Exhibit 2

FINANCIAL STATEMENTS OF JAPAN INTERNATIONAL COOPERATION AGENCY (“JICA”)

AND REPORTS OF THE INDEPENDENT AUDITOR

 

Index to Financial Statements
General Account
Independent Auditor’s Report			F-2
Balance Sheet (as of March 31, 2026)			F-6
Statement of Administrative Service Operation Cost (April 1, 2025-March 31, 2026)			F-8
Statement of Income (April 1, 2025-March 31, 2026)			F-9
Statement of Changes in Net Assets (April 1, 2025-March 31, 2026)			F-10
Statement of Cash Flows (April 1, 2025-March 31, 2026)			F-11
Basis of Presenting Financial Statements			F-12
Significant Accounting Policies			F-12
Notes to the Financial Statements			F-15
The Accompanying Supplementary Schedules			F-20
Finance and Investment Account
Independent Auditor’s Report			F-44
Balance Sheet (as of March 31, 2026)			F-48
Statement of Administrative Service Operation Cost (April 1, 2025-March 31, 2026)			F-50
Statement of Income (April 1, 2025-March 31, 2026)			F-51
Statement of Changes in Net Assets (April 1, 2025-March 31, 2026)			F-52
Statement of Cash Flows (April 1, 2025-March 31, 2026)			F-53
Basis of Presenting Financial Statements			F-54
Significant Accounting Policies			F-54
Notes to the Financial Statements			F-58
The Accompanying Supplementary Schedules			F-72

 

F-1

Independent Auditor’s Report

Mr. Akihiko Tanaka, President

Japan International Cooperation Agency

The Audit of the Financial Statements

Opinion

We have audited the accompanying financial statements of the general account of Japan International Cooperation Agency (the Agency), which comprise the balance sheet as at March 31, 2026 and the statements of administrative service operation cost, income, changes in net assets, and cash flows for the year then ended, and a summary of significant accounting policies and notes to the financial statements, and the accompanying supplementary schedules (except for the information described based on the financial statements and business reports relating to the associated public interest corporations).

In our opinion, the accompanying financial statements present fairly, in all material respects, the financial position of the general account of the Agency as at March 31, 2026, and its financial performance and its cash flows for the year then ended in accordance with accounting principles for incorporated administrative agencies generally accepted in Japan.

Basis for Opinion

We conducted our audit in accordance with auditing standards for incorporated administrative agencies generally accepted in Japan. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are independent of the Agency in accordance with the ethical requirements that are relevant to our audit of the financial statements in Japan, including those applicable to audits of financial statements of public interest entities, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. The basis includes the fact that no such fraud or error, or illegal acts, of the president, other executive officers or staff members that would result in material misstatement in the financial statements was found, to the extent that we conducted our audit. The audit we conducted is not intended to express an opinion on whether there was any fraud or error, or illegal acts, of the president, other executive officers or staff members, which would not result in material misstatement in the financial statements.

Other Information

The other information comprises the information included in the Annual Report that contains audited financial statements but does not include the financial statements and our auditor’s report thereon. President is responsible for preparation and disclosure of the other information. The Agency Auditor is responsible for overseeing the Agency’s reporting process of the other information.

 

F-2

Our opinion on the financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated.

If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact.

We have nothing to report in this regard.

Responsibilities of President, and the Agency Auditor for the Financial Statements

President is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles for incorporated administrative agencies generally accepted in Japan, and for such internal control as president determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error or illegal acts.

The Agency Auditor is responsible for overseeing the Agency’s financial reporting process.

Auditor’s Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, or illegal acts, and to issue an auditor’s report that includes our opinion. Misstatements can arise from fraud or error, or illegal acts, and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

As part of an audit in accordance with auditing standards for incorporated administrative agencies generally accepted in Japan, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

 

•

Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, or illegal acts, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion.

 

•

Consider internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances for our risk assessments, while the purpose of the audit of the financial statements is not expressing an opinion on the effectiveness of the Agency’s internal control.

 

•

Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by president.

 

•

Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation in accordance with accounting principles for incorporated administrative agencies generally accepted in Japan.

 

F-3

•

Plan and conduct audit with adequate attention being paid to the possibility that any fraud or error, or illegal acts, of the president, other executive officers or staff members may result in material misstatement in the financial statements.

