20-F

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 20-F

☐ REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR 12(g) OF THE SECURITIES EXCHANGE ACT OF 1934

or

☑ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended March 31, 2018

or

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from/to

or

☐ SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Date of event requiring this shell company report:

Commission file number 1-6439

Sony Kabushiki Kaisha

(Exact Name of Registrant as specified in its charter)

SONY CORPORATION

(Translation of Registrant’s name into English)

Japan

(Jurisdiction of incorporation or organization)

7-1, KONAN 1-CHOME, MINATO-KU,

TOKYO 108-0075 JAPAN

(Address of principal executive offices)

J. Justin Hill, Senior Vice President, Investor Relations

Sony Corporation of America

25 Madison Avenue, 26^th Floor

New York, NY 10010-8601

Telephone: 212-833-6722

E-mail: ir@sony.com

(Name, Telephone, E-mail and Address of Company Contact Person)

Securities registered or to be registered pursuant to Section 12(b) of the Act:

Title of Each Class	Name of Each Exchange on Which Registered
American Depositary Shares*	New York Stock Exchange
Common Stock**	New York Stock Exchange

* American Depositary Shares evidenced by American Depositary Receipts.

Each American Depositary Share represents one share of Common Stock.

** No par value per share.

Not for trading, but only in connection with the listing of American Depositary Shares pursuant to the requirements of the New York Stock Exchange.

Securities registered pursuant to Section 12(g) of the Act:

None

Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act:

None

Indicate the number of outstanding shares of each of the issuer’s classes of capital or common stock as of the close of the period covered by the Annual Report:

	Outstanding as of
	March 31, 2018		March 31, 2018
Title of Class	(Tokyo Time)		(New York Time)
Common Stock		1,265,425,048
American Depositary Shares				113,751,938

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.    Yes  ☑    No  ☐

If this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.    Yes  ☐    No  ☑

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  ☑    No  ☐

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  ☑    No  ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer, or an emerging growth company. See definition of “large accelerated filer,” “accelerated filer” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

☑  Large accelerated filer ☐  Accelerated filer ☐  Non-accelerated filer ☐  Emerging growth company

If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards† provided pursuant to Section 13(a) of the Exchange Act.   ☐

† The term “new or revised financial accounting standard” refers to any update issued by the Financial Accounting Standards Board to its Accounting Standards Codification after April 5, 2012.

Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing:

US GAAP  ☑ International Financial Reporting Standards as issued by the International Accounting Standards Board  ☐ Other  ☐

If “Other” has been checked in response to the previous question, indicate by check mark which financial statement item the registrant has elected to follow.

Item 17  ☐ Item 18  ☐

If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes  ☐ No  ☑

Cautionary Statement

Statements made in this release with respect to Sony’s current plans, estimates, strategies and beliefs and other statements that are not historical facts are forward-looking statements about the future performance of Sony. Forward-looking statements include, but are not limited to, those statements using words such as “believe,” “expect,” “plans,” “strategy,” “prospects,” “forecast,” “estimate,” “project,” “anticipate,” “aim,” “intend,” “seek,” “may,” “might,” “could” or “should,” and words of similar meaning in connection with a discussion of future operations, financial performance, events or conditions. From time to time, oral or written forward-looking statements may also be included in other materials released to the public. These statements are based on management’s assumptions, judgments and beliefs in light of the information currently available to it. Sony cautions investors that a number of important risks and uncertainties could cause actual results to differ materially from those discussed in the forward-looking statements, and therefore investors should not place undue reliance on them. Investors also should not rely on any obligation of Sony to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Sony disclaims any such obligation. Risks and uncertainties that might affect Sony include, but are not limited to:

(i) Sony’s ability to maintain product quality and customer satisfaction with its products and services;

(ii) Sony’s ability to continue to design and develop and win acceptance of, as well as achieve sufficient cost reductions for, its products and services, including image sensors, game and network platforms, smartphones and televisions, which are offered in highly competitive markets characterized by severe price competition and continual new product and service introductions, rapid development in technology and subjective and changing customer preferences;

(iii) Sony’s ability to implement successful hardware, software, and content integration strategies, and to develop and implement successful sales and distribution strategies in light of new technologies and distribution platforms;

(iv) the effectiveness of Sony’s strategies and their execution, including but not limited to the success of Sony’s acquisitions, joint ventures, investments, capital expenditures, restructurings and other strategic initiatives;

(v) changes in laws, regulations and government policies in the markets in which Sony and its third-party suppliers, service providers and business partners operate, including those related to taxation, as well as growing consumer focus on corporate social responsibility;

(vi) Sony’s continued ability to identify the products, services and market trends with significant growth potential, to devote sufficient resources to research and development, to prioritize investments and capital expenditures correctly and to recoup its investments and capital expenditures, including those required for technology development and product capacity;

(vii) Sony’s reliance on external business partners, including for the procurement of parts, components, software and network services for its products or services, the manufacturing, marketing and distribution of its products, and its other business operations;

(viii) the global economic and political environment in which Sony operates and the economic and political conditions in Sony’s markets, particularly levels of consumer spending;

(ix) Sony’s ability to meet operational and liquidity needs as a result of significant volatility and disruption in the global financial markets or a ratings downgrade;

(x) Sony’s ability to forecast demands, manage timely procurement and control inventories;

(xi) foreign exchange rates, particularly between the yen and the U.S. dollar, the euro and other currencies in which Sony makes significant sales and incurs production costs, or in which Sony’s assets, liabilities and operating results are denominated;

(xii) Sony’s ability to recruit, retain and maintain productive relations with highly skilled personnel;

(xiii) Sony’s ability to prevent unauthorized use or theft of intellectual property rights, to obtain or renew licenses relating to intellectual property rights and to defend itself against claims that its products or services infringe the intellectual property rights owned by others;

(xiv) the impact of changes in interest rates and unfavorable conditions or developments (including market fluctuations or volatility) in the Japanese equity markets on the revenue and operating income of the Financial Services segment;

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(xv) shifts in customer demand for financial services such as life insurance and Sony’s ability to conduct successful asset liability management in the Financial Services segment;

(xvi) risks related to catastrophic disasters or similar events;

(xvii) the ability of Sony, its third-party service providers or business partners to anticipate and manage cybersecurity risk, including the risk of unauthorized access to Sony’s business information and the personally identifiable information of its employees and customers, potential business disruptions or financial losses; and

(xviii) the outcome of pending and/or future legal and/or regulatory proceedings.

Risks and uncertainties also include the impact of any future events with material adverse impact.

Important information regarding risks and uncertainties is also set forth elsewhere in this annual report, including in “Risk Factors” under “Item 3. Key Information,” “Item 4. Information on the Company,” “Item 5. Operating and Financial Review and Prospects,” “Legal Proceedings” included in “Item 8. Financial Information,” Sony’s consolidated financial statements referenced in “Item 8. Financial Information” and “Item 11. Quantitative and Qualitative Disclosures about Market Risk.”

In this document, Sony Corporation and its consolidated subsidiaries are together referred to as “Sony” or “Sony Group.” In addition, sales and operating revenue are referred to as “sales” in the narrative description except in the consolidated financial statements.

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TABLE OF CONTENTS

Item 1. Identity of Directors, Senior Management and Advisers	6
Item 2. Offer Statistics and Expected Timetable	6
Item 3. Key Information	6
A. Selected Financial Data	6
B. Capitalization and Indebtedness	7
C. Reasons for the Offer and Use of Proceeds	7
D. Risk Factors	7
Item 4. Information on the Company	17
A. History and Development of the Company	17
B. Business Overview	19
C. Organizational Structure	28
D. Property, Plant and Equipment	28
Item 4A. Unresolved Staff Comments	30
Item 5. Operating and Financial Review and Prospects	30
A. Operating Results	30
B. Liquidity and Capital Resources	53
C. Research and Development	54
D. Trend Information	55
E. Off-balance Sheet Arrangements	58
F. Contractual Obligations, Commitments, and Contingent Liabilities	58
Critical Accounting Policies and Estimates	59
Recently Adopted Accounting Standards	65
Recent Accounting Pronouncements	65
Item 6. Directors, Senior Management and Employees	65
A. Directors and Senior Management	65
B. Compensation	71
C. Board Practices	76
D. Employees	80
E. Share Ownership	82
Item 7. Major Shareholders and Related Party Transactions	82
A. Major Shareholders	82
B. Related Party Transactions	83
C. Interests of Experts and Counsel	83
Item 8. Financial Information	83
A. Consolidated Statements and Other Financial Information	83
Legal Proceedings	83
Dividend Policy	84
B. Significant Changes	84
Item 9. The Offer and Listing	84
A. Offer and Listing Details	84
B. Plan of Distribution	85
C. Markets	85
D. Selling Shareholders	85
E. Dilution	85
F. Expenses of the Issue	85
Item 10. Additional Information	85
A. Share Capital	85
B. Memorandum and Articles of Association	86
C. Material Contracts	94
D. Exchange Controls	94
E. Taxation	95
F. Dividends and Paying Agent	97
G. Statement by Experts	97
H. Documents on Display	97
I. Subsidiary Information	97
Item 11.  Quantitative and Qualitative Disclosures about Market Risk	97
Item 12.  Description of Securities Other Than Equity Securities	99
A. Debt Securities	99

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B. Warrants and Rights	99
C. Other Securities	99
D. American Depositary Shares	99
Item 13. Defaults, Dividend Arrearages and Delinquencies	101
Item 14.  Material Modifications to the Rights of Security Holders and Use of Proceeds	101
Item 15. Controls and Procedures	101
Item 16. [Reserved]	102
Item 16A. Audit Committee Financial Expert	102
Item 16B. Code of Ethics	102
Item 16C. Principal Accountant Fees and Services	102
Audit and Non-Audit Fees	102
Audit Committee’s Pre-Approval Policies and Procedures	102
Item 16D.  Exemptions from the Listing Standards for Audit Committees	103
Item 16E.  Purchases of Equity Securities by the Issuer and Affiliated Purchasers	103
Item 16F.  Change in Registrant’s Certifying Accountant	103
Item 16G.  Disclosure About Differences in Corporate Governance	104
Item 16H. Mine Safety Disclosure	109
Item 17. Financial Statements	109
Item 18. Financial Statements	109
Item 19. Exhibits	110
Signatures	111

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Item  1. Identity of Directors, Senior Management and Advisers

Not Applicable

Item  2. Offer Statistics and Expected Timetable

Not Applicable

Item  3. Key Information

A. Selected Financial Data

	Fiscal year ended March 31
	2014			2015			2016			2017			2018
	(Yen in millions, yen per share amounts)
Income statement data:
Sales and operating revenue		7,767,266			8,215,880			8,105,712			7,603,250			8,543,982
Equity in net income (loss) of affiliated companies		(7,374	)		3,921			2,238			3,563			8,569
Operating income		26,495			68,548			294,197			288,702			734,860
Income before income taxes		25,741			39,729			304,504			251,619			699,049
Income taxes		94,582			88,733			94,789			124,058			151,770
Net income (loss) attributable to Sony Corporation’s stockholders		(128,369	)		(125,980	)		147,791			73,289			490,794
Comprehensive income (loss)		121,978			34,317			(44,915	)		143,652			553,220
Data per share of Common Stock:
Net income (loss) attributable to Sony Corporation’s stockholders*
— Basic		(124.99	)		(113.04	)		119.40			58.07			388.32
— Diluted		(124.99	)		(113.04	)		117.49			56.89			379.75
Cash dividends declared Interim		12.50			—			10.00			10.00			12.50
		(12.12 cents	)		—			(8.09 cents	)		(8.79 cents	)		(11.11 cents	)
Cash dividends declared Fiscal year-end		12.50			—			10.00			10.00			15.00
		(12.19 cents	)		—			(9.01 cents	)		(9.13 cents	)		(13.75 cents	)
Balance sheet data:
Sony Corporation’s stockholders’ equity		2,258,137			2,317,077			2,463,340			2,497,246			2,967,366
Common stock		646,654			707,038			858,867			860,645			865,678
Net assets		2,783,141			2,928,469			3,124,410			3,135,422			3,647,157
Total assets		15,333,720			15,834,331			16,673,390			17,660,556			19,065,538
Number of shares issued at fiscal year-end (thousands of shares of common stock)		1,044,708			1,169,773			1,262,494			1,263,764			1,266,552
Sony Corporation’s stockholders’ equity per share of common stock		2,163.63			1,982.54			1,952.79			1,977.72			2,344.96

* Refer to Note 22 of the consolidated financial statements.

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	Average		High		Low		Period-end
	(Yen)
Yen exchange rates per U.S. dollar:
Fiscal year ended March 31
2014		100.15		105.25		92.96		102.98
2015		109.75		121.50		101.26		119.96
2016		120.04		125.58		111.30		112.42
2017		108.25		118.32		100.07		111.41
2018		110.80		114.25		104.83		106.20
2018
January		—		113.18		108.38		109.31
February		—		110.40		106.10		106.62
March		—		106.91		104.83		106.20
April		—		109.33		105.99		109.28
May		—		111.08		108.62		108.73
June (through June 8)		—		110.00		109.45		109.45

The yen exchange rates represent noon buying rates for yen in New York City as certified for customs purposes by the Federal Reserve Bank of New York for the business days in the respective periods.

B. Capitalization and Indebtedness

Not Applicable

C. Reasons for the Offer and Use of Proceeds

Not Applicable

D. Risk Factors

This section contains forward-looking statements that are subject to the Cautionary Statement appearing on page 2 of this annual report. Risks to Sony are also discussed elsewhere in this annual report, including, without limitation in the other sections of this annual report referred to in the Cautionary Statement.

Sony must overcome increasingly intense competition, which could lead to lower revenue or operating margins.

Sony has several business segments in different industries with many product and service categories, which cause it to compete with many existing and new competitors ranging from large multinational companies to highly specialized entities that focus on only one or a few businesses and also, potentially, with outsourced manufacturing service partners that currently supply products to Sony. These competitors may have greater financial, technical, labor and marketing resources available to them than those available to Sony. Sony’s financial condition and operating results depend on its ability to efficiently anticipate and respond to these established and new competitors.

The competitive factors Sony faces vary depending on the nature of the business. For example, Sony’s electronics businesses compete on the basis of various factors including price and function, while Sony’s Music and Pictures businesses compete for talent, such as artists, songwriters, actors, directors and producers, and for entertainment content that is created, acquired, licensed and/or distributed. Competition on price in the electronics businesses can lead to lower margins when costs do not fall at a proportional rate, and competition for talent and appealing product in the entertainment businesses can also lead to lower profitability if the higher costs required for such talent and content creation cannot be recouped through greater sales. Moreover, even for those products where Sony believes it has a strong competitive advantage, such as image sensors, it is possible that its competitors’ technological capabilities will accelerate such that Sony would be unable to maintain its advantageous market position. In its consumer electronics businesses, to produce products that appeal to changing and increasingly diverse consumer preferences or to overcome the fact that a relatively high percentage of consumers already possess similar products, Sony must develop superior technology, anticipate consumer tastes and rapidly develop attractive and differentiated products with competitive prices and features. Sony faces increasingly intense pricing pressure from competitors, retailer consolidation, new sales/distribution channels and shorter product cycles in a variety of consumer product categories. In the Music and Pictures segments, operating results can be impacted by worldwide consumer acceptance of their products, which is difficult to predict, by other competing products released at or near the same time and by alternative forms of entertainment and leisure activities available to consumers.

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If Sony is unable to maintain its advantageous market position in the fields in which it has a technological or other competitive advantage, Sony is unable to effectively anticipate and counter the ongoing price erosion that frequently affects its consumer products or the cost pressures affecting its businesses, there is a change in existing business models or consumer preferences, or the average prices of Sony’s consumer products decrease faster than Sony is able to reduce manufacturing costs, Sony’s operating results and financial condition may be adversely impacted.

To remain competitive and stimulate customer demand, Sony must invest in research and development to achieve product and service innovations and successfully manage frequent introductions of such new products and services.

To strengthen the competitiveness of its products and services, Sony continues to invest in research and development (“R&D”), particularly in growth areas such as image sensors and the Game & Network Services (“G&NS”) segment. However, Sony may not be successful in investing in R&D if it fails to identify products, services and market trends with significant growth potential. In addition, Sony’s investments may not yield the innovation or the expected results quickly enough, or competitors may lead Sony in technological innovation. This may hinder Sony’s ability to commercialize new and competitive products and services.

In the consumer electronics, network services and mobile communication industries, Sony must continually introduce, enhance and stimulate customer demand for products and services. Sales of these products and services are particularly sensitive to the significant weighting of consumer demand to the year-end holiday season. In Sony’s G&NS segment, the successful introduction and penetration of gaming platforms is a significant factor driving sales and profitability, and this success is affected by the ability to provide customers with attractive software line-ups and online services. However, there is no assurance that third-party software developers and publishers, major contributors to this effort, will continue to develop and release software. In addition, Sony believes that integrating its hardware, software, entertainment content and network services, and investing in R&D to effect such integration, is essential in generating revenue growth and profitability. However, this strategy depends on its ability to further develop network services technologies, coordinate and prioritize strategic and operational issues among Sony’s various business units and sales channels, continually introduce enhanced and competitively priced hardware that is seamlessly connected to network platforms with user interfaces that are innovative and attractive to consumers and also standardize technological and interface specifications industry-wide and across Sony’s networked products and business units. In addition, the G&NS, Music and Pictures segments must invest substantial amounts, which may include significant upfront investments, in internally developed software titles, artist advances, motion picture productions, television productions and broadcast programming before knowing whether their products will receive customer acceptance. Furthermore, underperformance of Pictures’ products in the initial distribution market is correlated with weak performance in subsequent distribution markets, which would have an adverse effect on Sony’s results in the year of initial release as well as future years.

The successful introductions of, and transitions to, new products and services depend on a number of factors, such as the timely and successful completion of development efforts, market acceptance, planning and executing an effective marketing strategy, managing new product introductions, managing production ramp-up issues, the availability of application software for new products, quality control and the concentration of consumer demand in the year-end holiday season. If Sony cannot achieve the expected results from its investment in R&D, adequately manage frequent introductions of new products and services and obtain consumer acceptance of its new products and services, or if Sony is not successful in implementing its integration strategy, Sony’s reputation, operating results and financial condition may be adversely impacted.

Sony’s strategic initiatives, including acquisitions, joint ventures, investments, capital expenditures and restructurings, may not be successful in achieving their strategic objectives.

Sony actively engages in acquisitions, joint ventures, capital expenditures and other strategic investments to acquire new technologies, efficiently develop new businesses and enhance its business competitiveness. For example, on May 22, 2018, Sony signed a legally binding memorandum of understanding to acquire an approximately 60% equity interest in EMI Music Publishing. (The closing of this transaction is subject to certain conditions, including regulatory approvals.)

When making acquisitions, Sony’s financial results may be adversely affected by the significant cost of the acquisition and/or integration expenses, failure to achieve synergies, failure to generate expected revenue and cost improvements, loss of key personnel and assumption of liabilities.

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When establishing joint ventures and strategic partnerships, Sony’s financial and operating results may be adversely affected by strategic or cultural differences with partners, conflicts of interest, failure to achieve synergies, additional funding or debt guarantees required to maintain the joint venture or partnership, requirements to buy out a joint venture partner, sell its shares or dissolve a partnership, insufficient management control including control over cash flow, loss of proprietary technology and know-how, impairment losses and reputational harm from the actions or activities of a joint venture that uses the Sony brand.

Sony invests heavily in production facilities and equipment in its electronics businesses, including fabrication facilities used to make image sensors for smartphones and other products. Sony may not be able to recover these capital expenditures in part or full or in the planned timeframe due to the competitive environment, lower-than-expected consumer demand or changes in the financial condition or business decisions of Sony’s major customers. Sony invested 45.0 billion yen and 106.6 billion yen of capital in the fiscal years ended March 31, 2017 and 2018, respectively, mainly for the purpose of increasing image sensor production capacity.

Further, Sony is implementing restructuring and transformation initiatives to enhance profitability, business autonomy and shareholder value and to clearly position each business within the overall business portfolio. For example, Sony transferred its battery business to Murata Manufacturing Co., Ltd. Group in the fiscal year ended March 31, 2018. The expected benefits of these initiatives, including the expected level of profitability, may not be realized due to internal and external impediments or market conditions worsening beyond expectations. If Sony is not successful in achieving its restructuring and transformation initiatives, Sony’s operating results, financial condition, reputation, competitiveness or profitability may be adversely affected. Sony incurred restructuring charges in the amount of 38.3 billion yen, 60.2 billion yen and 22.4 billion yen in the fiscal years ended March 31, 2016, 2017 and 2018, respectively.

Sony’s sales and profitability may be affected by the operating performance of wholesalers, retailers, other resellers and third-party distributors.

Sony is dependent for the distribution of its products on wholesalers, retailers, other resellers and third-party distributors, many of whom also distribute competitors’ products. For example, in some cases, Sony’s smartphones sold through cellular network carriers are subsidized by the carriers. There is no assurance that such subsidies will be continued at all or in the same amounts upon renewal of Sony’s agreements with these carriers or in agreements Sony enters into with new carriers. In addition, the Pictures segment depends on third-party exhibitors to distribute its motion pictures, and cable, satellite and other distribution systems to distribute its motion pictures and television programming; a decline in the licensing fees received from these third parties may adversely affect the Pictures segment’s sales. The Pictures segment’s worldwide television networks are also distributed on third-party cable, satellite and other distribution systems and the failure to renew, or renewal on less favorable terms of, television carriage contracts (broadcasting agreements) with these third-party distributors may adversely affect the Pictures segment’s ability to generate advertising and subscription sales through these networks.

Sony invests in programs to incentivize wholesalers, retailers, and other resellers and third-party distributors to position and promote Sony’s products, but there is no assurance that these programs will provide a significant return or incremental revenue by persuading consumers to buy Sony products instead of competitors’ products.

The operating results and financial condition of many wholesalers, retailers, other resellers and third-party distributors have been adversely impacted by competition, especially from online retailers, and weak economic conditions. If their financial condition continues to weaken, they stop distributing Sony’s products, or uncertainty regarding demand for Sony’s products or other factors cause them to reduce their ordering, marketing, subsidizing, or distributing Sony’s products, Sony’s operating results and financial condition may be adversely impacted.

As a global company, Sony is subject to a wide range of laws and regulations and a growing consumer focus on corporate social responsibility in many countries. Those laws and regulations, as well as consumer focus, might change in significant ways, leading to an increase in the costs of Sony’s operations, a curtailment of Sony’s activities, and/or an adverse effect on Sony’s reputation.

As a global company, Sony is subject to the laws and regulations of many countries throughout the world that affect its traditional and online operations in a number of areas, including advertising, promotions, consumer protection, import and export requirements, anti-corruption, anti-competition, environmental protection, privacy, data protection, content and broadcast regulation, labor, taxation, foreign exchange controls, as well as laws relating to the collection, use, retention, security and transfer of personally identifiable information, or PII.

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Compliance with these laws and regulations may be onerous and expensive. These laws and regulations continue to develop and may be inconsistent from jurisdiction to jurisdiction, further increasing the cost of compliance and doing business. Any such developments could make Sony’s products less attractive to its customers, delay introduction of new products in one or more regions or cause Sony to change or limit its business practices. For example, a change in labor regulations or policies may significantly change local labor environments. Such a change in China or another country or regions in which Sony or a partner manufactures could cause interruptions in production and shipping of Sony’s products or components thereof, a sharp rise in local labor costs, or a shortage of well-trained employees, which may adversely affect Sony’s operating results. In addition, changes in laws or regulations or the judicial interpretation thereof that Sony relies on or Sony is subject to in conducting its operations, including online operations, as well as Sony’s failure to anticipate such changes, may subject Sony to greater risk of liability, increase the costs of compliance, or limit Sony’s ability to engage in certain operations or lead to discontinuance of certain operations.

Violation of applicable laws or regulations by Sony, its employees, third-party suppliers, business partners and agents may subject Sony to fines, penalties, legal judgments, restrictions on business operations and/or reputational damage. Additionally, there is a growing global regulatory and consumer focus on corporate social responsibility and sourcing practices and increasing regulatory obligations of public disclosure regarding these matters. In particular, there is increased attention on labor practices, including work environments at electronic component manufacturers and original design manufacturing/original equipment manufacturing, or ODM/OEM, product manufacturers operating in Asia. Increased regulation or public pressure in this area could cause Sony’s compliance costs to increase, particularly since Sony uses many parts, components and materials to manufacture its products and relies on suppliers to provide these parts, components and materials but does not directly control the suppliers’ procurement or employment practices. A finding of non-compliance, or the perception that Sony has not responded appropriately to growing consumer concern for such issues, whether or not Sony is legally required to do so, may adversely affect Sony’s reputation, operating results and financial condition.

Sony must manage its large and increasing volume of procurement from third-party suppliers and business partners to control inventory levels, availability, costs and quality of parts, components, software and network services within volatile markets.

Sony’s products and services increasingly rely on third-party suppliers and business partners for parts, components, software and network services, including semiconductors, chipsets for PlayStation game consoles and mobile products, liquid crystal display (“LCD”) panels and the Android OS that is used in mobile products, televisions and services. External suppliers’ and partners’ shortages, fluctuations in pricing, quality issues, discontinued support, changes in business terms or prioritization of customers outside the electronics sector or of Sony’s competitors can adversely affect Sony’s operating results, brand and reputation. Reliance on third-party software and technologies may make it increasingly difficult for Sony to differentiate its products from competitors’ products. Also, shortages or delayed shipments of critical parts or components may result in a reduction or suspension of production at Sony’s or its business partners’ manufacturing sites, particularly where Sony is substantially reliant on one supplier, where there is limited production capacity for custom parts or components, or where there are initial manufacturing capacity constraints for products, parts or components that use new technologies.

Sony places orders for parts and components in line with production and inventory plans determined in advance based on its forecast of consumer demand, which is highly volatile and difficult to predict. Inaccurate forecasts of consumer demand or inadequate business planning can lead to a shortage or excess inventory, which can disrupt production plans and result in lost sales opportunities or inventory adjustments, respectively. Sony writes down the value of its inventory when the underlying parts, components or products have become obsolete, when inventory levels exceed the amount expected to be used, or when the value of the inventory is otherwise recorded at a value higher than net realizable value. For example, Sony recorded a 6.5 billion yen inventory write-down of certain image sensors for mobile products in the fiscal year ended March 31, 2017. Such lost sales opportunities, inventory adjustments, or shortages of parts and components have had and may have an adverse impact on Sony’s operating results and financial condition.

Sony’s sales, profitability and operations are sensitive to global and regional economic and political trends and conditions.

Sony’s sales and profitability are sensitive to economic trends in its major markets. In the fiscal year ended March 31, 2018, 30.7%, 21.5% and 21.6% of Sony’s sales and operating revenue were attributable to Japan, the U.S. and Europe, respectively. These markets may be subject to significant economic downturns, resulting in an adverse impact on Sony’s operating results and financial condition. An actual or expected deterioration of

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economic conditions in any of Sony’s major markets may result in a decline in consumers’ consumption and adverse impacts on the businesses of commercial customers, resulting in reduced demand for Sony’s products and services. For example, in the Pictures segment, a general decline in the economy may result in decreased overall spending within the advertising market and a decline in third-party television networks’ ability to generate revenues, which could result in lower license fees paid by these networks for Sony’s content, which may adversely affect the Picture segment’s revenues.

In addition, Sony’s operations are conducted in many countries and regions around the world, and these international operations, particularly in certain emerging markets, can create challenges. For example, in Sony’s electronics businesses, production and procurement of products, parts and components in China and other Asian countries and regions increase the time necessary to supply products to other markets worldwide, which can make it more difficult to meet changing customer demand in a timely manner. Further, in certain countries and regions, Sony may encounter difficulty in planning and managing operations due to unfavorable political or economic factors, such as armed conflicts, deterioration in foreign relations, non-compliance with expected business conduct and a lack of adequate infrastructure. If international or domestic political and military instability disrupts Sony’s business operations or those of its business partners Sony’s operating results and financial condition may be adversely affected.

Foreign exchange rate fluctuations can affect Sony’s operating results and financial condition.

Sony’s operating results and financial condition are sensitive to foreign exchange rate fluctuations because many of Sony’s products are sold in countries other than the ones in which they were developed and/or manufactured. For example, within Sony’s electronics businesses, research and development and headquarters’ overhead costs are incurred mainly in yen, and manufacturing costs, including material costs, costs of procurement of parts and components, and costs of outsourced manufacturing services, are incurred mainly in the U.S. dollar and yen. Sales are dispersed and recorded in Japanese yen, the U.S. dollar, euro, Chinese renminbi, and local currencies of other areas, including emerging markets. Consequently, foreign exchange rate fluctuations have had and may have an adverse impact on Sony’s operating results, especially when the yen or the euro weaken significantly against the U.S. dollar, when the yen strengthens significantly against the euro, or when the U.S. dollar strengthens against emerging market currencies. Sony’s operating results may also be adversely impacted by foreign exchange rate fluctuations since Sony’s consolidated statements of income are prepared by translating the local currency denominated operating results of its subsidiaries around the world into yen. Furthermore, as Sony’s businesses have expanded in China and other areas, including emerging markets, the impact of fluctuations of foreign currency exchange rates in these areas against the U.S. dollar and yen has increased. Mid- to long-term changes in exchange rate levels may interfere with Sony’s global allocation of resources and hinder Sony’s ability to engage in research and development, procurement, production, logistics, and sales activities in a manner that is profitable after the effect of such exchange rate changes.

Although Sony seeks to reduce its exposure to foreign exchange risk by hedging a portion of its net short-term foreign currency exposure shortly before the transactions are projected to occur, such hedging activity may not offset any, or only a portion, of the adverse financial effects of unfavorable movements in foreign exchange rates over the limited time the hedges are in place.

Moreover, since Sony’s consolidated balance sheet is prepared by translating the local currency denominated assets and liabilities of its subsidiaries around the world into yen, Sony’s equity capital may be adversely impacted when the yen strengthens significantly against the U.S. dollar, the euro and/or other foreign currencies.

Ratings downgrades or significant volatility and disruption in the global financial markets may adversely affect the availability and cost of Sony’s funding.

Sony’s credit ratings may be adversely impacted by unfavorable operating results and a decline in its financial condition. Any credit rating downgrades may, in turn, result in an increase in Sony’s cost of funding and may have an adverse impact on Sony’s ability to access commercial paper or mid- to long-term debt markets on acceptable terms.

Additionally, global financial markets may experience significant levels of volatility and disruption, generally putting downward pressure on financial and other asset prices and impacting credit availability. Historically, Sony’s primary sources of funds have been cash flows from operations, the issuance of commercial paper and other debt securities, such as term debt, as well as borrowings from banks and other institutional lenders. There can be no assurance that such sources will continue to be available on acceptable terms or be sufficient to meet Sony’s needs.

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As a result, Sony may seek other sources of financing to fund operations, such as the draw-down of funds from contractually committed lines of credit from financial institutions or the sale of assets, in order to repay commercial paper and mid- to long-term debt as they become due, and to meet other operational and liquidity needs. However, such funding sources may also not be available at acceptable terms or be sufficient to meet Sony’s requirements. As a result, Sony’s operating results, financial condition and liquidity may be adversely affected.

Sony’s success depends on the ability to recruit, retain and maintain productive relations with highly skilled personnel.

In order to continue to develop, design, manufacture, market, and sell products and services, in increasingly competitive markets, Sony must attract, retain and maintain productive relations with key personnel, both internally and externally, including its executive team, other management professionals, creative talent and other highly skilled employees such as hardware and software engineers. However, such key personnel are in high demand. In addition, business divestitures, restructuring or other transformation initiatives may lead to an unintended loss of experienced human resources or know-how. Actual or threatened work slowdowns or stoppages related to unionized workers, particularly in the entertainment businesses, could lead to delayed releases or cost increases. If these incidents occur or if Sony is unable to attract, retain and maintain productive relations with its highly skilled employees and key management professionals, Sony’s operating results and financial condition may be adversely affected.

