FINANCIAL SECTION[PDF:531KB]

FINANCIAL SECTION		FINANCIAL SECTION

Ten-Year Summary and Business Highlights

												Thousands of
										Millions of Yen	U.S. Dollars
	2012/3	2013/3	2014/3	2015/3	2016/3	2017/3	2018/3	2019/3	2020/3	2021/3		2021/3
RESULTS OF OPERATIONS:
Operating revenues	¥1,260,833	¥1,282,374 ¥1,374,610 ¥1,396,708	¥1,416,413 ¥1,466,852 ¥1,538,813	¥1,625,315	¥1,630,147	¥1,695,867		$15,318,103
Delivery	1,014,564	1,028,219	1,099,400	1,101,439	1,111,867	1,151,028	1,201,770	1,297,223	1,310,068	1,418,993		12,817,211
Non-delivery	246,269	254,155	275,210	295,269	304,546	315,824	337,043	328,092	320,079	276,874		2,500,892
Operating costs	1,163,777	1,181,834	1,274,471	1,290,715	1,306,200	1,385,492	1,452,485	1,513,988	1,526,103	1,538,524		13,896,890
Selling, general and administrative	30,405	34,337	37,043	37,046	41,673	46,475	50,642	52,981	59,343	65,221		589,115
expenses
Operating profit	66,651	66,203	63,096	68,947	68,540	34,885	35,686	58,346	44,701	92,122		832,098
Profit before income taxes	45,817	64,284	65,882	69,158	68,079	33,038	33,123	52,258	44,581	91,760		828,830
Income taxes	26,059	29,563	31,003	31,555	28,415	14,673	14,435	26,308	21,679	34,825		314,563
Profit attributable to owners of parent	19,787	35,144	34,776	37,533	39,425	18,054	18,232	25,682	22,324	56,701		512,154
										Yen	U.S. Dollars
PER SHARE OF COMMON STOCK:
Basic earnings	¥       46.00	¥       81.85	¥       82.22	¥       90.41	¥       96.45	¥       45.37	¥       46.24	¥       65.14	¥       56.78	¥     151.55	$1.37
Diluted earnings	44.87	79.84	80.18	88.26	95.64	-	-	-	-	-	-
Cash dividends	22.00	23.00	24.00	25.00	28.00	27.00	27.00	28.00	41.00	46.00		0.42
Net assets per share	1,197.26	1,261.35	1,316.12	1,368.66	1,349.56	1,367.51	1,395.74	1,435.15	1,441.20	1,553.45		14.03
Stock price (closing), end of year	1,279	1,740	2,224	2,772	2,247	2,332.5	2,668.5	2,859.0	1,697.0	3,035.0		-
												Thousands of
										Millions of Yen	U.S. Dollars
FINANCIAL POSITION:
Working capital	¥   182,111	¥   186,868	¥   179,999	¥   209,172	¥   235,884	¥   214,661	¥   164,600	¥   139,835	¥   134,072	¥   139,010	$   1,255,623
Total shareholders' equity	514,996	534,451	551,379	565,521	537,821	539,179	550,308	565,841	555,173	576,368		5,206,106
Total assets	919,295	950,153	1,032,134	1,082,531	1,089,437	1,114,672	1,114,870	1,123,660	1,100,740	1,089,991		9,845,465
Capital expenditures	48,615	48,052	79,531	52,022	53,945	48,994	54,482	79,839	55,034	55,432		500,695
Depreciation and amortization	38,682	37,936	42,266	46,058	46,739	46,114	46,423	51,347	55,083	48,862		441,349
Net cash provided by operating activities	71,843	73,950	80,075	92,620	49,715	73,325	51,728	118,094	74,434	123,921		1,119,332
KEY RATIOS:
Operating profit margin (%)	5.29	5.16	4.59	4.94	4.84	2.38	2.32	3.59	2.74	5.43
Net margin (%)	1.57	2.74	2.53	2.69	2.78	1.23	1.18	1.58	1.37	3.34
Return on assets (ROA) (%)	2.18	3.76	3.51	3.55	3.63	1.64	1.64	2.29	2.01	5.18
Return on equity (ROE) (%)	3.84	6.70	6.41	6.75	7.15	3.35	3.35	4.60	3.98	10.02
Current ratio (%)	164.50	162.39	151.82	158.59	167.76	157.73	141.67	134.07	132.80	135.70
Shareholders' equity ratio (%)	56.02	56.25	53.42	52.24	49.37	48.37	49.36	50.36	50.44	52.88
Assets turnover (Times)	1.39	1.37	1.39	1.32	1.30	1.33	1.38	1.45	1.47	1.55
Interest coverage ratio (Times)	90.52	108.36	153.41	173.45	125.33	81.45	131.94	212.29	106.25	124.51
Price earnings ratio (PER) (Times)	27.8	21.3	27.0	30.7	23.3	51.4	57.7	43.9	29.9	20.0
Price book-value ratio (PBR) (Times)	1.1	1.4	1.7	2.0	1.7	1.7	1.9	2.0	1.2	2.0
NON-FINANCIAL DATA:
Number of employees	177,301	177,108	193,146	197,056	196,582	201,784	213,096	225,125	224,945	223,191
Full-time	84,293	84,422	87,279	88,247	89,112	90,737	93,534	97,587	98,744	96,829
Part-time	93,008	92,686	105,867	108,809	107,470	111,047	119,562	127,538	126,201	126,362
Parcel delivery amount	1,423	1,487	1,665	1,622	1,731	1,867	1,836	1,803	1,799	2,096
(Millions of parcels)
Unit price (Yen)	600	591	574	595	578	559	597	664	676	633
Kuroneko DM-Binhandling volume	2,187	2,112	2,084	1,901	1,536	1,542	1,464	1,211	987	826
(Millions of units)
Unit price (Yen)	62	61	61	61	57	55	56	60	65	67