We communicate with the Agency Auditor regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

We also provide the Agency Auditor with a statement that we have complied with the ethical requirements regarding independence that are relevant to our audit of the financial statements in Japan, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, actions taken to eliminate threats or safeguards applied to reduce threats to an acceptable level.

Fee-related Information

The fees for the audits of the financial statements of the Agency and other services provided by us and other EY member firms for the year ended March 31, 2026 are 54 million yen and 394 million yen, respectively.

 

F-4

Interest Required to Be Disclosed by the Certified Public Accountants Act of Japan

Our firm and its designated engagement partners do not have any interest in the Agency which is required to be disclosed pursuant to the provisions of the Certified Public Accountants Act of Japan.

 

Ernst & Young ShinNihon LLC

Tokyo, Japan

September 25, 2026

/s/ Kenji Izawa

Kenji Izawa

Designated Engagement Partner

Certified Public Accountant

/s/ Takuya Kodama

Takuya Kodama

Designated Engagement Partner

Certified Public Accountant

/s/ Hiroshi Nishida

Hiroshi Nishida

Designated Engagement Partner

Certified Public Accountant

 

F-5

Balance Sheet

(as of March 31, 2026)

General Account

 

														(Unit: Yen)
Assets
I  Current assets
Cash and deposits							209,919,892,088
Stored goods			565,079,409
Payments for uncompleted contracted programs			1,855,144,167				2,420,223,576
Advance payments							15,869,091,725
Prepaid expenses							101,550,175
Accrued income							57,327,680
Accounts receivable							2,542,284,569
Contra-accounts for provision for bonuses*							1,558,776,288
Short-term loans for development projects							6,500,000
Suspense payments							76,973,300
Advance paid							15,366,664
Total current assets											232,567,986,065
II  Non-current assets
1 Tangible assets
Buildings			46,332,160,233
Accumulated depreciation			(23,197,592,544)				23,134,567,689
Structures			1,547,169,234
Accumulated depreciation			(1,226,581,867)				320,587,367
Machinery and equipment			264,126,449
Accumulated depreciation			(205,039,769)				59,086,680
Vehicles			2,415,937,570
Accumulated depreciation			(1,770,720,039)				645,217,531
Tools, furniture, and fixtures			2,256,182,929
Accumulated depreciation			(1,373,112,357)				883,070,572
Land			14,177,935,458
Accumulated impairment losses			(8,710,639)				14,169,224,819
Construction in progress							303,226,943
Total tangible assets							39,514,981,601
2 Intangible assets
Trademark rights							2,435,790
Telephone subscription rights							235,200
Software							2,531,347,167
Software in progress							519,864,467
Total intangible assets							3,053,882,624
3 Investments and other assets
Long-term deposits							152,000,000
Long-term loans for development projects							32,500,000
Long-term prepaid expenses							25,839,041
Prepaid pension expenses							5,211,415,559
Contra-accounts for provision for retirement benefits							10,756,107,413
Long-term guarantee deposits							1,621,361,994
Total investment and other assets							17,799,224,007
Total non-current assets											60,368,088,232
Total assets															292,936,074,297

 

F-6

Balance Sheet (Continued)

(as of March 31, 2026)

 

Liabilities
I  Current liabilities
Operational grant liabilities*			46,939,019,949
Funds for grant aid			123,627,900,126
Donations received*			588,976,319
Accounts payable			46,131,813,381
Accrued expenses			240,529,937
Lease obligations			54,781,350
Advance payments received			2,197,343,331
Deposits received			163,232,761
Unearned revenue			403,700
Provision for bonuses			1,558,776,288
Total current liabilities							221,502,777,142
II  Non-current liabilities
Contra-accounts for assets*			8,148,466,400
Long-term lease obligations			75,799,738
Provision for retirement benefits			10,756,107,413
Assets retirement obligations			400,758,930
Total non-current liabilities							19,381,132,481
Total liabilities											240,883,909,623
Net assets
I  Capital
Government investment			61,152,034,684
Total capital							61,152,034,684
II  Capital surplus
Capital surplus			13,380,355,439
Accumulated other administrative service operation costs*
Accumulated depreciation not included in expenses*			(22,627,016,047)
Accumulated impairment losses not included in expenses*			(8,710,639)
Accumulated interest expenses not included in expenses*			(6,889,486)
Accumulated disposal and sale differential not included in expenses*			(14,378,811,266)
Total capital surplus							(23,641,071,999)
III  Retained earnings
Reserve fund carried over from the previous Mid-term Objective period*			1,763,059,806
Reserve fund			8,389,965,034
Unappropriated income for the current fiscal year			4,388,177,149
(Total income for the current fiscal year)			( 4,388,177,149	)
Total retained earnings							14,541,201,989
Total net assets											52,052,164,674
Total liabilities and net assets											292,936,074,297

*	Accounts prepared in accordance with special accounting practices of incorporated administrative agencies.

