ANNUAL REPORT 2011 for the year ended March 31, 2011

Notes To Consolidated Financial Statements

Credit Saison Co., Ltd. and Consolidated Subsidiaries
For the Years Ended March 31, 2011 and 2010

23. Segment Information

For the years ended March 31, 2011 and 2010

In March 2008, the ASBJ revised ASBJ Statement No. 17 "Accounting Standard for Segment Information Disclosures" and issued ASBJ Guidance No. 20 "Guidance on Accounting Standard for Segment Information Disclosures." Under the standard and guidance, an entity is required to report financial and descriptive information about its reportable segments. Reportable segments are operating segments or aggregations of operating segments that meet specified criteria. Operating segments are components of an entity about which separate financial information is available and such information is evaluated regularly by the chief operating decision maker in deciding how to allocate resources and in assessing performance. Generally, segment information is required to be reported on the same basis as is used internally for evaluating operating segment performance and deciding how to allocate resources to operating segments. This accounting standard and the guidance are applicable to segment information disclosures for the fiscal years beginning on or after April 1, 2010.

The segment information for the year ended March 31, 2010 under the revised accounting standard is also disclosed hereunder as required.

(A) Description of Reportable Segments

The Companies' reportable segments are those for which separate financial information is available and regular evaluations by the Board of Directors meeting are being performed in order to decide how resources are allocated among the Companies.

The Companies conduct business activities directly with customers based on the services they segment by market and target customer. Accordingly, Credit Service Business, Lease Business, Finance Business, Real Estate Related Business and Entertainment Business comprise the Companies' reporting segments.

The Credit Service Business segment consists of the Companies' core credit card business and various peripheral businesses closely linked with the credit card business.

The Lease Business segment consists mainly of the leasing of office equipment and other assets.

The Finance Business segment consists of the credit guarantee business and other finance-related businesses.

The Real Estate Related Business segment consists of the real estate business, real estate lease business and other businesses.

The Entertainment Business segment consists of amusement businesses mainly indoor recreation facilities.

(B) Methods of Measurement For The Amounts of Operating Revenues, Profit(Loss), Assets, And Other Items For Each Reportable Segment

The accounting policies of each reportable segment are consistent to those disclosed in Note 2, "Summary of Significant Accounting Policies."

(C) Information About Operating Revenues, Profit(Loss), Assets, And Other Items Is As Follows:


Year ended
March 31, 2011
Reportable segment
Millions of yen
Operating revenues Total Segment
profit
(loss)
Segment
assets
Depreciation Financial
cost
Credit
cost
Investment
in equity
method-affiliated
companies
Increase in
property,
plant and
equipment
and intangible
assets
Outside
customers
Inter
segment
Credit service ¥229,925 ¥ 948 ¥230,873 ¥15,973 ¥1,493,232 ¥11,575 ¥13,953 ¥56,577 ¥24,785 ¥31,261
Lease 14,437 14 14,451 5,038 241,474 226 2,957 3,569 - 300
Finance 15,305 275 15,580 6,796 121,795 255 1,220 4,108 - 133
Real Estate related 12,118 204 12,322 (2,182) 365,522 787 4,679 1,976 - 2,797
Entertainment 13,928 12 13,940 1,737 20,097 2,978 44 - - 3,576
Total 285,713 1,453 287,166 27,362 2,242,120 15,821 22,853 66,230 24,785 38,067
Reconciliations - (1,453) (1,453) 15 (10,873) (4) (276) (12) - -
Consolidated ¥285,713 ¥ - ¥285,713 ¥27,377 ¥2,231,247 ¥15,817 ¥22,577 ¥66,218 ¥24,785 ¥38,067

Year ended
March 31, 2010
Reportable segment
Millions of yen
Operating revenues Total Segment
profit
(loss)
Segment
assets
Depreciation Financial
cost
Credit
cost
Investment
in equity
method-affiliated
companies
Increase in
property,
plant and
equipment
and intangible
assets
Outside
customers
Inter
segment
Credit service ¥249,243 ¥ 932 ¥250,175 ¥25,627 ¥1,652,535 ¥13,077 ¥14,350 ¥57,520 ¥22,291 ¥28,487
Lease 12,572 2 12,574 2,128 227,654 214 3,271 5,005 - 84
Finance 16,330 498 16,829 5,011 106,971 335 1,936 5,701 - 168
Real Estate related 14,073 948 15,021 1,825 380,172 521 5,064 (787) - 13,569
Entertainment 14,638 11 14,648 1,730 18,610 2,996 53 - - 3,229
Total 306,856 2,391 309,247 36,321 2,385,942 17,143 24,674 67,439 22,291 45,528
Reconciliations - (2,391) (2,391) (148) (11,812) (3) (297) (59) - -
Consolidated ¥306,856 ¥ - ¥306,856 ¥36,173 ¥2,374,130 ¥17,140 ¥24,377 ¥67,380 ¥22,291 ¥45,528

