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## (2) Classification of financial assets and financial liabilities 

The breakdown of financial assets and financial liabilities is as follows: 

<img src='content_image/289842.jpg'>

Financial assets at FVTPL, loans and other financial assets, and available-for-sale financial assets are included in “Other financial assets” in the consolidated statements of financial position. 

## (3) Financial risk management policy 

The Group is exposed to financial risks such as credit risks, liquidity risks, and foreign exchange risks in operating businesses, and it manages risks based on its policy to mitigate them. 

The Group limits the use of derivatives to transactions for the purpose of hedging financial risks and does not use derivatives for speculation purposes. 

## (i) Credit risk 

## (a) Credit risk management 

Receivables, such as trade receivables, resulting from the business activities of the Group are exposed to the customer’s credit risk. This risk is managed by grasping the financial con- dition of the customer and monitoring the trade receivables balance. Also, the Group reviews collectability of trade receiv- ables depending on the credit conditions of customers and recognises an allowance for doubtful accounts as necessary. 

Securities held by the Group are exposed to the issuer’s credit risk, and deposits are exposed to the credit risk of banks. Also, derivative transactions that the Group conducts in order to hedge financial risks are exposed to the credit risk of the financial institutions which are counterparties of those transactions. In regard to securities transactions and deposit transactions in fund management, the Group only deals with banks and issuers with certain credit ratings in accordance with Astellas Group financial management policies. In addition, regarding derivative transactions, the Group only deals with financial institutions with certain credit ratings in accordance 

with Astellas Group financial management policies. 

## (b) Concentrations of credit risk 

In Japan, like other pharmaceutical companies, the Group sells its products through a small number of wholesalers. Sales to the four largest wholesalers amounted to approximately 80% of the Group’s sales in Japan, and the amount of trade receivables due from those four wholesalers are ¥153,427 million at 31 March 2013 and ¥143,511 million at 31 March 2014, respectively. 

## (c) Maximum exposure to credit risk 

Other than guaranteed obligations, the Group’s maximum exposure to credit risks without taking into account any collat- eral held or other credit enhancements is the carrying amount of financial instruments less impairment losses in the consoli- dated statements of financial position. The Group’s maximum exposure to credit risks of guaranteed obligations as of 1 April 2012, 31 March 2013, and 31 March 2014 were ¥2,509 mil- lion, ¥2,133 million, and ¥1,875 million, respectively. 

## (d) Collateral 

The Group has securities and deposits received as collateral for certain trade receivables and other receivables. The carry- ing amount of securities held as collateral is ¥850 million at 31 March 2014 (¥656 million at 31 March 2013), and the carrying amount of deposits received is ¥85 million at 31 March 2014 (¥85 million at 31 March 2013). 