Sony’s intellectual property might be subject to unauthorized use or theft and it might encounter restrictions in its use of intellectual property owned by third parties.

Sony’s intellectual property relating to Sony’s products and services, including those of the electronics businesses, such as image sensors, might be subject to unauthorized use or theft. For example, digital technology, the availability of digital media, and global internet penetration impact Sony’s ability to protect its copyrighted content from unauthorized duplication, digital theft and counterfeiting, putting pressure on legitimate product sales. Sony has incurred and will continue to incur expenses to help protect its intellectual property rights; however, Sony’s various initiatives to prevent such unauthorized use or theft of intellectual property might not achieve their intended result, which could adversely affect Sony’s competitive position and the value of its investment in R&D. Additionally, Sony’s intellectual property rights may be challenged or invalidated, or such intellectual property rights may not be sufficient to provide Sony with competitive advantages.

Many of Sony’s products and services are designed under the license of patents and other intellectual property rights owned by third parties. Based upon past experience and industry practice, Sony believes it will be able to obtain or renew licenses relating to various intellectual property rights that its business needs in the future; however, such licenses may not be available at all or on acceptable terms, and as a consequence Sony may need to redesign or discontinue its marketing, selling or distribution of such products or services.

Claims have been and may be asserted against Sony that its products or services, including third-party parts, components, software and network services used in Sony’s products or services, infringe the intellectual property rights of other parties. Such claims may be asserted by competitors or by other rights holders, particularly as products and services evolve to include new technologies and enhanced functionality. Such claims might require Sony to enter into settlement or license agreements, pay significant damage awards, face an injunction or refrain from marketing, selling or distributing certain of its products and services.

The failure to prevent unauthorized use or theft of Sony’s intellectual property rights, the failure to enter into licenses for necessary third-party intellectual property rights, the invalidation of Sony’s intellectual property rights or the settlement of an infringement claim against Sony by others may adversely impact Sony’s reputation, operating results and financial condition.

Changes in consumer behavior resulting from new technologies and distribution platforms may adversely affect operating results in Sony’s Music and Pictures segments.

Technology, particularly digital technology, used in the Music and Pictures segments continues to evolve, rapidly leading to alternative methods for the delivery, consumption and storage of digital content. These technological advancements have changed consumer behavior and empowered consumers to seek more control over when, where and how they consume digital content. The prevalence of enhanced internet capabilities and other new media may continue to reduce the demand for packaged physical media and impact traditional broadcast television and in-theater motion picture viewership, which could negatively affect revenues from

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Sony’s entertainment businesses. Digital distribution revenues, such as those from subscription streaming services, may not be sufficient to offset the decline in physical media sales that has affected and may continue to affect the operating results of Sony’s Music and Pictures segments. If Sony is unable to adequately respond to these changes, or fails to effectively anticipate or adapt to new market changes, Sony’s operating results and financial condition may be adversely impacted.

Changes in the regulation and performance of financial markets may adversely affect the operating results and financial condition of Sony’s Financial Services segment.

Sony’s Financial Services segment operates in industries subject to comprehensive regulation and supervision, including the Japanese insurance and banking industries. Future developments or changes in laws, regulations or policies may lead to increased compliance costs or limitations on operations in the Financial Services segment. In addition, Sony Corporation’s ability to receive funds from its affiliate Sony Financial Holdings Inc. (“SFH”) in the form of financial support or loans is restricted by guidelines issued by regulatory agencies in Japan.

Changes in interest rates, foreign exchange rates and the value of Japanese government and corporate bonds, equities, real estate and other asset classes may have an adverse effect on the operating results and financial condition of the Financial Services segment. For example, the life insurance business has invested most of its general account assets in ultra-long-term Japanese government and corporate bonds to match the liability characteristics of the long-term maturity insurance policies it has underwritten. The life insurance business has guaranteed yields on outstanding policies while its investment portfolio could be reduced by the market changes discussed above. The banking businesses have invested most of their total loan balance, or over half of their total assets, in their mortgage loans account. An increase in non-performing loans or a decline in prices of the real estate collateral from the market changes discussed above or deterioration of credit quality may have an adverse effect on operating results and financial condition through an increase in the allowance for doubtful accounts.

The market changes discussed above, Sony’s management of these changes or the occurrence of earthquakes, pandemic disease or other catastrophic events in Japan could expose the life and non-life insurance businesses to increasing costs or adverse impact on their ability to meet policy commitments.

The insurance businesses’ policy reserves and deferred insurance acquisition costs are calculated based on many actuarial assumptions that are uncertain. Significant differences between these actuarial assumptions and actual situations may result in additional policy reserves being recorded and the accelerated amortization of deferred acquisition costs, through the changes of calculation assumptions. In particular, the insurance businesses calculate policy reserves and deferred insurance acquisition costs based on the actuarial assumptions, assuming the future schedule of insurance premium revenue, yield of investments, claims to be paid for occurrence of insured events and other factors. The review of these actuarial assumptions is required at least once in each fiscal year.

Sony’s facilities and operations are subject to damage and disruption as a result of catastrophic disasters, outages or similar events that could lead to supply chain, manufacturing and other business disruptions and have an adverse impact on Sony’s operating results.

Sony’s headquarters and many of Sony’s most advanced device manufacturing facilities, including those for semiconductors, are located in Japan, where the risk of earthquakes is relatively high. A major earthquake in Japan, especially in Tokyo, the Tokai area or the Kyushu and Tohoku areas, where Sony headquarters, certain product manufacturing sites and semiconductor manufacturing sites, respectively, are located, could cause substantial damage to Sony’s business operations, including damage to buildings, machinery, equipment and inventories, and the interruption of production at manufacturing facilities. For example, the earthquake of April 14, 2016 and subsequent earthquakes in the Kumamoto region in Japan caused damage to a semiconductor manufacturing site in Kyushu, which interrupted production at the site.

In addition, offices and facilities used by Sony, its suppliers, service providers and business partners, including those used for raw materials, parts, components, network, telecommunications and information systems infrastructure, R&D, material procurement, manufacturing, motion picture and television production, logistics, sales, and online and other services are located throughout the world and are subject to possible destruction, temporary stoppage or disruption as a result of unexpected catastrophic events such as natural disasters, pandemic diseases, terrorist attacks, large-scale power outages and large-scale fires. If any of these facilities or offices were to experience a significant loss as a result of any of the above events, it may disrupt Sony’s operations, delay design, development or production, interrupt shipments and postpone the recording of sales,

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and/or result in large expenses to repair or replace these facilities or offices. Sony may also be exposed to price increases for raw materials, parts and components, and lower demand from commercial customers. These situations may have an adverse impact on Sony’s operating results and financial condition.

Sony’s brand image, reputation and business may be harmed and Sony may be subject to legal and regulatory claims if there is a breach or other compromise of Sony’s information security or that of its third-party service providers or business partners.

Sony, its third-party service providers, suppliers and other business partners make extensive use of information technology to support business operations, and to provide network and online services to customers. These operations and services, as well as Sony’s business information, may be intentionally or inadvertently compromised by malicious third parties, including state-sponsored organizations, Sony employees, third-party service providers or other business partners. Such organizations or individuals may use a variety and combination of techniques, such as installing malicious software, exploiting vulnerabilities in information technology, using social engineering to mislead employees and business partners into disclosing passwords and sensitive information, and coordinating distributed denial-of-service attacks to render services unavailable. As cyber-attacks become increasingly sophisticated and automated, and as tools and resources become more readily available, there can be no guarantee that Sony’s actions, security measures and controls designed to prevent, detect or respond to intrusion, to limit access to data, to prevent loss, destruction, alteration, or exfiltration of business information, or to limit the negative impact from such attacks can provide absolute security against compromise. As a result, Sony’s business information, including personal information, may be lost, destroyed, disclosed, misappropriated, altered, or accessed without consent, and Sony’s information technology systems or operations, or those of its service providers or other business partners, may be disrupted. Malicious adversaries may also use unauthorized access to Sony’s networks as a platform to compromise Sony’s third-party business partners without Sony’s knowledge. Sony has previously been the subject of sophisticated and targeted attacks. For example, in the fiscal year ended March 31, 2015, Sony’s Pictures segment was subject to a cyber-attack that resulted in unauthorized access to, and theft and disclosure of, Sony business information, including employee information and other information, and the destruction of data. Additionally, Sony’s network services, online game businesses and websites have been subject to cyber-attacks by groups and individuals with a range of motives and expertise, resulting in unauthorized access, denial of service, and the theft and/or disclosure of customer information.

Any of the above incidents can result in significant remediation costs. In addition, a disruption to Sony’s network and online services, information technology, or other compromise of its information security may have serious consequences to its business and operations, including lost revenues, damage to relationships with business partners and other third parties, disclosure, alteration, destruction or use of proprietary information and the failure to retain or attract customers. Moreover, such disruptions and breaches may result in a diversion of management’s attention and resources. Further, it may result in adverse media coverage, which may harm Sony’s brand image and reputation. Sony may also be subject to legal claims or legal proceedings, including regulatory investigations and actions. Sony’s cyber insurance may not cover all expenses and losses and, accordingly, such breaches or other compromises of Sony’s information security or that of its third-party service providers or business partners may have an adverse impact on Sony’s operating results and financial condition.

Sony’s business may suffer as a result of adverse outcomes of litigation and regulatory actions.

Sony faces the risk of litigation and regulatory actions in different countries in connection with its operations. Legal proceedings, including regulatory actions, may seek to recover very large indeterminate amounts or to limit Sony’s operations, and the possibility that they may arise and their magnitude may remain unknown for substantial periods of time. For example, legal proceedings, including regulatory actions, may result from antitrust scrutiny of market practices for anti-competitive conduct. A substantial legal liability or adverse regulatory outcome and the substantial cost to defend the litigation or regulatory actions may have an adverse effect on Sony’s reputation, operating results and financial condition.

Sony is subject to financial and reputational risks due to product quality and liability issues.

Sony’s products and services, such as consumer products, non-consumer products, parts and components, semiconductors, software and network services are becoming increasingly sophisticated and complicated as rapid advancements in technologies occur and as demand increases for mobile products and online services. Also, many Sony products are connected to the internet, and regularly communicate with services provided by Sony or third parties.

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Sony’s efforts to adapt to rapid advancements in technologies and increased demand for mobile products and online services, while also maintaining product quality, may not be successful and may increase exposure to product liability. As a result, Sony may incur both reputational damages and expenses in connection with, for example, product recalls and after-sales services. In addition, Sony may not be successful in introducing after-sales upgrades, enhancements or new features to existing products and services, or in enabling existing products and services to continue to conveniently and effectively integrate with other technologies and online services. Moreover, cyber-attacks targeting internet-connected products have increased significantly. For example, customer information and Sony or third-party technical information may be misappropriated, the functionality of Sony’s products and services may be impaired, or Sony products may be used in denial-of-service attacks. There can be no guarantee that Sony’s security measures will prevent products from being compromised.

As a result, the quality of Sony’s existing products and services may not remain satisfactory to consumers and become less marketable, less competitive or obsolete, and Sony’s reputation, operating results and financial condition may be adversely affected. Moreover, allegations of security vulnerability, health and safety issues related to Sony products, or lawsuits related to product quality, health issues arising from products or product safety, regardless of merit, may adversely impact Sony’s operating results and financial condition, either directly or as a result of the impact on Sony’s brand image and reputation as a producer of high-quality products and services. These issues are relevant to Sony products sold directly to customers, whether manufactured by Sony or a third party, and also to products of other companies that are equipped with Sony’s components, such as semiconductors.

Sony’s financial results and condition may be adversely affected by its employee benefit obligations.

Sony recognizes an unfunded pension obligation for its defined benefit pension plans based on (i) the Projected Benefit Obligation (“PBO”) under each pension plan less (ii) the fair value of the pension plan’s assets, in accordance with the accounting guidance for defined benefit plans. Actuarial gains and losses are amortized and included in pension expenses in a systematic manner over employees’ average remaining service periods. Any decrease of the pension plan asset value due to low returns from investments or increases in the PBO due to a lower discount rate, increases in rates of compensation and changes in certain other actuarial assumptions may increase the unfunded pension obligations and may have an adverse effect on Sony’s financial results and condition due to an increase in pension expenses.

Sony’s financial results and condition may be adversely affected by the status of its Japanese and foreign pension plans. Specifically, adverse equity market conditions and volatility in the credit markets may have an unfavorable impact on the value of Sony’s pension plan assets and its future estimated pension liabilities, the majority of which relate to the Japanese plans, which have approximately 30% of pension plan assets invested in equity securities. As a result, Sony’s financial results and condition could be adversely affected.

Further, Sony’s financial results and condition could be adversely affected by future pension funding requirements pursuant to the Japanese Defined Benefit Corporate Pension Plan Act (“Act”). Under the Act, Sony is required to meet certain financial criteria including periodic actuarial revaluation and the annual settlement of gains or losses of the plans. In the event that the actuarial reserve required by law exceeds the fair value of pension plan assets and that the fair value of pension assets may not be recovered within a certain moratorium period permitted by laws and/or special legislative decree, Sony may be required to make an additional contribution to its plans, which may reduce cash flows. Similarly, if Sony is required to make an additional contribution to a foreign plan to meet any funding requirements in accordance with local laws and regulations in each country, Sony’s cash flows might be adversely affected. If Sony is required to increase cash contributions to its pension plans when actuarial assumptions, such as an expected long-term rate of return of the pension plan assets, are updated for purposes of determining statutory contributions, it may have an adverse impact on Sony’s cash flows.

Further losses in jurisdictions where Sony has established valuation allowances against deferred tax assets, the inability of Sony to fully utilize its deferred tax assets, limitations on the use of its deferred tax assets under local law, exposure to additional tax liabilities or changes in Sony’s tax rates could adversely affect Sony’s net income and financial condition.

Sony is subject to income taxes in Japan and numerous other jurisdictions, and in the ordinary course of its business there are many situations where the ultimate tax determination can be uncertain, because of the transfer pricing for its intercompany transactions, and Sony is subject to continuous review by tax authorities of numerous jurisdictions. The calculation of Sony’s tax provision and the carrying value of tax assets, including net operating loss carryforwards and tax credit carryforwards, require significant judgment and the use of estimates,

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including estimates of future taxable income. As additional evidence becomes available, Sony reassesses these assets to determine if they remain appropriate or whether a reduction by a valuation allowance is appropriate. As of March 31, 2018, total established valuation allowances were 899.8 billion yen. An increase in a valuation allowance may have an adverse impact on Sony’s net income and financial condition.

Deferred tax assets are evaluated on a jurisdiction by jurisdiction basis. As of March 31, 2018, Sony and/or its subsidiaries had valuation allowances principally in Japan and the U.S. Additionally, deferred tax assets could expire unused or otherwise not be realizable for a variety of reasons including the lack of sufficient taxable income in the appropriate jurisdiction. Sony’s net income and financial condition could be adversely affected when the deferred tax assets expire unused.

In some jurisdictions, the use of net operating loss carryforwards or tax credits to reduce taxable income in a subsequent period is limited to a fixed percentage of taxable income or may only be used to offset taxes on income from certain sources. Thus, it is possible that even with significant net operating loss carryforwards or tax credits, Sony could record and pay taxes in a jurisdiction where it has taxable income.

In addition to the above, Sony’s future effective tax rates may be unfavorably affected by changes in both the statutory rates and the mix of earnings in countries with differing statutory rates or by other factors such as changes in tax laws and regulations or their interpretation, including limitations or restrictions on various tax deductions and credits, including deductions for royalties and interest.

Sony could incur asset impairment charges for goodwill, intangible assets or other long-lived assets.

Sony has a significant amount of goodwill, intangible assets and other long-lived assets, including production facilities and equipment in its electronics businesses. A decline in financial performance, market capitalization, reduced estimates of future cash flows, changes in global economic conditions or changes in estimates and assumptions used in the impairment analysis, which in many cases requires significant judgment, could result in impairment charges against these assets. Goodwill and indefinite lived intangible assets are tested annually for impairment during the fourth quarter of the fiscal year and between annual tests if an event occurs or circumstances change that would more likely than not reduce the fair value below the carrying amount. Such an event or change in circumstances would include unfavorable variances from or adjustments to established business plans, significant changes in forecasted results or volatility inherent to external markets and industries. The increased levels of global competition and the faster pace of technological change to which Sony is exposed can result in greater volatility of these estimates, assumptions and judgments, and increase the likelihood of impairment charges. In addition, the recoverability of the carrying value of long-lived assets held and used and long-lived assets to be disposed of is reviewed whenever events or changes in circumstances, including the types of events or changes described above with respect to goodwill and intangible assets, indicate that the carrying value of the assets or asset groups may not be recoverable. If the carrying value of the asset or asset group is considered impaired, an impairment charge is recorded for the amount by which the carrying value of the asset or asset group exceeds its fair value. For example, in the fiscal year ended March 31, 2016, Sony recorded impairment charges related to long-lived assets, both in the camera module business in the Semiconductors segment, amounting to 59.6 billion yen, and in the battery business in the Components segment, amounting to 30.6 billion yen. In the fiscal year ended March 31, 2017, Sony recorded a 23.9 billion yen impairment charge against long-lived assets in the Semiconductors segment resulting from the termination of the development and manufacturing of certain high-functionality camera modules for external sale, as well as a 112.1 billion yen impairment charge related to goodwill in the Pictures segment. In the fiscal year ended March 31, 2018, Sony recorded a 31.3 billion yen impairment charge against long-lived assets in the Mobile Communications segment. Any such charge may adversely affect Sony’s operating results and financial condition.

Holders of American Depositary Shares have fewer rights than shareholders and may not be able to enforce judgments based on U.S. securities laws.

The rights of shareholders under Japanese law to take actions, including voting their shares, receiving dividends and distributions, bringing derivative actions, examining Sony’s accounting books and records, and exercising appraisal rights, are available only to shareholders of record. Because the depositary, through its custodian agents, is the record holder of the shares underlying the American Depositary Shares (“ADSs”), only the depositary can exercise those rights in connection with the deposited shares. The depositary will make efforts to vote the shares underlying ADSs in accordance with the instructions of ADS holders and will pay the dividends and distributions collected from Sony. However, ADS holders will not be able to bring a derivative action, examine Sony’s accounting books and records, or exercise appraisal rights through the depositary.

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Sony Corporation is incorporated in Japan with limited liability. A majority of Sony’s directors and corporate executive officers are non-U.S. residents, and a substantial portion of the assets of Sony Corporation and the assets of Sony’s directors and corporate executive officers are located outside the U.S. As a result, it may be more difficult for investors to enforce against Sony Corporation or such persons, judgments obtained in U.S. courts predicated upon civil liability provisions of the federal and state securities laws of the U.S. or similar judgments obtained in other courts outside Japan. There is doubt as to the enforceability in Japanese courts, in original actions or in actions for enforcement of judgments of U.S. courts, of civil liabilities predicated solely upon the federal and state securities laws of the U.S.

Item 4. Information on the Company

A. History and Development of the Company

Sony Corporation was established in Japan in May 1946 as Tokyo Tsushin Kogyo Kabushiki Kaisha, a joint stock company (Kabushiki Kaisha) under Japanese law. In January 1958, it changed its name to Sony Kabushiki Kaisha (“Sony Corporation” in English).

In December 1958, Sony Corporation was listed on the Tokyo Stock Exchange (the “TSE”). In June 1961, Sony Corporation issued American Depositary Receipts (“ADRs”) in the U.S.

In March 1968, Sony Corporation established CBS/Sony Records Inc. in Japan, as a 50-50 joint venture company between Sony Corporation and CBS Inc. in the U.S. In January 1988, the joint venture became a wholly-owned subsidiary of Sony Corporation, and in April 1991, changed its name to Sony Music Entertainment (Japan) Inc. (“SMEJ”). In November 1991, SMEJ was listed on the Second Section of the TSE.

In September 1970, Sony Corporation was listed on the New York Stock Exchange (the “NYSE”).

In August 1979, Sony Corporation established Sony Prudential Life Insurance Co., Ltd. in Japan, as a 50-50 joint venture company between Sony Corporation and The Prudential Insurance Company of America. In April 1991, the joint venture changed its name to Sony Life Insurance Co., Ltd. (“Sony Life”). In March 1996, Sony Life became a wholly-owned subsidiary of Sony Corporation, and in April 2004, with the establishment of SFH, a financial holding company, Sony Life became a wholly-owned subsidiary of SFH.

In July 1984, Sony Magnescale Inc., a subsidiary of Sony Corporation, was listed on the Second Section of the TSE. The subsidiary changed its name to Sony Precision Technology Inc. in October 1996 and then to Sony Manufacturing Systems Corporation in April 2004. In April 2012, Sony Manufacturing Systems was merged into Sony EMCS Corporation. Sony EMCS Corporation changed its name to Sony Global Manufacturing & Operations Corporation in April 2016.

In July 1987, Sony Chemicals Corporation, a subsidiary of Sony Corporation, was listed on the Second Section of the TSE. The subsidiary changed its name to Sony Chemical & Information Device Corporation in July 2006, and changed its name again to Dexerials Corporation in October 2012.

In January 1988, Sony Corporation acquired CBS Records Inc., the music business division of CBS Inc. in the U.S. The acquired company changed its name to Sony Music Entertainment Inc. in January 1991 and then to Sony Music Holdings Inc. in December 2008.

In November 1989, Sony Corporation acquired Columbia Pictures Entertainment, Inc. in the U.S. In August 1991, Columbia Pictures Entertainment, Inc. changed its name to Sony Pictures Entertainment Inc. (“SPE”).

In November 1993, Sony established Sony Computer Entertainment Inc. (“SCEI”) in Japan. SCEI changed its name to Sony Interactive Entertainment Inc. (“SIEI”) in April 2016.

In October 1995, Sony/ATV Music Publishing LLC (“Sony/ATV”) was formed as a 50-50 joint venture company between Sony Corporation and Michael Jackson. In September 2016, the joint venture became a wholly-owned subsidiary of Sony Corporation.

In January 2000, acquisition transactions by way of a share exchange were completed such that three subsidiaries which had been listed on the TSE — SMEJ, Sony Chemicals Corporation (currently Dexerials Corporation), and Sony Precision Technology Inc. (which was merged into Sony EMCS Corporation) — became wholly-owned subsidiaries of Sony Corporation. In September 2012, Sony Corporation completed the sale of certain of its chemical products businesses, including Sony Chemical & Information Device Corporation (currently Dexerials Corporation) to Development Bank of Japan Inc.

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In October 2001, Sony Ericsson Mobile Communications AB (“Sony Ericsson”), a 50-50 joint venture company between Sony Corporation and Telefonaktiebolaget LM Ericsson (“Ericsson”) of Sweden, was established. In February 2012, Sony acquired Ericsson’s 50% equity interest in Sony Ericsson. As a result of the acquisition, Sony Ericsson became a wholly-owned subsidiary of Sony and changed its name to Sony Mobile Communications AB.

In October 2002, Aiwa Co., Ltd. (“Aiwa”), then a TSE-listed subsidiary, became a wholly-owned subsidiary of Sony Corporation. In December 2002, Aiwa was merged into Sony Corporation.

In June 2003, Sony Corporation adopted the “Company with Three Committees” corporate governance system in line with the revised Japanese Commercial Code then effective. (Refer to “Board Practices” in “Item 6. Directors, Senior Management and Employees.”)

In April 2004, Sony Corporation established SFH, a financial holding company, in Japan. Sony Life, Sony Assurance Inc. (“Sony Assurance”), and Sony Bank Inc. (“Sony Bank”) became subsidiaries of SFH. In October 2007, SFH was listed on the First Section of the TSE in conjunction with the global initial public offering of shares of SFH by Sony Corporation and SFH.

In April 2004, S-LCD Corporation (“S-LCD”), a joint venture between Sony Corporation and Samsung Electronics Co., Ltd. of Korea for the manufacture of amorphous thin film transistor LCD panels, was established in Korea. Sony’s stake in S-LCD was 50% minus 1 share. In January 2012, Sony sold all of its shares of S-LCD to Samsung Electronics Co., Ltd.

In August 2004, Sony combined its worldwide recorded music business, excluding its recorded music business in Japan, with the worldwide recorded music business of Bertelsmann AG (“Bertelsmann”), forming a 50-50 joint venture, SONY BMG MUSIC ENTERTAINMENT (“SONY BMG”). In October 2008, Sony acquired Bertelsmann’s 50% equity interest in SONY BMG. As a result of the acquisition, SONY BMG became a wholly-owned subsidiary of Sony. In January 2009, SONY BMG changed its name to Sony Music Entertainment (“SME”).

In December 2005, Sony Communication Network Corporation, a subsidiary of Sony Corporation, was listed on the Mother’s market of the TSE, and was later listed on the First Section of the TSE in January 2008. Sony Communication Network Corporation was renamed So-net Corporation (“So-net”) in July 2013. In January 2013, Sony Corporation acquired all of the common shares of So-net through a tender offer and subsequent share exchange and, as a result of the acquisition, So-net became a wholly-owned subsidiary of Sony Corporation. So-net was renamed Sony Network Communications Inc. (“SNC”) in July 2016.

In April 2013, Sony Olympus Medical Solutions Inc. (“SOMED”), a medical business venture between Sony Corporation and Olympus Corporation (“Olympus”) was established in Japan. Sony’s stake in SOMED is 51%.

In July 2014, Sony Corporation sold its personal computer (“PC”) business operated under the VAIO brand to Japan Industrial Partners, Inc.

In July 2014, pursuant to a separation of Sony’s businesses into distinct subsidiaries, the television business was split out and began operations as Sony Visual Products Inc. (“SVP”).

In October 2015, the video and sound business was split out and began operations as Sony Video & Sound Products Inc. (“SVS”).

In April 2016, the semiconductors business was split out and began operations as Sony Semiconductor Solutions Corporation (“SSS”).

In April 2017, the imaging products and solution business was split out and began operations as Sony Imaging Products & Solutions Inc. (“SIPS”), which completed the sequential separation of Sony’s business units into distinct subsidiaries.

In September 2017, Sony transferred its battery businesses to the Murata Manufacturing Co., Ltd. Group.

Sony Corporation’s registered office is located at 7-1, Konan 1-chome, Minato-ku, Tokyo 108-0075, Japan, telephone +81-3-6748-2111.

The agent in the U.S. for purposes of this Item 4 is Sony Corporation of America (“SCA”), 25 Madison Avenue, 26^th Floor, New York, NY 10010-8601 (Attn: Office of the General Counsel).

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Principal Capital Investments

In the fiscal years ended March 31, 2016, 2017 and 2018, Sony’s capital expenditures were 468.9 billion yen, 272.2 billion yen and 332.1 billion yen, respectively. Sony’s capital expenditures are expected to be approximately 360.0 billion yen during the fiscal year ending March 31, 2019. For a breakdown of principal capital expenditures and divestitures (including interests in other companies), refer to “Item 5. Operating and Financial Review and Prospects.” The funding requirements of such various capital expenditures are expected to be financed by cash provided principally by operating and financing activities or the existing balance of cash and cash equivalents.

In the fiscal year ended March 31, 2018, Sony invested approximately 128.1 billion yen in the Semiconductors segment. This investment included approximately 106.6 billion yen to increase image sensor production capacity.

B. Business Overview

Sony is engaged in the development, design, production, manufacture, offer and sale of various kinds of electronic equipment, instruments and devices for consumer, professional and industrial markets such as network services, game hardware and software, televisions, audio and video recorders and players, still and video cameras, mobile phones, and semiconductors. Sony is engaged in the development, production, manufacture, and distribution of recorded music and the management and licensing of the words and music of songs as well as the production and distribution of animation titles, including game applications based on animation titles. Sony is also engaged in the production, acquisition and distribution of motion pictures and television programming and the operation of television and digital networks. Further, Sony is also engaged in various financial services businesses, including life and non-life insurance operations through its Japanese insurance subsidiaries and banking operations through a Japanese internet-based banking subsidiary.

Sony has striven to ensure the implementation of 1) clearly attributable accountability and responsibility, 2) management policies with an emphasis on sustainable profit generation and 3) the acceleration of decision-making processes and reinforcement of business competitiveness. To achieve this, Sony has separated its business units within Sony Corporation to form distinct subsidiaries and operate them alongside existing Sony Group companies. These separations include SVP in July 2014, SVS in October 2015, SSS in April 2016, and SIPS in April 2017. As a result of this separation of businesses, all segments are now being operated as subsidiaries of Sony Corporation.

Sony realigned its business segments from the first quarter of the fiscal year ended March 31, 2018. As a result of this realignment, the operations of the former Components segment are now included in All Other.

Products and Services

Game & Network Services (“G&NS”)

Sony Interactive Entertainment LLC (“SIE”) undertakes product research, development, design, marketing, sales, production, distribution and customer service for PlayStation^® hardware, software, content and network services.

The G&NS segment includes the Network and Hardware and Others categories. Network includes network services relating to game, video and music content provided by SIE; and Hardware and Others includes home and portable game consoles, packaged software and peripheral devices.

Music

Recorded Music:

“Recorded Music” includes the distribution of physical and digital recorded music and revenue derived from artists’ live performance. SME, a global entertainment company, excluding Japan, is engaged primarily in the development, production, marketing and distribution of recorded music in all commercial formats and genres. SMEJ is an entertainment company focused on the Japanese market, which includes a Japanese domestic recorded music business that produces recorded music and music videos through contacts with many artists in all music genres.

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Music Publishing:

“Music Publishing” includes the management and licensing of the words and music of songs. Sony/ATV is a U.S.-based music publishing business that owns and acquires rights to musical compositions, exploiting and marketing these compositions and receiving royalties or fees for their use.

Visual Media and Platform:

“Visual Media and Platform” includes the production and distribution of animation titles, game applications based on animation titles and various service offerings for music and visual products. These businesses are operated primarily by SMEJ.

Pictures

Motion Pictures:

“Motion Pictures” includes the worldwide production, acquisition and distribution of live-action and animated motion pictures. SPE’s motion picture production organizations include Columbia Pictures, Screen Gems, TriStar Pictures, Sony Pictures Animation, Stage 6 Films, AFFIRM Films and Sony Pictures Classics. SPE also operates Sony Pictures Imageworks, a visual effects and animation unit, and manages a studio facility, Sony Pictures Studios, which includes post-production facilities.

Television Productions:

“Television Productions” includes the production, acquisition and distribution of television programming including scripted series, unscripted “reality” or “light entertainment,” daytime serials, game shows, animated series, made for television movies and miniseries and other programming. Outside the U.S., SPE produces local language programming and licenses SPE owned programming and formats around the world.

Media Networks:

“Media Networks” includes the operation of television and digital networks worldwide. SPE’s television networks around the world include Sony Pictures Networks India Private Limited, which operates television networks in India, and a controlling interest in Game Show Network, which operates a U.S.-based cable network and an online game business. Digital networks include Crackle, a multi-platform video entertainment network focusing on premium video content.

Home Entertainment & Sound (“HE&S”)

SVP undertakes product research, development, design, marketing, sales, production, distribution and customer services for televisions. SVS undertakes product research, development, design, marketing, sales, production, distribution and customer services for video and sound products.

Imaging Products & Solutions (“IP&S”)

SIPS undertakes product research, development, design, manufacturing, sales, distribution and customer service for interchangeable lens cameras, compact digital cameras, consumer and professional video cameras as well as display products such as projectors and medical equipment. Additionally, SIPS is responsible for the broadcast/professional solutions business and the FeliCa contactless IC (integrated circuit) card technology business. SOMED undertakes development support to provide comprehensive medical and imaging device solutions for operating rooms and other medical areas.

