
	Yen in millions
	For the years ended March 31,
	2018		2019		2020
Net revenues		30,680,535		32,200,711		35,340,807

Gross profit		4,065,344		4,070,621		4,315,967

Net income attributable to affiliated companies accounted for by the equity method		1,344,687		857,832		841,938

Equity in earnings of affiliated companies attributable to Toyota Motor Corporation		470,083		360,066		271,152

Entities comprising a significant portion of Toyota’s investment in affiliated companies and percentage of ownership are presented below:


	Percentage of ownership
	March 31,
Name of affiliated companies	2019			2020
Denso Corporation		24.5	%		24.5	%
Subaru Corporation		—			20.0	%
Toyota Industries Corporation		24.9	%		24.9	%
Aisin Seiki Co., Ltd.		24.9	%		24.9	%
Toyota Tsusho Corporation		22.0	%		22.0	%

Certain affiliated companies accounted for by the equity method with carrying amounts of ¥2,430,251 million and ¥2,895,656 million at March 31, 2019 and 2020, respectively, were quoted on various established markets at an aggregate value of ¥2,513,886 million and ¥2,247,107 million, respectively. Toyota

evaluated its investments in affiliated companies, considering the length of time and the extent to which the quoted market prices have been less than the carrying amounts, the financial condition and near-term prospects of the affiliated companies and Toyota’s ability and intent to retain those investments in the companies for a period of time. Toyota did not recognize any impairment loss for the years ended March 31, 2018, 2019 and 2020.

Account balances and transactions with affiliated companies are presented below:


	Yen in millions
	March 31,
	2019		2020
Trade accounts and notes receivable, and other receivables		362,831		357,849
Accounts payable and other payables		845,755		780,935


	Yen in millions
	For the years ended March 31,
	2018		2019		2020
Net revenues		2,004,632		2,213,236		2,423,338
Purchases		5,749,430		6,431,464		6,781,279

Dividends from affiliated companies accounted for by the equity method for the years ended March 31, 2018, 2019 and 2020 were ¥196,403 million, ¥204,322 million and ¥208,950 million, respectively.

Toyota does not have any significant related party transactions other than transactions with affiliated companies in the ordinary course of business.

Variable Interest Entities -

Toyota enters into securitization transactions using special-purpose entities, that are considered variable interest entities (“VIEs”). Although the finance receivables and vehicles on operating leases related to securitization transactions have been legally sold to the VIEs, Toyota has both the power to direct the activities of the VIEs that most significantly impact the VIEs’ economic performance and the obligation to absorb losses of the VIEs or the right to receive benefits from the VIEs that could potentially be significant to the VIEs. As a result, Toyota is considered the primary beneficiary of the VIEs and therefore consolidates the VIEs.

Related to securitization transactions, ¥1,872,564 million and ¥1,906,256 million retail finance receivables, ¥609,694 million and ¥621,633 million vehicles on operating leases, ¥131,804 million and ¥140,750 million restricted cash and ¥1,893,073 million and ¥1,979,563 million secured debt were included in Toyota’s consolidated financial statements as of March 31, 2019 and 2020, respectively. The creditors of the VIEs do not have recourse to Toyota’s general credit with the exception of debts guaranteed by Toyota. Risks to which Toyota is exposed including credit, interest rate, and/or prepayment risks are not incremental compared with the situation before Toyota enters into securitization

transactions

Toyota has variable interests in investment trusts that are VIEs and debt securities issued by a VIE. With respect to some of the investment trusts, Toyota has both the obligation to absorb losses of or the right to receive benefits from the VIEs that could potentially be significant to the VIEs and the power to direct the activities of the VIEs that most significantly impact the VIEs’ economic performance through the asset manager. As a result, Toyota is considered the primary beneficiary of the VIEs and therefore consolidates the VIEs. Related to such investment trusts, ¥2,790,679 million and ¥2,767,681 million marketable securities and other securities investments were included in Toyota’s consolidated financial statements as of March 31, 2019 and 2020.

As for other VIEs, Toyota determined that it was not the primary beneficiary due to lack of the power to direct the activities of the VIEs that most significantly impact the VIEs’ economic performance and, therefore, does not consolidate the VIEs. The investments are held at fair value and are included in “Marketable securities and other securities investments” in the accompanying consolidated balance sheets. The maximum exposure to loss is limited to the carrying value of its investment. The carrying value of the trusts totaled ¥22,001 million and

¥16,622

million as of March 31, 2019 and 2020, respectively. The carrying value of the debt securities totaled

¥351,945

million and

¥748,131

million as of March 31, 2019 and 2020, respectively. Toyota does not provide support that is not contractually required to the investments.

As for VIEs other than those specified above, neither the aggregate size nor Toyota’s involvements are material to Toyota’s consolidated financial statements.