 

F-7

Statement of Administrative Service Operation Cost

(April 1, 2025-March 31, 2026)

General Account

 

								(Unit: Yen)
I		Expenses in the statement of income
		Operating expenses			292,969,664,496
		General administrative expenses			5,049,670,768
		Miscellaneous losses			39,702,388
		Extraordinary losses			47,277,325
		Total expenses in the statement of income							298,106,314,977
II		Other administrative service operation costs
		Depreciation not included in expenses*			462,696,698
		Interest expenses not included in expenses*			(54,866	)
		Disposal and sale differential not included in expenses*			1,296,373,085
		Total other administrative service operation costs							1,759,014,917
III		Administrative service operation cost							299,865,329,894

* Accounts prepared in accordance with special accounting practices of incorporated administrative agencies.

 

F-8

Statement of Income

(April 1, 2025-March 31, 2026)

General Account

 

										(Unit: Yen)
Ordinary expenses
Operating expenses
Expenses for priority sectors and regions			90,286,190,541
Expenses for JICA Development Studies			5,573,230,415
Expenses for private sector partnership			2,797,651,321
Expenses for domestic partnership and acceptance of foreign human resources			19,744,260,881
Expenses for strengthen foundations for operational implementation			4,064,388,293
Expenses for indirect operations			45,141,659,138
Expenses for grant aid			123,675,166,624
Expenses for facilities			175,898,726
Expenses for contracted programs			6,210,267
Expenses for donation projects			171,222,681
Depreciation			1,333,785,609				292,969,664,496
General administrative expenses							5,049,670,768
Miscellaneous losses							39,702,388
Total ordinary expenses											298,059,037,652
Ordinary revenues
Revenues from operational grants*							173,553,837,557
Revenues from grant aid							123,675,166,624
Revenues from contracted programs
Revenues from contracted programs from Japanese government and local governments			6,046,194
Revenues from contracted programs from other entities			168,670				6,214,864
Revenues from development projects							100,724
Revenues from subsidy for facilities*							175,898,726
Donations*							171,222,681
Revenues from contra-accounts for provision for bonuses*							1,558,776,288
Revenues from contra-accounts for provision for retirement benefits*							(2,146,965,846	)
Reversal of contra-accounts for assets*							1,519,710,198
Financial revenues
Interest income			420,940,496
Foreign exchange gains			155,612,825				576,553,321
Miscellaneous income							1,679,794,284
Total ordinary revenues											300,770,309,421
Ordinary income											2,711,271,769
Extraordinary losses
Loss on disposal of non-current assets							45,913,653
Loss on sales of non-current assets							1,363,672				47,277,325
Extraordinary income
Reversal of contra-accounts for assets*							43,356,355
Gain on sales of non-current assets							38,221,096				81,577,451
Net income											2,745,571,895
Reversal of reserve fund carried over from the previous Mid-term Objective period*											1,642,605,254
Total income for the current fiscal year											4,388,177,149

* Accounts prepared in accordance with special accounting practices of incorporated administrative agencies.

 

F-9

Statement of Changes in Net Assets

(April 1, 2025-March 31, 2026)

 

General Account								(Unit: Yen)

 