The IP&S segment includes the Still and Video Cameras as well as Other categories. Still and Video Cameras includes interchangeable lens cameras, compact digital cameras, consumer video cameras and video cameras for broadcast. Other includes display products such as projectors and medical equipment.

Mobile Communications (“MC”)

Sony Mobile Communications Inc. (“Sony Mobile”) undertakes product research, development, design, marketing, sales, production, distribution and customer services for mobile phones, tablets, accessories and applications. SNC provides internet broadband network services to subscribers as well as creates and distributes content through its portal services to various electronics product platforms such as PCs and mobile phones.

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Semiconductors

SSS and its subsidiary Sony Semiconductor Manufacturing Corporation undertake product research, development, design, manufacturing, marketing, sales, production, distribution and customer services for complementary metal oxide semiconductor (“CMOS”) image sensors, charge-coupled devices (“CCDs”), large-scale integration systems (“LSIs”) and other semiconductors.

Financial Services

In the Financial Services segment, on April 1, 2004, Sony established a wholly-owned subsidiary, SFH, a holding company for Sony Life, Sony Assurance and Sony Bank, with the aim of integrating various financial services including insurance and savings and loans, and offering individual customers high value-added products and high-quality services. On October 11, 2007, in conjunction with the global initial public offering of shares of SFH, the shares of SFH were listed for trading on the First Section of the TSE. Following this global offering, SFH remains a consolidated subsidiary of Sony Corporation, which is the majority shareholder of SFH.

SFH conducts insurance, banking and other operations primarily through Sony Life, a Japanese life insurance company, Sony Assurance, a Japanese non-life insurance company, and Sony Bank, a Japanese internet-based bank, which are all wholly-owned by SFH.

All Other

All Other consists of various operating activities, including the batteries, recording media and storage media businesses, the disc manufacturing business outside of Japan and the PC business, which was sold in July 2014. Certain costs related to the PC business remain in All Other.

Sales and Distribution

Electronics*

* The term “Electronics” refers to the sum of the G&NS, HE&S, IP&S, MC and Semiconductors segments.

Sony’s electronics products and services, excluding those in the game business, are marketed throughout the world under the trademark “Sony,” which has been registered in approximately 200 countries and territories.

In most cases, sales of Sony’s electronics products are made to sales subsidiaries of Sony Corporation located in or responsible for sales in the countries and territories where Sony’s products and services are marketed. These subsidiaries then sell those products to unaffiliated local distributors and dealers or through direct sales, such as through the internet. In some regions, sales of certain products and services are made directly to local distributors by Sony Corporation.

Sales of electronics products and services are particularly seasonal and also vary significantly with the timing of new product introductions and the economic conditions of each country. Sales for the third quarter ending December 31 of each fiscal year are generally higher than other quarters of the same fiscal year due to demand in the year-end holiday season.

Japan:

Sony Marketing (Japan) Inc. markets consumer electronics products mainly through retailers. Sony Business Solutions Corporation markets professional electronics products and services. For electronic components, Sony sells products directly to wholesalers and manufacturers.

United States:

Sony markets its electronics products and services through Sony Electronics Inc. and other wholly-owned subsidiaries in the U.S.

Europe:

In Europe, Sony’s electronics products and services are marketed through sales subsidiaries including Sony Europe Limited, which is headquartered in the United Kingdom and has branches in European countries, and Sony Electronics JSC in Russia.

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China:

Sony markets its electronics products and services through Sony (China) Limited, Sony Corporation of Hong Kong Limited and other wholly-owned subsidiaries in China.

Asia-Pacific:

In Asia-Pacific, Sony’s electronics products and services are marketed through sales subsidiaries including Sony India Private Limited, Sony Electronics of Korea Corporation, Sony Taiwan Limited and Sony Electronics Vietnam.

Other Areas:

In overseas areas other than the U.S., Europe, China and Asia-Pacific, Sony’s electronics products and services are marketed through sales subsidiaries including Sony Brasil Ltda., Sony Middle East & Africa FZE in the United Arab Emirates and Sony de Mexico S.A.de C.V.

PlayStation^® hardware, software and content and network services are marketed and distributed by SIE, SIEI, and Sony Interactive Entertainment Europe, Ltd. (“SIEE”).

Along with certain of its global corporate functions in Japan, Sony Mobile has sales and marketing operations in many major regions of the world, as well as manufacturing sites in China and product development sites in Japan, Sweden and China. Sony Mobile brings its products to market through direct and indirect distribution channels, such as third-party cellular network carriers and retailers, as well as through its website.

Music

SME and SMEJ develop, produce, market, and distribute recorded music in various commercial formats. SME and its affiliates conduct business globally under “Columbia Records,” “Epic Records,” “RCA Records” and other labels. SMEJ conducts business in Japan under “Sony Music Records,” “Epic Records Japan,” “SME Records,” “Ki/oon Music,” “Sony Music Associated Records” and other labels.

Sony owns and acquires rights to musical compositions, exploits and markets these compositions, receives royalties or fees for their use and conducts its music publishing business in countries other than Japan primarily under the Sony/ATV name. Sony/ATV, previously a 50%-owned and consolidated joint venture, became a wholly-owned subsidiary of Sony on September 30, 2016 as a result of Sony’s acquisition of the 50% equity interest in Sony/ATV owned by the Estate of Michael Jackson (the “Estate”).

SMEJ creates artwork and produces packaged home entertainment products including music/games, and organizes various events in Japan through Sony Music Communications Inc. and its affiliates. SMEJ also produces, markets, and distributes animation products and game applications based on animation titles under the Aniplex name.

Pictures

SPE generally retains all rights relating to the worldwide distribution of its internally produced motion pictures and television programming, including rights for theatrical exhibition, home entertainment distribution, pay and free television exhibition and other markets. SPE also acquires distribution rights to motion pictures and television programming produced by other companies, and jointly produces and distributes motion pictures and television programming with other studios, television networks or production companies. These rights may be limited to particular geographic regions, specific forms of media or periods of time.

Within the U.S., SPE uses its own distribution service businesses, Sony Pictures Releasing and Sony Pictures Classics, for the U.S. theatrical release of its motion pictures and for the theatrical release of motion pictures acquired from and produced by others.

Outside the U.S., SPE generally distributes and markets motion pictures through one of its Sony Pictures Releasing International subsidiaries. In certain countries, however, SPE has joint distribution or sub-distribution arrangements with other studios, or arrangements with independent local distributors or other entities.

The worldwide home entertainment distribution of SPE’s motion pictures and television programming (and product acquired or licensed from others) is handled through Sony Pictures Home Entertainment, except in certain countries where SPE has joint distribution or sub-distribution arrangements with other studios, or

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arrangements with independent local distributors. Product is distributed in various home media formats including DVD, Blu-ray Disc™ and Digital Distribution. Digital Distribution includes electronic sell-through and video-on-demand distributed on cable, direct broadcast satellite (“DBS”) providers and digital platforms, as well as hotel pay-per-view.

The worldwide television distribution of SPE’s motion pictures and television programming (and product acquired or licensed from others) is handled through Sony Pictures Television. SPE’s library of motion pictures and television programming is licensed to linear distributors such as broadcast television networks, pay and basic cable networks and DBS providers, as well as to digital platforms such as subscription and advertising supported digital platforms (including Sony’s PlayStation^TM Network, Netflix, Amazon, Crackle and YouTube Red).

SPE’s television networks are distributed through cable, DBS providers, telecommunications companies and digital platforms to viewers around the world. These networks generate advertising, subscription and other ancillary revenues.

Financial Services

Sony Life conducts its life insurance business primarily in Japan. Sony Life’s core business is providing death protection and other insurance products to individuals, primarily through a consulting-based sales approach utilizing its experienced team of Lifeplanner^® sales employees as well as partner independent sales agents. Sony Life provides tailor-made life insurance products that are optimized for each customer. As of March 31, 2018, Sony Life employed 5,142 Lifeplanner^® sales employees. Sony Life maintains an extensive service network which mainly consists of the Lifeplanner^® channel and the independent agent channel in Japan. The Lifeplanner^® channel is characterized by recruitment of high-caliber sales professionals from industries outside the life insurance industry, quality improvement through education and training, performance-linked compensation and high productivity. Lifeplanner^® sales employees offer custom-made packages. Most of the agents in the independent agent channel are corporate and non-exclusive agents, primarily shop-style agents. Shop-style agents are a sub-channel of the independent agent channel, who offer insurance in local stores and provide customers with opportunities to compare various insurers’ products. To enhance Sony Life’s relationship with independent agents, Sony Life’s agent support staff provides independent agents with various support services, including recruiting, training and sales promotion activities. As part of its plan to expand its sales of individual annuity products, Sony Life established a Japanese joint venture company with AEGON N.V. in August 2009. The 50-50 joint venture, known as AEGON Sony Life Insurance Co., Ltd., began operations in Japan in December 2009.

Sony Assurance has conducted a non-life insurance business in Japan since October 1999. Sony Assurance’s core business is providing automobile insurance products and medical insurance products to individual customers, primarily through direct marketing via the internet and the telephone. The direct marketing business model employed by Sony Assurance enables it to improve operating efficiency and lower the costs of marketing and maintaining its insurance policies, creating savings which it passes on to policyholders in the form of competitively priced premiums.

Sony Bank has conducted banking operations in Japan since June 2001. As an internet bank focusing on the asset management and borrowing needs of individual customers, Sony Bank offers an array of products and services including yen and foreign currency deposits, investment trusts and mortgages. By using Sony Bank’s transaction channel, the “MONEYKit” service website, account holders can invest and manage assets over the internet according to their life plans. On July 1, 2011, Sony Bank acquired Sony’s 57% equity interest in Sony Payment Services Inc. (“Sony Payment Services”), resulting in Sony Payment Services becoming a consolidated subsidiary of Sony Bank. Sony Payment Services is an industry-leading provider of credit card settlement services to members of its internet network.

All Other

Sony Energy Devices Corporation and Sony Storage Media Solutions Corporation sell their battery and storage media products, respectively, through Sony’s Electronics sales companies, mentioned in the Electronics’ Sales and Distribution section above, as well as through their own sales forces. Sony DADC group (“Sony DADC”) offers Blu-ray Disc™, DVD and CD media replication services as well as digital and physical supply chain solutions to business customers.

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Sales to External Customers by Geographic Area

The following table shows Sony’s consolidated sales to external customers in each of its major markets for the periods indicated.

	Fiscal year ended March 31
	2016		2017		2018
	(Yen in millions)
Japan		2,317,312		2,392,790		2,625,619
United States		1,733,759		1,673,768		1,835,705
Europe		1,881,329		1,634,683		1,841,457
China		540,497		557,995		674,718
Asia-Pacific		959,171		866,712		1,024,179
Other Areas		673,644		477,302		542,304
Total		8,105,712		7,603,250		8,543,982

Sources of Supply

Sony procures raw materials, parts and components used in the production of its products on a global basis on the most favorable terms that it can achieve. These items are purchased from various suppliers around the world. Sony has a general policy of maintaining multiple suppliers for important parts and components and, in the fiscal year ended March 31, 2018, Sony continued to optimize the number of its suppliers to achieve efficiencies and to minimize procurement risk when possible.

When raw materials, parts and components become scarce, the cost of production rises. For example, LCD panels and memory devices, which are used in multiple applications, can influence Sony’s performance when the cost of such parts and components fluctuates substantially. With regard to raw materials, the market price of copper has the potential to proportionately affect the cost of the parts and components that utilize copper, such as printed circuit boards and power cables. The price of resin and sheet steel, which is widely used in mechanical parts and components, may also fluctuate and impact the cost of those parts and components.

After-Sales Service

Sony provides repair and servicing functions in the areas where its electronics products are sold. Sony provides these services through its own online support network, call centers, service centers, factories, authorized independent service centers, authorized servicing dealers and subsidiaries.

In line with industry practices of the electronics businesses, almost all of Sony’s consumer-use products that are sold in Japan carry a warranty, generally for a period of one year from the date of purchase, covering repairs, free of charge, in the case of a malfunction in the course of ordinary use of the product. Warranties outside of Japan generally provide coverage for various periods of time depending on the product and the area in which it is marketed. In the case of broadcast- and professional-use products, Sony maintains support contracts with customers in addition to warranties.

To further help ensure customer satisfaction, Sony maintains customer information centers in its principal markets and web support information for all markets.

Patents and Licenses

Sony has a number of Japanese and foreign patents relating to its products. Sony is licensed to use a number of patents owned by others, covering a wide range of products. Certain of these licenses are important to Sony’s business. Sony products that employ DVD player functionality, including PlayStation^®4 (“PS4”) and PlayStation^®3 (“PS3”) hardware, are substantially dependent upon patents that relate to technologies specified in the DVD specifications and are licensed from Dolby Laboratories Licensing Corporation. Sony products that employ Blu-ray Disc™ player functionality and DVD player functionality, including PS4 and PS3 hardware, are substantially dependent upon patents that relate to technologies specified in the Blu-ray Disc™ specifications and are licensed by MPEG LA LLC and One-Blue, LLC, in addition to the patents that relate to technologies specified in the DVD specifications, as described above. Sony’s smartphone products are substantially dependent upon patents that relate to technologies specified in certain codec standards and are licensed by MPEG LA LLC and Via Licensing Corporation, as well as patents that relate to CDMA technologies specified by the standard-setting bodies within the telecommunications industry and are licensed by Qualcomm Incorporated and NTT DOCOMO, INC. Sony considers its overall license position beneficial to its operations.

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Competition

In each of its principal product lines and services, Sony encounters intense competition throughout the world. Sony believes, however, that in the aggregate it competes successfully and has a major position in all of the principal product lines and services in which it is engaged, although the strength of its position varies with products and markets. Refer to “Risk Factors” in “Item 3. Key Information.”

Electronics and All Other

Sony believes that its product planning and product design expertise, the high quality of its products, its record of innovative product introductions and product improvements, the user experience it provides and the ecosystem that supports such an experience, its price competitiveness derived from reductions in manufacturing and indirect costs, and its extensive marketing and servicing efforts are important factors in maintaining its competitive position. Continuing to provide high-value added products, services and experiences is a key factor by which Sony aims to differentiate itself in the highly competitive market of consumer electronics. Sony believes that the success of the G&NS businesses is determined by the availability of attractive software titles and related content, downloadable content, network services and peripherals. In the Semiconductors segment, Sony puts significant effort into keeping Sony’s strong competitive position by investing in R&D and production capacity, while also trying to avoid overinvesting and increasing fixed costs by carefully monitoring customer demand, market trends and demand for end-user products.

Music

Success in the music industry is dependent to a large extent upon the artistic and creative abilities of artists, producers and employees and is subject to the vagaries of public taste. The Music segment’s future competitive position depends on its continuing ability to attract and develop artists and products that can achieve a high degree of public acceptance as well as offer efficient services. In addition, Sony believes that the success of the Music segment’s animation products and game applications business, Aniplex, is largely dependent on the creative talent of game producers and developers, and is also subject to the vagaries of public taste.

Pictures

SPE faces intense competition from all forms of entertainment and other leisure activities to attract the attention of audiences worldwide. SPE competes with other motion picture studios and production companies to obtain story rights and talent, including writers, actors, directors and producers, which are essential to the success of SPE’s products. SPE competes with other companies, in particular technology companies, who are expanding into the production or distribution of film and television programing. In motion picture production and distribution, SPE faces competition to obtain exhibition and distribution outlets and optimal release dates for its products. In addition, SPE faces competition to acquire motion pictures and television programming from third parties. In television production and distribution, competition arises from the increasing fragmentation of audiences among broadcast and cable networks, DBS providers, digital platforms and other outlets both within and outside of the U.S. Furthermore, broadcast networks in the U.S., or their affiliated production companies, continue to produce their own shows internally. This competitive environment may result in fewer opportunities to produce shows for U.S. networks and a shorter lifespan for ordered shows that do not immediately achieve favorable ratings. SPE’s worldwide television networks compete for viewers with broadcast and cable networks, DBS providers, digital platforms and other forms of entertainment. The growth in the number of networks around the world has increased the competition for advertising and subscription revenues, acquisition of programming, and distribution of SPE’s television networks by cable, DBS providers, digital platforms and other distribution systems.

Financial Services

In the Financial Services segment, Sony faces strong competition in the financial services markets in Japan. In recent years, the regulatory barriers between the life insurance and non-life insurance industries as well as among the insurance, banking and securities industries have been relaxed, resulting in new competitive pressures.

Sony Life competes not only with traditional insurance companies in Japan but also with other companies including online insurance companies, foreign-owned life insurance companies and a number of Japanese cooperative associations.

Sony Assurance competes against insurers that sell their policies through sales agents as well as insurers that, like Sony Assurance, primarily sell their policies through direct marketing via the telephone and the

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internet. Competition in Japan’s non-life insurance industry has intensified in recent years, in part due to a number of new market entrants, including foreign-owned insurers.

Some of the competitors in the life insurance and non-life insurance businesses have advantages over Sony including:

• greater financial resources and financial strength ratings;

• greater brand awareness;

• more extensive marketing and sales networks, including through tie-ups with other types of financial institutions;

• more competitive pricing;

• larger customer bases; and

• a wider range of products and services.

Sony Bank has focused on providing retail asset management and mortgage services for individuals, and faces significant competition in Japan’s retail financial services market. Sony Bank competes with traditional banking institutions, regional banks, trust banks, non-bank companies, and newer financial groups providing online full-services of bank and brokerage in Japan.

In the Financial Services segment, it is important to maintain a strong and healthy financial foundation for the business as well as to meet diversifying customer needs. Sony Life and Sony Assurance have maintained a high solvency margin ratio, relative to the Japanese domestic minimum solvency margin ratio requirements. Sony Bank has maintained a sufficient capital adequacy ratio relative to the Japanese domestic criteria.

Government Regulations

Sony’s business activities are subject to various governmental regulations in different countries in which it operates, including regulations relating to: various business/investment approvals; trade affairs, including customs, import and export control; competition and antitrust; anti-bribery; advertising and promotion; intellectual property; broadcasting, consumer and business taxation; foreign exchange controls; personal information protection; product safety; labor; human rights; conflict; occupational health and safety; environmental; and recycling requirements.

In Japan, Sony’s insurance businesses are subject to the Insurance Business Act and approvals and oversight from the Financial Services Agency (“FSA”). The primary purpose of the Insurance Business Act and related regulations is to protect policyholders, not shareholders. The Insurance Business Act specifies the types of businesses insurance companies may engage in, imposes limits on the types and amounts of investments that can be made and requires insurance companies to maintain specified reserves and a minimum solvency margin ratio. In particular, life insurance companies must maintain a premium reserve (for the portion of their portfolio other than unearned premiums), an unearned premium reserve, a reserve for refunds with respect to certain insurance contracts of life insurance companies specified in the Insurance Business Act’s regulations, and a contingency reserve in amounts no lower than the amount of the “standard policy reserve” as set forth by the regulatory guidelines. The FSA maintains a solvency standard which is used by Japanese regulators to monitor the financial strength of insurance companies. Non-life insurance companies are also required to provide a policy reserve. Sony Bank is also subject to regulation by the FSA under the Banking Act of Japan, including the requirement that it maintain a minimum capital adequacy ratio in accordance with capital adequacy guidelines adopted by the FSA based on the Basel III agreement. The FSA has broad regulatory powers over insurance and banking businesses in Japan, including the authority to grant or revoke operating licenses and to request information and conduct onsite inspections of books and records. Sony’s subsidiaries in the Financial Services segment are subject to the Japanese Insurance Business Act and Banking Act that require insurance and business companies to maintain their financial credibility and to secure protection for policyholders and depositors in view of the public importance of insurance and banking services. As such, lending and borrowing between subsidiaries in the Financial Service segment and the other companies within Sony Group is strictly limited.

In addition, Sony’s telecommunication businesses in Japan are subject to approvals and oversight from the Ministry of Internal Affairs and Communications, under the Telecommunications Business Act and other regulations related to the internet businesses and communication methods in Japan.

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Social Responsibility Regulations Such as Environmental and Human Rights Regulations

Sony monitors, evaluates, and complies with new environmental requirements that may affect its operations. For example, in Europe, Sony is required to comply with a number of environmental regulations enacted by the EU such as the Restriction of Hazardous Substances (“RoHS”) Directive, the Waste Electrical and Electronic Equipment (“WEEE”) Directive and the Registration, Evaluation, Authorization and Restriction of Chemicals (“REACH”) regulation. Similar regulations are being formulated in other areas of the world, including South American and Southeast Asian countries.

Sony has taken steps to address new regulations or governmental policies related to climate change including carbon disclosure, greenhouse gas emission reduction, carbon taxes and energy efficiency for electronics products. For example, Sony has established an internal management system in response to the EU directive on energy-related products and their energy efficiency (“ErP”).

Sony also monitors and evaluates newly adopted laws and regulations that may affect its operations applicable to purchasing activities including the procurement of raw materials, with respect to environmental, occupational health and safety, human rights, labor and armed conflict issues, and complies as appropriate.

Also refer to “Risk Factors” in “Item 3. Key Information.”

Disclosure pursuant to Section 219 of the Iran Threat Reduction and Syria Human Rights Act of 2012

Section 219 of the Iran Threat Reduction and Syria Human Rights Act of 2012 added Section 13(r) to the Securities Exchange Act of 1934 (the “Exchange Act”), as amended. Section 13(r) requires an issuer to disclose in its annual or quarterly reports, as applicable, whether it or any of its affiliates knowingly engaged in certain activities, transactions or dealings relating to Iran or with designated natural persons or entities sanctioned under programs relating to terrorism or the proliferation of weapons of mass destruction. Disclosure is required even where the activities, transactions or dealings are conducted outside the U.S. by non-U.S. affiliates in compliance with applicable law, and whether or not the activities are sanctionable under U.S. law.

Sony is aware that certain transactions during the fiscal year ended March 31, 2018, as described below, may be disclosable pursuant to Section 13(r) of the Exchange Act.

Sony does not customarily allocate net profit on a country-by-country or activity-by-activity basis, other than as set forth in Sony’s consolidated financial statements prepared in accordance with U.S. GAAP; thus, the net profit and loss described below are non-U.S. GAAP figures and are estimated solely for the purpose of preparing this disclosure pursuant to Section 13(r) of the Exchange Act. The information below is to the best of Sony’s knowledge, and in particular Sony may not be aware of all potentially reportable sales by third-party-owned dealers and distributors.

• During the fiscal year ended March 31, 2018, a non-U.S. subsidiary of Sony sold medical instruments, including medical printers, print media and monitors, to a third-party-owned dealer in Dubai, which, to the best of Sony’s knowledge, planned to resell those products to hospitals and health organizations in Iran, some of which are under the control of the Iranian Ministry of Health. Sony’s gross revenue from these sales was approximately 3.0 million U.S. dollars, and Sony has estimated that its net profit from such sales was 0.5 million U.S. dollars.

• Sony’s representative office in Tehran, Iran, which was established in 1992, has been closed and has been under liquidation processes since before the beginning of the fiscal year ended March 31, 2014. In the course of liquidation, Sony engages in certain incidental transactions (for example, permits, taxes, and similar matters incidental to the wind-down of the office in Iran) with Iranian government-owned entities. No material revenues or profits are associated with these transactions with the Iranian government-owned entities.

Sony is not aware of any other activity, transaction or dealing by Sony Corporation or any of its affiliates during the fiscal year ended March 31, 2018 that is disclosable in this report under Section 13(r) of the Exchange Act. As of the date of this report, Sony does not anticipate that any activity, transaction or dealing that may be disclosable will be conducted during the fiscal year ending March 31, 2019, except as described above in connection with the wind-down of its representative office or for certain transactions through third-party-owned dealers that Sony believes to be intended for hospitals and health organizations in Iran. Nevertheless, Sony has continued to monitor developments in this area, especially in the light of the United States’ decision to cease its participation in the Joint Comprehensive Plan of Action of July 14, 2015, among the United States, the United Kingdom, China, France, Russia, Germany, the European Union and Iran, and will determine whether and to

27

what extent they affect Sony’s business with Iranian customers as currently conducted and may additionally be conducted. Such business activities may require disclosure pursuant to Section 13(r) of the Exchange Act. Sony intends to conduct any such business activities in accordance with applicable law.

Sony believes, and maintains policies and procedures designed to ensure that, its transactions with Iran and elsewhere have been conducted in accordance with applicable economic sanctions laws and regulations and do not involve transactions likely to result in the imposition of sanctions or other penalties on Sony. However, there can be no assurance that Sony’s policies and procedures will be effective, and if the relevant authorities were to impose penalties or sanctions against Sony, the impact of such sanctions could be material.

C. Organizational Structure

The following table sets forth the significant subsidiaries owned, directly or indirectly, by Sony Corporation.

Name of company	Country of incorporation	(As of March 31, 2018) Percentage owned
Sony Global Manufacturing & Operations Corporation	Japan		100.0
Sony Semiconductor Solutions Corporation	Japan		100.0
Sony Semiconductor Manufacturing Corporation	Japan		100.0
Sony Marketing Inc.	Japan		100.0
Sony Mobile Communications Inc.	Japan		100.0
Sony Network Communications Inc.	Japan		100.0
Sony Interactive Entertainment Inc.	Japan		100.0
Sony Visual Products Inc.	Japan		100.0
Sony Video & Sound Products Inc.	Japan		100.0
Sony Storage Media Solutions Corporation	Japan		100.0
Sony Imaging Products & Solutions Inc.	Japan		100.0
Sony Music Entertainment (Japan) Inc.	Japan		100.0
Sony Financial Holdings Inc.*	Japan		63.0
Sony Life Insurance Co., Ltd.*	Japan		100.0
Sony Bank Inc.*	Japan		100.0
Sony Assurance Inc.*	Japan		100.0
Sony Americas Holding, Inc.	U.S.A.		100.0
Sony Corporation of America	U.S.A.		100.0
Sony Entertainment Inc.	U.S.A.		100.0
Sony Electronics Inc.	U.S.A.		100.0
Sony Interactive Entertainment LLC	U.S.A.		100.0
Sony Pictures Entertainment Inc.	U.S.A.		100.0
CPT Holdings, Inc.	U.S.A.		100.0
Sony Music Entertainment	U.S.A.		100.0
Sony/ATV Music Publishing LLC	U.S.A.		100.0
Sony Europe Limited	U.K.		100.0
Sony Interactive Entertainment Europe Ltd.	U.K.		100.0
Sony Global Treasury Services Plc	U.K.		100.0
Sony Overseas Holding B.V.	Netherlands		100.0
Sony (China) Limited	China		100.0
Sony EMCS (Malaysia) Sdn. Bhd.	Malaysia		100.0
Sony Electronics (Singapore) Pte. Ltd.	Singapore		100.0

* Sony Corporation owns 63% of Sony Financial Holdings Inc., and Sony Financial Holdings Inc. owns 100% of Sony Life Insurance Co., Ltd., Sony Bank Inc. and Sony Assurance Inc.

D. Property, Plant and Equipment

Sony has a number of offices, plants and warehouses throughout the world. Most of the buildings and land in/on which such offices, plants and warehouses are located are owned by Sony.

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The following table sets forth information as of March 31, 2018 with respect to plants used for the production of products mainly for electronics products and services with floor space of more than 500,000 square feet:

Location	Approximate floor space		Principal products produced
	(square feet)
In Japan:
Nagasaki (Sony Semiconductor Manufacturing Corporation — Nagasaki TEC)		2,305,000	CMOS image sensors and other semiconductors
Kumamoto (Sony Semiconductor Manufacturing Corporation — Kumamoto TEC)		2,204,000	CCDs, CMOS image sensors, LCDs and other semiconductors
Kagoshima (Sony Semiconductor Manufacturing Corporation — Kagoshima TEC)		1,789,000	CCDs and other semiconductors
Oita (Sony Semiconductor Manufacturing Corporation — Oita TEC)		975,000	CMOS image sensors and other semiconductors
Kohda, Aichi (Sony Global Manufacturing & Operations Corporation — Tokai TEC — Kohda Site)		902,000	Compact digital cameras and interchangeable lens cameras
Inazawa, Aichi (Sony Global Manufacturing & Operations Corporation — Tokai TEC — Inazawa Site)		842,000	Televisions
Tsuruoka, Yamagata (Sony Semiconductor Manufacturing Corporation — Yamagata TEC)		703,000	CMOS image sensors and other semiconductors
Kosai, Shizuoka (Sony Global Manufacturing & Operations Corporation — Tokai TEC — Kosai Site)		576,000	Broadcast- and professional-use video equipment
Kisarazu, Chiba (Sony Global Manufacturing & Operations Corporation — Kisarazu TEC)		541,000	Blu-ray Disc™ players/recorders, audio equipment and video conference systems
Outside of Japan:
Terre Haute, Indiana, U.S.A. (Sony DADC US Inc.)		1,541,000	Blu-ray Disc™-ROMs, CDs, DVDs and UMDs (Universal Media Disc)
Bangi, Malaysia (Sony EMCS (Malaysia) Sdn. Bhd. — KL TEC)		1,183,000	Televisions, TV components, Blu-ray Disc™ players/recorders and DVD-players/recorders
Huizhou, China (Sony Precision Devices (Huizhou) Co., Ltd.)		1,027,000	Optical pickups and LCDs
Penang, Malaysia (Sony EMCS (Malaysia) Sdn. Bhd. — PG TEC)		1,021,000	Audio equipment
Wuxi, China (Sony Digital Products (Wuxi) Co., Ltd.)		798,000	Compact digital cameras, interchangeable lens cameras etc.
Beijing, China (Sony Mobile Communications (China) Co., Ltd.)		552,000	Mobile phones
Bangkadi, Thailand (Sony Device Technology (Thailand) Co.,Ltd.)		513,000	Image sensor assembly etc.

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In addition to the above facilities, Sony has a number of other plants for electronic products throughout the world. Sony owns R&D facilities, and Sony Corporation’s headquarters building, with a total floor space of approximately 1,753,000 square feet, in Tokyo, Japan, where administrative functions and product development activities are carried out. SIEI has its corporate headquarters in Sony Corporation’s headquarters building and leases additional office space in Tokyo from a third party, where administrative functions, product development, and software development are carried out. SIE and SIEE lease their offices in the U.S. and Europe, respectively.

SPE’s corporate offices and motion picture and television production facilities are headquartered in Culver City, California, where it owns and operates a studio facility, Sony Pictures Studios, with aggregate floor space of approximately 1,939,200 square feet. SPE also leases office space and motion picture and television support facilities from third parties and affiliates of Sony Corporation in various worldwide locations. SPE’s film and videotape storage operations are located in various leased locations in the U.S. and Europe.

SME’s corporate offices are headquartered in New York, NY where it leases office space from SCA. SME also leases office space from third parties in various locations worldwide.

Most of SMEJ’s offices, including leased premises, are located in Tokyo, Japan.

SCA’s corporate offices are headquartered in New York, NY where it leases office space from a third party.

On April 1, 2017, Sony China completed the transfer of all of the equity interest in Sony Electronics Huanan Co., Ltd., which manufactures camera modules, to Shen Zhen O-film Tech Co., Ltd.

On September 1, 2017, Sony completed the transfer to Murata Manufacturing Co., Ltd. Group of the battery-related plants located in Japan, China and Singapore.

