(o) Cash and cash equivalents
Cash and cash equivalents include cash on hand, deposits placed with banks and short-term highly liquid investments with
original maturities of three months or less.
(p) Restricted cash
Restricted cash consists of trust accounts under securitization programs and real estate, deposits related to servicing
agreements, deposits collected on the underlying assets and applied to non-recourse loans, deposits held on behalf of third parties in the aircraft-related business and others.
(q) Installment loans
Certain loans, for which the Company and its subsidiaries have the intent and ability to sell to outside parties in the
foreseeable future, are considered held for sale and are carried at the lower of cost or fair value determined on an individual basis, except loans held for sale for which the fair value option was elected. A certain subsidiary elected the fair
value option on certain loans held for sale. The subsidiary enters into forward sale agreements to offset the change in the fair value of loans held for sale, and the election of the fair value option allows the subsidiary to recognize both the
change in the fair value of the loans and the change in the fair value of the forward sale agreements due to changes in interest rates in the same accounting period.
Loans held for sale are included in installment loans, and the outstanding balances of these loans as of March 31, 2019
and December 31, 2019 were ¥54,311 million and ¥80,234 million, respectively. There were ¥38,671 million and ¥43,238 million of loans held for sale as of March 31, 2019 and December 31, 2019,
respectively, measured at fair value by electing the fair value option.
(r) Property under facility operations
Property under facility operations consist primarily of operating facilities (including hotels and training facilities) and
environmental assets (including mega solar and thermal power stations), which are stated at cost less accumulated depreciation, and depreciation is calculated mainly on a straight-line basis over the estimated useful lives of the assets. Accumulated
depreciation was ¥102,185 million and ¥99,748 million as of March 31, 2019 and December 31, 2019, respectively.
(s) Trade notes, accounts and other receivable
Trade notes, accounts and other receivable primarily include accounts receivables in relation to sales of assets to be leased,
inventories and other assets and payment made on behalf of lessees for property tax, maintenance fees and insurance premiums in relation to lease contracts.
(t) Inventories
Inventories consist primarily of residential condominiums under development, completed residential condominiums (including
those waiting to be delivered to buyers under the contract for sale), and merchandise for sale. Residential condominiums under development are carried at cost less any impairment losses, and completed residential condominiums and merchandise for
sale are stated at the lower of cost or fair value less cost to sell. The cost of inventories that are unique and not interchangeable is determined on the specific identification method and the cost of other inventories is principally determined on
the average method. As of March 31, 2019 and December 31, 2019, residential condominiums under development were ¥55,860 million and ¥74,843 million, respectively, and completed residential condominiums and merchandise for
sale were ¥59,835 million and ¥57,115 million, respectively.
The Company and its subsidiaries recorded
¥269 million and ¥277 million of write-downs principally on completed residential condominiums and merchandise for sale for the nine months ended December 31, 2018 and 2019, respectively, primarily resulting from a decrease in
expected sales price. The amounts of such write-downs for the three months ended December 31, 2018 and 2019 were ¥159 million and ¥123 million, respectively. These write-downs were recorded in costs of goods and real estate
sold and included in Real Estate segment, Investment and Operation segment and Corporate Financial Services segment.
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