		I  Capital								II  Capital surplus																								III  Retained earnings (Loss carried forward )
		Government investment				Total capital				Capital surplus				Accumulated other administrative service operation cost																Total capital surplus				Reserve fund carried over from the previous Mid-term Objective period				Reserve fund												Total retained earnings (Loss carried forward)				Total net assets
														Accumulated depreciation not included in expenses				Accumulated impairment losses not included in expenses				Accumulated interest expenses not included in expenses				Accumulated disposal and sale differential not included in expenses																Unappropriated income for the current fiscal year (Unappropriated loss for the current fiscal year)				Total income for the current fiscal year (Total loss for the current fiscal year)
Balance at the beginning of the fiscal year			61,152,034,684				61,152,034,684				12,073,562,977				(22,164,319,349	)			(8,710,639	)			(6,944,352	)			(13,082,438,181	)			(23,188,849,544	)			3,405,665,060				7,330,136,398				1,059,828,636								11,795,630,094				49,758,815,234
Changes during the period
I   Changes in capital during the period
II   Changes in capital surplus during the period
Purchase of non-current assets											1,306,792,462																				1,306,792,462																								1,306,792,462
Sale and retirement of non-current assets															727,489,904												(1,296,373,085	)			(568,883,181	)																							(568,883,181	)
Depreciation															(1,190,186,602	)															(1,190,186,602	)																							(1,190,186,602	)
Increase in asset retirement obligations due to passage of time																							54,866								54,866																								54,866
III Changes in retained earnings (loss carried forward) during the period
(1)   Appropriation of income or loss
Increase in reserve fund derived from profit appropriation																																							1,059,828,636				(1,059,828,636	)							—				—
(2)   Others
Net income (Net loss)																																											2,745,571,895				2,745,571,895				2,745,571,895				2,745,571,895
Reversal of reserve fund carried over from the previous Mid-term Objective period																																			(1,642,605,254	)							1,642,605,254				1,642,605,254				—				—
Total changes during the period			—				—				1,306,792,462				(462,696,698	)			—				54,866				(1,296,373,085	)			(452,222,455	)			(1,642,605,254	)			1,059,828,636				3,328,348,513				4,388,177,149				2,745,571,895				2,293,349,440
Balance at the end of the fiscal year			61,152,034,684				61,152,034,684				13,380,355,439				(22,627,016,047	)			(8,710,639	)			(6,889,486	)			(14,378,811,266	)			(23,641,071,999	)			1,763,059,806				8,389,965,034				4,388,177,149				4,388,177,149				14,541,201,989				52,052,164,674

 

F-10

Statement of Cash Flows

(April 1, 2025-March 31, 2026)

General Account

 

		(Unit: Yen)
I. Cash flows from operating activities
Payments of operating expenses			(160,654,289,290	)
Payments for grant aid			(112,100,850,112	)
Payments of personnel expenses			(17,050,820,934	)
Payments for contracted programs			(855,186,504	)
Payments for other operations			(904,182,762	)
Proceeds from operational grants			156,051,951,000
Proceeds from grant aid			116,874,214,070
Proceeds from contracted programs			689,749,884
Proceeds from interest on loans			110,252
Proceeds from donations			317,572,146
Proceeds from other operations			2,551,298,328
Subtotal			(15,080,433,922	)
Interest income received			420,436,390
Net cash used in operating activities			(14,659,997,532	)
II. Cash flows from investing activities
Payments for purchase of non-current assets			(2,961,310,728	)
Proceeds from sales of non-current assets			45,508,309
Proceeds from subsidy for facilities			2,052,347,577
Proceeds from collection of loans			6,500,000
Payments into time deposits			(629,250,000,000	)
Proceeds from time deposit refund			634,300,000,000
Payments for purchase of negotiable deposits			(135,700,000,000	)
Proceeds from refund of negotiable deposits			135,700,000,000
Net cash used in investing activities			4,193,045,158
III. Cash flows from financing activities
Repayments of lease obligations			(55,584,886	)
Net cash used in financing activities			(55,584,886	)
IV. Effect of exchange rate changes on funds			271,981,479
V.  Net increase (decrease) in funds			(10,250,555,781	)
VI. Funds at the beginning of the fiscal year			206,370,447,869
VII. Funds at the end of the fiscal year			196,119,892,088

 

F-11

Basis of Presenting Financial Statements

The Japan International Cooperation Agency (the “JICA”) was established in October 2003 pursuant to the Act on General Rules for Incorporated Administrative Agencies and the Act of the Incorporated Administrative Agency—Japan International Cooperation Agency. The fiscal year end of JICA is March 31. The accompanying financial statements of JICA as of March 31, 2026 have been prepared in accordance with accounting principles for incorporated administrative agencies generally accepted in Japan. These principles differ in many respects from the application and disclosure requirements of the accounting principles for business enterprises generally accepted in Japan. JICA’s operations are separated into two accounts for accounting purposes pursuant to Article 17 of the Act of the Incorporated Administrative Agency—Japan International Cooperation Agency (the “JICA Act”): (a) a General Account, which is largely funded by management grants from the Japanese government, and (b) a Finance and Investment Account, which is funded through capital contributions and borrowings from the Japanese government, bonds issued to investors and interest and revenues generated by JICA from loans disbursed. The financial statements are stated in Japanese yen, the currency of the country in which JICA is incorporated and operates.