Item 4A. Unresolved Staff Comments

None

Item 5. Operating and Financial Review and Prospects

A. Operating Results

Operating Performance

	Fiscal year ended March 31
	2016		2017		2018
	(Yen in billions)
Sales and operating revenue		8,105.7		7,603.3		8,544.0
Equity in net income of affiliated companies		2.2		3.6		8.6
Operating income		294.2		288.7		734.9
Income before income taxes		304.5		251.6		699.0
Net income attributable to Sony Corporation’s stockholders		147.8		73.3		490.8

Sales

Fiscal year ended March 31, 2018 compared to fiscal year ended March 31, 2017:

For the fiscal year ended March 31, 2018, sales and operating revenue (“sales”) were 8,544.0 billion yen, an increase of 940.7 billion yen compared to the fiscal year ended March 31, 2017. This increase was due to increases in sales in all segments except for the Mobile Communications (“MC”) segment and All Other. In addition, sales for the fiscal year ended March 31, 2018 included 6.7 billion yen and 2.6 billion yen of insurance recoveries, mainly for opportunity losses related to the 2016 Kumamoto Earthquakes (the “Kumamoto Earthquakes”) in the Semiconductors segment and the Imaging Products & Solutions (“IP&S”) segment, respectively.

Fiscal year ended March 31, 2017 compared to fiscal year ended March 31, 2016:

For the fiscal year ended March 31, 2017, sales were 7,603.3 billion yen, a decrease of 502.5 billion yen, or 6% compared to the fiscal year ended March 31, 2016. This decrease was primarily due to the impact of foreign exchange rates. On a constant currency basis, sales were essentially flat year-on-year, due to significant increases in Game & Network Services (“G&NS”) and Semiconductors segment sales, substantially offset by a significant decrease in MC segment sales.

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Cost of Sales, Selling, General and Administrative Expenses and Other Operating (Income) Expense, net

“Sales” in the analysis of the ratio of “cost of sales” to sales, the ratio of “R&D costs” to sales, and the ratio of “selling, general and administrative expenses (“SGA expenses”)” to sales refers only to the “net sales” and “other operating revenue” portions of consolidated sales (which excludes financial services revenue). This is because “financial services expenses” are recorded separately from cost of sales and SGA expenses in the consolidated financial statements. The calculations of all ratios below that pertain to reportable segments include intersegment transactions.

Fiscal year ended March 31, 2018 compared to fiscal year ended March 31, 2017:

For the fiscal year ended March 31, 2018, cost of sales increased 435.2 billion yen year-on-year to 5,188.3 billion yen. The ratio of cost of sales to sales improved year-on-year from 72.9% to 70.9%.

R&D costs (all R&D costs are included within cost of sales) increased 11.1 billion yen year-on-year to 458.5 billion yen. The ratio of R&D costs to sales was 6.3% compared to 6.9% in the fiscal year ended March 31, 2017. For further details, refer to Research and Development in Item 5.C.

SGA expenses increased 77.2 billion yen year-on-year to 1,583.2 billion yen. The ratio of SGA expenses to sales improved year-on-year from 23.1% to 21.6%.

Other operating expense, net, was 4.1 billion yen, a decrease of 144.9 billion yen year-on-year. This significant improvement was mainly due to the following factors that occurred in the fiscal year ended March 31, 2018 and the absence of the following factors that occurred in the fiscal year ended March 31, 2017. Refer to Note 20 of the consolidated financial statements.

Factors that occurred in the fiscal year ended March 31, 2018

• An impairment charge against long-lived assets: 31.3 billion yen (MC segment)

• A gain resulting from the sale of the entire equity interest in a manufacturing subsidiary in the camera module business: 28.3 billion yen (Semiconductors segment)

• A gain resulting from the sale of real estate held by a subsidiary: 10.5 billion yen (Music segment)

• A gain resulting from the sale of manufacturing equipment: 8.6 billion yen (Semiconductors segment)

Factors that occurred in the fiscal year ended March 31, 2017

• An impairment charge of goodwill: 962 million U.S. dollars (112.1 billion yen) (Pictures segment)

• An impairment charge related to the transfer of the battery business: 42.3 billion yen (All Other)

• An impairment charge against long-lived assets resulting from the termination of the development and manufacturing of certain high-functionality camera modules for external sale: 23.9 billion yen (Semiconductors segment)

• A gain on the sale of certain shares of M3: 37.2 billion yen (All Other)

Fiscal year ended March 31, 2017 compared to fiscal year ended March 31, 2016:

For the fiscal year ended March 31, 2017, cost of sales decreased by 413.9 billion yen year-on-year, to 4,753.0 billion yen. The cost of sales included net charges of 15.4 billion yen in expenses in the Semiconductors segment resulting from the Kumamoto Earthquakes. The ratio of cost of sales to sales improved year-on-year from 73.4% to 72.9%.

R&D costs (all R&D costs are included within cost of sales) decreased by 20.7 billion yen year-on-year, to 447.5 billion yen. The ratio of R&D costs to sales was 6.9% compared to 6.7% in the fiscal year ended March 31, 2016. For further details, refer to Research and Development in Item 5.C.

SGA expenses decreased by 186.0 billion yen year-on-year, to 1,506.0 billion yen, mainly due to the impact of the appreciation of the yen. The ratio of SGA expenses to sales improved year-on-year from 24.0% to 23.1%.

Other operating expense, net was 149.0 billion yen, an increase of 101.8 billion yen year-on-year. This significant deterioration was mainly due to the above-mentioned factors that occurred in the fiscal year ended March 31, 2017, as well as the factors listed below that occurred in the fiscal year ended March 31, 2016. Refer to Note 20 of the consolidated financial statements.

31

Factors that occurred in the fiscal year ended March 31, 2016

• An impairment charge against long-lived assets in the camera module business: 59.6 billion yen (Semiconductors segment)

• An impairment charge against long-lived assets in the battery business: 30.6 billion yen (All Other)

• A gain on the remeasurement to fair value of SME’s 51% equity interest in Orchard Media, Inc. (“The Orchard”), which had previously been accounted for under the equity method, as a result of SME increasing its ownership interest to 100%: 151 million U.S. dollar (18.1 billion yen) (Music segment)

• A gain from the sale of a part of the logistics business, in connection with the formation of a logistics joint venture: 12.3 billion yen (Corporate and elimination)

Equity in Net Income (Loss) of Affiliated Companies

For the fiscal year ended March 31, 2018, equity in net income of affiliated companies was 8.6 billion yen, an increase of 5.0 billion yen year-on-year. This increase was primarily due to an improvement of equity in net income (loss) for SA Reinsurance Ltd. in the Financial Services segment. For the fiscal year ended March 31, 2017, equity in net income of affiliated companies was 3.6 billion yen, an increase of 1.3 billion yen year-on-year.

Operating Income

Fiscal year ended March 31, 2018 compared to fiscal year ended March 31, 2017:

For the fiscal year ended March 31, 2018, operating income increased 446.2 billion yen year-on-year to 734.9 billion yen. This significant increase was due to the impact of the above-mentioned increase in sales and the positive impact of foreign exchange rates as well as the above-mentioned factors that occurred in the fiscal year ended March 31, 2018. Operating income in the fiscal year ended March 31, 2017 included the above-mentioned factors that occurred in the fiscal year ended March 31, 2017.

Fiscal year ended March 31, 2017 compared to fiscal year ended March 31, 2016:

For the fiscal year ended March 31, 2017, operating income decreased 5.5 billion yen year-on-year, to 288.7 billion yen. This decrease was mainly due to the 962 million U.S. dollars (112.1 billion yen) impairment charge of goodwill recorded in the Pictures segment, substantially offset by an improvement in the operating results of the MC segment and an increase in the operating income of the G&NS segment.

Other Income and Expenses

Fiscal year ended March 31, 2018 compared to fiscal year ended March 31, 2017:

For the fiscal year ended March 31, 2017, other income increased by 9.3 billion yen year-on-year, to 23.7 billion yen, while other expenses increased by 8.0 billion yen year-on-year, to 59.5 billion yen. The net amount of other income and other expenses was an expense of 35.8 billion yen, an improvement of 1.3 billion yen year-on-year primarily due to an increase in interest and dividend income as well as lower losses on the devaluation of securities investments, partially offset by an increase in net foreign exchange losses.

The foreign exchange loss, net, increased by 8.5 billion yen year-on-year, to 30.6 billion yen.

Interest and dividends in other income of 19.8 billion yen were recorded in the fiscal year ended March 31, 2018, an increase of 8.3 billion yen year-on-year. Interest recorded in other expenses totaled 13.6 billion yen, a decrease of 1.0 billion yen year-on-year.

Fiscal year ended March 31, 2017 compared to fiscal year ended March 31, 2016:

For the fiscal year ended March 31, 2017, other income decreased by 52.4 billion yen year-on-year, to 14.4 billion yen, while other expenses decreased by 5.0 billion yen year-on-year, to 51.5 billion yen. The net amount of other income and other expenses was an expense of 37.1 billion yen, a deterioration of 47.4 billion yen year-on-year primarily due to the absence in the fiscal year ended March 31, 2017 of a 46.8 billion yen gain on the sale of certain shares of Olympus recorded in the fiscal year ended March 31, 2016.

32

The foreign exchange loss, net, increased by 1.6 billion yen year-on-year, to 22.2 billion yen.

Interest and dividends in other income of 11.5 billion yen were recorded in the fiscal year ended March 31, 2017, a decrease of 1.0 billion yen year-on-year. Interest recorded in other expenses totaled 14.5 billion yen, a decrease of 10.7 billion yen year-on-year, mainly due to a decrease in interest rates.

Income before Income Taxes

For the fiscal year ended March 31, 2018, income before income taxes was 699.0 billion yen, an increase of 447.4 billion yen year-on-year. For the fiscal year ended March 31, 2017, income before income taxes was 251.6 billion yen, a decrease of 52.9 billion yen year-on-year.

Income Taxes

Fiscal year ended March 31, 2018 compared to fiscal year ended March 31, 2017:

During the fiscal year ended March 31, 2018, Sony recorded 151.8 billion yen of income tax expense, resulting in an effective tax rate of 21.7%, which was lower than the effective tax rate of 49.3% in the fiscal year ended March 31, 2017. This lower effective tax rate in the fiscal year ended March 31, 2018 was mainly due to (1) profits recorded at Sony Corporation and its national tax filing group in Japan, and in the U.S. consolidated tax filing group, both of which have established valuation allowances for deferred tax assets, compared to the losses recorded for those groups in the fiscal year ended March 31, 2017 and (2) the negative impact of the nondeductible goodwill charge that was recorded in the fiscal year ended March 31, 2017. In addition, during the fiscal year ended March 31, 2018, Sony recorded a 13.8 billion yen tax benefit related to deferred tax liabilities as a result of U.S. tax reform. Refer to Note 21 of the consolidated financial statements.

Fiscal year ended March 31, 2017 compared to fiscal year ended March 31, 2016:

During the fiscal year ended March 31, 2017, Sony recorded 124.1 billion yen of income tax expense, resulting in an effective tax rate of 49.3%, which exceeded the effective tax rate of 31.1% in the fiscal year ended March 31, 2016. This higher effective tax rate was mainly due to the nondeductible impairment charge of goodwill recorded during the fiscal year ended March 31, 2017. Refer to Note 21 of the consolidated financial statements.

Net Income Attributable to Sony Corporation’s Stockholders

Fiscal year ended March 31, 2018 compared to fiscal year ended March 31, 2017:

For the fiscal year ended March 31, 2018, the net income attributable to Sony Corporation’s stockholders, which excludes net income attributable to noncontrolling interests, was 490.8 billion yen, an increase of 417.5 billion yen year-on-year.

Net income attributable to noncontrolling interests of 56.5 billion yen was recorded, an increase of 2.2 billion yen year-on-year.

Basic net income per share and diluted net income per share, attributable to Sony Corporation’s stockholders for the fiscal year ended March 31, 2018 were 388.32 yen and 379.75 yen, respectively, compared with 58.07 yen and 56.89 yen, respectively, in the fiscal year ended March 31, 2017. Refer to Note 22 of the consolidated financial statements.

Fiscal year ended March 31, 2017 compared to fiscal year ended March 31, 2016:

For the fiscal year ended March 31, 2017, the net income attributable to Sony Corporation’s stockholders, which excludes net income attributable to noncontrolling interests, was 73.3 billion yen, a decrease of 74.5 billion yen year-on-year.

Net income attributable to noncontrolling interests of 54.3 billion yen was recorded, a decrease of 7.7 billion yen year-on-year. This decrease was mainly due to the acquisition of the 50% equity interest in Sony/ATV held by the Estate, making Sony/ATV a wholly-owned subsidiary of Sony.

Basic net income per share and diluted net income per share, attributable to Sony Corporation’s stockholders for the fiscal year ended March 31, 2017 were 58.07 yen and 56.89 yen, respectively, compared with 119.40 yen and 117.49 yen, respectively, in the fiscal year ended March 31, 2016. Refer to Note 22 of the consolidated financial statements.

33

Operating Performance by Business Segment

The following discussion is based on segment information. Sales and operating revenue in each business segment include intersegment transactions. Refer to Note 28 of the consolidated financial statements.

In addition to those significant trends, uncertainties and events listed herein, refer to Trend Information in Item 5.D for more information on significant trends, uncertainties and events that had, or may have, an effect on business segment operating performance.

Game & Network Services (“G&NS”)

Key Financial Figures

	Fiscal year ended March 31
	2016		2017		2018
	(Yen in millions)
Sales to external customers by product category
Network		529,318		714,924		1,033,192
Hardware & Other		950,457		866,644		815,106
Sales to external customers		1,479,775		1,581,568		1,848,298
Intersegment sales		72,118		68,231		95,514
G&NS segment total sales		1,551,893		1,649,799		1,943,812
G&NS segment operating income		88,668		135,553		177,478
	(Units in millions)
Major product unit sales
PS4 hardware		17.7		20.0		19.0

Fiscal year ended March 31, 2018 compared to fiscal year ended March 31, 2017:

For the fiscal year ended March 31, 2018, Sales increased 294.0 billion yen year-on-year to 1,943.8 billion yen. This increase was primarily due to an increase in PlayStation^®4 (“PS4”) software sales, including sales through the network, the impact of foreign exchange rates, as well as an increase in the number of subscribers for PlayStation^®Plus, a paid membership service.

Operating income increased 41.9 billion yen year-on-year to 177.5 billion yen. This increase was primarily due to the above-mentioned increase in sales, partially offset by an increase in selling, general and administrative expenses. During the current fiscal year, there was a 19.8 billion yen positive impact from foreign exchange rate fluctuations.

The operating performance of the G&NS segment for the fiscal year ended March 31, 2018 reflected the continued demand for hardware, software and network services. The expansion of the PS4 eco-system is expected to continue throughout the fiscal year ending March 31, 2019, and Sony intends to expand the network services business during that fiscal year as the PS4 eco-system continues to be in its harvesting period.

Fiscal year ended March 31, 2017 compared to fiscal year ended March 31, 2016:

For the fiscal year ended March 31, 2017, sales increased 97.9 billion yen year-on-year to 1,649.8 billion yen. This increase was primarily due to an increase in PS4 software sales, including sales through the network, as well as an increase in PS4 hardware sales, partially offset by the impact of foreign exchange rates and the impact of a price reduction for PS4 hardware.

Operating income increased 46.9 billion yen year-on-year to 135.6 billion yen. This significant increase was primarily due to PS4 hardware cost reductions and the above-mentioned increase in PS4 software sales, partially offset by the impact of the price reduction for PS4 hardware and a decrease in PS3 software sales.

34

Music

Key Financial Figures

	Fiscal year ended March 31
	2016		2017		2018
	(Yen in millions)
Sales to external customers by product category
Recorded Music		412,718		388,948		446,960
Music Publishing		71,258		66,541		74,360
Visual Media & Platform		118,588		175,278		263,472
Sales to external customers		602,564		630,767		784,792
Intersegment sales		16,675		16,891		15,203
Music segment total sales		619,239		647,658		799,995
Music segment operating income		86,509		75,798		127,786

The Music segment results include the yen-translated results of SME and Sony/ATV, both U.S.-based operations which aggregate the results of their worldwide subsidiaries on a U.S. dollar basis and the results of SMEJ, a Japan-based music company which aggregates its results in yen. The segment also includes equity in net income for EMI Music Publishing (“EMI”), an affiliated company accounted for under the equity method for which Sony records 39.8% of EMI’s net income in the segment operating income.

Fiscal year ended March 31, 2018 compared to fiscal year ended March 31, 2017:

For the fiscal year ended March 31, 2018, sales increased 152.3 billion yen year-on-year to 800.0 billion yen. This significant increase was mainly due to higher Visual Media and Platform sales and higher Recorded Music sales. Visual Media and Platform sales increased due to the continued strong performance of Fate/Grand Order, a game application for mobile devices. Recorded Music sales increased due to a continued increase in digital streaming revenues. Best-selling music titles included P!nk’s Beautiful Trauma, DJ Khaled’s Grateful and Camila Cabello’s Camila.

Operating income increased 52.0 billion yen year-on-year to 127.8 billion yen. This increase was primarily due to the impact of the above-mentioned increase in sales and the above-mentioned gain recorded on the sale of real estate.

The operating performance of the Music segment for the fiscal year ended March 31, 2018 reflected continued growth in the market for recorded music after many years of historical market decline, as the continued development and growth of digital streaming has continued to offset the decreases in physical and digital download revenues. Additionally, the music industry also faces increased margin pressure from higher artist royalty costs, as well as pressure on top line licensing rates with our digital partners. In this environment, Sony has pursued initiatives to offset the decreases in physical and digital download revenues with increased streaming, broadcast, and other licensing revenues through continued investment in new recorded music and music publishing rights. Sony intends to continue these initiatives in the fiscal year ending March 31, 2019, while also undertaking various measures to maintain the current momentum of Fate/Grand Order and other game applications based on animation titles.

Fiscal year ended March 31, 2017 compared to fiscal year ended March 31, 2016:

For the fiscal year ended March 31, 2017, sales increased 28.4 billion yen year-on-year to 647.7 billion yen, while sales increased significantly year-on-year on a constant currency basis (as described below under “Foreign Exchange Fluctuations and Risk Hedging”). The significant increase in sales on a constant currency basis was due to higher Visual Media and Platform sales and higher Recorded Music sales. Visual Media and Platform sales increased due to the strong performance of Fate/Grand Order, a game application for mobile devices in Japan. Recorded Music sales increased due to an increase in digital streaming revenues. Best-selling music titles included Beyoncé’s Lemonade, various hit tracks from The Chainsmokers and Sia’s This is Acting.

Operating income decreased 10.7 billion yen year-on-year to 75.8 billion yen. Operating income decreased primarily due to the absence of the above-mentioned 151 million U.S. dollar (18.1 billion yen) gain that was recorded in the fiscal year ended March 31, 2016 on the remeasurement of SME’s equity interest in The Orchard. The operating results of the Music segment were also positively impacted by the above-mentioned increase in sales, partially offset by the negative impact of the appreciation of the yen against the U.S. dollar.

35

Pictures

Key Financial Figures

	Fiscal year ended March 31
	2016		2017			2018
	(Yen in millions)
Sales to external customers by product category
Motion Pictures		447,355		409,363			448,945
Television Productions		270,115		271,886			289,024
Media Networks		218,357		219,981			272,204
Sales to external customers		935,827		901,230			1,010,173
Intersegment sales		2,315		1,899			894
Pictures segment total sales		938,142		903,129			1,011,067
Pictures segment operating income (loss)		38,507		(80,521	)		41,110

Pictures segment results presented below are a yen-translation of the results of SPE, a U.S.-based operation that aggregates the results of its worldwide subsidiaries on a U.S. dollar basis. Management analyzes the results of SPE in U.S. dollars, so discussion of certain portions of its results is specified as being on “a U.S. dollar basis.”

Fiscal year ended March 31, 2018 compared to fiscal year ended March 31, 2017:

For the fiscal year ended March 31, 2018, sales increased 107.9 billion yen year-on-year (a 10% increase on a U.S. dollar basis) to 1,011.1 billion yen. The significant increase in sales on a U.S. dollar basis was due to higher sales in Media Networks, Motion Pictures, and Television Productions. Media Networks sales increased primarily due to higher advertising and subscription revenues resulting from the acquisition of TEN Sports Network and improved ratings, both in India. Motion Pictures sales increased due to the strong worldwide theatrical performance of Spider-Man: Homecoming and Jumanji: Welcome to the Jungle, partially offset by lower television licensing revenues for catalog product. Television Productions sales increased due to higher licensing revenues for various U.S. television series including The Goldbergs, The Good Doctor and Philip K. Dick’s Electric Dreams, partially offset by lower television licensing revenues for catalog product.

Operating income of 41.1 billion yen was recorded, compared to an operating loss of 80.5 billion yen in the fiscal year ended March 31, 2017. This significant improvement in operating results was primarily due to the absence of the 962 million U.S. dollars (112.1 billion yen) impairment charge of goodwill recorded in the fiscal year ended March 31, 2017. Operating results also improved due to the above-mentioned increase in sales, partially offset by an operating loss from TEN Sports Network, which was acquired in February 2017.

The operating performance of the Pictures segment in the fiscal year ended March 31, 2018 reflected the following underlying market trends. In the market in which Motion Pictures operates, a larger share of film revenue is concentrated in tent-pole films while demand for packaged physical media continues to decline. In this environment, Sony is working to expand the global appeal of its films, enhance developed and acquired intellectual property and maximize digital distribution revenues. In the market in which Television Productions operates, U.S. networks are continuing to seek to own more of the content broadcast on their networks. This impacts the number of series that these networks license from third-party producers such as SPE or the rights SPE retains in the series that are licensed. Sony, which does not own a major U.S. broadcast network, has been striving to build strong relationships with top content creators and major networks around the world to offset this impact. In the market in which Media Networks operates, there has been a gradual movement from a linear carriage environment — that is, one in which a viewer watches a program at a particular, pre-scheduled time — to a non-linear, on-demand carriage environment, which has put pressure on Media Networks’ carriage negotiations with distributors. As a result, Sony expects to continue to aim to differentiate its branded channels from the competition. Sony intends to continue these initiatives in the fiscal year ending March 31, 2019.

Fiscal year ended March 31, 2017 compared to fiscal year ended March 31, 2016:

For the fiscal year ended March 31, 2017, sales decreased 35.0 billion yen year-on-year (a 5% increase on a U.S. dollar basis) to 903.1 billion yen, primarily due to the impact of the appreciation of the yen against the U.S. dollar. The increase in sales on a U.S. dollar basis was primarily due to higher sales for Television Productions and Media Networks. Sales for Television Productions increased primarily due to higher subscription video-on-demand licensing revenues. The increase in sales for Media Networks was due to higher advertising and subscription revenues mainly in India, Latin America and the U.S.

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Operating loss of 80.5 billion yen was recorded, compared to operating income of 38.5 billion yen in the fiscal year ended March 31, 2016. This significant deterioration in operating results was primarily due to the above-mentioned 962 million U.S. dollars (112.1 billion yen) impairment charge of goodwill. The operating results for the Pictures segment were also negatively impacted by higher programming and marketing expenses for Media Networks as well as higher theatrical marketing expenses for Motion Pictures.

Home Entertainment & Sound (“HE&S”)

Key Financial Figures

	Fiscal year ended March 31
	2016		2017		2018
	(Yen in millions)
Sales to external customers by product category
Televisions		797,764		720,557		861,763
Audio and Video		354,946		311,771		357,194
Other		2,375		1,887		2,777
Sales to external customers		1,155,085		1,034,215		1,221,734
Intersegment sales		3,957		4,789		999
HE&S segment total sales		1,159,042		1,039,004		1,222,733
HE&S segment operating income		50,558		58,504		85,841
	(Units in millions)
Major product unit sales
Televisions		12.2		12.1		12.4

Fiscal year ended March 31, 2018 compared to fiscal year ended March 31, 2017:

For the fiscal year ended March 31, 2018, sales increased 183.7 billion yen year-on-year to 1,222.7 billion yen, primarily due to an improvement in the product mix of televisions reflecting a shift to high value-added models, as well as the impact of foreign exchange rates.

Operating income increased 27.3 billion yen year-on-year to 85.8 billion yen. This increase was primarily due to the impact of the above-mentioned increase in sales and the positive impact of foreign exchange rates, partially offset by an increase in research and development, marketing and other expenses.

The operating performance of the HE&S segment for the fiscal year ended March 31, 2018 reflected the relatively stabilized television market and a continued market shift to high value-added models such as 4K televisions. In this environment, Sony expects to continue to pursue an improvement in product mix reflecting the shift to high value-added models such as 4K OLED televisions, and an enhancement of its marketing initiatives.

Fiscal year ended March 31, 2017 compared to fiscal year ended March 31, 2016:

For the fiscal year ended March 31, 2017, sales decreased 120.0 billion yen year-on-year to 1,039.0 billion yen, primarily due to the impact of foreign exchange rates.

Operating income increased 7.9 billion yen year-on-year to 58.5 billion yen. This increase was primarily due to an improvement in the product mix reflecting a shift to high value-added models, partially offset by the negative impact of foreign exchange rates as well as an increase in expenses resulting from the change in the method of calculating royalties and other costs for brand and patent utilization, pursuant to the separation of Sony’s businesses into distinct subsidiaries and the realignment of corporate functions.

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Imaging Products & Solutions (“IP&S”)

Key Financial Figures

	Fiscal year ended March 31
	2016		2017		2018
	(Yen in millions)
Sales to external customers by product category
Still and Video Cameras		428,777		351,834		415,318
Other		248,454		219,665		231,845
Sales to external customers		677,231		571,499		647,163
Intersegment sales		6,724		8,134		8,729
IP&S segment total sales		683,955		579,633		655,892
IP&S segment operating income		69,320		47,257		74,924
	(Units in millions)
Major product unit sales
Digital cameras within Still and Video Cameras*		6.1		4.2		4.4

* Digital cameras include compact digital cameras and interchangeable lens cameras.

Fiscal year ended March 31, 2018 compared to fiscal year ended March 31, 2017:

For the fiscal year ended March 31, 2018, sales increased 76.3 billion yen year-on-year to 655.9 billion yen. This significant increase was mainly due to the absence of the impact from the Kumamoto Earthquakes in the previous fiscal year, the impact of foreign exchange rates and an improvement in the product mix of Still and Video Cameras reflecting a shift to high value-added models.

Operating income increased 27.7 billion yen year-on-year to 74.9 billion yen. This significant increase was mainly due to the above-mentioned improvement in product mix, the positive impact of foreign exchange rates and the absence of the impact from the Kumamoto Earthquakes in the previous fiscal year.

The operating performance of the IP&S segment for the fiscal year ended March 31, 2018 reflected shrinking markets for compact digital cameras, consumer video cameras and interchangeable lens cameras. In this environment, Sony continued to strengthen its high value-added products, such as interchangeable lens cameras and lenses, and focus on high-end models within its product portfolio of compact digital cameras and consumer video cameras. Sony intends to continue these initiatives in the fiscal year ending March 31, 2019.

Fiscal year ended March 31, 2017 compared to fiscal year ended March 31, 2016:

For the fiscal year ended March 31, 2017, sales decreased 104.3 billion yen year-on-year to 579.6 billion yen. This significant decrease was mainly due to the impact of foreign exchange rates and a decrease in unit sales resulting from the 2016 Kumamoto Earthquakes.

Operating income decreased 22.1 billion yen year-on-year to 47.3 billion yen. This significant decrease was mainly due to the negative impact of foreign exchange rates and the impact of the above-mentioned decrease in unit sales, partially offset by an improvement in the product mix of Still and Video Cameras reflecting a shift to high value-added models and cost reductions.

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Mobile Communications (“MC”)

Key Financial Figures

	Fiscal year ended March 31
	2016			2017		2018
	(Yen in millions)
Sales to external customers		1,121,925			752,688		713,916
Intersegment sales		5,548			6,457		9,826
MC segment total sales		1,127,473			759,145		723,742
MC segment operating income (loss)		(61,435	)		10,164		(27,636	)
	(Units in millions)
Major product unit sales
Smartphones		24.9			14.6		13.5

Fiscal year ended March 31, 2018 compared to fiscal year ended March 31, 2017:

For the fiscal year ended March 31, 2018, sales decreased 35.4 billion yen year-on-year to 723.7 billion yen. This decrease was due to a decrease in smartphone unit sales.

Operating loss of 27.6 billion yen was recorded, compared to operating income of 10.2 billion yen in the fiscal year ended March 31, 2017. This deterioration in operating results was mainly due to a 31.3 billion yen loss recorded as an impairment charge against long-lived assets, the decrease in unit sales and an increase in the price of key components, partially offset by a reduction in operating costs.

The operating performance of the MC segment for the fiscal year ended March 31, 2018 reflected the continued slowing and maturation of the smartphone market on a global scale. In addition, the Japanese carrier market, where Sony sells many premium smartphones due to its brand strength, shrank mainly due to the proliferation of mobile virtual network operators, with which Sony has traditionally not had business relationships. In this environment, Sony continued to focus on increasing smartphone sales in areas outside of Japan, but these efforts were unsuccessful mainly due to fierce competition. As a result, beginning in the fiscal year ending March 31, 2019, Sony intends to reduce the quantity of unprofitable models and stabilize the segment’s operating results by further reducing operating costs and by growing recurring revenue businesses, such as the internet service provider business.

Fiscal year ended March 31, 2017 compared to fiscal year ended March 31, 2016:

For the fiscal year ended March 31, 2017, sales decreased 368.3 billion yen year-on-year to 759.1 billion yen. This significant decrease was primarily due to a decrease in smartphone unit sales mainly in Europe, the Middle East and Latin America, as well as a significant downsizing of unit sales in unprofitable regions.

Operating income of 10.2 billion yen was recorded, compared to an operating loss of 61.4 billion yen in the fiscal year ended March 31, 2016. Despite the impact of the above-mentioned decrease in sales, operating results improved significantly mainly due to a reduction in operating costs including the benefit of restructuring initiatives, an improvement in profitability resulting from a concentration on fewer geographic areas and a focus on high value-added models, the positive impact of foreign exchange rates, as well as a reduction in restructuring charges.

Semiconductors

Key Financial Figures

	Fiscal year ended March 31
	2016		2017			2018
	(Yen in millions)
Sales to external customers		599,430		659,779			726,892
Intersegment sales		139,629		113,344			123,118
Semiconductors segment total sales		739,059		773,123			850,010
Semiconductors segment operating income (loss)		14,500		(7,811	)		164,023

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Fiscal year ended March 31, 2018 compared to fiscal year ended March 31, 2017:

For the fiscal year ended March 31, 2018, sales increased 76.9 billion yen year-on-year to 850.0 billion yen. This increase was primarily due to a significant increase in unit sales of image sensors for mobile products, as well as the absence of the impact from the Kumamoto Earthquakes which resulted in a production decrease in the previous fiscal year, partially offset by a significant decrease in sales of camera modules, a business which was downsized.

Operating income of 164.0 billion yen was recorded, compared to operating loss of 7.8 billion yen in the previous fiscal year. This significant improvement in operating results was primarily due to the impact of the above-mentioned increase in sales, the 28.3 billion yen gain resulting from the sale of the entire equity interest in a manufacturing subsidiary in the camera module business, the 8.6 billion yen gain resulting from the sale of manufacturing equipment, as well as the 6.7 billion yen in insurance recoveries related to the Kumamoto Earthquakes. Additionally, in the previous fiscal year, the Semiconductors segment operating results included the above-mentioned 23.9 billion yen impairment charge against long-lived assets relating to camera modules, net charges of 15.4 billion yen in expenses resulting from the Kumamoto Earthquakes and 6.5 billion yen in inventory write-downs of certain image sensors for mobile products.

The operating performance of the Semiconductors segment for the fiscal year ended March 31, 2018 reflected continued growth in demand for image sensors for mobile products, which is currently the most important market for Sony’s image sensors. This growth was largely due to increased demand for high value-added products that use these image sensors to improve their front-facing cameras, dual-lens cameras and video functionality. In this environment, Sony continued to streamline the portfolio of the Semiconductors segment to focus on image sensors, exiting from certain other businesses in the segment, including the camera modules business. Sony also continued to invest in production capacity for image sensors and increased its customer base while carefully monitoring demand. Sony intends to continue these initiatives in the fiscal year ending March 31, 2019.

