Under the Commercial Code of Japan, the entire amount of the issue price of shares is required to be accounted for as stated capital, although a company may, by resolution of its board of directors, account for an amount not exceeding one-half of the issue price of the new shares as additional paid-in capital.

  The accompanying financial statements for the year ended March 31, 2000, reflect the appropriations of accumulated deficit for the year ended March 31, 1999, which were approved at the general stockholders' meeting held on June 29, 1999.