals of property for lease and rent.

(3) Provision for bonuses

Of the estimated amount of bonuses payable to employees in the following fiscal year, the portion attributable to their service during current fiscal year has been set aside as provision for employees bonuses.

(4) Provision for employees retirement benefits

The Company provides for the estimated year-end liabilities for retirement benefits based on the projected benefit obligations and plan assets at the balance sheet date.

(6)

4. Lease accounting

Accounting policy for revenues and costs from finance lease transactions

The Company adopts the method in which lease revenue and cost of lease are recorded at the time when lease fees are collectible.

Accounting policy for revenues from operating lease transactions

The Company records lease revenues corresponding to the elapsed period of the lease contract term, on the basis of the monthly lease fees collectible according to the lease contract for such contract term.

5. Accounting for installment contracts

The Company accounts for the full amount of contracts as installment contract receivables upon delivery of goods and records installment sales and costs of installment sales as each payment becomes due.

Unrealized gross profits on installment contract receivables with installment payments becoming due at later dates are deferred.

Meanwhile, for some of the installment contracts, amount equivalent to interest is allocated to each period as installment sales.

6. Accounting treatment for financial expenses

Total assets are divided into assets based on sales transactions and other assets, where financial expenses corresponding to the former are recorded as financing costs under the heading of operating expenses while financial expenses corresponding to the latter are recorded as non-operating expense, based on the balance proportion of such assets.

Financial expenses related to operating assets less corresponding interest received, etc. are recorded as financing costs.

7. The method of hedge accounting

Gains or losses on derivatives are deferred until maturity of the hedged items. For interest rate swap, the Company applies the exceptional method as far as it qualifies for the required rules.

8. Translation of foreign currency accounts

All monetary receivables and payables denominated in foreign currencies are translated into Japanese yen at the spot exchange rates on the balance sheet date, and the foreign exchange gains and losses therefrom are

recognized in the statement of income.

9. Other significant matters that serve as the basis for preparing financial statements (1) Accounting treatment for consumption taxes

Consumption tax and local consumption tax are accounted for by the tax exclusion method. (2) Amortization of goodwill

Goodwill is amortized over five years under the straight-line method.

(Notes to Change in Accounting Policies)

1. Change in method of depreciation

With the enforcement of amendments to the Corporate Tax Act, the Company changed the method of

(7)

(Notes to Balance Sheet)

1. Assets pledged as collateral and corresponding liabilities (1) Assets pledged as collateral

(Millions of yen)

Installment contract receivables 1,302

Lease receivables 20,098

Lease investment assets 54,748

Other loan receivables to customers 1,326

Property for lease and rent 359

Investment securities 9

Other investments 5

Total 77,851

(2) Liabilities corresponding to assets pledged as collateral

(Millions of yen)

Payables under fluidity lease receivables 15,718

Long-term payables under fluidity lease receivables 37,499

Other liabilities 115

Total 53,332

2. Accumulated depreciation of tangible assets

(Millions of yen)

Property for lease and rent 24,294

Other tangible assets 978

Total 25,272

3. Contingent liabilities

Contingent liabilities for the subsidiaries borrowing liabilities etc. from financial institutions (Millions of yen)

PT. Mitsui Leasing Capital Indonesia 46,856

Altair Lines S.A. 39,093

JA Mitsui Leasing Singapore Pte.Ltd. 12,019

JA MITSUI LEASING TATEMONO CO., LTD. 2,072

PT. JA Mitsui Leasing Indonesia 1,675

Others 1,548

Total 103,266

4. Breakout of lease receivables and lease investment assets

(Millions of yen) Lease receivables Lease investment assets

Amount of receivables 117,043 497,128

Estimated residual value 24,984

Amount equivalent to interest receivables 17,987 42,467

(8)

5. Notes received as guarantees

(Millions of yen) Notes received for installment contract receivables 9,341

Notes received for lease receivables 22

Notes received for lease investment assets 1,876

Notes received for other loan receivables to customers 2,069 6. Operating lease contract receivables under the remaining lease terms

(Millions of yen)

Other lease contract receivables 11,176

7. Trade receivables due after one year

(Millions of yen)

