Application of the Revenue Recognition Accounting Standard and Net Presentation of Revenue

「As a result, the impact on net sales and cost of sales for the first half of the current consolidated cumulative period was minor, while there was no impact on selling, general and administrative expenses, operating profit, ordinary profit, or profit before income taxes and other adjustments for the quarter.」

「The company applied the Accounting Standard for Revenue Recognition (ASBJ Statement No. 29, dated 31 March 2020, hereinafter the "Revenue Recognition Standard") and related standards from the beginning of the first quarter of the current consolidated accounting period. Revenue is recognized at the amount expected to be received in exchange for the promised goods or services when control of those goods or services is transferred to the customer. As a result, for certain transactions, although the company had previously recognized the total consideration received from customers as revenue, for transactions in which the group's role in providing goods or services to customers qualifies as that of an agent, revenue is recognized on a net basis after deducting the amount paid to business partners from the amount received from customers.」