Fiscal year ended March 31, 2017 compared to fiscal year ended March 31, 2016:

For the fiscal year ended March 31, 2017, sales increased 34.1 billion yen year-on-year to 773.1 billion yen. This increase in sales was primarily due to a significant increase in unit sales of image sensors mainly for mobile products, partially offset by the impact of foreign exchange rates, a significant decrease in sales of camera modules, a business which was downsized, and the decrease in production due to the 2016 Kumamoto Earthquakes. Sales to external customers increased 10.1% year-on-year.

Operating loss of 7.8 billion yen was recorded, compared to operating income of 14.5 billion yen in the fiscal year ended March 31, 2016. This significant deterioration in operating results was primarily due to the negative impact of foreign exchange rates, the above-mentioned expenses resulting from the 2016 Kumamoto Earthquakes, and a 6.5 billion yen write-down of inventories of certain image sensors mainly for mobile products. This deterioration was partially offset by the above-mentioned year-on-year increase in sales and the decrease in impairment charges against long-lived assets related to the camera module business.

Electronics*

* The term “Electronics” refers to the sum of the G&NS, HE&S, IP&S, MC, and Semiconductors segments.

Inventory

	Fiscal year ended March 31
	2017		2018
	(Yen in billions)
Game & Network Service		81.7		74.0
Home Entertainment & Sound		114.1		121.3
Imaging Products & Solutions		62.9		75.6
Mobile Communications		79.5		78.7
Semiconductors		203.6		240.9
Electronics Total		541.8		590.5

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Sales to External Customers by Geographic Area

	Fiscal year ended March 31
	2016			2017			2018
Japan		18.1	%		20.1	%		18.1	%
United States		20.9	%		22.4	%		22.4	%
Europe		28.0	%		26.4	%		26.5	%
China		8.7	%		10.1	%		11.4	%
Asia-Pacific (other than Japan and China)		14.9	%		14.6	%		15.3	%
Other		9.4	%		6.4	%		6.3	%
Electronics Total		100	%		100	%		100	%

Manufacturing by Geographic Area

The following tables set forth the Electronics segments’ total production breakdown of in-house and outsourced production, and the breakdown of in-house production by geographic regions. Figures in parentheses indicate the percentage of products that were exported from each geographic region to other regions.

Total production breakdown of in-house and outsourced production*

	Fiscal year ended March 31
	2017			2018
In-house production		63	%		63	%
Outsourced production		37	%		37	%
Electronics total		100	%		100	%

Breakdown of in-house production by geographic regions*

	Fiscal year ended March 31
	2017			2018
Japan		44% (88%	)		43% (89%	)
China		33% (74%	)		20% (62%	)
Asia-Pacific (other than Japan and China)		22% (56%	)		34% (66%	)
Americas and Europe		2% (less than 5%	)		3% (20%	)
Electronics total		100%			100%

* Because decimals have been rounded upwards, there may be cases in which the sum of individual figures does not equal 100%.

Financial Services

In Sony’s Financial Services segment, the results include SFH and SFH’s consolidated subsidiaries such as Sony Life, Sony Assurance and Sony Bank. The results of Sony Life discussed below on the basis of U.S. GAAP differ from the results that SFH and Sony Life disclose separately on a Japanese statutory basis.

Key Financial Figures

	Fiscal year ended March 31
	2016		2017		2018
	(Yen in millions)
Financial services revenue		1,073,069		1,087,504		1,228,377
Financial Services segment operating income		156,543		166,424		178,947

Fiscal year ended March 31, 2018 compared to fiscal year ended March 31, 2017:

For the fiscal year ended March 31, 2018, financial services revenue increased 140.9 billion yen year-on-year to 1,228.4 billion yen. This was primarily due to an increase in revenue at Sony Life. Revenue at Sony Life increased 128.0 billion yen year-on-year to 1,093.6 billion yen, primarily due to higher insurance premium revenue reflecting an increase in the policy amount in force.

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Operating income increased 12.5 billion yen year-on-year to 178.9 billion yen primarily due to an increase in operating income at Sony Life and a decrease of equity in net loss of affiliated companies. Operating income at Sony Life increased 4.8 billion yen year-on-year to 159.1 billion yen, mainly due to a gain recorded on the sale of real estate held for investment purposes in the general account, as well as an improvement in net gains and losses on derivative transactions to hedge market risk pertaining to minimum guarantees for variable life insurance. These increases were partially offset by a year-on-year increase in amortization of deferred insurance acquisition costs, primarily driven by a decrease in interest rates in the current fiscal year compared to an increase in interest rates in the previous fiscal year.

The operating performance of the Financial Services segment for the fiscal year ended March 31, 2018 reflected the circumstances in the Japanese economy, bond market and foreign exchange market. The Japanese economy continued to recover, as global demand for information technology products continued and a stable recovery in the Japanese employment situation fueled domestic demand. However, early 2018 was marked by a growing sense of uncertainty regarding the overseas political and economic situation, causing instability in the financial markets with the yen appreciating and stock prices falling. Between April 2017 and September 2017, such factors as political uncertainty and geopolitical risk pushed down Japanese government bond (“JGB”) yields. On the other hand, since October 2017, debates on tax reform in the United States prompted a rise in U.S. government bond yields, which rippled outward to affect JGB yields. Furthermore, with crude oil prices beginning to trend upward, Japan’s core consumer price index increased, spurring expectations among market participants that the Bank of Japan (“BOJ”) would lift the 10-year interest rate target defined in its “quantitative and qualitative monetary easing with long- and short-term interest rate controls.” However, as this situation prompted yen appreciation, the BOJ engaged in fixed-rate buying operations to curtail the rise in JGB yields, thereby indicating its stance toward continuing current levels of monetary easing. Although Sony expects the current environment to continue in the fiscal year ending March 31, 2019, Sony is continuing to pursue growth in the Financial Services segment by focusing on differentiating itself through high-quality financial products and services.

Fiscal year ended March 31, 2017 compared to fiscal year ended March 31, 2016:

For the fiscal year ended March 31, 2017, financial services revenue was 1,087.5 billion yen, essentially flat year-on-year. This was primarily due to an improvement in investment performance in the separate account driven by a rise in the stock market, substantially offset by a decrease in insurance premium revenue and a deterioration in investment performance in the general account, all at Sony Life. Revenue at Sony Life was 965.6 billion yen, essentially flat year-on-year.

Operating income increased 9.9 billion yen year-on-year to 166.4 billion yen primarily due to an increase in operating income at Sony Life. Operating income at Sony Life increased 15.5 billion yen year-on-year to 154.3 billion yen mainly due to decreases in the amortization of deferred insurance acquisition costs and the provision of policy reserves, primarily driven by an increase in interest rates and the improvement in the stock market, partially offset by a decline in net gains on sales of securities in the general account.

Information on Operations Separating Out the Financial Services Segment

The following schedules show unaudited condensed statements of income for the Financial Services segment and all other segments excluding Financial Services. These presentations are not in accordance with U.S. GAAP, which is used by Sony to prepare its consolidated financial statements. However, because the Financial Services segment is different in nature from Sony’s other segments, Sony believes that a comparative presentation may be useful in understanding and analyzing Sony’s consolidated financial statements. Transactions between the Financial Services segment and Sony without the Financial Services segment, including noncontrolling interests, are included in those respective presentations, then eliminated in the consolidated figures shown below.

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	Fiscal year ended March 31
Financial Services segment	2016			2017			2018
	(Yen in millions)
Financial services revenue		1,073,069			1,087,504			1,228,377
Financial services expenses		914,508			917,365			1,049,305
Other operating expenses, net		1,373			114			64
		915,881			917,479			1,049,369
Equity in net loss of affiliated companies		(645	)		(3,601	)		(61	)
Operating income		156,543			166,424			178,947
Other income (expenses), net		—			—			—
Income before income taxes		156,543			166,424			178,947
Income taxes		37,689			47,604			51,825
Net income		118,854			118,820			127,122
Less — Net income attributable to noncontrolling interests		52			107			201
Net income of Financial Services		118,802			118,713			126,921
	Fiscal year ended March 31
Sony without Financial Services segment	2016			2017			2018
	(Yen in millions)
Net sales and operating revenue		7,044,415			6,527,499			7,329,755
Costs of sales		5,176,143			4,761,541			5,199,748
Selling, general and administrative		1,687,715			1,501,957			1,578,716
Other operating expense, net		45,793			148,887			4,008
		6,909,651			6,412,385			6,782,472
Equity in net income of affiliated companies		2,883			7,164			8,630
Operating income		137,647			122,278			555,913
Other income (expenses), net		20,755			(22,728	)		(20,738	)
Income before income taxes		158,402			99,550			535,175
Income taxes		57,101			76,454			99,945
Net income		101,301			23,096			435,230
Less — Net income attributable to noncontrolling interests		14,350			8,502			9,311
Net income of Sony without Financial Services		86,951			14,594			425,919
	Fiscal year ended March 31
Consolidated	2016			2017			2018
	(Yen in millions)
Financial services revenue		1,066,319			1,080,284			1,221,235
Net sales and operating revenue		7,039,393			6,522,966			7,322,747
		8,105,712			7,603,250			8,543,982
Costs of sales		5,166,894			4,753,010			5,188,259
Selling, general and administrative		1,691,930			1,505,956			1,583,197
Financial services expenses		907,758			910,144			1,042,163
Other operating expenses		47,171			149,001			4,072
		7,813,753			7,318,111			7,817,691
Equity in net income of affiliated companies		2,238			3,563			8,569
Operating income		294,197			288,702			734,860
Other income (expenses), net		10,307			(37,083	)		(35,811	)
Income before income taxes		304,504			251,619			699,049
Income taxes		94,789			124,058			151,770
Net income		209,715			127,561			547,279
Less — Net income attributable to noncontrolling interests		61,924			54,272			56,485
Net income attributable to Sony Corporation’s Stockholders		147,791			73,289			490,794

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All Other

Fiscal year ended March 31, 2018 compared to fiscal year ended March 31, 2017:

Sales for the fiscal year ended March 31, 2018 decreased 43.3 billion yen year-on-year to 407.2 billion yen. This decrease in sales was primarily due to a decrease in sales in the battery business.

Operating loss for the fiscal year ended March 31, 2018 decreased 6.1 billion yen year-on-year to 23.5 billion yen. This decrease was primarily due to the absence of a 42.3 billion yen impairment charge related to the transfer of the battery business recorded in the previous fiscal year, partially offset by the absence of a gain of 37.2 billion yen from the sale of certain shares of M3 recorded in the previous fiscal year.

Fiscal year ended March 31, 2017 compared to fiscal year ended March 31, 2016:

Sales for the fiscal year ended March 31, 2017 decreased 89.7 billion yen year-on-year to 450.5 billion yen. This significant decrease in sales was primarily due to the impact of foreign rates and a decrease in sales in the battery business, as well as the disc manufacturing business resulting from the contraction of the market.

Operating loss for the fiscal year ended March 31, 2017 decreased 11.7 billion yen year-on-year to 29.6 billion yen. This decrease was primarily due to the absence of the 30.6 billion yen impairment charge related to long-lived assets of the battery business recorded in the fiscal year ended March 31, 2016 and the above-mentioned gain from the sale of certain shares of M3, partially offset by an impairment charge related to the planned transfer of the battery business and the impact of the above-mentioned decrease in sales.

Restructuring

In a highly competitive landscape, Sony has continued to make efforts to revitalize its Electronics businesses and has undertaken a number of restructuring initiatives including exiting businesses or product categories, headcount reduction programs, and streamlining of its sales and administrative functions. For example, during the fiscal year ended March 31, 2018, Sony transferred its battery business to the Murata Manufacturing Co., Ltd. Group. In accordance with the transfer, Sony classified certain assets and liabilities related to the battery business as held for sale and, as a result of the fair value valuation of these assets and liabilities, recorded impairment losses of 42.3 billion yen in other operating expenses (net) in the fiscal year ended March 31, 2017. In an effort to optimize the organization and improve the performance of its businesses, Sony implemented a number of restructuring initiatives, primarily within the Music segment, targeting effectiveness and cost reduction in the fiscal year ended March 31, 2018.

Sony believes the competitive environment will continue to be difficult, and therefore plans to be vigilant with respect to the scale of its businesses and to changes in the environment. Sony will continue to evaluate the cost and profit structure of its businesses and continue to take action to reduce cost where Sony believes appropriate.

The chart below shows the restructuring charges, which include non-cash charges related to depreciation associated with restructured assets, recorded in the fiscal years ended March 31, 2016, 2017 and 2018. For further details, refer to Note 19 of the consolidated financial statements.

	Fiscal year ended March 31
	2016		2017		2018
	(Yen in millions)
Restructuring charges		38,259		60,215		22,405

Foreign Exchange Fluctuations and Risk Hedging

Fiscal year ended March 31, 2018 compared to fiscal year ended March 31, 2017:

During the fiscal year ended March 31, 2018, the average rates of the yen were 110.9 yen against the U.S. dollar and 129.7 yen against the euro, which were 2.5 yen and 10.9 yen lower, respectively, than the fiscal year ended March 31, 2017. For the latest yen exchange rates per U.S. dollar, refer to “Selected Financial Data” in “Item 3. Key Information.”

For the fiscal year ended March 31, 2018, consolidated sales increased 940.7 billion yen (12%) year-on-year to 8,544.0 billion yen. On a constant currency basis, sales increased approximately 9% year-on-year.

Consolidated operating income increased 446.2 billion yen year-on-year to 734.9 billion yen. The foreign exchange fluctuations had a positive impact on the consolidated operating results mainly in Electronics.

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Fiscal year ended March 31, 2017 compared to fiscal year ended March 31, 2016:

During the fiscal year ended March 31, 2017, the average rates of the yen were 108.4 yen against the U.S. dollar and 118.8 yen against the euro, which were 11.7 yen and 13.8 yen higher, respectively, than the fiscal year ended March 31, 2016. For the latest yen exchange rates per U.S. dollar, refer to “Selected Financial Data” in “Item 3. Key Information.”

For the fiscal year ended March 31, 2017, consolidated sales decreased 502.4 billion yen (6.2%) year-on-year to 7,603.3 billion yen. On a constant currency basis, sales were essentially flat year-on-year.

Consolidated operating income decreased 5.5 billion yen year-on-year to 288.7 billion yen. The foreign exchange fluctuations had a negative impact on the consolidated operating results mainly in Electronics.

The table below indicates the foreign exchange impact on sales and operating results in each of the Electronics segments. For further details, refer to “Operating Performance by Business Segment” which discusses the impact of foreign exchange rates within segments and categories where foreign exchange rate fluctuations had a significant impact.

		Fiscal year ended March 31									Impact of changes in foreign exchange rates
		2016			2017			2018			2016 to 2017		2017 to 2018
		(Yen in billions)
G&NS	Sales		1,551.9			1,649.8			1,943.8			-144.2		+82.5
	Operating income		88.7			135.6			177.5			-2.2		+19.8
HE&S	Sales		1,159.0			1,039.0			1,222.7			-111.3		+56.4
	Operating income		50.6			58.5			85.8			-13.4		+22.8
IP&S	Sales		684.0			579.6			655.9			-55.1		+22.9
	Operating income		69.3			47.3			74.9			-26.5		+11.6
MC	Sales		1,127.5			759.1			723.7			-37.8		+16.1
	Operating income (loss)		(61.4	)		10.2			(27.6	)		+26.1		-5.3
Semiconductors	Sales		739.1			773.1			850.0			-76.3		+20.8
	Operating income (loss)		14.5			(7.8	)		164.0			-43.7		+11.7

During the fiscal year ended March 31, 2018, sales for the Music segment increased 24% year-on-year to 800.0 billion yen, while sales increased approximately 22% year-on-year on a constant currency basis. In the Pictures segment, sales increased 12% year-on-year to 1,011.1 billion yen, while sales increased approximately 10% on a U.S. dollar basis. During the fiscal year ended March 31, 2017, sales for the Music segment increased 4.6% year-on-year to 647.7 billion yen, while sales increased approximately 11% year-on-year on a constant currency basis. In the Pictures segment, sales decreased 3.7% year-on-year to 903.1 billion yen, while sales increased approximately 5% on a U.S. dollar basis. For a detailed analysis of segment performance, refer to the Music and Pictures segments under “Operating Performance by Business Segment.” Sony’s Financial Services segment consolidates the yen-based results of SFH. As most of the operations in this segment are based in Japan, Sony management analyzes the performance of the Financial Services segment on a yen basis only.

During the fiscal year ended March 31, 2018, Sony estimated that a one yen appreciation against the U.S. dollar would have decreased Electronics sales by approximately 21 billion yen, with an increase in operating income of approximately 3.5 billion yen. A one yen appreciation against the euro was estimated to decrease Electronics sales by approximately 9.5 billion yen, with a corresponding decrease in operating income of approximately 5.5 billion yen. For more details, refer to “Risk Factors” in “Item 3. Key Information.”

Sony’s consolidated results are subject to foreign currency rate fluctuations primarily due to different currency composition of revenue and costs. In the G&NS segment, a significant proportion of costs is incurred in U.S. dollars but sales are recorded in Japanese yen, U.S. dollars or euros. As a result, the yen appreciation against the U.S. dollar has a positive impact on operating income while the yen appreciation against the euro has a negative impact. In the HE&S segment, yen appreciation against emerging market currencies has a negative impact on operating income, but yen appreciation against the U.S. dollar has a positive impact on operating income due to a high proportion of manufacturing costs being incurred in U.S. dollars. In the IP&S segment, there is a relatively high proportion of costs in yen, while a large proportion of sales is in emerging markets; therefore, yen appreciation against the currencies of emerging markets, particularly the Chinese yuan, has a negative impact on operating income. In the MC segment, the proportion of sales in yen is relatively high, but a significant proportion of manufacturing and procurement costs is incurred in U.S. dollars. Therefore, yen appreciation against the U.S. dollar has a positive impact on operating income. In the Semiconductors segment, a

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significant proportion of sales contracts are denominated in U.S. dollars, but manufacturing operations are located in Japan, and, therefore, yen appreciation against the U.S. dollar has a significantly negative impact on operating income.

In order to reduce the risk caused by foreign exchange rate fluctuations, Sony employs derivatives, including foreign exchange forward contracts and foreign currency option contracts, in accordance with a consistent risk management strategy. Such derivatives are used primarily to mitigate the effect of foreign currency exchange rate fluctuations on cash flows generated or anticipated by Sony’s transactions and accounts receivable and payable denominated in foreign currencies.

Sony Global Treasury Services Plc (“SGTS”) in the U.K. provides integrated treasury services for Sony Corporation, its subsidiaries, and affiliated companies. Sony’s policy is that Sony Corporation and all subsidiaries with foreign exchange exposures should enter into commitments with SGTS to hedge their exposures. Sony Corporation and most of its subsidiaries utilize SGTS for this purpose. Sony’s policy of concentrating its foreign exchange exposures means that SGTS and Sony Corporation hedge most of the net foreign exchange exposure within the Sony group. Sony has a policy on the use of derivatives that, in principle, SGTS should centrally deal with and manage derivatives with financial institutions for risk management purposes. SGTS enters into foreign exchange transactions with creditworthy third-party financial institutions. Most of these transactions are entered into against projected exposures before the actual export and import transactions take place. In general, SGTS hedges the projected exposures for a period of one to three months before the actual transactions take place. Sony enters into foreign exchange transactions with financial institutions primarily for hedging purposes. Sony does not use these derivative financial instruments for trading or speculative purposes except for certain derivatives in the Financial Services segment. In the Financial Services segment, Sony uses derivatives primarily for asset liability management.

To minimize the effects of foreign exchange fluctuations on its financial results, particularly in the Electronics segments, Sony seeks, when appropriate, to localize material and parts procurement, design and manufacturing operations in areas outside of Japan.

Changes in the fair value of derivatives designated as cash flow hedges are initially recorded in accumulated other comprehensive income and reclassified into earnings when the hedged transaction affects earnings. Foreign exchange forward contracts, foreign currency option contracts and other derivatives that do not qualify as hedges are marked-to-market with changes in value recognized in other income and expenses. The notional amount of all the foreign exchange derivative contracts as of March 31, 2017 and 2018 was 2,567.7 billion yen and 2,420.6 billion yen, respectively. The net fair value of all the foreign exchange derivative contracts as of March 31, 2017 and 2018 was an asset of 9.4 billion yen and 15.2 billion yen, respectively. Refer to Note 14 of the consolidated financial statements.

* Note: In this section, the impact of foreign exchange rate fluctuations on sales is calculated by applying the change in the yen’s periodic weighted average exchange rates for the previous fiscal year from the current fiscal year to the major transactional currencies in which the sales are denominated. The impact of foreign exchange rate fluctuations on operating income (loss) is calculated by subtracting from the impact on sales the impact on cost of sales and selling, general and administrative expenses calculated by applying the same major transactional currencies calculation process to cost of sales and selling, general and administrative expenses as for the impact on sales. Additionally, the MC segment enters into its own foreign exchange hedging transactions. The impact of those transactions is included in the impact of foreign exchange rate fluctuations on operating income (loss) for that segment. The descriptions of sales on a constant currency basis reflects sales obtained by applying the yen’s monthly average exchange rates from the fiscal year ended March 31, 2016 and 2017 to local currency-denominated monthly sales in the fiscal years ended March 31, 2017 and 2018, respectively. For Sony Music Entertainment and Sony/ATV Music Publishing in the Music segment, and in the Pictures segment, the constant currency amounts are calculated by applying the monthly average U.S. dollar / yen exchange rates after aggregation on a U.S. dollar basis. This information is not a substitute for Sony’s consolidated financial statements measured in accordance with U.S. GAAP. However, Sony believes that these disclosures provide additional useful analytical information to investors regarding the operating performance of Sony.

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Assets, Liabilities and Stockholders’ Equity

The following schedules show unaudited condensed balance sheets for the Financial Services segment and all other segments excluding Financial Services. These presentations are not in accordance with U.S. GAAP, which is used by Sony to prepare its consolidated financial statements. However, because the Financial Services segment is different in nature from Sony’s other segments, Sony believes that a comparative presentation may be useful in understanding and analyzing Sony’s consolidated financial statements. Transactions between the Financial Services segment and Sony without the Financial Services segment, including noncontrolling interests, are included in those respective presentations, then eliminated in the consolidated figures shown below.

	Financial Services				Sony without Financial Services				Consolidated
	March 31 2017		March 31 2018		March 31 2017		March 31 2018		March 31 2017		March 31 2018
	(Yen in millions)
Assets
Current assets:
Cash and cash equivalents (*1)		268,382		393,133		691,760		1,193,196		960,142		1,586,329
Marketable securities (*2)		1,051,441		1,176,601		—		—		1,051,441		1,176,601
Notes and accounts receivable, trade		10,931		15,612		947,602		1,003,558		953,811		1,012,779
Inventories		—		—		640,835		692,937		640,835		692,937
Other receivables		56,807		60,819		167,127		130,393		223,632		190,706
Prepaid expenses and other current assets		112,085		137,539		414,420		379,893		525,861		516,744
Total current assets		1,499,646		1,783,704		2,861,744		3,399,977		4,355,722		5,176,096
Film costs		—		—		336,928		327,645		336,928		327,645
Investments and advances (*3)		9,904,576		10,560,933		285,965		272,545		10,111,793		10,756,058
Investments in Financial Services, at cost		—		—		133,514		133,514		—		—
Property, plant and equipment		21,323		22,424		735,590		715,760		758,199		739,470
Other assets:
Intangibles, net		30,643		34,622		553,542		492,546		584,185		527,168
Goodwill		2,375		7,225		520,163		523,267		522,538		530,492
Deferred insurance acquisition costs		568,837		586,670		—		—		568,837		586,670
Deferred income taxes		1,868		1,684		97,090		95,088		98,958		96,772
Other		34,607		33,267		292,529		295,650		323,396		325,167
Total other assets		638,330		663,468		1,463,324		1,406,551		2,097,914		2,066,269
Total assets		12,063,875		13,030,529		5,817,065		6,255,992		17,660,556		19,065,538
Liabilities and Equity
Current liabilities:
Short-term borrowings (*4)		411,643		433,119		106,437		288,496		518,079		721,615
Notes and accounts payable, trade		—		—		539,900		468,550		539,900		468,550
Accounts payable, other and accrued expenses		31,486		37,479		1,364,042		1,477,875		1,394,758		1,514,433
Accrued income and other taxes		13,512		19,401		92,525		126,504		106,037		145,905
Deposits from customers in the banking business		2,071,091		2,159,246		—		—		2,071,091		2,159,246
Other		173,853		181,467		422,916		435,996		591,874		610,792
Total current liabilities		2,701,585		2,830,712		2,525,820		2,797,421		5,221,739		5,620,541
Long-term debt (*4)		75,511		205,373		609,692		421,817		681,462		623,451
Accrued pension and severance costs		31,289		33,062		365,427		361,442		396,715		394,504
Deferred income taxes		317,043		342,405		115,781		107,458		432,824		449,863
Future insurance policy benefits and other (*5)		4,834,492		5,221,772		—		—		4,834,492		5,221,772
Policyholders’ account in the insurance business		2,631,073		2,820,702		—		—		2,631,073		2,820,702
Other		21,825		17,778		317,980		284,270		314,771		278,338
Total liabilities		10,612,818		11,471,804		3,934,700		3,972,408		14,513,076		15,409,171
Redeemable noncontrolling interest		—		—		12,058		9,210		12,058		9,210
Equity:
Stockholders’ equity of Financial Services		1,449,605		1,557,062		—		—		—		—
Stockholders’ equity of Sony without Financial Services		—		—		1,770,632		2,173,128		—		—
Sony Corporation’s stockholders’ equity		—		—		—		—		2,497,246		2,967,366
Noncontrolling interests		1,452		1,663		99,675		101,246		638,176		679,791
Total Equity		1,451,057		1,558,725		1,870,307		2,274,374		3,135,422		3,647,157
Total liabilities and equity		12,063,875		13,030,529		5,817,065		6,255,992		17,660,556		19,065,538

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*1 Refer to Cash Flow section below for details regarding the year-on-year increases in cash and cash equivalents as of March 31, 2018 in the Financial Services segment and for all segments excluding Financial Services segment.

*2 Marketable securities as of March 31, 2018 in the Financial Services segment increased year-on-year due to increases in the amount of marketable securities mainly at Sony Life.

*3 Investments and advances as of March 31, 2018 in the Financial Services segment increased year-on-year due to increases in investments and advances mainly at Sony Life.

*4 In all segments excluding the Financial Services segment, short-term borrowings as of March 31, 2018 increased year-on-year while long-term debt decreased year-on-year. These changes were mainly due to conversions from long-term debt to short-term borrowings for long-term debts whose repayment terms had become shorter than one year. In the Financial Services segment, long-term debt increased year-on-year due to an increase in long-term debt mainly at Sony Bank.

*5 Future insurance policy benefits and others as of March 31, 2018 in the Financial Services segment increased year-on-year due to an increase in future insurance policy benefits mainly at Sony Life.

Investments

The following table contains available-for-sale and held-to-maturity securities, including the breakdown of unrealized gains and losses by investment category.

	March 31, 2018
	Cost		Unrealized gain		Unrealized loss			Fair market value
	(Yen in millions)
Financial Services Business:
Available-for-sale
Debt securities
Sony Life		1,299,105		190,736		(4,202	)		1,485,639
Sony Bank		669,317		4,223		(1,185	)		672,355
Other		63,181		94		(28	)		63,247
Equity securities
Sony Life		25,459		17,196		(264	)		42,391
Sony Bank		—		—		—			—
Other		413		2,611		—			3,024
Held-to-maturity
Debt securities
Sony Life		6,463,675		1,643,497		(56,528	)		8,050,644
Sony Bank		200		1		—			201
Other		79,079		17,186		(322	)		95,943
Total Financial Services		8,600,429		1,875,544		(62,529	)		10,413,444
Non-Financial Services:
Available-for-sale securities		29,804		51,916		(512	)		81,208
Held-to-maturity securities		—		—		—			—
Total Non-Financial Services		29,804		51,916		(512	)		81,208
Consolidated		8,630,233		1,927,460		(63,041	)		10,494,652

At March 31, 2018, Sony Life had debt and equity securities with gross unrealized losses of 61.0 billion yen. Of the unrealized loss, 94.7% related to securities in an unrealized loss position for periods greater than 12 months at March 31, 2018. Sony Life principally invests in Japanese and foreign government and corporate bonds. Almost all of the debt securities in which Sony Life invested were rated higher than or equal to “BBB” or its equivalent by Standard & Poor’s Ratings Services (“S&P”), Moody’s Investors Service (“Moody’s”) or other rating agencies.

At March 31, 2018, Sony Bank had debt securities with gross unrealized losses of 1.2 billion yen. Of the unrealized loss, 93.2% related to securities in an unrealized loss position for periods greater than 12 months at March 31, 2018. Sony Bank principally invests in Japanese government bonds, Japanese corporate bonds and foreign bonds. Almost all of these securities were rated higher than or equal to “BBB” or its equivalent by S&P, Moody’s or other rating agencies.

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These unrealized losses related to numerous investments, with no single investment being in a material unrealized loss position for greater than 12 months. In addition, there was no individual security with unrealized losses that met the test for impairment as the decline in values were small both in amount and percentage, and the decline in values for those investments were still determined to be temporary in nature.

For fixed maturity securities with unrecognized losses held by Sony Life as of March 31, 2018 (60.7 billion yen), maturity dates vary as follows:

• Within 1 year:	—
• 1 to 5 years:	—
• 5 to 10 years:	—
• above 10 years:	100.0	%

For fixed maturity securities with unrecognized losses held by Sony Bank as of March 31, 2018 (1.2 billion yen), maturity dates vary as follows:

• Within 1 year:	15.1	%
• 1 to 5 years:	65.1	%
• 5 to 10 years:	1.9	%
• above 10 years:	17.9	%

For the fiscal years ended March 31, 2016, 2017 and 2018, Sony Life recorded net realized gains on available-for-sale securities of 19.3 billion yen, 1.3 billion yen and 0 billion yen, respectively.

In the ordinary course of business, Sony maintains long-term investment securities, included in securities investments and other issued by a number of non-public companies. The aggregate carrying amount of the investments in non-public companies at March 31, 2018 was 52.4 billion yen. A non-public equity investment is primarily valued at cost if fair value is not readily determinable. If the value is estimated to have declined and such decline is judged to be other-than-temporary, the impairment of the investment is recognized immediately and the carrying value is reduced to its fair value.

For the fiscal years ended March 31, 2016, 2017 and 2018, total realized impairment losses were 3.6 billion yen, 7.6 billion yen and 5.2 billion yen, respectively, of which 0.1 billion yen, 0.05 billion yen and 0.2 billion yen, respectively, were recorded in financial services revenue by the subsidiaries in the Financial Services segment. Realized impairment losses recorded other than by subsidiaries in the Financial Services segment in each of the three fiscal years were reflected in non-operating expenses and primarily relate to certain strategic investments in non-Financial Services businesses. These investments primarily relate to certain strategic investments in Japan and the U.S. with which Sony has strategic relationships for the purposes of developing and marketing new technologies. Impairment losses were recorded for each of the three fiscal years as certain companies failed to successfully develop and market such technology, resulting in the operating performance of these companies being more unfavorable than previously expected. As a result the decline in the fair value of these companies was judged as other-than-temporary. None of these impairment losses were individually material to Sony.

Upon determination that the value of an investment is impaired, the value of the investment is written down to its fair value. For an investment where the quoted price is available in an active market, fair value is determined based on unadjusted quoted prices as of the date on which the impairment determination is made. For investments where the quoted price is not available in an active market, fair value is usually determined based on quoted prices of securities with similar characteristics or measured through the use of various methodologies such as pricing models, discounted cash flow techniques, or similar techniques that require significant management judgment or estimation of assumptions that market participants would use in pricing the investments. The impairment losses that were recorded in each of the three fiscal years related to the unique facts and circumstances of each individual investment and did not significantly impact other investments.