Foreign currency translation: U.S. dollar amounts have been translated, for convenience only, at the rate of ¥110.71 to U.S.$1.

Note: On March 31, 2015, we ceased accepting items for Kuroneko Mail and from April 1 launched Kuroneko DM-Bin.

Analysis of Operating Revenues

(¥ billion)

2020/3	1,630.1
	Delivery		+108.9
		BIZ-Logistics	+2.6
	Home Convenience	(0.9)
		e-Business	(2.1)
	Financial	(37.4)
	Autoworks	(3.0)
	Other	(2.2)
2021/3		1,695.8

YoY +65.7

Analysis of Operating Profit

(¥ billion)

2020/3

44.7

+65.7

Revenue

Subcontracting

(10.1)

expenses

Personnel expenses

(28.7)

Vehicle expenses

+3.7

Other

(5.9)

Consolidation

+22.8

2021/3

journal entries

92.1

YoY +47.4

Quarterly YoY Growth Rates of Parcel Delivery Amount and Unit Price (Excluding Nekopos)

(%)

25

20

15

10

5

0

(5)

(10)

1Q

2Q

3Q

4Q

1Q

2Q

3Q

4Q

1Q

2Q

3Q

4Q

2019/3

2020/3

2021/3

Parcel Delivery Amount Growth Rate	Delivery Amount:
Parcel Unit Price Growth Rate
YoY +10.8%
	Unit Price:
	YoY (3.0)%

066	YAMATO HOLDINGS CO., LTD.	YAMATO HOLDINGS CO., LTD.	067
Integrated Report 2021	Integrated Report 2021

FINANCIAL SECTION

Consolidated Balance Sheet

March 31, 2021

							Thousands of
							U.S. Dollars
				Millions of Yen		(Note 1)
ASSETS	2021	2020	2021
CURRENT ASSETS:
Cash and cash equivalents (Notes 2.e and 14)		¥   241,523	¥   197,227	$2,181,584
Notes and accounts receivable (Note 14):
		Trade	212,766	213,981	1,921,832
		Installment (Note 4)	45,643	46,088	412,279
		Lease (Note 13)			53,887
	Allowance for doubtful accounts	(1,342)	(1,440)	(12,122)
	Inventories (Note 5)	2,281	4,216	20,600
Prepaid expenses and other current assets	27,508	28,925	248,470
		Total current assets	528,379	542,884	4,772,643
PROPERTY, PLANT AND EQUIPMENT-At cost:
	Land	174,141	175,159	1,572,945
	Buildings and structures	367,719	362,315	3,321,459
	Vehicles	199,977	214,177	1,806,312
	Machinery and equipment	128,533	132,896	1,160,988
Leased assets (Note 13)	36,645	31,261	331,004
	Construction in progress	6,345	6,418	57,315
	Others	2,156	21,979	19,475
		Total	915,516	944,205	8,269,498
	Accumulated depreciation	(509,203)	(520,369)	(4,599,435)
		Net property, plant and equipment	406,313	423,836	3,670,063
INVESTMENTS AND OTHER ASSETS:
Investment securities (Notes 6 and 14)	40,003	29,205	361,330
Investments in and advances to unconsolidated subsidiaries and affiliates,	net
	of valuation allowance of ¥371 million ($3,352 thousand) in 2021 and ¥373 million
	in 2020 (Note 14)	16,942	15,217	153,030
	Long-term loans	1,634	1,240	14,765
	Software	22,082	18,182	199,459
	Lease deposits	20,122	18,671	181,753
Deferred tax assets (Note 12)	45,625	45,611	412,115
Other assets (Notes 2.k and 9)	8,891	5,894	80,307
		Total investments and other assets	155,299	134,020	1,402,759
TOTAL	¥1,089,991	¥1,100,740	$9,845,465