Significant Accounting Policies

General Account

1. Revenue recognition method of operational grants

Revenue from operational grants is recognized in profit or loss on a systematic basis over the periods in which JICA recognizes based on the level of operational achievement.

The term-based revenue recognition method is applied for administrative operations except for the operations which have been specified as having a direct correlation between the operational achievement and operational grants.

Due to the difficulty to estimate the budget and terms, as well as to specify a correlation between the operational achievement and operational grants, the revenue from disaster relief operations, which are relief operations for unexpected disasters during the period, therefore it is recognized as the related expenses when incurred.

2. Depreciation method

(1) Tangible assets (except for lease assets)

Straight-line method

The useful lives of major assets are as follows:

 

 

F-12

The estimated depreciation costs for specific depreciable assets (Accounting Standards for Incorporated Administrative Agencies No. 87) and specific removal costs, etc., associated with asset retirement obligations (Accounting Standards for Incorporated Administrative Agencies No. 91) are indirectly deducted from capital surplus and reported as accumulated depreciation not included in expenses.

(2) Intangible assets (except for lease assets)

Straight-line method

Software used by JICA is depreciated over its useful life (5 years).

(3) Leased assets

Leased assets are depreciated by the straight-line method over the lease term. Depreciation for leased assets is calculated with zero residual value being assigned to the asset.

3. Provision for bonuses

Provision for bonuses is calculated and provided for based on estimated amounts of future payments attributable to the services that have been rendered by officers and employees applicable to the current fiscal year. Contra-accounts for provision for bonuses are equally accrued since the financial source is secured by operational grants.

4. Provision for retirement benefits

Provision for retirement benefits is calculated and provided for based on estimated amounts of future payments attributable to the retirement of employees. It is accrued in line with the retirement benefit obligations and estimated plan assets applicable to the fiscal year ended March 31, 2026. If the estimated plan assets exceed the estimated retirement benefit obligations, the excess is recorded as prepaid pension expenses. In calculating the retirement benefit obligations, the estimated amount of retirement benefit payments is attributed to the period based on the straight-line basis. The profit and loss appropriation method for actuarial differences and past service costs is as follows:

Actuarial differences are recognized as a lump-sum gain or loss in the fiscal year in which they occur.

Past service costs are recognized as a lump-sum gain or loss in the fiscal year in which they occur.

The financial source for lump-sum severance indemnities is secured by operational grants. The estimated amount of retirement benefits is reported as Provision for retirement benefits and Contra-accounts for provision for retirement benefits. Therefore, an equal amount is recorded for both accounts. The financial source for defined benefit corporate pension plan contributions and reserve shortfall is secured by operational grants. Therefore, an equal amount of Provision for retirement benefits is accrued as Contra-accounts for provision for retirement benefits.

 

F-13

5. Basis and standard for the accrual of allowance and loss contingencies

Allowance for loan losses

To provide for loan losses, JICA records the estimated amount of default as an allowance, taking into account the transition rate to delinquent loans for the ordinary loans. For doubtful loans, collectability is taken into consideration individually and the estimated amount of default is recorded as an allowance.

6. Standard and method for the valuation of inventories

Stored goods

Stored goods valuation is based on the lower of cost or market using the first-in, first-out (FIFO) method.

7. Translation standard for foreign currency-denominated assets and liabilities into yen

Foreign currency monetary claims and liabilities are translated into Japanese yen at the spot exchange rate at the balance sheet date. Exchange differences are recognized in profit or loss.

8. Accounting treatment for consumption taxes

Consumption taxes and local consumption taxes are included in transaction amounts.

9. Accounting principles and procedures to be adopted in cases where the accounting treatment is not clearly defined in the relevant accounting standards

Accounting treatment for grant aid

Funds received from the Japanese government for grant aid are recorded as Funds for grant aid in current liabilities at the time of receipt.

Subsequently, when funds are granted to the government of the recipient countries, in accordance with their purposes, they are recorded in operating expenses as Expenses for grant aid. The same amount is transferred from current liabilities to Revenues from grant aid in ordinary income.

 

F-14

Notes to the financial statements

General Account

(Balance Sheet)

1.	Donated funds for grant aid

Grant aid is received in the form of donated funds from the government of Japan. JICA administers this grant aid based on grant agreements with the government of the recipient country. At the end of the fiscal year 2025, the outstanding balance of unexecuted grant agreements stood at ¥270,969,057,460.

