Consolidated Statements of Changes in Net Assets Millions of yen Thousands of U.S. dollars (Note 6) Years ended December 31, 2012 2011 2012 Shareholders’ equity Common stock Balance at beginning of the year .................................................................................................................... \ 20,886 \ 20,886 $ 241,238 Changes during the year: Total changes during the year................................................................................................................... . . . Balance at end of the year .................................................................................................................................. \ 20,886 \ 20,886 $ 241,238 Capital surplus Balance at beginning of the year .................................................................................................................... \ 16,797 \ 15,088 $ 194,006 Changes during the year: Gain on sales of treasury stock ......................................................................................................................... (0) 1 (1) Changes of share exchanges ............................................................................................................................. . 1,706 . Total changes during the year................................................................................................................... (0) 1,708 (1) Balance at end of the year .................................................................................................................................. \ 16,796 \ 16,797 $ 194,004 Retained earnings Balance at beginning of the year .................................................................................................................... \ 86,758 \ 77,131 $1,002,056 Effect of changes in accounting policies applied to foreign equity method company ... . (765) . Changes during the year: Cash dividends ................................................................................................................................................... (2,636) (2,608) (30,453) Net income ........................................................................................................................................................... 9,699 13,000 112,031 Total changes during the year................................................................................................................... 7,063 10,391 81,577 Balance at end of the year .................................................................................................................................. \ 93,821 \ 86,758 $1,083,634 Treasury stock Balance at beginning of the year .................................................................................................................... \ (103) \ (2,955) $ (1,194) Changes during the year: Purchase of treasury stock ........................................................................................................................... (22) (3,315) (257) Gain on sales of treasury stock .................................................................................................................. 5 7 61 Changes of share exchanges ..................................................................................................................... . 6,160 . Total changes during the year................................................................................................................... (16) 2,852 (196) Balance at end of the year .................................................................................................................................. \ (120) \ (103) $ (1,390) Total shareholders’ equity Balance at beginning of the year .................................................................................................................... \124,338 \110,151 $1,436,106 Effect of changes in accounting policies applied to foreign equity method company ... . (765) . Changes during the year: Cash dividends ................................................................................................................................................... (2,636) (2,608) (30,453) Net income ........................................................................................................................................................... 9,699 13,000 112,031 Purchase of treasury stock ........................................................................................................................... (22) (3,315) (257) Gain on sales of treasury stock .................................................................................................................. 5 9 59 Changes of share exchanges ..................................................................................................................... . 7,866 . Total changes during the year................................................................................................................... 7,045 14,951 81,380 Balance at end of the year .................................................................................................................................. \131,384 \124,338 $1,517,487 See accompanying notes to consolidated financial statements. Toagosei Co., Ltd. and Consolidated Subsidiaries Toagosei Co., Ltd. 35