Installment contract receivables 69,016

Lease receivables 69,495

Lease investment assets 320,146

Loan receivables from customers 65,435

Other loan receivables from customers 24,141

Operating lease contract receivables under the remaining lease terms 6,921

Total 555,156

8. Receivables and payables with affiliated companies

(Millions of yen)

Short-term receivables 132,141

Long-term receivables 141,466

Short-term payables 37,463

Long-term payables 27,650

9. Notes receivable and payable maturing on the balance sheet date

Notes receivable and payable maturing on the balance sheet date are treated as if they were settled at the clearing date of notes. Consequently, as the balance sheet date for the fiscal year was a bank holiday, the following notes receivable and payable maturing on the balance sheet date were included in the amount of each balance at March 31, 2013.

(Millions of yen)

Notes receivable-trade 2

Notes received for installment contract receivables 639

Notes received for lease receivables 0

Notes received for lease investment assets 70

Notes received for other loan receivables to customers 287

(9)

(Notes to Statement of Income)

1. Transactions with affiliated companies

(Millions of yen) Amount of operating transactions

Revenues 3,727 Costs 452 Selling, general and administrative expenses (145)

Amount of non-operating transactions 5,125

(Notes to Statement of Changes in Net Assets)

1. Number of issued and outstanding shares

Class of shares

Number of shares at the beginning of

the fiscal year

Number of increased shares during the fiscal

year

Number of decreased shares during the fiscal

year

Number of shares at the end of the fiscal

year Issued and outstanding shares Ordinary shares 32,415,296 32,415,296 Class I classified shares 4,077,528 4,077,528 Class II classified shares 33,448,582 33,448,582 Class III classified shares 3,883,500 3,883,500 Total 73,824,906 73,824,906

2. Matters regarding dividends from surplus (1) Amount of dividend payments

① Dividend payments resolved at the 4th annual general meeting of shareholders held on June 28, 2012 Total amount of dividends ¥2,436 million

Dividend per share Ordinary shares ¥33 Class I classified shares ¥33 Class II classified shares ¥33 Class III classified shares ¥33 Dividend record date March 31, 2012 Effective date June 29, 2012

(2) Dividends with a record date within the current fiscal year but effective date in the next fiscal year ① At the 5th annual general meeting of shareholders scheduled to be held on June 27, 2013, the Company

will make the following proposals to be discussed and resolved. Total amount of dividends ¥3,617 million

(10)

(Notes to Income Taxes)

1. Significant components of the Company s deferred tax assets and liabilities

(Millions of yen) Deferred tax assets

Allowance for doubtful receivables 9,207

Excess provision for depreciation and amortization 3,829

Investment securities 1,228

Investments in affiliated companies 977

Provision for employees retirement benefits 911

Other 2,064

Subtotal 18,220

Less valuation allowance (1,462)

Total deferred tax assets 16,758

Deferred tax liabilities

Net unrealized gain on available-for-sale securities (1,136)

Other (64)

Total deferred tax liabilities (1,201)

Net deferred tax assets 15,557

(Notes to leased fixed assets)

(11)

(Notes to Financial Instruments)

1. Matters relating to the status of financial instruments (1) The Company s policy in handling financial instruments

The Company engages in its core business leasing and other financial service businesses including installment sales and loans to customers. To ensure constant financial liquidity to carry out these businesses, the Company raises funds by direct financing such as issuance of commercial paper and bonds as well as securitization of receivables, along with indirect financing including bank borrowing. Since the Company s business involves holding of financial assets and liabilities exposed to interest rate volatility, it engages in derivative transactions as part of the comprehensive asset and liability management (ALM) in an effort to avoid unexpected losses due to the fluctuations of interest rate.

(2) Details of financial instruments and their risks

Financial assets held by the Company are primarily lease receivables, lease investment assets, installment contract receivables and loans to customers involving domestic clientele, all of which are exposed to credit risk associated with the event of default by customers.

Bank borrowing and issuance of commercial paper and bonds are all exposed to liquidity risk involving difficulty in ensuring the procurement of sufficient fund via normal fund raising activities in the event of significant dysfunction of the financial/capital market. Furthermore, borrowing at variable interest rate is exposed to interest rate risk, which, however, is partially avoided by interest rate swap transactions. Lease, installment sales and loan transactions denominated in foreign currencies are exposed to exchange risk, which, however, is mitigated by foreign currency denominated borrowing.