See notes to consolidated financial statements.

FINANCIAL SECTION

						Thousands of
						U.S. Dollars
			Millions of Yen		(Note 1)
LIABILITIES AND EQUITY	2021	2020	2021
CURRENT LIABILITIES:
Short-term bank loans (Notes 8 and 14)	¥     20,000	¥     70,000		$   180,652
Current portion of long-term debt (Notes 8 and 14)	19,055	19,079	172,115
Notes and accounts payable (Note 14):
		Trade	153,860	147,082	1,389,758
		Other	12,221	12,641	110,391
	Income taxes payable	32,099	20,377	289,938
	Accrued expenses	83,036	77,970	750,027
	Deferred profit on installment sales (Notes 4 and 14)	4,781	5,028	43,185
Other current liabilities (Note 10)	64,317	56,635	580,954
		Total current liabilities	389,369	408,812	3,517,020
LONG-TERM LIABILITIES:
Long-term debt (Notes 8 and 14)	26,099	35,760	235,741
	Liability for employees' retirement benefits (Notes 2.k and 9)	71,835	79,231	648,855
Deferred tax liabilities (Note 12)	5,194	2,064	46,916
Other long-term liabilities (Note 10)	13,207	12,038	119,295
		Total long-term liabilities	116,335	129,093	1,050,807
COMMITMENTS LIABILITIES (Note 13)
EQUITY (Notes 11 and 20):
Common stock-authorized, 1,787,541,000 shares in 2021 and 2020;
		issued, 388,575,592 shares in 2021 and 411,339,992 shares in 2020	127,235	127,235	1,149,262
	Capital surplus	36,813	36,813	332,519
	Retained earnings	431,572	441,747	3,898,218
	Treasury stock-at cost, 17,550,515 shares in 2021 and
		26,124,409 shares in 2020	(39,549)	(54,771)	(357,232)
Accumulated other comprehensive income:
	Unrealized gain on available-for-sale securities	15,884	8,158	143,473
	Foreign currency translation adjustments	(1,317)	(317)	(11,891)
		Remeasurements of defined employees' retirement benefit plans (Notes 2.k and 9)	5,730	(3,692)	51,757
		Total	576,368	555,173	5,206,106
	Non-controlling interests	7,919	7,662	71,532
		Total equity	584,287	562,835	5,277,638
TOTAL	¥1,089,991	¥1,100,740	$9,845,465