Sony Life and Sony Bank’s investments constitute the majority of the investments in the Financial Services segment. As of March 31, 2018, Sony Life and Sony Bank account for approximately 92% and 7% of the investments in the Financial Services segment, respectively.

Cash Flows

Fiscal year ended March 31, 2018 compared to fiscal year ended March 31, 2017:

Operating Activities: During the fiscal year ended March 31, 2018, there was a net cash inflow of 1,255.0 billion yen from operating activities, an increase of 445.7 billion yen year-on-year.

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For all segments excluding the Financial Services segment, there was a net cash inflow of 771.7 billion yen, an increase of 325.9 billion yen year-on-year. This increase was primarily due to an increase in net income after taking into account non-cash adjustments (including depreciation and amortization, gain on sales of securities investments and other operating income (expense)) and an increase in accrued expenses in other current liabilities.

The Financial Services segment had a net cash inflow of 498.6 billion yen, an increase of 122.4 billion yen year-on-year. This increase was primarily due to an increase in insurance premium revenue at Sony Life.

Investing Activities: During the fiscal year ended March 31, 2018, Sony used 822.2 billion yen of net cash in investing activities, a decrease of 431.8 billion yen year-on-year.

For all segments excluding the Financial Services segment, there was a net cash outflow of 163.1 billion yen, a decrease of 136.3 billion yen year-on-year. This decrease was mainly due to a decrease in payments for fixed asset purchases such as semiconductor manufacturing equipment, as well as a year-on-year increase in cash proceeds from the sales of fixed assets and businesses, such as the battery business.

The Financial Services segment used 659.3 billion yen of net cash, a decrease of 293.9 billion yen year-on-year. This decrease was mainly due to a year-on-year decrease in payments for investments and advances at Sony Life and Sony Bank.

In all segments excluding the Financial Services segment, net cash generated in operating and investing activities combined* for the fiscal year ended March 31, 2018 was 608.6 billion yen, a year-on-year increase of 462.2 billion yen.

Financing Activities: Net cash provided by financing activities during the fiscal year ended March 31, 2018, was 246.5 billion yen, a decrease of 205.8 billion yen year-on-year.

For all segments excluding the Financial Services segment, there was a 54.1 billion yen net cash outflow, a decrease of 119.3 billion yen year-on-year. This decrease was mainly due to a year-on-year decrease in the repayment of long-term debt, as well as the absence of the payment for the purchase of Sony/ATV shares from the Estate in the fiscal year ended March 31, 2017. On the other hand, during the fiscal year ended March 31, 2017, Sony raised capital from the issuance of straight bonds.

In the Financial Services segment, there was a 285.4 billion yen net cash inflow, a decrease of 326.2 billion yen year-on-year. This decrease was primarily due to a decrease in short-term borrowings at Sony Life.

Total Cash and Cash Equivalents: Accounting for the above factors and the effect of fluctuations in foreign exchange rates, the total outstanding balance of cash and cash equivalents at March 31, 2018 was 1,586.3 billion yen. Cash and cash equivalents of all segments excluding the Financial Services segment was 1,193.2 billion yen at March 31, 2018, an increase of 501.4 billion yen compared with the balance as of March 31, 2017. Within the Financial Services segment, the outstanding balance of cash and cash equivalents was 393.1 billion yen at March 31, 2018, an increase of 124.8 billion yen compared with the balance as of March 31, 2017.

Fiscal year ended March 31, 2017 compared to fiscal year ended March 31, 2016:

Operating Activities: During the fiscal year ended March 31, 2017, there was a net cash inflow of 809.3 billion yen from operating activities, an increase of 60.2 billion yen year-on-year.

For all segments excluding the Financial Services segment, there was a net cash inflow of 445.8 billion yen, an increase of 183.0 billion yen year-on-year. This increase was primarily due to an increase in net income after taking into account non-cash adjustments (including depreciation and amortization, gain on sales of securities investments and other operating income (expense)) and a decrease of inventories, compared to an increase in the fiscal year ended March 31, 2016.

The Financial Services segment had a net cash inflow of 376.2 billion yen, a decrease of 119.1 billion yen year-on-year. This decrease was primarily due to a decrease in net income after taking into account a net gain or loss on revaluation of marketable securities held for trading purposes.

Investing Activities: During the fiscal year ended March 31, 2017, Sony used 1,254.0 billion yen of net cash in investing activities, an increase of 223.6 billion yen year-on-year.

For all segments excluding the Financial Services segment, there was a net cash outflow of 299.4 billion yen, a decrease of 35.5 billion yen year-on-year. This decrease was mainly due to a decrease in payments for fixed asset purchases such as semiconductor manufacturing equipment.

The Financial Services segment used 953.2 billion yen of net cash, an increase of 259.2 billion yen year-on-year. This increase was mainly due to a year-on-year decrease in proceeds from sales or return of investments and collections of advances at Sony Life.

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In all segments excluding the Financial Services segment, net cash generated in operating and investing activities combined* for the fiscal year ended March 31, 2017 was 146.3 billion yen, a 218.5 billion yen improvement from net cash used in the fiscal year ended March 31, 2016.

Financing Activities: Net cash provided by financing activities during the fiscal year ended March 31, 2017, was 452.3 billion yen, an increase of 72.2 billion yen year-on-year.

For all segments excluding the Financial Services segment, there was a 173.4 billion yen net cash outflow, compared to a 144.8 billion yen net cash inflow in the fiscal year ended March 31, 2016. During the fiscal year ended March 31, 2017, there was a net cash outflow as Sony redeemed long-term debt and made a payment for the acquisition of the 50% equity interest in Sony/ATV previously owned by the Estate, making Sony/ATV a wholly-owned subsidiary of Sony, partially offset by the issuance of straight bonds by Sony. During the fiscal year ended March 31, 2016, Sony issued new stock and convertible bonds.

In the Financial Services segment, there was a 611.6 billion yen net cash inflow, an increase of 386.7 billion yen year-on-year. This increase was primarily due to an increase in short-term borrowings at Sony Life and a larger year-on-year increase in deposits from customers at Sony Bank.

Total Cash and Cash Equivalents: Accounting for the above factors and the effect of fluctuations in foreign exchange rates, the total outstanding balance of cash and cash equivalents at March 31, 2017 was 960.1 billion yen. Cash and cash equivalents of all segments excluding the Financial Services segment was 691.8 billion yen at March 31, 2017, a decrease of 58.2 billion yen compared with the balance as of March 31, 2016. Within the Financial Services segment, the outstanding balance of cash and cash equivalents was 268.4 billion yen at March 31, 2017, an increase of 34.7 billion yen compared with the balance as of March 31, 2016.

* Sony has included the information for cash flow from operating and investing activities combined, excluding the Financial Services segment’s activities, as Sony’s management frequently monitors this financial measure and believes this non-U.S. GAAP measurement is important for use in evaluating Sony’s ability to generate cash to maintain liquidity and fund debt principal and dividend payments from business activities other than its Financial Services segment. This information is derived from the reconciliations prepared in the section “Information on Cash Flows Separating Out the Financial Services Segment”. This information and the separate condensed presentations shown below are not required or prepared in accordance with U.S. GAAP. The Financial Services segment’s cash flow is excluded from the measure because SFH, which constitutes a majority of the Financial Services segment, is a separate publicly traded entity in Japan with a significant minority interest and it, as well as its subsidiaries, secures liquidity on its own. This measure may not be comparable to those of other companies. This measure has limitations because it does not represent residual cash flows available for discretionary expenditures, principally due to the fact that the measure does not deduct the principal payments required for debt service. Therefore, Sony believes it is important to view this measure as supplemental to its entire statement of cash flows and together with Sony’s disclosures regarding investments, available credit facilities and overall liquidity.

A reconciliation of the differences between the Consolidated Statement of Cash Flows reported and cash flows from operating and investing activities combined excluding the Financial Services segment’s activities is as follows:

	Fiscal year ended March 31
	2016			2017			2018
	(Yen in billions)
Net cash provided by operating activities reported in the consolidated statements of cash flows		749.1			809.3			1,255.0
Net cash used in investing activities reported in the consolidated statements of cash flows		(1,030.4	)		(1,254.0	)		(822.2	)
(1)		(281.3	)		(444.7	)		432.8
Less: Net cash provided by operating activities within the Financial Services segment (2)		495.3			376.2			498.6
Less: Net cash used in investing activities within the Financial Services segment (3)		(694.0	)		(953.2	)		(659.3	)
Eliminations**(4)		10.5			14.1			15.1
Cash flow generated by operating and investing activities combined excluding the Financial Services segment’s activities (1) - (2) - (3) + (4)		(72.1	)		146.3			608.6

** Eliminations primarily consist of intersegment dividend payments

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Information on Cash Flows Separating Out the Financial Services Segment

The following schedules show unaudited condensed statements of cash flows for the Financial Services segment and all other segments excluding Financial Services. These presentations are not in accordance with U.S. GAAP, which is used by Sony to prepare its consolidated financial statements. However, because the Financial Services segment is different in nature from Sony’s other segments, Sony believes that a comparative presentation may be useful in understanding and analyzing Sony’s consolidated financial statements. Transactions between the Financial Services segment and Sony without the Financial Services segment, including noncontrolling interests, are included in those respective presentations, then eliminated in the consolidated figures shown below.

	Fiscal year ended March 31
	Financial Services									Sony without Financial Services									Consolidated
	2016			2017			2018			2016			2017			2018			2016			2017			2018
	(Yen in millions)
Cash flows from operating activities:
Net income (loss)		118,854			118,820			127,122			101,301			23,096			435,230			209,715			127,561			547,279
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Depreciation and amortization, including amortization of deferred insurance acquisition costs		102,270			47,056			79,843			294,821			279,992			281,601			397,091			327,048			361,444
Amortization of film costs		—			—			—			299,587			297,505			359,274			299,587			297,505			359,274
Other operating (income) expense, net		1,373			114			64			45,793			148,887			4,008			47,171			149,001			4,072
(Gain) loss on sale or devaluation of securities investments, net		2,653			47			220			(48,857	)		7,404			3,438			(46,204	)		7,451			3,658
(Gain) loss on revaluation of marketable securities held for trading purposes, net		44,821			(55,789	)		(47,339	)		—			—			—			44,821			(55,789	)		(47,339	)
Changes in assets and liabilities:
(Increase) decrease in notes and accounts receivable, trade		(2,478	)		(1,163	)		(3,880	)		(6,080	)		(37,148	)		(77,793	)		(5,828	)		(37,529	)		(80,004	)
(Increase) decrease in inventories		—			—			—			(57,804	)		11,199			(51,508	)		(57,804	)		11,199			(51,508	)
(Increase) decrease in film costs		—			—			—			(318,391	)		(331,179	)		(362,496	)		(318,391	)		(331,179	)		(362,496	)
Increase (decrease) in notes and accounts payable, trade		—			—			—			(49,525	)		(1,386	)		(87,939	)		(49,525	)		(1,386	)		(87,939	)
Increase (decrease) in future insurance policy benefits and other		403,392			433,803			495,419			—			—			—			403,392			433,803			495,419
(Increase) decrease in deferred insurance acquisition costs		(83,774	)		(93,234	)		(86,779	)		—			—			—			(83,774	)		(93,234	)		(86,779	)
(Increase) decrease in marketable securities held for trading purposes		(107,433	)		(81,456	)		(89,797	)		—			—			—			(107,433	)		(81,456	)		(89,797	)
Other		15,605			8,031			23,714			1,938			47,400			267,836			16,271			56,267			289,688
Net cash provided by (used in) operating activities		495,283			376,229			498,587			262,783			445,770			771,651			749,089			809,262			1,254,972
Cash flows from investing activities:
Payments for purchases of fixed assets		(8,495	)		(12,296	)		(13,386	)		(366,916	)		(321,200	)		(249,770	)		(375,411	)		(333,509	)		(262,989	)
Payments for investments and advances		(1,219,623	)		(1,232,059	)		(963,210	)		(20,831	)		(17,106	)		(13,801	)		(1,241,923	)		(1,250,498	)		(977,011	)
Proceeds from sales or return of investments and collections of advances		534,072			289,901			317,159			81,535			16,078			6,596			615,607			305,979			323,755
Other		15			1,262			162			(28,688	)		22,793			93,887			(28,676	)		24,055			94,048
Net cash provided by (used in) investing activities		(694,031	)		(953,192	)		(659,275	)		(334,900	)		(299,435	)		(163,088	)		(1,030,403	)		(1,253,973	)		(822,197	)
Cash flows from financing activities:
Increase (decrease) in borrowings, net		76,841			358,010			140,055			(236,289	)		(46,516	)		(24,379	)		(159,440	)		311,223			115,676
Increase (decrease) in deposits from customers, net		165,169			277,152			169,479			—			—			—			165,169			277,152			169,479
Dividends paid		(17,400	)		(23,926	)		(23,921	)		(12,751	)		(25,301	)		(28,490	)		(12,751	)		(25,301	)		(28,490	)
Other		312			408			(174	)		393,791			(101,608	)		(1,214	)		387,144			(110,772	)		(10,209	)
Net cash provided by (used in) financing activities		224,922			611,644			285,439			144,751			(173,425	)		(54,083	)		380,122			452,302			246,456
Effect of exchange rate changes on cash and cash equivalents		—			—			—			(64,609	)		(31,061	)		(53,044	)		(64,609	)		(31,061	)		(53,044	)
Net increase (decrease) in cash and cash equivalents		26,174			34,681			124,751			8,025			(58,151	)		501,436			34,199			(23,470	)		626,187
Cash and cash equivalents at beginning of the fiscal year		207,527			233,701			268,382			741,886			749,911			691,760			949,413			983,612			960,142
Cash and cash equivalents at end of the fiscal year		233,701			268,382			393,133			749,911			691,760			1,193,196			983,612			960,142			1,586,329

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B. Liquidity and Capital Resources

The description below covers basic financial policy and figures for Sony’s consolidated operations except for the Financial Services segment and So-net Media Networks Corporation, which secure liquidity on their own. Furthermore, the Financial Services segment is described separately at the end of this section.

Liquidity Management and Market Access

An important financial objective of Sony is to maintain the strength of its balance sheet, while securing adequate liquidity for business activities. Sony defines its liquidity sources as the amount of cash and cash equivalents (“cash balance”) (excluding restrictions on capital transfers mainly due to national regulations) and the unused amount of committed lines of credit.

Funding requirements that arise from maintaining liquidity are principally covered by cash flow from operating activities and investing activities (including asset sales) combined and by the cash balance; however, as needed, Sony has demonstrated the ability to procure funds from financial and capital markets. In the event financial and capital markets become illiquid, based on its current forecasts, Sony could sustain sufficient liquidity through access to committed lines of credit with financial institutions, together with its cash balance.

Sony procures funds mainly from the financial and capital markets through Sony Corporation and SGTS, a finance subsidiary in the U.K.

In order to meet working capital requirements, Sony Corporation and SGTS maintain Commercial Paper (“CP”) programs that have the ability to access the Japanese, U.S. and European CP markets, subject to prevailing market conditions. Although the borrowing limits under the CP program, translated into yen, were 8,187 billion yen in total for Sony Corporation and SGTS as of March 31, 2018, there were no amounts outstanding under the CP programs as of and during the fiscal year ended March 31, 2017. On April 10, 2018, Sony Capital Corporation (“SCC”), a subsidiary in the U.S., established a 2 billion U.S. dollar CP program for the purpose of flexibly securing short-term working capital in the U.S.

Sony typically raises funds through straight bonds, CP programs and bank loans (including syndicated loans). If market disruption and volatility occur and Sony could not raise sufficient funds from these sources, Sony may also draw down funds from contractually committed lines of credit from various financial institutions. Sony has a total, translated into yen, of 459.4 billion yen in unused committed lines of credit, as of March 31, 2018. Details of those committed lines of credit are: a 300.0 billion yen committed line of credit contracted with a syndicate of Japanese banks and a 1.5 billion U.S. dollar multi-currency committed line of credit also with a syndicate of Japanese banks. The above-mentioned 300.0 billion yen committed line with a syndicate of Japanese banks was renewed as of April 2, 2018, will remain in effect until July 2020 and was decreased to 275.0 billion yen. The above-mentioned 1.5 billion U.S. dollar committed line with a syndicate of Japanese banks was renewed as of April 2, 2018, will remain in effect until December 2023 and was increased to 1.7 billion U.S. dollars. In addition, a 525 million U.S. dollar multi-currency committed line of credit contracted with a syndicate of foreign banks expired at the end of March 2018, was renewed as of April 2, 2018 and will remain in effect until March 2020. In all of the above-mentioned committed lines, Sony Corporation and SGTS are defined as borrowers. In the above-mentioned multi-currency committed line with a syndicate of Japanese banks, SCC was also defined as a borrower as of April 2, 2018. These contracts are aimed at securing sufficient liquidity in a quick and stable manner even in the event of turmoil within the financial and capital markets.

In the event of a downgrade in Sony’s credit ratings, there are no financial covenants in any of Sony’s material financial agreements with financial institutions that would cause an acceleration of the obligation. Even though the cost of borrowing for some committed lines of credit could change according to Sony’s credit ratings, there are no financial covenants that would cause any impairment on the ability to draw down on unused facilities. Furthermore, there are no restrictions on the uses of most proceeds except that certain borrowings may not be used to acquire securities listed on a U.S. stock exchange or traded over-the-counter in the U.S. in accordance with the rules and regulations issued by authorities such as the Board of Governors of the Federal Reserve Board.

Ratings

Sony considers one of management’s top priorities to be the maintenance of stable and appropriate credit ratings in order to ensure financial flexibility for liquidity and capital management and continued adequate access to sufficient funding resources in the financial and capital markets.

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In order to facilitate access to global capital markets, Sony obtains credit ratings from two rating agencies, Moody’s and S&P. In order to facilitate access to Japanese financial and capital markets, Sony obtains credit ratings from two agencies in Japan, including Rating and Investment Information, Inc. and Japan Credit Rating Agency, Ltd.

Sony currently believes that it has access to sufficient funding resources in the financial and capital markets. For information regarding a possible further rating downgrade, refer to “Risk Factors” in “Item 3. Key Information.”

Cash Management

Sony manages its global cash management activities mainly through SGTS. The excess or shortage of cash at most of Sony’s subsidiaries is invested or funded by SGTS on a net basis, although Sony recognizes that fund transfers are limited in certain countries and geographic areas due to restrictions on capital transactions. In order to pursue more efficient cash management, cash surpluses among Sony’s subsidiaries are deposited with SGTS and cash shortfalls among subsidiaries are covered by loans through SGTS, so that Sony can make use of excess cash balances and reduce third-party borrowings. Where local restrictions prevent an efficient intercompany transfer of funds, Sony’s intent is that cash balances remain outside of SGTS and that Sony meet its liquidity needs through ongoing cash flows, external borrowings, or both. Sony does not expect restrictions of capital transactions on amounts held outside of Japan to have a material effect on Sony’s overall liquidity, financial condition or results of operations.

Financial Services segment

The management of SFH, Sony Life, Sony Assurance and Sony Bank recognizes the importance of securing sufficient liquidity to cover the payment of obligations that these companies incur in the ordinary course of business. Sony Life, Sony Assurance and Sony Bank maintain a sufficient cash balance and secure sufficient means to meet their obligations while abiding by laws and regulations such as the Insurance Business Act or the Banking Act of Japan, and restrictions imposed by the Financial Services Agency and other regulatory authorities as well as establishing and operating under company guidelines that comply with these regulations. Sony Life and Sony Assurance establish a sufficient level of liquidity for the smooth payment of insurance claims when they invest primarily in various securities cash inflows which are mainly from policyholders’ insurance premiums. Sony Bank maintains a necessary level of liquidity for the smooth settlement of transactions when it uses its cash inflows, which come mainly from customers’ deposits in local currency, in order to offer mortgage loans to individuals, and the remaining cash inflows are invested mainly in marketable securities. Cash inflows from customers’ deposits in foreign currencies are invested mainly in investment instruments of the same currency.

In addition, Sony’s subsidiaries in the Financial Services segment are subject to the Japanese Insurance Business Act and Banking Act, which require insurance and business companies to maintain their financial credibility and to secure protection for policyholders and depositors in view of the public nature of insurance and banking services. As such, lending and borrowing between subsidiaries in the Financial Service segment and the other companies within Sony Group is strictly limited. Sony’s subsidiaries in the Financial Services segment are managed separately from Sony’s cash management activities through SGTS as mentioned above.

C. Research and Development

Through the key themes of KANDO—to move people emotionally—and “getting closer to people,” Sony plans to continue to conduct R&D based on the spirit of innovation and challenge detailed in its Founding Prospectus. While continuing its R&D efforts to enhance product strength for Branded Hardware, comprised of the HE&S, IP&S and MC segments that bear the Sony brand, Sony will also strive to expand the G&NS ecosystem, which combines hardware and network services, and to expand the use of technology in B2B areas such as entertainment and Financial Services. In the Semiconductors segment, Sony plans to strengthen its sensing technology through continued R&D efforts.

Sony has engaged in the separation of business units into distinct subsidiaries across the Sony Group, in order to reinforce the competitiveness of each business, and ensure clearly attributable accountability and responsibility. Concurrently, Sony has also realigned the Group headquarters functions and platform functions that support each of its business units in order to enhance the effectiveness and efficiency of these operations. At its Group headquarters, Sony promotes corporate R&D, which leads its differentiation and creativity through technological innovation.

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R&D costs for the fiscal year ended March 31, 2018 increased by 11.0 billion yen to 458.5 billion yen. The ratio of R&D expense to total revenue excluding Financial Services was 6.3% compared to 6.9% in the previous fiscal year.

The following table includes R&D expenses in the fiscal years ended March 31, 2016, 2017, and 2018.

	Fiscal year ended March 31
	2016		2017		2018
	(Yen in billions)
R&D expenses
Game & Network Services		91.9		95.6		106.2
Home Entertainment & Sound		44.8		47.3		58.0
Imaging Products & Solutions		61.5		58.6		58.6
Mobile Communications		78.1		54.9		55.4
Semiconductors		120.4		117.6		107.2
Corporate R&D		31.3		44.4		44.9
Total		468.2		447.5		458.5

Consolidated R&D costs for the fiscal year ending March 31, 2019 are expected to increase to 470 billion yen.

R&D costs for the fiscal year ended March 31, 2017 decreased by 20.7 billion yen to 447.5 billion yen. This decrease was primarily a result of the strategic decision in the MC segment not to pursue scale in order to improve profitability, which accelerated cost control initiatives.

D. Trend Information

This section contains forward-looking statements about the possible future performance of Sony and should be read in light of the cautionary statement on that subject, which appears on the inside front cover page and applies to this entire document.

Issues Facing Sony and Management’s Response to those Issues

The global economy has recovered, supported by the economies of emerging markets such as China. Advanced economies have benefited from consumer spending bolstered by improvements in employment and income, and are gradually recovering as a whole. On the other hand, noneconomic shocks related to geopolitical conflicts, political discord, or terrorism loom over many regions, and could have a significant impact on the global economy.

The uncertain economic environment surrounding Sony is compounded by continued, intense pricing pressure from competitors, shrinking markets for certain key products and shorter product cycles, primarily in Sony’s Electronics businesses.

On May 22, 2018, Sony unveiled a corporate direction and mid-term strategy (“third mid-range plan”) that charts the path forward for Sony over the next three years, starting with the fiscal year ending March 31, 2019 and finishing with the fiscal year ending March 31, 2021. Through the key themes of KANDO — to move people emotionally — and “getting closer to people,” Sony will aim to sustainably generate societal value and high profitability across its three primary business areas of Electronics, entertainment, and Financial Services. It will pursue this strategy based on the following basic principles.

Overall Strategy

• Reinforce Sony’s user-oriented Direct to Consumer services and its creator-oriented content IP, and create “Communities of Interest” that bring together people who share similar emotional values and experiences.

• Position Branded Hardware, which allows Sony to connect users and creators through its innovative video and audio technologies, as a sustainable and consistent cash flow generating business.

• In the area of CMOS image sensors that capture the real world in which we all live, and are vital to KANDO content creation, aim to maintain Sony’s global number one position in imaging applications, and become the global leader in sensing.

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Initiatives of each Business Segment

<Game & Network Services>

• The business of the G&NS segment is about being connected with both users as well as creators with PlayStation^®4 as its core, and the basic strategy is to further expand PlayStation^TMNetwork (“PSN”), which has now become one of the world’s leading network services with annual sales of more than one trillion yen and monthly active users of more than 80 million. Specifically, Sony aims to grow subscribers to the PlayStation^®Plus service, and increase user engagement with PSN as measured by login frequency and time spent on the platform, by having more people use its products and services such as PlayStation^®VR, the cloud gaming service PlayStation^TMNow, the video services PlayStation^TMVue and PlayStation^TMVideo, and the music service PlayStation^TMMusic. Sony will also aim to strengthen its content IP by creating and utilizing IP for in-house production titles and harnessing growth opportunities in areas such as add-on content.

<Music>

• The basic strategy for the Music segment is to strengthen Sony’s music content IP. In order to maximize the business opportunities from the continuing growth of the streaming market, Sony will seek to reinforce the quality and quantity of its content IP catalog, while also discovering and nurturing new artists to generate new IP.

• In addition to music IP, Sony’s animation IP is another vital part of this segment, and Sony will continue to build these assets going forward.

<Pictures>

• The basic strategy for the Pictures segment is to strengthen and leverage Sony’s IP while also expanding the Media Networks business, particularly in India, in order to continue to enhance profitability.

<Branded Hardware>

• Sony will aim to position Branded Hardware as a sustainable and consistent cash flow generating business that enables continued investment in Sony Group’s growth. In the fiscal year ended March 31, 2018, Branded Hardware was the driving force behind Sony’s record profits, and from the fiscal year ending March 31, 2019 to the fiscal year ending March 31, 2021, it is expected to be the business which generates the most stable cash flow. In this area, Sony will continue its policy of targeting profitability and the premium market rather than unnecessarily pursuing volume.

• In addition, Sony will leverage the technologies cultivated in Branded Hardware to support long-term initiatives in areas such as medical products and AI x Robotics.

<Semiconductors>

• CMOS image sensors are key component devices in growth industries such as the internet of things, artificial intelligence, autonomous vehicles, and more. Sony’s competitive strength in this area is based on its wealth of technological expertise in analog semiconductors, cultivated over many years from the charge-coupled device (CCD) era. Sony aims to maintain its global number one position in imaging and, in the longer term, become number one in sensing applications. To this end, Sony will extend its development of sensing applications beyond the area of smartphones, into new domains such as automotive use.

<Financial Services>

• The Financial Services segment, which continues to generate a high level of revenue and provide a stable source of profit for the Sony Group, is a business with direct and very close ties to customers. Through FinTech (financial services that utilize information technology), Sony will aim to position itself even closer to customers.

Sony’s Long-term Vision and Creating Social Value

• In addition to creating economic value as a company, Sony must also be managed with a view toward creating social value, including the natural environment of the Earth.

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• With its mission of KANDO, Sony will aim to create social value by giving people a sense of enrichment through the creation of a Community of Interest.

• At the same time, based on the recognition that Sony’s business only exists because of its natural environment and society, Sony will continue to promote environmental and human rights initiatives, from a long-term perspective, across all levels of its supply chain.

• Furthermore, based on its desire to contribute to safety in the self-driving car era, Sony will work to further develop its imaging and sensing technologies.

• Sony also intends to make a broader contribution to education (e.g., by nurturing creators, providing educational tools that enable children to learn about programming, and incubating businesses).

Third Mid-Range Plan — Financial Targets

• In order to transition management of Sony’s operations to a more long-term perspective, key performance indicators are being set as a total for the next three-year period.

• From the fiscal year ending March 31, 2019 to the fiscal year ending March 31, 2021, operating cash flow (“OCF”) will be the most important performance metric, and Sony will target total OCF of 2 trillion yen or more, excluding the Financial Services segment, for this three-year period.

• In terms of allocation of cash generated, Sony plans to spend approximately 1 trillion yen on capital expenditure. The priority for the remaining 1 trillion yen will be strategic investment, while also making an appropriate allocation to balance sheet improvement and shareholder returns, in order to further enhance Sony’s corporate value. In terms of shareholder returns, Sony intends to increase dividends in a stable and long-term manner.

• Sony will seek to maintain a Return on Equity (“ROE”) level of 10% or more. For the fiscal year ended March 31, 2018, Sony achieved both financial targets of ROE of 10% or more and operating income of 500 billion yen or more, which were set in the previous mid-range plan (from the fiscal year ended March 31, 2016 to the fiscal year ended March 31, 2018).

Group Environmental Mid-Term Targets “Green Management 2020”

Sony announced in June 2015 the establishment of its “Green Management 2020” group environmental mid-term targets, effective from fiscal 2016 (the fiscal year ended March 31, 2017) through fiscal 2020 (the fiscal year ending March 31, 2021). Based on the following three pillars, Sony has been implementing various initiatives to reduce the Sony Group’s environmental footprint:

• Formulate targets and implement initiatives that leverage the distinctive characteristics of Sony’s businesses, from Electronics to entertainment. Among these, reduce annual energy consumption by an average of 30% (compared to levels at the fiscal year ended March 31, 2014) in Electronics products, and in entertainment, continue to look to use its content to raise awareness of sustainability issues and inspire environmentally conscious actions;

• Enhance efforts to reduce Sony’s environmental footprint across its entire value chain, including manufacturing partners and suppliers, by calling on them to reduce greenhouse gas (GHG) emissions and water consumption; and

• Accelerate the use of renewable energy.

Sony’s long-term vision is to achieve a “zero environmental footprint” throughout all stages of its product lifecycles and business activities by 2050. The “Green Management 2020” mid-term plan has been backcasted (calculated backwards) in order to determine the necessary intermediate steps that need to be taken by fiscal 2020 on the way to this long-term goal. With “Green Management 2020,” Sony plans to further accelerate its various initiatives directed towards its ultimate goal of a “zero environmental footprint.”

Sony also plans to continue to participate in the WWF’s Climate Savers Programme, which aims to achieve reductions in greenhouse gas emissions. Climate change targets are verified by WWF and a third-party verification body for their degrees of difficulty and progress.

Further details of the group environmental mid-term targets “Green Management 2020” and actual measures undertaken by Sony are reported in Sony’s CSR report available on the following website: http://www.sony.net/SonyInfo/csr_report/.

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E. Off-balance Sheet Arrangements

Sony has certain off-balance sheet arrangements that provide liquidity, capital resources and/or credit risk support.

Refer to Note 6 of the consolidated financial statements for transfers of financial asset transactions in which Sony has relinquished control of receivables and accounted for these transfers as sales, and Note 23 of the consolidated financial statements for various arrangements with variable interest entities, including those where Sony is not the primary beneficiary and therefore does not consolidate the entity.

F. Contractual Obligations, Commitments, and Contingent Liabilities

The following table summarizes Sony’s contractual obligations and commitments as of March 31, 2018. The references to the notes below refer to the corresponding notes within the consolidated financial statements.