One area of the derivative transactions engaged by the Company is interest rate swap transactions deployed as hedging instruments as part of ALM in which interest rate risk associated with the hedged borrowing is subject to hedge accounting. Under hedge accounting, the Company compares the cumulative changes in cash flows of the hedged items against those of the hedging instruments during the period from the start of the hedging until the time to determine the its effectiveness. This comparison serves as the basis to evaluate the effectiveness of hedging.

(3) Risk management system for financial instruments ① Management of credit risks

In accordance with the internal rules for credit risk management, the Company has developed and maintains credit management system in respect of its trade receivables, including credit assessment and management of credit limits and credit data on case-by-case basis, internal credit rating, application of ceiling system to avoid credit concentration risk, arrangement of guarantee and security, and response to questionable receivables. ② Management of market risks

The Company manages interest rate risk on the basis of the comprehensive management of its assets and liabilities (ALM).

Details of the methods and procedures of the risk management are set out under the Company s Risk Management Policies, while analysis of information on the financial market trend and

(12)

③ Management of liquidity risks concerning financing

(13)

2. Matters relating to the fair value of financial instruments

Balance sheet amounts, fair values, and the differences as of March 31, 2013 are as follows:

(Millions of yen) Balance sheet amount Fair value Difference

(1) Installment contract receivables 95,578 96,345 767

Installment contract receivables (*1) 97,167 Allowance for doubtful receivables (*2) (1,589)

(2) Lease receivables 98,495 98,568 73

Lease receivables 99,056

Allowance for doubtful receivables (*2) (560)

(3) Lease investment assets 452,226 459,578 7,351

Lease investment assets 479,645

Estimated residual value (*3) (24,984)

Allowance for doubtful receivables (*2) (2,434)

(4) Loan receivables from customers 105,523 107,591 2,068

Loan receivables from customers 111,958

Allowance for doubtful receivables (*2) (6,435)

(5) Other loan receivables from customers 45,485 46,252 767

Other loan receivables from customers 46,760 Allowance for doubtful receivables (*2) (1,275)

(6) Short and long-term loan receivables 256,988 261,275 4,286

Short-term loan receivables 88,506

Long-term loan receivables 176,758

Allowance for doubtful receivables (*2) (8,276) (7) Claims provable in bankruptcy, in

rehabilitation and other 266 266

Claims provable in bankruptcy, in

rehabilitation and other 2,297

Allowance for doubtful receivables (*2) (2,031)

Total assets 1,054,564 1,069,878 15,314

(1) Short-term borrowings 50,912 50,912

(2) Commercial paper 329,920 329,920

(3) Payables under fluidity lease receivables (*4) 7,500 7,500

(4) Long-term debt (*5) 555,515 557,573 2,057

(5) Long-term payables under fluidity lease

receivables (*6) 53,217 53,167 (50)

Total liabilities 997,066 997,073 2,007

Derivative transactions (*7)

1) Derivative transactions to which hedge

accounting is not applied (236) (236)

2) Derivative transactions to which hedge

accounting is applied (1,862) (1,862)

Total derivative transactions (2,099) (2,099)

(*1) Deferred unrealized gross profits on installment contracts have been deducted from installment contract receivables.

(*2) Corresponding allowance for doubtful receivables has been deducted.

(*3) Estimated residual value included in lease investment assets has been deducted.

(*4) Long-term payables under fluidity lease receivables scheduled to be repaid within one year as included in payables under fluidity lease receivables have been deducted.

(*5) Current portion of long-term debt is included.

(*6) Long-term payables under fluidity lease receivables scheduled to be repaid within one year as included in payables under fluidity lease receivables are included also in long-term payables under fluidity lease receivables.