068	YAMATO HOLDINGS CO., LTD.	YAMATO HOLDINGS CO., LTD.	069
Integrated Report 2021	Integrated Report 2021

FINANCIAL SECTION

Consolidated Statement of Income

Year Ended March 31, 2021

						Thousands of
						U.S. Dollars
			Millions of Yen		(Note 1)
			2021	2020	2021
OPERATING REVENUES	¥1,695,867	¥1,630,147	$15,318,103
OPERATING COSTS AND EXPENSES:
	Operating costs	1,538,524	1,526,103	13,896,890
Selling, general and administrative expenses	65,221	59,343	589,115
		Total operating costs and expenses	1,603,745	1,585,446	14,486,005
		Operating profit	92,122	44,701	832,098
OTHER INCOME (EXPENSES):
Interest and dividend income	1,154	1,096	10,427
	Interest expense	(742)	(422)	(6,699)
Gain on sales and disposal of property, plant and equipment-net	255	7,528	2,299
Loss on impairment of long-lived assets (Note 7)	(877)	(991)	(7,920)
Gain on sales of marketable and investment securities (Note 6)		1,300
Gain on sales of shares of subsidiaries and affiliates	38		347
Loss on valuation of investment securities (Note 6)	(355)	(140)	(3,205)
Loss on valuation of investment in unconsolidated subsidiaries and affiliates	(18)	(2,207)	(163)
Share of loss of entities accounted for using equity method	(766)	(4,169)	(6,923)
Loss on liquidation of business		(1,207)
	Electric vehicle subsidies	656		5,928
Loss associated with measures to address COVID-19	(1,163)		(10,509)
	Other-net	1,456	(908)	13,150
		Other expenses-net	(362)	(120)	(3,268)
PROFIT BEFORE INCOME TAXES	91,760	44,581	828,830
INCOME TAXES (Note 12):
	Current	38,252	23,026	345,513
	Deferred	(3,427)	(1,347)	(30,950)
		Total income taxes	34,825	21,679	314,563
PROFIT	56,935	22,902	514,267
PROFIT ATTRIBUTABLE TO NON-CONTROLLING INTERESTS	234	578	2,113
PROFIT ATTRIBUTABLE TO OWNERS OF PARENT	¥     56,701	¥     22,324		$     512,154
						U.S. Dollars
			Yen			(Note 1)
			2021	2020	2021
PER SHARE OF COMMON STOCK (Notes 2.q and 16):
	Basic earnings	¥151.55	¥56.78	$1.37
Cash dividends applicable to the year	46.00	41.00	0.42

See notes to consolidated financial statements.

FINANCIAL SECTION

Consolidated Statement of Comprehensive Income

Year Ended March 31, 2021

					Thousands of
					U.S. Dollars
		Millions of Yen		(Note 1)
		2021	2020	2021
PROFIT	¥56,935	¥22,902	$514,267
OTHER COMPREHENSIVE INCOME (Note 15):
Unrealized gain (loss) on available-for-sale securities	7,926	(4,928)	71,595
Foreign currency translation adjustments	(994)	199	(8,979)
	Remeasurements of defined employees' retirement benefit plans	9,422	(613)	85,104
Share of other comprehensive income of entities accounted for using equity method	3	(274)	31
	Total other comprehensive income (loss)	16,357	(5,616)	147,751
COMPREHENSIVE INCOME	¥73,292	¥17,286	$662,018
TOTAL COMPREHENSIVE INCOME ATTRIBUTABLE TO:
	Owners of parent	¥72,849	¥17,092	$658,020
	Non-controlling interests	443	194	3,998

See notes to consolidated financial statements.