	Total		Less than 1 year		1 to 3 years		3 to 5 years		More than 5 years
	(Yen in millions)
Contractual obligations and commitments:
Short-term debt (Note 11)		496,093		496,093		—		—		—
Long-term debt (Notes 8 and 11)
Capital lease obligations and other		52,929		13,483		23,559		7,751		8,136
Other long-term debt		796,044		212,039		190,551		213,114		180,340
Interest on other long-term debt		5,377		3,015		1,332		601		429
Minimum rental payments required under operating leases (Note 8)		287,263		57,810		102,875		45,273		81,305
Purchase commitments (Note 27)
Expected cost for the production or purchase of motion pictures and television programming or certain rights		118,914		62,352		41,492		13,947		1,123
Long-term contracts with recording artists, songwriters and companies		73,259		24,073		24,835		11,720		12,631
Long-term sponsorship contracts related to advertising and promotional rights		6,379		4,931		944		504		—
Long-term contracts for programming contents		26,227		14,875		11,352		—		—
Other purchase commitments		143,212		105,482		32,381		3,055		2,294
Future insurance policy benefits and other and policyholders’ account in the life insurance business* (Note 10)		22,951,646		490,578		1,084,792		1,203,235		20,173,041
Gross unrecognized tax benefits** (Note 21)		95,425		902		—		—		—
Total		25,052,768		1,485,633		1,514,113		1,499,200		20,459,299

* Future insurance policy benefits and other and policyholders’ account in the life insurance business are the estimated future cash payments to be made to policyholders and others. These cash payments are based upon assumptions including morbidity, mortality, withdrawals and other factors. The sum of the cash payments shown for all years in the table of 22,951.6 billion yen exceeds the corresponding liability amount of 7,987.1 billion yen included in the consolidated balance sheets as of March 31, 2018. Refer to Note 10 of the consolidated financial statements.

** The total amount represents the liability for gross unrecognized tax benefits in accordance with the accounting guidance for uncertain tax positions. Sony estimates that 0.9 billion yen of the liability is expected to be settled within one year. The settlement period for the remaining portion of the liability, which totaled 94.5 billion yen, cannot be reasonably estimated due to the uncertainty associated with the timing of the settlements with the various taxing authorities. Refer to Note 21 of the consolidated financial statements.

The following items are not included in either the above table or the total amount of commitments outstanding at March 31, 2018:

• The total amount of expected future pension payments is not included as such amount is not currently determinable. Sony expects to contribute approximately 11 billion yen to Japanese pension plans and approximately 6 billion yen to foreign pension plans during the fiscal year ending March 31, 2019. Refer to Note 15 of the consolidated financial statements.

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• The total unused portion of the line of credit extended under loan agreements in the Financial Services segment is not included in the above table as it is not foreseeable what loans will be incurred under such line of credit. The total unused portion of the line of credit extended under these contracts was approximately 31.2 billion yen as of March 31, 2018. Refer to Note 27 of the consolidated financial statements.

• Purchases made during the ordinary course of business from certain component manufacturers and contract manufacturers in order to establish the best pricing and continuity of supply for Sony’s production are not included as there are typically no binding purchase obligations. Purchase obligations are defined as contractual obligations to purchase goods or services that are enforceable and legally binding on Sony. These obligations specify all significant terms, including fixed or minimum quantities to be purchased; fixed, minimum, or variable price provisions; and the approximate timing of the transaction. Purchase obligations do not include contracts that may be cancelled without penalty. These purchases include arrangements with certain component manufacturers whereby Sony procures goods, including product components, for these component manufacturers and is reimbursed for the related purchases. This allows Sony’s supply chain management to have flexible and mutually beneficial purchase arrangements with these manufacturers in order to minimize inventory risk. Consistent with industry practice, Sony purchases processed goods that meet technical criteria from these component manufacturers after issuing to these manufacturers information on Sony’s projected demand and manufacturing needs.

Refer to Item 8 A. “Financial Information” Consolidated Statements and Other Financial Information for legal proceedings and Note 27 of the consolidated financial statements for guarantees issued, including product warranties.

Critical Accounting Policies and Estimates

The preparation of the consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. On an ongoing basis, Sony evaluates its estimates, which are based on historical experience, future projections and various other assumptions that are believed to be reasonable under the circumstances. The results of these evaluations form the basis for making judgments about the carrying values of assets and liabilities and the reported amounts of expenses that are not readily apparent from other sources. Actual results may significantly differ from these estimates. Sony considers an accounting policy to be critical if it is important to its financial condition and results, and requires significant judgment and estimates on the part of management in its application. Sony believes that the following represents its critical accounting policies.

Investments

Sony’s investments include debt and equity securities accounted for under both the cost and equity method of accounting. If it has been determined that an investment has sustained an other-than-temporary decline in its value, the investment is written down to its fair value with a charge to income. Sony regularly evaluates its investment portfolio to identify other-than-temporary impairments of individual securities. Factors that are considered by Sony in determining whether an other-than-temporary decline in value has occurred include: the length of time and extent to which the market value of the security has been less than its original cost, the financial condition, operating results, business plans and estimated future cash flows of the issuer of the security, other specific factors affecting the market value, deterioration of the credit condition of the issuer, sovereign risk, and whether or not Sony is able to retain the investment for a period of time sufficient to allow for the anticipated recovery in market value.

In evaluating the factors for available-for-sale securities whose fair values are readily determinable, Sony presumes a decline in value to be other-than-temporary if the fair value of the security is 20% or more below its original cost for an extended period of time (generally for a period of up to six months). This criterion is employed as a threshold to identify securities which may have a decline in value that is other-than-temporary. The presumption of an other-than-temporary impairment in such cases may be overcome if there is evidence to support that the decline is temporary in nature due to the existence of other factors which overcome the duration or magnitude of the decline. On the other hand, there may be cases where impairment losses are recognized when the decline in the fair value of the security is not more than 20% or such decline has not existed for an extended period of time, as a result of considering specific factors which may indicate that the decline in the fair value is other-than-temporary.

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When an other-than-temporary impairment of a held-to-maturity debt security has occurred, the amount of the other-than-temporary impairment recognized in income depends on whether Sony intends to sell the security or more likely than not will be required to sell the security before recovery of its amortized cost. If the debt security meets either of these two criteria, the other-than-temporary impairment is recognized in income, measured as the entire difference between the security’s amortized cost and its fair value at the impairment measurement date. For other-than-temporary impairments of debt securities that do not meet these two criteria, the net amount recognized in income is a credit loss equal to the difference between the amortized cost of the debt security and its net present value calculated by discounting Sony’s best estimate of projected future cash flows at the effective interest rate implicit in the debt security prior to impairment. Any difference between the fair value and the net present value of the debt security at the impairment measurement date is recorded in accumulated other comprehensive income. Unrealized gains or losses on securities for which an other-than-temporary impairment has been recognized in income are presented as a separate component of accumulated other comprehensive income.

The assessment of whether a decline in the value of an investment is other-than-temporary is often subjective in nature and involves certain assumptions and estimates concerning the expected operating results, business plans and future cash flows of the issuer of the security. Accordingly, it is possible that investments in Sony’s portfolio that have had a decline in value that Sony currently believes to be temporary may be determined to be other-than-temporary in the future based on Sony’s evaluation of subsequent information such as continued poor operating results, future broad declines in the value of worldwide equity markets and the effect of worldwide interest rate fluctuations. As a result, unrealized losses recorded for investments may be recognized and reduce income in future periods.

Valuation of inventory

Sony values its inventory based on the lower of cost and net realizable value. Sony writes down inventory in an amount equal to the difference between the cost of the inventory and the net realizable value — i.e., estimated selling price in the ordinary course of business less reasonably predictable costs of completion and disposal. Sony writes down the value of its inventory when the underlying parts, components or products have become obsolete, when inventory levels exceed the amount expected to be used, or when the value of the inventory is otherwise recorded at a higher value than net realizable value. As a result, if actual market conditions are less favorable than projected and further price decreases are needed, additional inventory write-downs may be required in the future.

Impairment of long-lived assets

Sony reviews the recoverability of the carrying value of its long-lived assets held and used and long-lived assets to be disposed of, whenever events or changes in circumstances indicate that the carrying value of the assets or asset groups may not be recoverable. Long-lived assets to be held and used are reviewed for impairment by comparing the carrying value of the asset or asset group with their estimated undiscounted future cash flows. This review is primarily performed using estimates of future cash flows by product category or, in certain cases, by entity. If the carrying value of the asset or asset group is considered impaired, an impairment charge is recorded for the amount by which the carrying value of the asset or asset group exceeds its fair value. Fair value is determined using the present value of estimated net cash flows or comparable market values. This approach uses significant estimates and assumptions including projected future cash flows, the timing of such cash flows, discount rates reflecting the risk inherent in future cash flows, perpetual growth rates applied to determine terminal values, determination of appropriate market comparables and the determination of whether a premium or discount should be applied to comparables.

Management believes that the estimates of future cash flows and fair value are reasonable; however, changes in estimates resulting in lower future cash flows and fair value due to unforeseen changes in Sony’s businesses or assumptions could negatively affect the valuations of long-lived assets.

Business combinations

When Sony applies the acquisition method of accounting, the deemed purchase price is allocated to identifiable assets acquired and liabilities assumed. Any residual purchase price is recorded as goodwill. The allocation of the purchase price utilizes significant estimates in determining the fair values of assets acquired and liabilities assumed, especially with respect to intangible assets. Independent third-party appraisal firms are typically engaged in order to assist in the estimation process. The significant estimates and assumptions include, but are not limited to, the timing and amount of revenue and future cash flows, the discount rate reflecting the risk inherent in future cash flows and the perpetual growth rate used to calculate the terminal value.

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Due to the inherent uncertainties involved in making the estimates and assumptions, the purchase price for acquisitions could be valued and allocated to the acquired assets and liabilities differently. Actual results may differ, or unanticipated events and circumstances may affect such estimates, which could require Sony to record an impairment of an acquired asset, including goodwill, or increase in the amounts recorded for an assumed liability.

Goodwill and other intangible assets

Goodwill and indefinite lived intangible assets are tested annually for impairment during the fourth quarter of the fiscal year and between annual tests if an event occurs or circumstances change that would more likely than not reduce the fair value below its carrying amount. Such an event or change in circumstances would include unfavorable variances from established business plans, significant changes in forecasted results or volatility inherent to external markets and industries, which are periodically reviewed by Sony’s management.

In the fiscal year ended March 31, 2018, Sony elected not to perform an optional qualitative assessment of goodwill and instead proceeded directly to a quantitative impairment test by comparing the fair value of a reporting unit with its carrying amount. Reporting units are Sony’s operating segments or one level below the operating segments. If the fair value of a reporting unit exceeds its carrying amount, goodwill of the reporting unit is not considered impaired. If the carrying amount of a reporting unit exceeds its fair value, an impairment loss is recognized in an amount equal to that excess, not to exceed the total amount of goodwill allocated to the reporting unit. Indefinite lived intangible assets are tested for impairment by comparing the fair value of the intangible asset with its carrying value, and if the carrying value of the intangible asset exceeds its fair value, an impairment loss is recognized in an amount equal to that excess.

Determining the fair value of a reporting unit under the goodwill impairment test is judgmental in nature and often involves the use of significant estimates and assumptions. Similarly, estimates and assumptions are used in determining the fair value of indefinite lived intangible assets. These estimates and assumptions could significantly impact whether or not an impairment charge is recognized as well as the magnitude of any such charge.

In its impairment review, Sony performs internal valuation analyses or utilizes third-party valuations when management believes it to be appropriate, and considers other market information that is publicly available. The fair value of a reporting unit or indefinite lived intangible asset is generally determined using a discounted cash flow analysis. This approach uses significant estimates and assumptions including projected future cash flows, the timing of such cash flows, discount rates reflecting the risk inherent in future cash flows, perpetual growth rates, earnings multiples, the determination of appropriate comparable entities and the determination of whether a premium or discount should be applied to comparables. Consideration is also given to Sony’s market capitalization in relation to the sum of the calculated fair values of the reporting units, including reporting units with no goodwill, and taking into account corporate level assets and liabilities not assigned to individual reporting units as well as a reasonable control premium.

The assumptions used for projected future cash flows and the timing of such cash flows are based on the forecast and mid-range plan (“MRP”) of each reporting unit and take into account such factors as historical experience, market and industry information, and current and forecasted economic conditions. Perpetual growth rates are utilized to determine a terminal cash flow value and are generally set after the three-year forecasted period for the MRP. Certain reporting units, such as those in the Pictures segment, utilize longer forecast periods and base the terminal value on an exit price using an earnings multiple applied to the final year of the forecasted earnings, which also takes into consideration a control premium. Discount rates are derived from the weighted average cost of capital of market participants in similar businesses.

For all reporting units with goodwill, fair value exceeded the carrying amount, and therefore no impairment existed in the fiscal year ended March 31, 2018. These reporting units’ fair value exceeded their respective carrying values by at least 10.0%. Also, for indefinite lived intangible assets, fair value exceeded the carrying amount, and therefore no impairment existed.

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The carrying amounts of goodwill by segment as of March 31, 2018 are as follows:

	Yen in millions
Game & Network Services		150,606
Music		165,394
Pictures		144,412
Imaging Products & Solutions		9,517
Mobile Communications		3,286
Semiconductors		45,793
Financial Services		7,225
All Other		4,259
Total		530,492

A discussion of the significant assumptions, other than the MRP described above, including a sensitivity analysis with respect to their impact, of the fair value of Sony’s reporting units for the impairment analysis performed for the fiscal year ended March 31, 2018 is included below:

• The discount rates ranged from 5.9% to 12.4%. A hypothetical one percentage point increase in the discount rate, holding all other assumptions constant, would not have resulted in an impairment.

• The growth rates applied to the terminal values for reporting units within the G&NS, IP&S, MC and Semiconductors and Financial Services segments and All Other ranged from approximately 1.0% to 1.5%. The growth rates beyond the MRP period for the reporting units in the Music segment ranged from 0% to 1.0%, and in the Pictures segment ranged from 3.0% to 4.5%. A hypothetical one percentage point decrease in the growth rate, holding all other assumptions constant, would not have resulted in an impairment.

• The earnings multiple used to calculate the terminal value in the Pictures reporting units ranged from 8.0x to 10.0x. A hypothetical reduction in the earnings multiple by 1.0x, holding all other assumptions constant, would not have resulted in an impairment.

Management believes that the assumptions used to estimate the fair value used in the goodwill impairment tests are reasonable; however, in the future, changes in estimates resulting in lower than currently anticipated cash flows and fair value due to unforeseen changes in assumptions could negatively affect the valuations, which may result in Sony recognizing impairment charges for goodwill and indefinite lived intangible assets in the future.

Pension benefit costs

Employee pension benefit costs and obligations are dependent on certain assumptions including discount rates, retirement rates and mortality rates, which are based upon current statistical data, as well as expected long-term rates of return on pension plan assets and other factors. Specifically, the discount rate and expected long-term rate of return on pension plan assets are two critical assumptions in the determination of periodic pension costs and pension liabilities. Assumptions are evaluated at least annually, or at the time when events occur or circumstances change and these events or changes could have a significant effect on these critical assumptions.

In accordance with U.S. GAAP, actual results that differ from the assumptions are accumulated and amortized over future periods. Therefore, actual results generally affect recognized costs and the recorded obligations for pensions in future periods. While management believes that the assumptions used are appropriate, differences in actual experience or changes in assumptions may affect Sony’s pension obligations and future costs.

Sony’s principal pension plans are its Japanese pension plans. No individual foreign pension plan is significant to the consolidated pension plan assets and pension obligations.

To determine the benefit obligation of the Japanese pension plans, Sony used a discount rate of 0.8% for its Japanese pension plans as of March 31, 2018. The discount rate was determined by using information about yields on high-quality bonds currently available and expected to be available during the period to maturity of the pension benefit obligation in consideration of amounts and timing of cash outflows for expected benefit payments. Such available information about yields is collected from published market information and credit rating agencies. The 0.8% discount rate represents a 10 basis point decrease from the 0.9% discount rate used for the fiscal year ended March 31, 2017 and reflects current Japanese market interest conditions.

To determine the expected long-term rate of return on pension plan assets, Sony considers the current and expected asset allocations, as well as historical and expected long-term rates of return on various categories of

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pension plan assets. Sony’s pension investment policy recognizes the expected growth and the variability risk associated with the long-term nature of pension liabilities, the returns and risks of diversification across asset classes, and the correlation among assets. The asset allocations are designed to maximize returns consistent with levels of liquidity and investment risk that are considered prudent and reasonable. While the pension investment policy gives appropriate consideration to recent market performance and historical returns, the investment assumptions utilized by Sony are designed to achieve a long-term return consistent with the long-term nature of the corresponding pension liabilities. For Japanese pension plans, the expected long-term rate of return on pension plan assets was 2.7% and 2.4% as of March 31, 2017 and 2018, respectively. The actual return on pension plan assets for the fiscal years ended March 31, 2017 and 2018 was a 5.2% gain and a 5.6% gain, respectively. The difference between the expected and the actual rate of return on pension plan assets was primarily due to the positive performance in the domestic (Japan) and the global equity markets through the fiscal year ended March 31, 2018. Actual results that differ from the expected return on pension plan assets are accumulated and amortized as a component of pension costs over the average future service period, thereby reducing the year-to-year volatility in pension costs. As of March 31, 2017 and 2018, Sony had, with respect to Japanese pension plans, net actuarial losses of 317.4 billion yen and 299.9 billion yen, respectively, including losses related to pension plan assets. The net actual loss decreased due to the higher actual return on pension plan assets than expected, partially offset by the impact of the decline in the discount rate used to determine the defined benefit obligation, as compared to the prior fiscal year’s rate.

The following table illustrates the effect on the fiscal year ending March 31, 2019 of changes in the discount rate and the expected return on pension plan assets, while holding all other assumptions as of March 31, 2018 constant, for Japanese pension plans.

Change in assumption	Projected benefit obligations		Pension costs		Net income
	(Yen in billions)
25 basis point increase / decrease in discount rate		-/+38.0		-/+1.9		+/-1.3
25 basis point increase / decrease in expected long-term rate of return on pension plan assets		—		-/+1.7		+/-1.2

Deferred tax asset valuation

Carrying amounts of deferred tax assets require a reduction by a valuation allowance if, based on the available evidence, it is more likely than not that such assets will not be realized prior to expiration. Accordingly, the need to establish a valuation allowance for deferred tax assets is assessed periodically with appropriate consideration given to all positive and negative evidence related to the realization of the deferred tax assets. Management’s judgments related to this assessment consider, among other matters, the nature, frequency and severity of current and cumulative losses on an individual tax jurisdiction basis, forecasts of future profitability after consideration of uncertain tax positions, excess of appreciated asset value over the tax basis of net assets, the duration of statutory carryforward periods, the past utilization of net operating loss carryforwards prior to expiration, as well as prudent and feasible tax planning strategies which would be employed by Sony to prevent net operating loss and tax credit carryforwards from expiring unutilized.

As a result of prior losses, as of March 31, 2018, total established valuation allowances against deferred tax assets were 899.8 billion yen, including approximately 500 billion yen relating to national and local taxes for Sony Corporation and its national tax filing group in Japan and approximately 250 billion yen relating to federal and state taxes for Sony Americas Holding Inc. (“SAHI”) and its consolidated tax filing group in the U.S.. As of March 31, 2018, some of the entities have returned to profitability, particularly SAHI and its consolidated tax filing group in the U.S. and Sony Corporation and its national tax filing group in Japan. This is a positive factor to be considered; however, in order to support a reversal of the valuation allowance, a pattern of consistent earnings still needs to be established, particularly in jurisdictions like Japan where the remaining net operating loss carryforward period is very limited.

Sony is subject to income taxes in Japan and numerous other jurisdictions, and in the ordinary course of business there are many situations where the ultimate tax determination can be uncertain, particularly with respect to transfer pricing for intercompany transactions. The amount of the deferred tax assets recorded takes into account the more likely than not final outcome of these uncertain tax positions based on Sony’s judgement, particularly for final allocations of taxable income among jurisdictions as a result of intercompany transfer pricing decisions. The estimate for the valuation of deferred tax assets, which is based on currently enacted tax laws and rates as of the balance sheet date, reflects management’s judgment and best estimate of the likely future tax consequences of events that have been recognized in Sony’s financial statements and tax returns, the ability to implement various tax planning strategies and, in certain cases, future forecasts, business plans and other

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expectations about future outcomes. Changes in existing tax laws or rates in tax jurisdictions in which Sony operates could affect actual tax results, and market or economic deterioration or failure of management to achieve its restructuring objectives could affect future business results, either of which could affect the valuation of deferred tax assets over time. If future results are less than projected, if the results of tax examinations or the negotiations of advance pricing agreements covering transfer pricing of intercompany transactions result in a different allocation of profits and losses than currently anticipated, if tax planning alternatives are no longer viable, or if there is no excess appreciated asset value over the tax basis of the assets contemplated for sale, further valuation allowance may be required in the future to reduce the deferred tax assets to their net realizable value. On the other hand, a forecasted improvement and consistency in future earnings or other factors, such as business reorganizations, could lead to the future reversal of valuation allowance into income as a reduction to tax expense, subject to review of the relevant qualitative factors and uncertainties. These factors and other changes that are not anticipated in current estimates could have a material impact on Sony’s earnings or financial condition in the period or periods in which the impact is recorded or reversed.

Film accounting

An aspect of film accounting that requires the exercise of judgment relates to the process of estimating the total revenues to be received throughout a film’s life cycle. Such estimate of a film’s ultimate revenue is important for two reasons. First, while a film is being produced and the related costs are being capitalized, it is necessary for management to estimate the ultimate revenue, less additional costs to be incurred, including exploitation costs which are expensed as incurred, in order to determine whether the value of a film has been impaired and thus requires an immediate write-off of unrecoverable film costs. Second, the amount of film costs recognized as cost of sales for a given film as it is exhibited in various markets throughout its life cycle is based upon the proportion that current period actual revenues bear to the estimated ultimate total revenues.

Management bases its estimates of ultimate revenue for each film on several factors including the historical performance of similar genre films, the star power of the lead actors and actresses, the expected number of theaters at which the film will be released, anticipated performance in the home entertainment, television and other ancillary markets, and agreements for future sales. Management updates such estimates on a regular basis based on the actual results to date and estimated future results for each film. For example, a film that has resulted in lower than expected theatrical revenues in its initial weeks of release would generally have its theatrical, home entertainment and television distribution ultimate revenues adjusted downward; a failure to do so would result in the understatement of amortized film costs for the period.

Future insurance policy benefits

Liabilities for future insurance policy benefits, which mainly relate to individual life insurance policies, are established in amounts adequate to meet the estimated future obligations of policies in force. These liabilities, which require significant management judgment and estimates, are computed by the net level premium method based upon the assumptions as to future investment yield, morbidity, mortality, withdrawals and other factors. Future policy benefits are computed using interest rates ranging from 1.0% to 4.5% and are based on factors such as market conditions and expected investment returns. Morbidity, mortality and withdrawal assumptions for all policies are based on either the subsidiary’s own experience or various actuarial tables. Generally these assumptions are locked-in throughout the life of the contract upon the issuance of new insurance, although significant changes in experience or assumptions may require Sony to provide for expected future losses.

Policyholders’ account in the life insurance business

Policyholders’ account in the life insurance business represents an accumulation of account deposits plus credited interest less withdrawals, expenses and mortality charges. Policyholders’ account includes universal life insurance and investment contracts. Universal life insurance includes interest sensitive whole life contracts and variable contracts. The credited rates associated with interest sensitive whole life contracts range from 1.8% to 2.0%. For variable contracts, policy values are expressed in terms of investment units. Each unit is linked to an asset portfolio. The value of a unit increases or decreases based on the value of the linked asset portfolio. Investment contracts mainly include single payment educational endowment contracts, individual variable annuities and policies after the start of annuity payments. The credited rates associated with investment contracts, except for individual variable annuities, range from 0.01% to 6.3%. For individual variable annuities, policy values are expressed in terms of investment units. Each unit is linked to an asset portfolio. The value of a unit increases or decreases based on the value of the linked asset portfolio.

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Recently Adopted Accounting Standards

Refer to Note 2, summary of significant accounting policies, recently adopted accounting pronouncements, of the consolidated financial statements.

Recent Accounting Pronouncements

Refer to Note 2, summary of significant accounting policies, recent accounting pronouncements not yet adopted, of the consolidated financial statements.

Item 6. Directors, Senior Management and Employees

A. Directors and Senior Management

Set forth below are the current members of the Board of Directors and Corporate Executive Officers of Sony Corporation, their responsibility as a director or officer, date of birth, the number of years they have served as a director or officer, and other principal business activities outside the Corporation as of June 19, 2018.

Board of Directors

Kenichiro Yoshida
Responsibility as a Director: Member of the Nominating Committee
Date of Birth: October 20, 1959
Number of Years Served as a Director: 4 years
Principal Business Activities Outside the Corporation: None
Brief Personal History:
April 1983	Joined Sony Corporation
July 2000	Joined Sony Communication Network Corporation (currently Sony Network Communications Inc.)
May 2001	SVP, Sony Communication Network Corporation
April 2005	President and Representative Director, Sony Communication Network Corporation
December 2013	EVP, CSO and Deputy CFO, Corporate Executive Officer, Sony Corporation
April 2014	EVP and CFO, Representative Corporate Executive Officer, Sony Corporation
June 2014	Director, Sony Corporation (present)
April 2015	Executive Deputy President and CFO, Representative Corporate Executive Officer, Sony Corporation
April 2018	President and CEO, Representative Corporate Executive Officer, Sony Corporation (present)
Kazuo Hirai
Responsibility as a Director: —
Date of Birth: December 22, 1960
Number of Years Served as a Director: 6 years
Principal Business Activities Outside the Corporation: None
Brief Personal History:
April 1984	Joined CBS/Sony Inc. (currently Sony Music Entertainment (Japan) Inc.)
July 1996	EVP and COO, Sony Computer Entertainment America LLC (currently Sony Interactive Entertainment America LLC)
October 1997	Corporate Executive, Sony Computer Entertainment Inc. (currently Sony Interactive Entertainment Inc.)
April 1999	President and COO, Sony Computer Entertainment America LLC
August 2003	President and CEO, Sony Computer Entertainment America LLC
December 2006	President and Group COO, Sony Computer Entertainment Inc. Chairman, Sony Computer Entertainment America LLC
June 2007	President and Group CEO, Sony Computer Entertainment Inc.
April 2009	EVP, Corporate Executive Officer, Sony Corporation
April 2011	Executive Deputy President, Representative Corporate Executive Officer, Sony Corporation
September 2011	Chairman, Sony Computer Entertainment Inc.
April 2012	President and CEO, Representative Corporate Executive Officer, Sony Corporation
June 2012	Director, Sony Corporation (present)
April 2018	Chairman, Sony Corporation (present)

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Osamu Nagayama

Responsibility as a Director: Chairman of the Board
Chair of the Nominating Committee

Date of Birth: April 21, 1947

Number of Years Served as a Director: 8 years

Brief Personal History and Principal Business Activities Outside the Corporation:

April 1971	Joined The Long-Term Credit Bank of Japan, Limited
November 1978	Joined Chugai Pharmaceutical Co., Ltd.
March 1985	Member of the Board, Chugai Pharmaceutical Co., Ltd.
March 1987	Director and Senior Vice President, Chugai Pharmaceutical Co., Ltd.
March 1989	Representative Director and Deputy President, Chugai Pharmaceutical Co., Ltd.
September 1992	Representative Director, President and Chief Executive Officer, Chugai Pharmaceutical Co., Ltd.
January 2006	Member of Enlarged Corporate Executive Committee, F. Hoffmann-La Roche Ltd. (present)
June 2010	Director, Sony Corporation (present)
March 2012	Representative Director, Chairman and Chief Executive Officer, Chugai Pharmaceutical Co., Ltd.
March 2018	Representative Director, Chairman, Chugai Pharmaceutical Co., Ltd. (present)
Eikoh Harada
Responsibility as a Director: Chair of the Compensation Committee
Date of Birth: December 3, 1948
Number of Years Served as a Director: 5 years
Brief Personal History and Principal Business Activities Outside the Corporation:
April 1972	Joined NCR Japan, Ltd.
November 1980	Joined Yokogawa Hewlett-Packard Company
January 1983	Director, Schlumberger Group
October 1994	Director, Apple Japan, Inc.
April 1997	President, Apple Japan, Inc. Vice President, Apple Computer, Inc.
March 2005	Chairman, President and Chief Executive Officer, Representative Director, McDonald’s Holdings Company (Japan), Ltd. Chairman, President and Chief Executive Officer, Representative Director, McDonald’s Company (Japan), Ltd.
June 2013	Director, Sony Corporation (present) Director, Benesse Holdings, Inc.
March 2014	Chairman, Director, McDonald’s Holdings Company (Japan), Ltd. Chairman, Director, McDonald’s Company (Japan), Ltd.
June 2014	Representative Director, Chairman and CEO, Benesse Holdings, Inc.
October 2014	Representative Director and CEO, Benesse Corporation
Tim Schaaff
Responsibility as a Director: Director in charge of Information Security
Date of Birth: December 5, 1959
Number of Years Served as a Director: 5 years
Brief Personal History and Principal Business Activities Outside the Corporation:
December 1982	Joined New England Digital Corporation
July 1991	Joined Apple Computer, Inc.
1998	Vice President, Apple Computer, Inc.
December 2005	Senior Vice President, Sony Corporation of America
November 2006	Deputy President, Technology Development Group, Sony Corporation
June 2008	President, Sony Media Software and Services Inc.
December 2009	President, Sony Network Entertainment International LLC
June 2013	Director, Sony Corporation (present)
January 2014	Independent startup advisor (present)
July 2015	Chief Product Officer, Intertrust Technologies Corporation (present)

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Kazuo Matsunaga
Responsibility as a Director: Chair of the Audit Committee
Date of Birth: February 28, 1952
Number of Years Served as a Director: 4 years
Brief Personal History and Principal Business Activities Outside the Corporation:
April 1974	Joined Ministry of International Trade and Industry (currently Ministry of Economy, Trade and Industry (“METI”))
June 2004	Director-General, Nuclear and Industrial Safety Agency, METI
September 2005	Assistant Vice-Minister, Minister’s Secretariat, METI
July 2006	Deputy Vice-Minister, Minister’s Secretariat, METI
July 2008	Director-General, Economic and Industrial Policy Bureau, METI
July 2010	Vice-Minister of Economy, Trade and Industry, METI
April 2012	Specially-appointed Professor, Graduate School of International Corporate Strategy, Hitotsubashi University (present)
June 2013	Outside Director, Takasago Thermal Engineering Co., Ltd. (present)
June 2014	Director, Sony Corporation (present) Outside Director, Hashimoto Sogyo Co., Ltd. (currently Hashimoto Sogyo Holdings Co., Ltd.) (present) President, Japan Cooperation Center for the Middle East (present)
April 2016	Vice Chairman of the Board, Mitsubishi Fuso Truck and Bus Corporation
January 2017	Chairman of the Board, Mitsubishi Fuso Truck and Bus Corporation (present)
Koichi Miyata
Responsibility as a Director: Member of the Nominating Committee
Date of Birth: November 16, 1953
Number of Years Served as a Director: 4 years
Brief Personal History and Principal Business Activities Outside the Corporation:
April 1976	Joined The Mitsui Bank, Ltd.
June 2003	Executive Officer, Sumitomo Mitsui Banking Corporation
October 2006	Managing Executive Officer, Sumitomo Mitsui Banking Corporation
April 2009	Director and Senior Managing Executive Officer, Sumitomo Mitsui Banking Corporation
April 2010	Senior Managing Executive Officer, Sumitomo Mitsui Financial Group, Inc.
June 2010	Director, Sumitomo Mitsui Financial Group, Inc.
April 2011	Director and President, Sumitomo Mitsui Financial Group, Inc. Director, Sumitomo Mitsui Banking Corporation
June 2014	Director, Sony Corporation (present)
June 2016	Outside Corporate Auditor, Isetan Mitsukoshi Holdings Ltd. (present)
April 2017	Chairman of the Board, Sumitomo Mitsui Financial Group, Inc. (present) Chairman of the Board, Sumitomo Mitsui Banking Corporation (present)
John V. Roos
Responsibility as a Director: Member of the Nominating Committee
Date of Birth: February 14, 1955
Number of Years Served as a Director: 4 years
Brief Personal History and Principal Business Activities Outside the Corporation:
October 1980	Associate, O’Melveny and Myers LLP
February 1985	Associate, Wilson Sonsini Goodrich & Rosati
February 1988	Partner, Wilson Sonsini Goodrich & Rosati
February 2000	Managing Director of Professional Services, Wilson Sonsini Goodrich & Rosati
February 2005	Chief Executive Officer, Wilson Sonsini Goodrich & Rosati
August 2009	United States Ambassador to Japan
September 2013	Outside Director, Salesforce.com, inc. (present)
October 2013	Chief Executive Officer, The Roos Group, LLC (present)
December 2013	Member of Global Advisory Board, Mitsubishi UFJ Financial Group, Inc. (present)
April 2014	Senior Advisor, Centerview Partners LLC (present)
June 2014	Director, Sony Corporation (present)
May 2015	Founding Partner, Geodesic Capital (present)
January 2016	Chairman of the Advisory Board, Toyota Research Institute, Inc. (present)