(14)

(Note 1) Matters relating to the calculation method of fair value of financial instruments and derivative transactions

Assets

(1) Installment contract receivables, (2) Lease receivables, (3) Lease investment assets, (4) Loan receivables to customers, (5) Other loan receivables to customers and (6) Short and long-term loan receivables

Financial instruments based on variable interest rate reflect market rate at shorter intervals, thus their book value approximate their fair value unless credit standing of the customers involved therein changes

significantly. Hence they are stated at book values. Meanwhile, financial instruments based on fixed interest rate are calculated by discounting the sum of principal and interest using the hypothetical interest rate assumed applicable to the new borrowing on similar conditions, by type of receivable, by grade of internal rating and by term basis. On the other hand, doubtful receivables are calculated based on the estimated amount recoverable through repossession or guarantee, in which their balance sheet amount less estimated bad debt at the closing date are approximate to their fair value, and thus are stated as such.

(7) Claims provable in bankruptcy, in rehabilitation and other

Receivables from businesses under bankruptcy or rehabilitation process are calculated based on the estimated amount recoverable through repossession or guarantee, in which their balance sheet amount at the closing date less the currently estimated bad debt are approximate to their fair value, and thus stated as such. Liabilities

(1) Short-term borrowings, (2) Commercial paper and (3) Payables under fluidity lease receivables

Since these are settled in a short period and their book value is approximate to their fair value, they are stated at book values.

(4) Long-term debt and (5) Long-term payables under fluidity lease receivables

Of the long-term debt, those based on variable interest rate reflecting market rate at short intervals with the Company s credit standing remaining without significant change since the borrowing, are stated at their book value which is believed to approximate their fair value. Meanwhile, those based on fixed interest rate are stated at their fair value calculated by discounting the sum of their principal and interest (*) for each of certain time periods within the term, using the hypothetical interest rate assumed applicable to the borrowing on similar conditions as at the end of each such time period.

(15)

Derivative transactions

① Derivative transactions to which hedge accounting is not applied

For the derivative transactions not applicable to hedge accounting, contract amounts, the contractual sums of their principal and interest, fair value and valuation profit or loss as at the closing date, and the methods to calculate such fair values are shown as follows by type of hedged item.

(a) Currency related (Millions of yen)

Classification Derivative transaction type etc. Contract amount etc.

Fair value (*)

Valuation profit or loss Forward exchange transactions

Open interest on seller s side

US$ 669 (36) (36)

Open interest on buyer s side Transactions

outside market transactions

US$ 351 37 37

Total 1,020 1 1

(*) Fair value is calculated using prices quoted by financial institutions.

(b) Interest rates related (Millions of yen)

Classification Derivative transaction type etc. Contract amount etc.

Fair value (*)

Valuation profit or loss Interest rate swap transactions

Fixed rate receivable/Variable

rate payable 5,240 4 4

Fixed rate payable/Variable

rate receivable 12,000 (241) (241) Transactions outside market transactions Payable at LIBOR/Receivable at TIBOR 1,800 0 0 Total 19,040 (236) (236)

(*) Fair value is calculated using prices quoted by financial institutions. ② Derivative transactions to which hedge accounting is applied

For the derivative transactions applicable to hedge accounting, contract amounts and the contractual sums of their principal and interest as at the closing date are shown as follows by type of hedge accounting method.

(Millions of yen) Hedge

accounting method

Derivative transaction type etc.

Main hedged items

Contract

amount etc. Fair value

Fair value calculation

method Interest rate swap

transaction Fixed rate receivable/Variable rate payable 2,790 27 Basic accounting method Fixed rate receivable/Variable rate payable Long-term debt 89,766 (1,890) Fair values are calculated using prices quoted by financial institutions. Interest rate swap

transaction Fixed rate receivable/Variable rate payable 6,500 (*) Exceptional method for interest rate swap

transactions Fixed rate

payable/Variable rate receivable Long-term debt 152,975 Total 252,031 (1,862)

(16)

(Notes to Related Party Transactions)

1. Parent company and corporate major stockholder Attributes Name of related company Percentage of voting rights of the Company Relationship with related party Description of the transaction Transactions (Millions of yen) Account Balance (Millions of yen) Borrowings (*1) 200,242 Short-term borrowings 21,907 Current portion of long-term debt 10,600 Long-term debt 27,650 Other affiliated company The Norinchukin Bank Directly 28.48% Loan Doubled as director Payment of the interest 336 Accrued expenses 5

(17)

