Changes in Consolidated Financial Statements Due to Voluntary - PowerPoint PPT Presentation

Changes in Consolidated Financial Statements Due to Voluntary Adoption of International Financial Reporting Standards (IFRS) In conjunction with the voluntary adoption of International Financial Reporting Standards (IFRS), the forecast for the fiscal year ending March 31, 2016 which is scheduled to be announced in late April 2015 will be disclosed based on IFRS. - Differences between the forecast based on U.S. generally accepted accounting principles (U.S. GAAP) and the forecast based on IFRS for the fiscal year ending March 31, 2016 will be explained within the “FY15 Financial Results Presentation”, which will be available upon the announcement of Honda’s financial results for the fiscal year ending March 31, 2015. - Please refer to the following slides for the changes in the accounts presented in the financial statements. Information included in this material is currently under consideration. Therefore, please be advised that Honda’s actual consolidated financial statements based on IFRS that will be announced at a later date could differ from those described in this material. This material does not constitute a solicitation of investments or any similar act regarding the shares issued by Honda. Honda Motor Co., Ltd. March 13, 2015

Consolidated Statements of Income U.S. GAAP IFRS Net sales and other operating revenue Sales revenue 1) “Equity in income of affiliates” under U.S. GAAP is included in Operating costs and expenses: Operating costs and expenses: “ Profit before income taxes ” and presented as “ Share of Cost of sales Cost of sales profit of investments accounted for using the equity Selling, general and administrative Selling, general and administrative method ”. Research and development Research and development Operating income Operating profit 2) “Other income (expenses)” under U.S. GAAP is presented as Other income (expenses): Share of profit from investments accounted “ Finance income and finance for using the equity method costs ”. Interest income Finance income and finance costs: Interest expense Interest income 3) “Net income” under U.S. GAAP is Other, net presented as “ Profit for the year ”. Interest expense Income before income taxes and equity in income of affiliates Other, net Income tax expense: Profit before income taxes 4) “Net income attributable to Honda Motor Co., Ltd.” under U.S. GAAP Current Income tax expense is presented as “ Profit for the year attributable to owners of Deferred Profit for the year the parent ”. Income before equity in income of Profit for the year attributable to: affiliates Owners of the parent 5) “Less: Net income attributable to Equity in income of affiliates noncontrolling interests” under Non-controlling interests Net income U.S. GAAP is presented as “ Profit for the year attributable Less: Net income attributable to to non-controlling interests ”. noncontrolling interests Net income attributable to Honda Motor Co., Ltd.

Consolidated Statements of Financial Position, Assets U.S. GAAP IFRS Assets Assets 1) “ Other financial assets ” and “ Other current assets ” are Current assets: Current assets: presented in separate lines from Cash and cash equivalents Cash and cash equivalents “Other current assets” under U.S. Trade accounts and notes receivable, net of GAAP. Trade receivables allowance for doubtful accounts Finance subsidiaries-receivables, net Receivables from financial services Inventories Other financial assets 2) “Investments in and advances to Deferred income taxes affiliates” under U.S. GAAP is Inventories presented as “ Investments Other current assets accounted for using the equity Other current assets Total current assets method ” and “ Other financial assets ”. Finance subsidiaries-receivables, net Total current assets Investments and advances: Non-current assets: Investments in and advances to affiliates Investments accounted for using the equity 3) “ Other financial asset ”, Other, including marketable equity securities method “ Intangible assets ”, “ Deferred Total investments and advances tax assets ” and “ Other non- Receivables from financial services current assets ” are presented in Property on operating leases: Other financial assets separate lines from “Other assets, Vehicles net of allowance for doubtful Equipment on operating leases Less accumulated depreciation accounts” under U.S. GAAP. Net property on operating leases Property, plant and equipment Property, plant and equipment, at cost: Intangible assets Land Deferred tax assets 4) “Deferred income taxes” presented Buildings in current assets under U.S. Other non-current assets Machinery and equipment GAAP is reclassified to “ Deferred Construction in progress Total non-current assets tax assets ” in non-current assets. Less accumulated depreciation and Total assets amortization Net property, plant and equipment Other assets, net of allowance for doubtful accounts Total assets

Consolidated Statements of Financial Position, Liabilities and Equity U.S. GAAP IFRS Liabilities and Equity Liabilities and Equity 1) “Notes payables” and “Accounts Current liabilities: payables” under U.S. GAAP are Current liabilities: presented as “ Trade payables ”. Short-term debt Trade payables Current portion of long-term debt Financing liabilities Trade payables: 2) “Short-term debt” and “Current Accrued expenses portion of long-term debt” under Notes Other financial liabilities U.S. GAAP are presented as Accounts Income taxes payable “ Financial liabilities ”. Accrued expenses Provisions Income taxes payable Other current liabilities 3) “ Other financial liabilities ” and Other current liabilities Total current liabilities “ Other current liabilities ” are Total current liabilities presented in separate lines from Non-current liabilities: “Other current liabilities” under Long-term debt, excluding current portion Financing liabilities U.S. GAAP. Other liabilities Other financial liabilities Total liabilities Retirement benefit liabilities 4) “ Accrued expenses ” and Equity: Provisions “ Provisions ” are presented in Honda Motor Co., Ltd. shareholders' equity: Deferred tax liabilities separate lines from “Accrued expenses” under U.S. GAAP. Common stocks, Other non-current liabilities authorized shares; issued shares Total non-current liabilities Capital surplus Total liabilities 5) “ Other financial liabilities ”, Legal reserves Equity: “ Retirement benefit liabilities ”, Retained earnings “ Provisions ”, “ Deferred tax Common stock Accumulated other comprehensive income liabilities ” and “ Other non- Capital surplus current liabilities ” are presented (loss), net Treasury stock in separate lines from “other Treasury stock, shares liabilities” under U.S. GAAP. Retained earnings Total Honda Motor Co., Ltd. shareholders' Other components of equity equity Equity attributable to owners of the parent 6) “Legal reserve” under U.S. GAAP Noncontrolling interests is included in “ Retained Non-controlling interests Total equity earnings ”. Total equity Commitments and contingent liabilities Total liabilities and equity Total liabilities and equity