070	YAMATO HOLDINGS CO., LTD.	YAMATO HOLDINGS CO., LTD.	071
Integrated Report 2021	Integrated Report 2021

FINANCIAL SECTION

Consolidated Statement of Changes in Equity

Year Ended March 31, 2021

		Thousands						Millions of Yen
								Accumulated Other Comprehensive Income
										Remeasurements
		Outstanding						Unrealized		of Defined
		Number of						Gain on	Foreign Currency	Employees'
		Shares of						Available-for-Sale Translation	Retirement		Non-controlling
		Common Stock		Common Stock	Capital Surplus	Retained Earnings	Treasury Stock	Securities	Adjustments	Benefit Plans	Total	Interests	Total Equity
BALANCE,
APRIL 1, 2019	394,274	¥127,235	¥36,813	¥431,498	¥(39,086)	¥12,975	¥  (515)	¥(3,079)	¥565,841	¥7,548	¥573,389
Cumulative effects of
changes in accounting
policies					(641)					(641)		(641)
RESTATED BALANCE		127,235	36,813	430,857	(39,086)	12,975	(515)	(3,079)	565,200	7,548	572,748
Profit attributable to
owners of parent					22,324					22,324		22,324
Cash dividends,
¥29 per share					(11,434)					(11,434)		(11,434)
Purchase of
treasury stock	(9,059)					(15,685)				(15,685)		(15,685)
Disposal of
treasury stock	1
Net change in the year							(4,817)	198	(613)	(5,232)	114	(5,118)
BALANCE,
MARCH 31, 2020	385,216	127,235	36,813	441,747	(54,771)	8,158	(317)	(3,692)	555,173	7,662	562,835
Profit attributable to
owners of parent					56,701					56,701		56,701
Cash dividends,
¥42 per share					(15,960)					(15,960)		(15,960)
Purchase of
treasury stock	(14,191)					(35,694)				(35,694)		(35,694)
Retirement of
treasury stock					(50,916)	50,916
Net change in the year							7,726	(1,000)	9,422	16,148	257	16,405
BALANCE,
MARCH 31, 2021	371,025	¥127,235	¥36,813	¥431,572	¥(39,549)	¥15,884	¥(1,317)	¥ 5,730	¥576,368	¥7,919	¥584,287
								Thousands of U.S. Dollars (Note 1)
								Accumulated Other Comprehensive Income
								Unrealized		Remeasurements
									of Defined
								Gain on	Foreign Currency	Employees'
				Common Stock	Capital Surplus	Retained Earnings	Treasury Stock	Available-for-Sale Translation	Retirement		Non-controlling
				Securities	Adjustments	Benefit Plans	Total	Interests	Total Equity
BALANCE,
MARCH 31, 2020		$1,149,262	$332,519	$3,990,126	$(494,720)	$  73,686	$  (2,864)	$(33,348)	$5,014,661	$69,209	$5,083,870
Profit attributable to
owners of parent					512,154					512,154		512,154
Cash dividends,
$0.38 per share					(144,158)					(144,158)		(144,158)
Purchase of
treasury stock						(322,416)				(322,416)		(322,416)
Retirement of
treasury stock					(459,904)	459,904
Net change in the year							69,787	(9,027)	85,105	145,865	2,323	148,188
BALANCE,
MARCH 31, 2021		$1,149,262	$332,519	$3,898,218	$(357,232)	$143,473	$(11,891)	$ 51,757	$5,206,106	$71,532	$5,277,638

See notes to consolidated financial statements.

FINANCIAL SECTION

Consolidated Statement of Cash Flows

Year Ended March 31, 2021

						Thousands of
						U.S. Dollars
			Millions of Yen		(Note 1)
			2021	2020	2021
OPERATING ACTIVITIES:
	Profit before income taxes	¥  91,760	¥  44,581		$   828,830
	Adjustments for:
		Income taxes-paid	(25,390)	(30,034)	(229,337)
		Depreciation and amortization	48,898	55,105	441,675
	Gain on sales and disposal of property, plant and equipment-net	(255)	(7,528)	(2,299)
	Loss on impairment of long-lived assets	877	991	7,920
	Gain on sales of marketable and investment securities		(1,300)
	Gain on sales of shares of subsidiaries and affiliates	(38)		(347)
	Loss on valuation of investment securities	355	140	3,205
	Loss on valuation of investment in unconsolidated subsidiaries and affiliates	18	2,207	163
	Share of loss of entities accounted for using equity method	766	4,169	6,923

• Changes in assets and liabilities, net of effects from previously consolidated subsidiaries:

		(Increase) decrease in notes and accounts receivable	(24,967)	4,478	(225,512)
		Decrease (increase) in inventories	1,517	(702)	13,701
		Increase (decrease) in notes and accounts payable	10,026	(11,768)	90,564
		Increase in liability for employees' retirement benefits	1,942	1,864	17,541
		Other-net	18,412	12,231	166,305
		Total adjustments	32,161	29,853	290,502
		Net cash provided by operating activities	123,921	74,434	1,119,332
INVESTING ACTIVITIES:
Proceeds from sale of property, plant and equipment	2,084	13,161	18,824
Purchases of property, plant and equipment	(32,075)	(54,853)	(289,717)
Proceeds from sales of marketable and investment securities	100	1,978	901
Purchases of marketable and investment securities	(793)	(585)	(7,166)
Decrease (increase) in investments in and advances to unconsolidated subsidiaries
	and affiliates	93,437	(1,663)	843,981
Payment for sales of shares of subsidiaries resulting in change in scope of consolidation
	(Note 19)	(484)		(4,374)
	Collection of loans	1,078	722	9,741
	Payment of loans	(1,480)	(661)	(13,363)
	Other	(17,789)	(8,043)	(160,685)
		Net cash provided by (used in) investing activities	44,078	(49,944)	398,142
FINANCING ACTIVITIES:
(Repayments of) proceeds from short-termdebt-net	(55,904)	45,634	(504,959)
Repayments of long-term debt	(15,500)	(40,800)	(140,005)
	Dividends paid	(16,138)	(11,512)	(145,769)
Purchase of treasury stock-net	(35,708)	(15,691)	(322,536)
	Other	3		23
		Net cash used in financing activities	(123,247)	(22,369)	(1,113,246)
FOREIGN CURRENCY TRANSLATION ADJUSTMENTS ON CASH AND CASH
EQUIVALENTS	(130)	(109)	(1,172)
NET INCREASE IN CASH AND CASH EQUIVALENTS	44,622	2,012	403,056
CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR	196,663	194,651	1,776,376
CASH AND CASH EQUIVALENTS, END OF YEAR (Note 2.e)	¥241,285	¥196,663	$2,179,432

See notes to consolidated financial statements.