2. Associated companies, etc. Attributes Name of related company Equity ownership percentage Relationship with related party Description of the transaction Transactions (Millions of yen) Account Balance (Millions of yen) Loan (*1) 292,462 Short-term loan

receivables 33,854 Long-term loan receivables 10,048 Subsidiary JA Mitsui Leasing Auto, Ltd. Directly 100% Loan Doubled as executive officer Receipt of the interest 327 Accrued income 9

Loan (*1) 137,100 Short-term loan receivables 12,735 Long-term loan receivables 12,700 Subsidiary Nishi-Nippon Sogo Lease Co., Ltd. Directly 85.10% Loan Doubled as executive officer Receipt of the interest 220 Accrued income 12

Loan (*1) 44,009 Short-term loan receivables 5,647 Long-term loan receivables 59,671 Loan Receipt of the interest 822 Accrued income 36 Guarantee of liabilities (*2) 39,093 Subsidiary Altair Lines

S.A. Directly 100% Guarantee of liability Receipt of the guarantee fee 82 Accrued income 30

Loan (*1) 217,400 Short-term loan receivables 17,050 Subsidiary Mitsui CM Leasing, Ltd. Directly 100% Loan Doubled as executive

officer Receipt of the interest 108 Accrued income 3 Loan (*1) 289,840 Short-term loan

receivables 34,320 Long-term loan receivables 18,120 Subsidiary JA MITSUI LEASING TATEMON O CO., LTD. Directly 100% Loan Doubled as executive officer Receipt of the interest 480 Accrued income 10 Guarantee of liabilities (*2) 46,856 Subsidiary PT. Mitsui Leasing Capital Indonesia Directly 85.00% Indirectly 14.99% Guarantee of liability Receipt of the guarantee fee 58 Accrued income 17

Loan (*1) Short-term loan receivables 756 Receipt of the interest 144 Long-term loan receivables 11,557 Subsidiary GLOBAL TANKSHIPS S.A. Directly 100% Loan Accrued income 5

The terms and conditions of the above transactions and its policy making, etc.

(*1) The terms and conditions of the loans are determined in consideration of the prevailing market prices and other factors. No collateral is received from the borrower.

(18)

3. Fellow subsidiaries, etc. Attributes Name of related company Percentage of voting rights (of the

Company) Relationship with related party Description of the transaction Transactions (Millions of yen) Account Balance (Millions of yen) Subsidiary of other affiliated company

Mitsui & Co. Plant Systems, Ltd. None Equipment lease Receipt of the lease fees (*1) 1,736 Lease investment assets 17,503

The terms and conditions of the above transactions and its policy making, etc.

(*1) The terms and conditions of the lease transactions are determined on similar terms and conditions applied to general transactions, in consideration of the prevailing market prices and other factors.

(Notes to Per Share Information)

(19)

(Translation)

Audit Report by the Board of Corporate Auditors Certified Copy

Audit Report

The board of corporate auditors, following deliberations on the reports made by each corporate auditor concerning the audit of performance of duties by directors of the Company for the 5th fiscal year from April 1, 2012 to March 31, 2013, has prepared this Audit Report, and hereby reports as follows:

1. Auditing Method Used by Each Corporate Auditor and the Board of Corporate Auditors and Details Thereof The board of corporate auditors established auditing policies, assignment of duties and other relevant matters, and received reports from each corporate auditor regarding the progress and results of audits, as well as received reports from the directors, other relevant personnel and the independent auditors regarding the performance of their duties, and sought explanations as necessary.

In conformity with the corporate auditors auditing standard policies established by the board of corporate auditors, and in accordance with the auditing policies, assignment of duties and other relevant matters, each corporate auditor endeavored to gather information and to create an improved environment for auditing through close communication with the directors, employees including those working in the Internal Audit Department and other relevant personnel. Each corporate auditor also attended meetings of the board of directors and other important meetings, received reports from the directors, employees and other relevant personnel regarding the performance of their duties, sought explanations as necessary, inspected documents involving important resolutions, and examined the operations and financial position of the Company at the Head Office and other principal offices of the Company. Also, each corporate auditor monitored and verified the content and the status of the resolution of the board of directors to establish the systems provided by Article 100, Section 1 and 3 of the Ordinance for Enforcement of the Companies Act and the systems established pursuant to such resolution (the Internal Control System ), which are necessary to establish the systems to ensure directors carry out their duties described in the business report in accordance with laws and regulations and the Company s Articles of

Incorporation and other systems to ensure appropriateness of the Company s business.