 

2.	Assets acquired through the investment from the government to Incorporated Administrative Agency

Of accumulated other administrative service operation cost, the amount of assets acquired through the investment from the government is ¥26,404,712,271.

(Statement of Administrative Service Operation Cost)

1.	Cost being borne by the public for the operation of Incorporated Administrative Agency

 

Administrative service operation cost			¥299,865,329,894
Self-revenues, etc.			¥(2,472,106,970)
Opportunity cost			¥886,301,625
Cost being borne by the public for the operation of Incorporated Administrative Agency			¥298,279,524,549

 

2.	Method for computing opportunity cost

(1) Interest rate used to compute opportunity cost concerning government investment

2.345% with reference to the yield of 10-year fixed-rate Japanese government bonds at March 31, 2026.

(2) Method for computing opportunity cost for public officers temporarily transferred to JICA

Of the estimated increase in retirement allowance during service rendered in JICA, costs are calculated in accordance with JICA’s internal rules.

(Statement of Cash Flows)

The funds shown in the statement of cash flows consist of cash, deposit accounts, and checking accounts.

 

1.	Breakdown of balance sheet items and ending balance of funds

(as of March 31, 2026)

 

Cash and deposits			¥209,919,892,088
Time deposits			¥(13,800,000,000)
Ending balance of funds			¥196,119,892,088

 

F-15

2. Description of significant non-cash transactions

(1) Assets acquired under finance leases

 

Tools, furniture, and fixtures		¥	68,060,986

(Financial Instruments)

1. Status of financial instruments

The General Account’s fund management is limited to short-term deposits and public and corporate bonds while fund-raising consists mainly of operational grants approved by the competent minister. The General Account does not borrow from the government fund for Fiscal Investment and Loan Program (FILP), nor does it borrow funds from financial institutions or issue FILP Agency Bonds.

2. Fair value of financial instruments

Cash is excluded from the note, as well as Deposits and Accounts payable because they are settled in a short period, and thus their fair value approximates their carrying amount.

(Retirement benefits)

1. Overview of retirement benefit plans

To provide retirement benefits for employees, JICA has a defined benefit pension plan comprised of a defined benefit corporate pension plan and a lump-sum severance indemnity plan, and a defined contribution plan comprised of a defined contribution pension plan.

2. Defined benefit pension plan

(1) The changes in the retirement benefit obligation are as follows:

 

		(Unit: Yen)
Retirement benefit obligation at the beginning of the fiscal year			22,114,355,374
Current service cost			884,834,530
Interest cost			192,163,026
Actuarial differences			(4,339,063,577	)
Retirement benefit paid			(1,086,132,281	)
Past service cost			0
Contribution by employees			58,664,430
Retirement benefit obligation at the end of the fiscal year			17,824,821,502

(2) The changes in the plan assets are as follows:

 

		(Unit: Yen)
Plan assets at the beginning of the fiscal year			11,080,853,561
Expected return on plan assets			221,617,072
Actuarial differences			933,652,427
Contribution by JICA			394,326,903
Retirement benefit paid			(408,984,745	)
Contribution by employees			58,664,430
Plan assets at the end of the fiscal year			12,280,129,648

 

F-16

(3) Reconciliation of the retirement benefit obligations and plan assets and provision for retirement benefits and prepaid pension expenses in the balance sheets

 

		(Unit: Yen)
Funded retirement benefit obligation			7,068,714,089
Plan assets			(12,280,129,648	)
Unfunded benefit obligations of funded pension plan			(5,211,415,559	)
Unfunded benefit obligations of unfunded pension plan			10,756,107,413
Subtotal			5,544,691,854
Unrecognized actuarial differences			0
Unrecognized past service cost			0
Net amount of assets and liabilities in the balance sheets			5,544,691,854
Provision for retirement benefits			10,756,107,413
Prepaid pension expenses			5,211,415,559
Net amount of assets and liabilities in the balance sheets			5,544,691,854

(4) Components of retirement benefit expenses

 

		(Unit: Yen)
Current service cost			884,834,530
Interest cost			192,163,026
Expected return on plan assets			(221,617,072	)
Realized actuarial differences			(5,272,716,004	)
Amortization of past service cost			0
Extraordinary additional retirement payments			0
Total			(4,417,335,520	)

(5) Major components of plan assets

Percentages of components to the total are as follows:

 

Bonds			41	%
Stocks			36	%
General account of life insurance company			4	%
Others			19	%
Total			100	%

 

F-17

(6) Method of determining the long-term expected rate of return on plan assets

The long-term expected rate of return on plan assets is determined based on components of plan assets, the actual historical returns, and market condition and other factors.