Year ended
March 31, 2011
Reportable segment
Thousands of U.S. dollars
Operating revenues Segment
profit
(loss)
Segment
assets
Depreciation Financial
cost
Credit
cost
Investment
in equity
method-affiliated
companies
Increase in
property,
plant and
equipment
and intangible
assets
Outside
customers
Inter
segment
Total
Credit service $2,765,187 $11,396 $2,776,583 $192,096 $17,958,288 $139,203 $167,802 $680,418 $298,081 $375,957
Lease 173,629 164 173,793 60,586 2,904,075 2,718 35,562 42,921 - 3,608
Finance 184,071 3,313 187,384 81,735 1,464,765 3,071 14,670 49,403 - 1,604
Real Estate related 145,732 2,459 148,191 (26,241) 4,395,935 9,468 56,273 23,769 - 33,644
Entertainment 167,493 148 167,641 20,891 241,698 35,811 529 0 - 43,000
Total 3,436,112 17,480 3,453,592 329,067 26,964,761 190,271 274,836 796,511 298,081 457,813
Reconciliations - (17,480) (17,480) 184 (130,764) (44) (3,313) (145) - -
Consolidated $3,436,112 $ - $3,436,112 $329,251 $26,833,997 $190,227 $271,523 $796,366 $298,081 $457,813

Related Information

(A) Information About Products And Services

Years ended March 31, 2011 and 2010 is as follows:
The Company omitted this disclosure because the information is similar to the information disclosed under the segment information.

(B) Information About Geographic Region

i. Operating Revenues

Years ended March 31, 2011 and 2010 is as follows:
The Company omitted this disclosure because operating revenues to external customers within Japan account for more than 90% of operating revenues reported in the consolidated statements of income.

ii. Tangible Property and Equipment

The Company omitted this disclosure because property and equipment within Japan account for more than 90% of the property and equipment reported in the consolidated balance sheets.

(C) Information About Major Customer

Years ended March 31, 2011 and 2010 is as follows:
The Company omitted this disclosure because no operating revenues to any specific external customer represents 10% or more of operating revenues reported in the consolidated statements of income.

Information Regarding Impairment Loss On Property And Equipment

Years ended March 31, 2011 and 2010 is as follows:


  Millions of yen   Thousands of
U.S. dollars
2011 2010   2011
Loss on
impairment
Loss on
impairment
  Loss on
impairment
Credit service ¥ - ¥ -   $ -
Lease - -   -
Finance - -   -
Real Estate related 88 29   1,056
Entertainment 68 236   823
Total 156 265   1,879
Reconciliations - -   -
Consolidated ¥156 ¥265   $1,879

Information Regarding Amortization of Goodwill And Unamortized Balance of Goodwill

Years ended March 31, 2011 and 2010 is as follows:
There was no significant amortization of goodwill or unamortized balance of goodwill.

Information Regarding Gains Arising From Negative Goodwill

Years ended March 31, 2011 and 2010 is as follows:
There were no significant gains from negative goodwill.

For the year ended March 31, 2010

Business Segments

Segment information by business segment for the year ended March 31, 2010 is as follows:

Year ended March 31, 2010 Millions of yen
Operating revenues Operating
expenses
Operating
income
Assets Depreciation Loss on
impairment
Capital
expenditures
Outside
customers
Inter
segment
Total
Credit service ¥244,188 ¥ 932 ¥245,120 ¥217,405 ¥27,715 ¥1,503,255 ¥12,837 ¥ - ¥28,102
Finance 31,882 500 32,382 24,270 8,112 341,352 439 - 220
Real Estate related 14,073 948 15,021 13,197 1,824 379,181 517 29 13,569
Entertainment 14,638 11 14,649 12,919 1,730 18,358 2,996 236 3,229
Other 2,075 - 2,075 530 1,545 1,606 15 - -
Total 306,856 2,391 309,247 268,321 40,926 2,243,752 16,804 265 45,120
Eliminations or corporate - (2,391) (2,391) 2,362 (4,753) 130,378 336 - 408
Consolidated ¥306,856 ¥ - ¥306,856 ¥270,683 ¥36,173 ¥2,374,130 ¥17,140 ¥265 ¥45,528
Note:
  1. Business segments are defined in consideration of the operations of the Companies.
  2. Significant operations of each segment are as summarized below.
    • (a) Credit service: credit cards and collection of receivables
    • (b) Finance: guarantees, loans and equipment leasing
    • (c) Real estate related: real estate and rental
    • (d) Entertainment: amusement
    • (e) Other: insurance agency business
  3. Significant components of "eliminations or corporate" are as follows:
  Millions of yen
2010
Non-allocatable operating expenses ¥ 4,606
Corporate assets 142,190

Non-allocable operating expenses include administrative expenses incurred by the management control department of the Company.

Corporate assets include surplus funds, long-term investments (investment securities) and assets used by the management control department of the Company.


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