As for the subsidiaries of the Company, each corporate auditor endeavored to keep communication and shared information with the directors, corporate auditors and other related personnel of the subsidiaries, and received reports from the subsidiaries regarding their businesses as necessary.

Based on the foregoing method, the corporate auditors examined the business report for the fiscal year. Furthermore, the corporate auditors monitored and verified whether the independent auditors maintained its independence and implemented appropriate audits, as well as received reports from the independent auditors regarding the performance of its duties and sought explanations as necessary. Each corporate auditor was notified by the independent auditors that it has established a system to ensure that duties of independent auditors are being conducted properly (matters prescribed in each item of Article 131 of the Corporate Accounting Regulations) and that the system is developed and implemented in accordance with the Quality Control

Standards for Audit (Business Accounting Council, October 28, 2005) and other applicable standards, and sought explanation as necessary.

(20)

2. Audit Results

(1) Audit Results on the Business Report, etc.

1) In our opinion, the business report fairly represents the Company s condition in conformity with the applicable laws and regulations as well as the Articles of Incorporation of the Company.

2) We have found no evidence of misconduct or material facts in violation of the applicable laws and regulations, nor of any violation with respect to the Articles of Incorporation of the Company, related to performance of duties by the directors.

3) In our opinion, the status of the operation and maintenance of the Internal Control System is appropriate. We have found no issues to be mentioned on the contents of the business report and the directors performance of their duties with respect to the Internal Control System.

(2) Results of Audit of the Financial Statements and Supplementary Schedules

In our opinion, the method and the results of the audit used and conducted by Deloitte Touche Tohmatsu LLC, the independent auditors are appropriate.

May 28, 2013

The board of corporate auditors of JA Mitsui Leasing, Ltd. Standing corporate auditor Ryuhei Kida (Seal) Standing corporate auditor Keisuke Kudo (Seal) Corporate auditor Katsuhisa Kiyozuka (Seal)

(21)

(TRANSLATION)

INDEPENDENT AUDITOR'S REPORT

May 16, 2013 To the Board of Directors of

JA MITSUI LEASING, Ltd.:

Deloitte Touche Tohmatsu LLC Designated Unlimited Liability Partner, Engagement Partner,

Certified Public Accountant:

Tomomitsu Umezu

Designated Unlimited Liability Partner, Engagement Partner,

Certified Public Accountant:

Haruhiko Ohno

Pursuant to the first item, second paragraph of Article 436 of the Companies Act, we have audited the financial statements, namely, the balance sheet as of March 31, 2013 of JA MITSUI LEASING, Ltd. (the Company ), and the related statements of income and changes in net assets for the fifth fiscal year from April 1, 2012 to March 31, 2013, and a summary of significant accounting policies and other explanatory information, and the accompanying supplemental schedules.

Management s Responsibility for the Financial Statements

Management is responsible for the preparation and fair presentation of these financial statements and the accompanying supplemental schedules in conformity with accounting principles generally accepted in Japan and for such internal control as management determines is necessary to enable the preparation of financial statements and the accompanying supplemental schedules that are free from material misstatement, whether due to fraud or error.

Auditor s Responsibility

Our responsibility is to express an opinion on these financial statements and the accompanying supplemental schedules based on our audit. We conducted our audit in accordance with auditing standards generally accepted in Japan. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and the accompanying

supplemental schedules are free from material misstatement.

(22)

accounting estimates made by management, as well as evaluating the overall presentation of the financial statements and the accompanying supplemental schedules.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Audit Opinion

In our opinion, the financial statements and the accompanying supplemental schedules referred to above present fairly, in all material respects, the financial position of the Company as of March 31, 2013, and the results of its operations for the year then ended in conformity with accounting principles generally accepted in Japan.

Interest

Our firm and the engagement partners do not have any interest in the Company for which disclosure is required under the provisions of the Certified Public Accountants Act.

Figure

Updating...

References

Updating...