(7) Assumptions used

Principal assumptions used in actuarial calculations at the end of the fiscal year

 

Discount rate		Defined benefit corporate pension plan			2.74	%
		Retirement benefits			2.48	%
Long-term expected rate of return on plan assets					2.00	%

3. Defined contribution plan

The amount of contribution required to be made to the defined contribution plan is ¥45,016,479.

(Lease transactions)

1. Future minimum lease payments related to operating lease transactions

 

Future minimum lease payments due within one year of the balance sheet date			¥6,218,968
Future minimum lease payments corresponding to periods more than one year from the balance sheet date			¥3,851,636

2. The impact of the finance lease transactions on the profit or loss in the current fiscal year was ¥5,777,797. Total income for the current fiscal year after the deduction of this amount was ¥4,382,399,352.

(Asset retirement obligations)

1. Overview of asset retirement obligations

In accordance with a building lease agreement, JICA has the obligation to restore the head office building to its original state. Restoration costs are reasonably estimated and recognized as asset retirement obligations.

2. Amount and calculation method of asset retirement obligations

The estimate for the asset retirement obligations assumes a five-year lease period for the projected period of use and a discount rate between (0.048)% and 0.529%.

3. Changes in the total amount of asset retirement obligations in the current fiscal year

 

		(Unit: Yen)
Balance at the beginning of the fiscal year			400,813,796
Increase related to acquisition of tangible assets			0
Adjustment resulting from passage of time			(54,866)
Decrease due to settlement of asset retirement obligations			0
Balance at the end of the fiscal year			400,758,930

 

F-18

(Significant contractual liabilities)

The amount of Significant contractual liabilities that plan to pay from the following fiscal year is ¥3,785,926,320.

(Significant subsequent events)

Not applicable.

 

F-19

The Accompanying Supplementary Schedules

General Account

 

(1)

Details of acquisition and disposal of non-current assets, depreciation (including depreciation not included in expenses, in accordance with “No. 87, Accounting for the Depreciation of Specific Depreciable Assets” and “No. 91, Accounting for Specific Removal Costs, etc., associated with Asset Retirement Obligations”), and accumulated impairment losses

 