072	YAMATO HOLDINGS CO., LTD.	YAMATO HOLDINGS CO., LTD.	073
Integrated Report 2021	Integrated Report 2021

FINANCIAL SECTION

Notes to Consolidated Financial Statements

Year Ended March 31, 2021

1. BASIS OF PRESENTATION OF CONSOLIDATED FINANCIAL STATEMENTS

The accompanying consolidated financial statements have been prepared in accordance with the provisions set forth in the Japanese Financial Instruments and Exchange Act and its related accounting regulations, and in accordance with accounting principles generally accepted in Japan ("Japanese GAAP"), which are different in certain respects as to the application and disclosure requirements of International Financial Reporting Standards.

In preparing these consolidated financial statements, certain reclassifications and rearrangements have been made to the consolidated financial statements issued domestically in order to present them in a form which is more familiar to readers outside Japan. In addition, certain reclassifications and rearrangements have been made in the 2020 consolidated financial statements to conform them to the classifications and presentations used in 2021.

The consolidated financial statements are stated in Japanese yen, the currency of the country in which Yamato Holdings Co., Ltd. (the "Company") is incorporated and operates. The translations of Japanese yen amounts into U.S. dollar amounts are included solely for the convenience of readers outside Japan and have been made at the rate of ¥110.71 to $1, the approximate rate of exchange at March 31, 2021. Such translations should not be construed as representations that the Japanese yen amounts could be converted into U.S. dollars at that or any other rate.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

1. Consolidation-The consolidated financial statements as of March 31, 2021 and 2020, include the accounts of the Company and its 39 significant subsidiaries (together, the "Group").

Effective from the fiscal year ended March 31, 2021, Yamato Lease Co., Ltd. was excluded from the scope of consolidation due to the partial transfer of shares, and KURONEKO Innovation Fund L.P. was newly established and is included in the scope of consolidation.

Under the control and influence concepts, those companies in which the Company, directly or indirectly, is able to

exercise control over operations are fully consolidated, and those companies over which the Group has the ability to exercise significant influence are accounted for by the equity method.

The unconsolidated subsidiaries, whose combined assets, net sales, profit and retained earnings in the aggregate are not significant to the consolidated financial statements, have not been consolidated with the Company.

There were 23 (19 in 2020) affiliates accounted for by the equity method.

Effective from the fiscal year ended March 31, 2021, Yamato Lease Co., Ltd. was excluded from the scope of consolidation due to the partial transfer of shares and is accounted for by the equity method, and VIVL Pte. Ltd. and two other companies are included in the scope of the equity method due to GDEX BHD., an affiliate accounted for using equity method, newly acquiring their shares. GD EXPRESS CARRIER BHD. has changed the company name to GDEX BHD. on December 17, 2020.

Investments in the unconsolidated subsidiaries and several affiliates not accounted for by equity method are stated at cost, less a valuation allowance representing possible losses on the investments that are deemed to be other than tempo- rary. If the equity method of accounting had been applied to the investments in such companies, the effect on the accompanying consolidated financial statements would not be material.

All significant intercompany balances and transactions have been eliminated in consolidation. All material unrealized profit included in assets resulting from transactions within the Group is also eliminated.

