content_image/88046.jpg content_image/88040.jpg content_image/88042.jpg
The interest rate swap agreements utilized by the Company effectively convert a portion of its floating-rate debt to a fixed-rate basis for the next 10 years. 

The Company expects to reclassify ¥744 million ($6,200 thousand) of net losses on derivative financial instruments from accumulated other comprehensive income (loss) to earnings during the next twelve months due to the col- lection of accounts receivable denominated in foreign currency and the payment of variable interest associated with the floating-rate debts. 

At March 31, 2003, there were no significant gains or losses on derivative financial instruments or portions thereof that were either ineffective as hedges, excluded from assessment of hedge effectiveness, or where the under- lying risk did not occur. 

The Company’s forward exchange contract amounts, the aggregate notional principal amounts of interest rate swap agreements, currency swap agreements, and currency options outstanding at March 31, 2003 and 2002 are sum- marized below: Thousands of 

<img src='content_image/88046.jpg'>

## (2) Fair value of financial instruments 

The estimated fair values of the Company’s financial instruments at March 31, 2003 and 2002 are summarized as follows: Millions of yen 

<img src='content_image/88040.jpg'>

<img src='content_image/88042.jpg'>

The above table excludes the financial instruments for which fair values approximate their carrying values and those related to leasing activities. 

In assessing the fair value of these financial instruments, the Company has used a variety of methods and assumptions, which were based on estimates of market conditions and risks existing at that time. For certain instru- ments, including cash and cash equivalents, notes and accounts receivable, trade, finance receivables, net, short- term borrowings, notes payable, trade, accounts payable, trade and accounts payable, other and accrued expenses, it was assumed that the carrying amount approximated fair value for the majority of these instruments because of their short maturities. Quoted market prices were used for a part of marketable securities and other investments. Other techniques, such as estimated discounted value of future cash flows, and replacement cost, have been used to determine fair value for the remaining financial instruments. These estimated fair values are not necessarily indicative of the amounts that could be realized in a current market exchange. 

Marketable securities and other investments include investment securities, which represent holdings in a number of 