(Unit: Yen)
Type				Balance at the  beginning of the  period				Increase during the period				Decrease during the period				Balance at the end of the period				Accumulated depreciation								Accumulated impairment losses								Net assets at the end of the period				Remarks
																								Depreciation during the period								Impairment losses  during the period
Tangible assets (Depreciation included in expenses)		Buildings			4,510,835,014				120,267,211				23,167,455				4,607,934,770				1,898,985,617				272,761,302				0				0				2,708,949,153
		Structures			225,314,598				0				530,033				224,784,565				146,941,304				12,939,055				0				0				77,843,261
		Machinery and equipment			204,206,938				11,936,407				2,717,874				213,425,471				159,695,554				15,193,054				0				0				53,729,917
		Vehicles			2,432,356,278				169,385,582				188,793,017				2,412,948,843				1,768,030,185				135,059,795				0				0				644,918,658
		Tools, furniture, and fixtures			1,852,813,924				129,915,843				71,354,519				1,911,375,248				1,209,554,952				169,522,503				0				0				701,820,296
		Total			9,225,526,752				431,505,043				286,562,898				9,370,468,897				5,183,207,612				605,475,709				0				0				4,187,261,285
Tangible assets (Depreciation not included in expenses)		Buildings			41,713,715,902				1,302,340,009				1,291,830,448				41,724,225,463				21,298,606,927				1,176,072,910				0				0				20,425,618,536
		Structures			1,318,174,766				4,452,453				242,550				1,322,384,669				1,079,640,563				13,800,967				0				0				242,744,106
		Machinery and equipment			51,331,975				0				630,997				50,700,978				45,344,215				312,725				0				0				5,356,763
		Vehicles			2,988,727				0				0				2,988,727				2,689,854				0				0				0				298,873
		Tools, furniture, and fixtures			348,373,871				0				3,566,190				344,807,681				163,557,405				0				0				0				181,250,276
		Total			43,434,585,241				1,306,792,462				1,296,270,185				43,445,107,518				22,589,838,964				1,190,186,602				0				0				20,855,268,554
Tangible assets (Non-depreciable assets)		Land			14,177,935,458				0				0				14,177,935,458				0				0				8,710,639				0				14,169,224,819
		Construction in progress			443,556,443				149,394,110				289,723,610				303,226,943				0				0				0				0				303,226,943
		Total			14,621,491,901				149,394,110				289,723,610				14,481,162,401				0				0				8,710,639				0				14,472,451,762
Total tangible assets		Buildings			46,224,550,916				1,422,607,220				1,314,997,903				46,332,160,233				23,197,592,544				1,448,834,212				0				0				23,134,567,689
		Structures			1,543,489,364				4,452,453				772,583				1,547,169,234				1,226,581,867				26,740,022				0				0				320,587,367
		Machinery and equipment			255,538,913				11,936,407				3,348,871				264,126,449				205,039,769				15,505,779				0				0				59,086,680
		Vehicles			2,435,345,005				169,385,582				188,793,017				2,415,937,570				1,770,720,039				135,059,795				0				0				645,217,531
		Tools, furniture, and fixtures			2,201,187,795				129,915,843				74,920,709				2,256,182,929				1,373,112,357				169,522,503				0				0				883,070,572
		Land			14,177,935,458				0				0				14,177,935,458				0				0				8,710,639				0				14,169,224,819
		Construction in progress			443,556,443				149,394,110				289,723,610				303,226,943				0				0				0				0				303,226,943
		Total			67,281,603,894				1,887,691,615				1,872,556,693				67,296,738,816				27,773,046,576				1,795,662,311				8,710,639				0				39,514,981,601
Intangible assets (Depreciation included in expenses)		Trademark rights			11,290,558				0				0				11,290,558				8,854,768				384,599				0				0				2,435,790
		Software			6,773,017,267				1,127,786,267				175,940,566				7,724,862,968				5,193,515,801				727,925,301				0				0				2,531,347,167
		Total			6,784,307,825				1,127,786,267				175,940,566				7,736,153,526				5,202,370,569				728,309,900				0				0				2,533,782,957
Intangible assets (Depreciation not included in expenses)		Trademark rights			1,139,550				0				0				1,139,550				1,139,550				0				0				0				0
		Total			1,139,550				0				0				1,139,550				1,139,550				0				0				0				0
Intangible assets (Non-depreciable assets)		Telephone subscription rights			338,100				0				102,900				235,200				0				0				0				0				235,200
		Software in progress			946,477,464				427,536,979				854,149,976				519,864,467				0				0				0				0				519,864,467
		Total			946,815,564				427,536,979				854,252,876				520,099,667				0				0				0				0				520,099,667
Total intangible assets		Trademark rights			12,430,108				0				0				12,430,108				9,994,318				384,599				0				0				2,435,790
		Telephone subscription rights			338,100				0				102,900				235,200				0				0				0				0				235,200
		Software			6,773,017,267				1,127,786,267				175,940,566				7,724,862,968				5,193,515,801				727,925,301				0				0				2,531,347,167
		Software in progress			946,477,464				427,536,979				854,149,976				519,864,467				0				0				0				0				519,864,467
		Total			7,732,262,939				1,555,323,246				1,030,193,442				8,257,392,743				5,203,510,119				728,309,900				0				0				3,053,882,624
		Long-term deposits			2,000,000				150,000,000				0				152,000,000				0				0				0				0				152,000,000
Investments and other assets		Long-term loans for development projects			39,000,000				0				6,500,000				32,500,000				0				0				0				0				32,500,000
		Long-term prepaid expenses			93,874				61,855,877				36,110,710				25,839,041				0				0				0				0				25,839,041
		Expected amount to be granted from the national budget			443,520				0				443,520				0				0				0				0				0				0
		Long-term guarantee deposits			1,595,066,012				84,933,298				58,637,316				1,621,361,994				0				0				0				0				1,621,361,994
		Prepaid pension expenses			2,439,400,446				2,772,015,113				0				5,211,415,559				0				0				0				0				5,211,415,559
		Contra-accounts for provision for retirement benefits			13,472,902,259				(2,039,647,310	)			677,147,536				10,756,107,413				0				0				0				0				10,756,107,413
		Total			17,548,906,111				1,029,156,978				778,839,082				17,799,224,007				0				0				0				0				17,799,224,007

(Note) Contra-accounts for provision for retirement benefits is described in No. 4 of Significant Accounting Policies.

 

F-20