b. Unification of Accounting Policies Applied to Foreign Subsidiaries for the Consolidated Financial Statements- Under Accounting Standards Board of Japan ("ASBJ") Practical Issues Task Force ("PITF") No. 18, "Practical Solution on Unification of Accounting Policies Applied to Foreign Subsidiaries for the Consolidated Financial Statements," the accounting policies and procedures applied to a parent company and its subsidiaries for similar transactions and events under similar circumstances should in principle be unified for the preparation of the consolidated financial statements. However, financial statements prepared by foreign subsidiaries in accordance with either International Financial Reporting Standards or generally accepted accounting principles in the United States of America tentatively may be used for the consolidation process, except for the following items which should be adjusted in the consolidation process so that profit is accounted for in accordance with Japanese GAAP, unless they are not material: (a) amortization of goodwill; (b) scheduled amortization of actuarial gain or loss of pensions that has been recorded in equity through other comprehensive income; (c) expensing capitalized development costs of R&D; (d) cancellation of the fair value model accounting for property, plant and equipment and investment properties and incorporation of the cost model accounting; and (e) recording a gain or loss

FINANCIAL SECTION

through profit or loss on the sale of an investment in an equity instrument for the difference between the acquisition cost and selling price, and recording impairment loss through profit or loss for other-than-temporary declines in the fair value of an investment in an equity instrument, where a foreign subsidiary elects to present in other comprehensive income subsequent changes in the fair value of an investment in an equity instrument.

c. Unification of Accounting Policies Applied to Foreign Affiliated Companies for the Equity Method-ASBJStatement No. 16, "Accounting Standard for Equity Method of Accounting for Investments," requires adjustments to be made to conform the affiliate's accounting policies for similar transactions and events under similar circumstances to those of the parent company when the affiliate's financial statements are used in applying the equity method, unless it is impracticable to determine such adjustments. In addition, financial statements prepared by foreign affiliated companies in accordance with either International Financial Reporting Standards or generally accepted accounting principles in the United States of America tentatively may be used in applying the equity method if the following items are adjusted so that profit is accounted for in accordance with Japanese GAAP, unless they are not material: (a) amortization of goodwill; (b) scheduled amortization of actuarial gain or loss of pensions that has been recorded in equity through other comprehensive income; (c) expensing capitalized development costs of R&D; (d) cancellation of the fair value model accounting for prop- erty, plant and equipment and investment properties and incorporation of the cost model accounting ; and (e) recording a gain or loss through profit or loss on the sale of an investment in an equity instrument for the difference between the acquisition cost and selling price, and recording impairment loss through profit or loss for other-than-temporarydeclines in the fair value of an investment in an equity instrument, where a foreign affiliate elects to present in other comprehensive income subsequent changes in the fair value of an investment in an equity instrument.

d. Recognition of Operating Revenues-The Group recognizes freight charge income as operating revenue at the time when freight has been received from the shipping customer for transportation.

Fees from customers based on installment sales contracts are recognized by the equal installment method.

e. Cash Equivalents-Cash equivalents in the consolidated statement of cash flows are short-term investments that are readily convertible into cash and that are exposed to insignificant risk of changes in value. Cash equivalents in the consolidated statement of cash flows include time deposits, certificates of deposit, and mutual funds investing in bonds that represent short-term investments, all of which mature or become due within three months of the date of acquisition.

The difference between cash and cash equivalents in the accompanying consolidated balance sheet and cash and cash equivalents in the accompanying consolidated statement of cash flows was as follows:

				Thousands of
	Millions of Yen		U.S. Dollars
	2021	2020	2021
Cash and cash equivalents presented in the consolidated balance sheet	¥241,523	¥197,227	$2,181,584
Time deposits due beyond three months	(238)	(564)	(2,152)
Cash and cash equivalents presented in the consolidated statement of cash flows	¥241,285	¥196,663	$2,179,432

f. Inventories-Inventories are stated at the lower of cost determined by the first-in,first-out method or net selling value.

g. Marketable and Investment Securities-Marketable and investment securities are classified and accounted for, depending on management's intent, as follows: (1) trading securities, which are held for the purpose of earning capital gains in near term, are reported at fair value, and the related unrealized gains and losses are included in earnings; (2) held- to-maturity debt securities, for which there is a positive intent and ability to hold to maturity, are reported at amortized cost; and (3) available-for-sale securities, which are not classified as either of the aforementioned securities, are reported at fair value, with unrealized gains and losses, net of applicable taxes, reported in a separate component of equity. The Group had no trading securities at March 31, 2021 and 2020.

Non-marketableavailable-for-sale securities are stated at cost determined by the moving-average method.

For other-than-temporary declines in fair value, investment securities are reduced to net realizable value by a charge to income.

074	YAMATO HOLDINGS CO., LTD.	YAMATO HOLDINGS CO., LTD.	075
Integrated Report 2021	Integrated Report 2021