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Eriko Sakurai
Responsibility as a Director: Member of the Compensation Committee
Date of Birth: November 16, 1960
Number of Years Served as a Director: 4 years
Brief Personal History and Principal Business Activities Outside the Corporation:
June 1987	Joined Dow Corning Corporation
May 2008	Director, Dow Corning Toray Co., Ltd.
March 2009	Chairman and Chief Executive Officer, Representative Director, Dow Corning Toray Co., Ltd. (present)
June 2014	Director, Sony Corporation (present)
June 2015	Outside Director, Sumitomo Mitsui Financial Group, Inc. (present)
Kunihito Minakawa
Responsibility as a Director: Member of the Audit Committee
Date of Birth: August 15, 1954
Number of Years Served as a Director: 1 year
Brief Personal History and Principal Business Activities Outside the Corporation:
April 1978	Joined Ricoh Company, Ltd.
October 1997	Senior Vice President and Chief Financial Officer, Ricoh Americas Corporation
April 2010	Corporate Vice President, and General Manager of Finance and Accounting Division, Ricoh Company, Ltd.
June 2010	Outside Audit & Supervisory Board Member, Ricoh Leasing Company, Ltd.
April 2012	Corporate Senior Vice President, and General Manager of Finance and Accounting Division, Ricoh Company, Ltd.
June 2013	Audit & Supervisory Board Member, Ricoh Company, Ltd.
June 2017	Director, Sony Corporation (present)

Shuzo Sumi

Responsibility as a Director: Vice Chairman of the Board

Member of the Nominating Committee

Date of Birth: July 11, 1947

Number of Years Served as a Director: 1 year

Brief Personal History and Principal Business Activities Outside the Corporation:

April 1970	Joined Tokio Marine & Fire Insurance Co., Ltd.
June 2000	Director and Chief Representative in London, Overseas Division, Tokio Marine & Fire Insurance Co., Ltd.
June 2002	Managing Director, Tokio Marine & Fire Insurance Co., Ltd.
October 2004	Managing Director, Tokio Marine & Nichido Fire Insurance Co., Ltd.
June 2005	Senior Managing Director, Tokio Marine & Nichido Fire Insurance Co., Ltd.
June 2007	President & Chief Executive Officer, Tokio Marine & Nichido Fire Insurance Co., Ltd. President & Chief Executive Officer, Tokio Marine Holdings, Inc.
June 2013	Chairman of the Board, Tokio Marine & Nichido Fire Insurance Co., Ltd. Chairman of the Board, Tokio Marine Holdings, Inc. (present)
June 2014	Outside Director, Toyota Industries Corporation (present)
June 2017	Director, Sony Corporation (present)

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Nicholas Donatiello, Jr.
Responsibility as a Director: Member of the Compensation Committee
Date of Birth: June 28, 1960
Number of Years Served as a Director: —
Brief Personal History and Principal Business Activities Outside the Corporation:
July 1986	Management Consultant, McKinsey & Company, Inc.
September 1993	President and CEO, Odyssey Ventures, Inc. (present)
December 2008	Outside Director, American Funds: EuroPacific Growth Fund, New Perspective Fund, and New World Fund
February 2009	Outside Director, Dolby Laboratories, Inc. (present)
September 2012	Lecturer, Stanford University, Graduate School of Business (present)
June 2015	Outside Director, Big 5 Sporting Goods Corporation (present)
January 2016	Chairman of the Board of Directors, American Funds: EuroPacific Growth Fund, New Perspective Fund, and New World Fund (present)
June 2018	Director, Sony Corporation (present)
Toshiko Oka
Responsibility as a Director: Member of the Audit Committee
Date of Birth: March 7, 1964
Number of Years Served as a Director: —
Brief Personal History and Principal Business Activities Outside the Corporation:
April 1986	Joined Tohmatsu Touche Ross Consulting Limited
July 2000	Joined Asahi Arthur Anderson Limited
September 2002	Principal, Deloitte Tohmatsu Consulting Co., Ltd. (currently ABeam Consulting Ltd.)
April 2005	President and Representative Director, ABeam M&A Consulting Ltd. (currently PwC Advisory LLC)
June 2015	Outside Corporate Auditor, Happinet Corporation (present)
April 2016	Partner, PwC Advisory LLC
June 2016	CEO, Oka & Company Ltd. (present) Outside Director, Mitsubishi Corporation. (present) Outside Director, Hitachi Metals, Ltd. (present)
June 2018	Director, Sony Corporation (present)

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Corporate Executive Officers

In addition to Kenichiro Yoshida, the four individuals set forth below are the current Corporate Executive Officers of Sony Corporation as of June 19, 2018. Refer to “Board Practices” below.

Hiroki Totoki
Responsibility as an Officer: Senior EVP, CFO
Date of Birth: July 17, 1964
Number of Years Served as a Corporate Executive Officer: 2 years
Principal Business Activities Outside Sony: None
Brief Personal History:
April 1987	Joined Sony Corporation
February 2002	Representative Director, Sony Bank Incorporated
June 2005	Director, Corporate Executive Officer and Senior Managing Director, Sony Communication Network Corporation (currently Sony Network Communications Inc.)
April 2012	Representative Director, Corporate Executive Officer and Senior Managing Director, So-net Corporation (currently Sony Network Communications Inc.)
April 2013	Representative Director, Corporate Executive Officer, Deputy President and CFO, So-net Entertainment Corporation (currently Sony Network Communications Inc.)
December 2013	SVP, Corporate Executive, Sony Corporation Corporate Executive in charge of Business Strategy, Corporate Development and Transformation
November 2014	Group Executive, Sony Corporation President and CEO, Sony Mobile Communications Inc.
June 2015	Director, Chairman, So-net Corporation (currently Sony Network Communications Inc.)
April 2016	EVP, Corporate Executive Officer, Sony Corporation Officer in charge of Mobile Communications Business, Sony Corporation President and Representative Director, So-net Corporation
June 2017	CSO, Sony Corporation Officer in Charge of Mid-to-Long Term Business Strategy, New Business
April 2018	Representative Corporate Executive Officer, CFO, Sony Corporation (present)
June 2018	Senior EVP, Sony Corporation (present)

Shiro Kambe

Responsibility as an Officer: EVP, Officer in charge of Legal, Compliance, Corporate Communications, CSR,
External Relations and Information Security & Privacy, Quality and Environment

Date of Birth: December 18, 1961

Number of Years Served as a Corporate Executive Officer: 4 years

Principal Business Activities Outside Sony: None

Brief Personal History:

April 1984	Joined Sony Corporation
June 2010	SVP, Corporate Executive, Sony Corporation
	Officer in charge of Corporate Communications and CSR, Sony Corporation (present)
April 2014	Officer in charge of External Relations, Sony Corporation (present)
	Officer in charge of Brand, Sony Corporation
June 2014	EVP, Corporate Executive Officer, Sony Corporation (present)
	Officer in charge of Legal and Compliance, Sony Corporation (present)
August 2016	Officer in charge of Information Security & Privacy, Sony Corporation (present)
June 2018	Officer in charge of Quality and Environment, Sony Corporation (present)

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Kazushi Ambe
Responsibility as an Officer: EVP, Officer in charge of Human Resources and General Affairs
Date of Birth: April 23, 1961
Number of Years Served as a Corporate Executive Officer: 2 years
Principal Business Activities Outside Sony: None
Brief Personal History:
April 1984	Joined Sony Corporation
October 2001	Vice President, Sony Ericsson Mobile Communications
April 2006	Senior Vice President, Sony Corporation of America
November 2014	Corporate Executive, SVP, Sony Corporation
June 2016	EVP, Corporate Executive Officer, Sony Corporation (present) Officer in charge of Human Resources and General Affairs (present)
Toru Katsumoto
Responsibility as an Officer: EVP, Officer in charge of R&D Platform, Medical Business
Date of Birth: October 14, 1957
Number of Years Served as a Corporate Executive Officer: -
Principal Business Activities Outside Sony: None
Brief Personal History:
April 1982	Joined Sony Corporation
November 2012	SVP, Corporate Executive, Sony Corporation
April 2013	Representative Director and President, Sony Olympus Medical Solutions Inc.
January 2016	Director, Sony Olympus Medical Solutions Inc. (present)
January 2017	President, Medical Business Group, Sony Corporation
April 2017	Representative Director and Deputy President, Sony Imaging Products & Solutions Inc. (present)
April 2018	EVP, Corporate Executive Officer, Sony Corporation (present) Officer in charge of R&D Platform, Medical Business(present)

Kenichiro Yoshida, Hiroki Totoki, Shiro Kambe, Kazushi Ambe and Toru Katsumoto are engaged on a full-time basis by Sony Corporation. There is no family relationship between any of the persons named above. There is no arrangement or understanding with major shareholders, customers, suppliers, or others pursuant to which any person named above was selected as a Director or a Corporate Executive Officer.

B. Compensation

Under the Financial Instruments and Exchange Act of Japan and related regulations, Sony is required to disclose the total remuneration paid by Sony Corporation to Directors and Corporate Executive Officers, as well as remuneration of any Director or Corporate Executive Officer who receives total aggregate annual remuneration exceeding 100 million yen from Sony in a fiscal year, on an individual basis. The following table and accompanying footnotes show the information on such matters that Sony Corporation has disclosed in its annual Securities Report for the fiscal year ended March 31, 2018 filed on June 19, 2018 with the Director General of the Kanto Local Finance Bureau (the “Bureau”) of the Ministry of Finance in Japan.

(1) Total amounts of remuneration paid by Sony Corporation to Directors and Corporate Executive Officers

	Fixed remuneration		Remuneration linked to business results		Phantom restricted stock plan
	Number of persons	Amount (Yen in millions)	Number of persons	Amount (Yen in millions)	Number of persons	Amount (Yen in millions)
Directors	11	162	—	—	1	51
	(*1) (*2)			(*3)
(Outside Directors)	(10)	(142)	(—)	(—)	(1)	(51)
Corporate Executive Officers	7	520	7	1,211	3	1,606
				(*4)
Total (*6)	18	682	7	1,211	4	1,657
						(*5)

*1 The number of persons does not include two Directors who concurrently serve as Corporate Executive Officers, because Sony Corporation does not pay any additional remuneration for services as Director to Directors who concurrently serve as Corporate Executive Officers.

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*2 The number of persons includes a Director who resigned on the day of the Ordinary General Meeting of Shareholders held on June 15, 2017.

*3 Sony Corporation does not pay remuneration linked to business results to Directors who do not concurrently serve as Corporate Executive Officers.

*4 The amount that Sony Corporation paid in June 2018 as remuneration linked to business results for the fiscal year ended March 31, 2018.

*5 The Phantom Restricted Stock Plan includes the amount that will be paid to a Director and two Corporate Executive Officers who resigned on the day of the Ordinary General Meeting of Shareholders held on June 19, 2018, and a Corporate Executive Officer who resigned on April 1, 2018.

*6 In addition to the above, Sony Corporation issued restricted stock and stock acquisition rights for the purpose of granting stock options as remuneration linked to share price. During the fiscal year ended March 31, 2018, Sony Corporation recorded 1 million yen in expenses for the restricted stock granted to Directors who did not concurrently serve as Corporate Executive Officers and 164 million yen in expenses for the restricted stock granted to Corporate Executive Officers. Regarding the stock acquisition rights granted to Corporate Executive Officers for the purpose of granting stock options, Sony Corporation recorded 848 million yen in expenses during the fiscal year ended March 31, 2018 or in the past for stock option purposes.

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(2) Amounts of remuneration paid by Sony Corporation and its subsidiaries to Directors and Corporate Executive Officers on an individual basis.

Name	Position (*1)	Basic Remuneration (*2) (Yen in millions)	Remuneration linked to business results (*2) (Yen in millions)	Phantom restricted stock plan (Yen in millions)	Total (*2) (Yen in millions)	Granted number of stock acquisition rights (*3) (Thousand shares)	Granted number of restricted stock (*4) (Thousand shares)
Kazuo Hirai	Sony Corporation Director, Chairman (*6) Former President & CEO, and Representative Corporate Executive Officer (Until April 1, 2018)	244 (*7)	647 (*7)	1,182	2,073	200	50
Kenichiro Yoshida	Sony Corporation Director, President & CEO, and Representative Corporate Executive Officer (*6)	80	358	—	438	140	40
Hiroki Totoki	Sony Corporation Representative Corporate Executive Officer, Senior Executive Vice President, CFO	40 (*8)	43 (*8)	—	83 (*8)	20	5
Shigeki Ishizuka	Sony Corporation Senior Executive Vice President (In charge of Imaging Products and Solutions Business, Mobile Communications Business, Storage Media Business)	40 (*8)	50 (*8)	—	90 (*8)	20	5
Ichiro Takagi	Sony Corporation Senior Executive Vice President (In charge of Manufacturing, Logistics, Procurement and Engineering Platform, Home Entertainment & Sound Business, Consumer AV Sales & Marketing)	40 (*8)	50 (*8)	—	90 (*8)	20	5
Shiro Kambe	Sony Corporation Corporate Executive Officer, Executive Vice President (In charge of Legal, Compliance, Corporate Communications, CSR, External Relations and Information Security & Privacy, Quality & Environment)	36	41	—	77	20	5
Kazushi Ambe	Sony Corporation Corporate Executive Officer, Executive Vice President (In charge of Human Resources and General Affairs)	36	37	—	73	20	5
Tomoyuki Suzuki	Sony Corporation Former Executive Deputy President, Corporate Executive Officer (Until June 19, 2018)	60	70	291	421	60	20 (*5)
Masashi Imamura	Sony Corporation Former Corporate Executive Officer, Executive Vice President (In charge of Manufacturing, Logistics, Procurement, Quality & Environment, Engineering Platform, Sony Corporation) (Until June 19, 2018)	36	42	133	211	20	5 (*5)

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*1 The above chart shows remuneration for Directors and Corporate Executive Officers who received, or will receive, total remuneration exceeding 100 million yen from Sony Corporation and its subsidiaries during the fiscal year ended March 31, 2018. Titles are as of the date of submission of this document.

*2 Due to rounding, individual sums may not total 100%.

*3 The weighted-average fair value per share at the date of grant of stock acquisition rights granted during the fiscal year ended March 31, 2018 was 2,045 yen and was estimated using the Black-Scholes option-pricing model with several assumptions. Refer to Note 17 of the consolidated financial statements for details. The weighted-average fair value per share does not indicate the actual value that would be realized by a Corporate Executive Officer upon the exercise of the above-mentioned stock acquisition rights. The actual value, if any, that is realized by a Corporate Executive Officer upon the exercise of any stock acquisition rights will depend on the extent to which the market value of Sony Corporation’s common stock (“Common Stock”) exceeds the exercise price of the stock acquisition rights on the date of exercise, and several other restrictions imposed on the exercise of the stock acquisition rights, including the period when a Corporate Executive Officer could exercise the stock acquisition rights. Accordingly, there is no assurance that the value realized or to be realized by a Corporate Executive Officer upon the exercise of the stock acquisition rights is or will be at or near the weighted-average fair value per share presented above. In addition, the above weighted-average fair value per share was calculated to recognize compensation expense for the fiscal year ended March 31, 2018 for accounting purposes and should not be regarded as any indication or prediction of Sony with respect to its future stock performance.

*4 Indicates the total number of shares of restricted stock granted in the fiscal year ended March 31, 2018 for Corporate Executive Officers. The issue price per share of restricted stock was 4,365 yen.

*5 As a result of their resignation on June 19, 2018, the transfer restriction on 1/3 of the shares allotted to these individuals in the fiscal year ended March 31, 2018 will be removed in accordance with the relevant conditions, and Sony Corporation will acquire the remaining 2/3 of the shares of restricted stock allotted without any consideration to, or consent of these individuals.

*6 As noted above, Sony Corporation does not pay any remuneration for services as Director to Directors who concurrently serve as Corporate Executive Officers.

*7 Remuneration for Kazuo Hirai, former Representative Corporate Executive Officer, is set in U.S. dollars. Apart from the remuneration contained in the above table, Sony also provided certain personal benefits and perquisites, including fringe benefits and in some instances income taxes related to perquisites, totaling 13 million yen to Kazuo Hirai during the fiscal year ended March 31, 2018.

*8 In the above chart, remuneration for Shigeki Ishizuka, Senior Executive Vice President, includes 40 million yen in fixed compensation and 50 million yen in performance-based compensation from SIPS. Remuneration for Ichiro Takagi, Senior Executive Vice President, includes 13 million yen in fixed compensation and 16 million yen in performance-based compensation from SVP, 13 million yen in fixed compensation and 16 million yen in performance-based compensation from SVS, and 14 million yen in fixed compensation and 18 million yen in performance-based compensation from Sony Marketing. Remuneration for Hiroki Totoki as a Corporate Executive Officer includes 25 million yen in fixed compensation and 27 million yen in performance-based compensation from Sony Mobile.

(3) Basic policy regarding Director and Corporate Executive Officer remuneration

The basic policy regarding remuneration for Directors and Corporate Executive Officers, as determined by the Compensation Committee, is as follows:

(a) Basic policy regarding Director remuneration

The primary duty of Directors is to supervise the performance of business operations of the Sony Group as a whole. In order to improve this supervisory function over the business operations of Sony, which is a global company, the following two elements have been established as the basic policy for the determination of remuneration of Directors. No Director remuneration is paid to those Directors who concurrently serve as Corporate Executive Officers.

• Attracting and retaining an adequate talent pool of Directors possessing the requisite abilities to excel in the global marketplace; and

• Ensuring the effectiveness of the supervisory function of the Directors.

Based upon the above, remuneration of Directors consists of the following three components:

• Fixed remuneration;

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• Remuneration linked to share price; and

• Phantom Restricted Stock Plan.

The schedule for the amount of each component and its percentage of total remuneration is determined in accordance with the basic policy above. Remuneration of Directors shall be at an appropriate level determined based upon research made by a third party regarding remuneration of directors of both domestic and foreign companies.

Regarding remuneration linked to share price, restricted stock will be used to further promote shared values between the shareholders and Directors, and incentivize to develop and maintain a sound and transparent management system. Appropriate restrictions and conditions shall be set in order to enhance the effectiveness of the programs.

Regarding the Phantom Restricted Stock Plan, points determined every year by the Compensation Committee shall be granted to Directors every year during his/her tenure, and at the time of resignation, the remuneration amount shall be calculated by multiplying the Common Stock price by the individual’s accumulated points. The resigning Director shall purchase shares of Common Stock with this remuneration. Sony will not grant any points pursuant to the Phantom Restricted Stock Plan to Directors for a fiscal year in which Sony granted restricted stock to Directors.

(b) Basic policy regarding Corporate Executive Officer remuneration

Corporate Executive Officers are key members of management responsible for executing the business operations of Sony. In order to further improve the business results of Sony, the following two elements have been established as the basic policy for the determination of remuneration of Corporate Executive Officers.

• Attracting and retaining an adequate talent pool of Corporate Executive Officers possessing the requisite abilities to excel in the global marketplace; and

• Providing effective incentives to improve business results on a short-, medium- and long- term basis.

Based upon the above, remuneration of Corporate Executive Officers shall consist of the following four components:

• Fixed remuneration;

• Remuneration linked to business results;

• Remuneration linked to share price; and

• Phantom Restricted Stock Plan.

The schedule for the amount of each component and its percentage of total remuneration shall be determined in accordance with the above basic policy with an emphasis on linking remuneration to business results and shareholder value. Remuneration of Corporate Executive Officers shall be at an appropriate level determined based upon research made by a third party regarding remuneration of management of both domestic and foreign companies.

The basis for the schedule for the amount of each component is below.

The amount of remuneration linked to business results shall be determined based upon 1) the consolidated financial results of Sony, such as ROE (return on equity), operating income, net income and cash flow, for the fiscal year for which remuneration is being given, and 2) the level of achievement of business results in the business area(s) for which the relevant Corporate Executive Officer is responsible. The amount paid shall fluctuate within a range from 0 percent to 200 percent, in principle, of the standard payout amount.

Remuneration linked to the share price, such as stock options and restricted stock, will be used to incentivize executives to increase mid- to long-term shareholder value. Appropriate restrictions and conditions shall be set in order to enhance the effectiveness of this program.

Regarding the Phantom Restricted Stock Plan, points determined every year by the Compensation Committee shall be granted to Corporate Executive Officers every year during his/her tenure in office, and at the time of resignation, the remuneration amount shall be calculated by multiplying the Common Stock price by the individual’s accumulated points. The resigning Corporate Executive Officer shall purchase shares of Common Stock with this remuneration.

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(For Reference)

(i) Remuneration linked to business results

The standard payout amount of remuneration linked to business results for the fiscal year ended March 31, 2018 was between 37.5 percent and 50.0 percent of cash compensation (fixed remuneration plus remuneration linked to business results) related to each individual’s level of responsibility. The key performance indicators (“KPIs”) and the weighting of each KPI related to the performance of consolidated Sony were as follows:

KPI	Weight
ROE	40%
Operating Income	40%
Net Income	10%
Cash Flow	10%

(ii) Restricted Stock

The Compensation Committee decided to introduce a restricted stock plan starting from the fiscal year ended March 31, 2018, pursuant to which shares of restricted stock will be allotted to Sony Corporation’s Corporate Executive Officers and other executives, and non-executive Directors of Sony Corporation (the “Non-Executive Directors”). The purpose of the plan for the Corporate Executive Officers and other executives of Sony Corporation is to further reinforce management’s alignment with shareholder value, and to incentivize management to improve mid- to long- term performance and increase shareholder value. Furthermore, the purpose of the plan for the Non-Executive Directors is to incentivize these Directors to develop and maintain a sound and transparent management system by further promoting shared values between the shareholders and the Non-Executive Directors.

The grantees will not be able to sell or transfer the granted shares during the restricted period, and Sony Corporation will acquire the granted shares from a grantee without any consideration to, or consent of, the grantee under certain conditions. Details of the plan, such as vesting conditions, eligibility and the number of grants, will be determined by the Compensation Committee. Sony Corporation intends to grant shares of restricted stock to Sony Corporation’s Corporate Executive Officers and other executives as a partial replacement for stock options, and to Non-Executive Directors as a partial replacement for the Phantom Restricted Stock Plan.

C. Board Practices

General

Sony continuously strives to strengthen its corporate governance system, recognizing that sound corporate governance is extremely important in operating Sony effectively, efficiently, and in a way that increases corporate value over the mid- to long-term. Sony approaches its corporate governance through two basic precepts: (a) the Board of Directors (the “Board”), a majority of which is comprised of independent outside Directors, focuses on effective oversight of management’s operation of the business and maintaining a sound and transparent governance framework; and (b) the Board determines Sony’s fundamental management policies and other material matters and delegates to each of the Corporate Executive Officers decision-making authority to conduct Sony’s business operations broadly in line with their respective responsibilities, as defined by the Board, with a view to promoting timely and efficient decision-making within Sony. In furtherance of these efforts, Sony Corporation has adopted a “Company with Three Committees” corporate governance system under the Companies Act of Japan (Kaishaho) and related regulations (collectively the “Companies Act”). Under this system, in addition to the requirements of applicable corporate governance laws and regulations, Sony has introduced its own requirements to help improve and maintain the soundness and transparency of its governance by strengthening the separation of the Directors’ function from that of management; maintaining what the company believes is an appropriate Board size, which enables the members of the Board to actively contribute to discussion; and advancing the proper functioning of the statutory committees.

Sony Corporation is governed by the Board, the members of which are elected at the Ordinary General Meeting of Shareholders. Under the Companies Act, a “Company with Three Committees” is required to have three committees: the Nominating Committee, Audit Committee and Compensation Committee. Under the Companies Act, each committee is required to consist of not fewer than three Directors, which must be named by the Board and the majority of whom must be outside Directors. Under this system, Directors have no power to

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execute the business of Sony Corporation except for limited circumstances as permitted by law. The Companies Act also requires the Board to appoint Corporate Executive Officers (Shikko-yaku), who make decisions regarding the execution of Sony’s business activities within the scope of the authority delegated to them by the Board (as well as a Representative Corporate Executive Officer who has the statutory authority to represent Sony in the conduct of its affairs). Sony has appointed its Chief Executive Officer (“CEO”), who is responsible for Sony’s overall management, and other officers that directly report to the CEO and who are responsible for important and extensive headquarters functions as Corporate Executive Officers. In addition to these statutory bodies and positions, Sony grants titles, such as Senior Executive Vice President, Executive Vice President and Senior Vice President, to management team members in accordance with their respective roles and responsibilities.

A summary of the governance system adopted by Sony Corporation is set forth below. For an explanation of the significant differences between the New York Stock Exchange’s corporate governance standards and Sony’s corporate governance practices, refer to “Item 16G. Disclosure About Differences in Corporate Governance.”

Board of Directors

The primary roles of the Board are to: (a) determine Sony’s fundamental management policies; (b) oversee the management of Sony’s business operations as an entity independent from Sony’s management; (c) appoint and dismiss the statutory committee members; (d) appoint and dismiss Corporate Executive Officers and certain other senior officers that assume important roles for management of Sony (such Corporate Executive Officers and other senior officers together, the “Senior Executives”); and (e) appoint and dismiss Representative Corporate Executive Officers.

Under the Companies Act, the term of office of Directors expires at the conclusion of the Ordinary General Meeting of Shareholders held with respect to the last business year ending within one year after their election.

With a view toward securing effective input and oversight by the Board, the Nominating Committee reviews and selects candidates for the Board with the aim of assuring that a substantial part of the Board is comprised of qualified outside Directors that satisfy the independence requirements established by Sony and by law. The Nominating Committee selects candidates that it views as well-suited to be Directors in light of the Board’s purpose of enhancing Sony’s corporate value. The Nominating Committee broadly considers various relevant factors, including a candidate’s capabilities (such as the candidate’s experience, achievements, expertise and international fluency), availability, and independence, as well as diversity in the boardroom, the appropriate size of the Board, and the knowledge, experiences and talent needed for the role. Under the Charter of the Board (the “Board Charter”), Sony also requires that the Board consist of not fewer than 10 Directors and not more than 20 Directors. In addition, since 2005 the majority of the members of the Board have been outside Directors.

Sony expects that each outside Director play an important role in ensuring proper business decisions by Sony and effective input and oversight by the Board through actively exchanging opinions and having discussions about Sony’s business based on his or her various and broad experience, knowledge and expertise.

As of June 19, 2018, the Board has 13 Directors, ten of whom are outside Directors. The Nominating Committee has five Directors, four of whom are outside Directors; the Compensation Committee and the Audit Committee each have three Directors, all of whom are outside Directors.

The qualifications for Directors of Sony are generally as summarized below. As of June 19, 2018, all Directors satisfy the qualifications of the Board Charter as set forth below, and all outside Directors are qualified and designated as Independent Directors under the Securities Listing Regulations of the Tokyo Stock Exchange.

All Directors must meet the qualifications below:

(a) He/she shall not be a director, a statutory auditor, a corporate executive officer, a general manager or other employee of any company in competition with Sony in any of Sony’s principal businesses (a “Competing Company”) or own 3% or more of the shares of any Competing Company.

(b) He/she shall not be or have been a representative partner or partner of Sony’s independent auditor the past three years before being nominated as a Director.

(c) He/she shall not have any connection with any matter that may cause a material conflict of interest in performing the duties of a Director.

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Outside Directors must meet the additional qualifications below:

(a) He/she shall not have received directly from Sony, during any consecutive twelve-month period within the last three years, more than an amount equivalent to U.S. $120,000, other than Director and committee fees and pension or other forms of deferred compensation for prior service (provided such compensation is not contingent in any way on continued service).

(b) He/she shall not be an executive director, corporate executive officer, general manager or other employee of any company whose aggregate amount of transactions with Sony, in any of the last three fiscal years, exceeds the greater of an amount equivalent to U.S. $1,000,000, or two percent of the annual consolidated sales of such company.

In addition, in order to qualify as an outside Director under the Companies Act, a Director must be a person who satisfies all of the following requirements:

(a) a person who is not a director of Sony or any of its subsidiaries engaged in the business operations of Sony or such subsidiaries, as the case may be, or a Corporate Executive Officer or general manager or other employee (“Group Executive Director, etc.”) of Sony or any of its subsidiaries and who has not been a Group Executive Director, etc. of Sony or any of its subsidiaries at any time within the ten years prior to assuming his/her office;

(b) if a person has been a director, accounting counselor (if the accounting counselor is a juridical person, a member who is in charge of the affairs), or corporate auditor of Sony or any of its subsidiaries (excluding a person who has been a Group Executive Director, etc.) at any time within the ten years prior to assuming office, a person who has not been a Group Executive Director, etc. of Sony or any of its subsidiaries at any time within the ten years prior to assuming office as a director, an accounting counselor, or a corporate auditor;

(c) a person who is not a director or a Corporate Executive Officer or general manager or other employee of a parent company or any entity which controls the management of Sony;

(d) a person who is not a Group Executive Director, etc. of a direct/indirect subsidiary of Sony or any entity the management of which is directly or indirectly controlled by Sony; and

(e) a person who is not a spouse or relative within the second degree of kinship of a director or a Corporate Executive Officer or general manager or other employee of Sony.

Also, each outside Director may, by resolution of the Nominating Committee, be nominated as a Director candidate for re-election five times, and thereafter by resolution of the Nominating Committee and by consent of all of the Directors. Even with consent of all of the Directors, in no event may any outside Director be re-elected more than eight times.

Nominating Committee

The primary roles of the Nominating Committee are to: (a) determine the content of proposals to be submitted for approval at the General Meeting of Shareholders regarding the appointment and dismissal of Directors and (b) evaluate management succession plans.

As stated above, under the Companies Act, the Nominating Committee must consist of at least three Directors, the majority of whom must be outside Directors. In addition, under the Board Charter, at least one Director of the Nominating Committee shall be a Corporate Executive Officer and the chair is to be selected from among the outside Directors. In determining whether to appoint or remove a member of the Nominating Committee, continuity of the Nominating Committee shall be duly taken into account.

The Nominating Committee is comprised of the following members as of June 19, 2018: Osamu Nagayama, who is the Chair of the Nominating Committee, the Chairman of the Board and an outside Director; Koichi Miyata, John V. Roos and Shuzo Sumi who are each outside Directors; and Kenichiro Yoshida, who is a Corporate Executive Officer.

Audit Committee

The primary roles of the Audit Committee are to: (a) monitor the performance of duties by Directors and Corporate Executive Officers and (b) oversee and evaluate the independent auditor.

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As stated above, under the Companies Act, the Audit Committee must consist of at least three Directors, the majority of whom must be outside Directors. In addition, under the Companies Act and the Board Charter, each member of the Audit Committee (“Audit Committee Member”) must satisfy all of the following qualifications: (a) he/she shall not be a Director engaged in the business operations of Sony or any of its subsidiaries, a Corporate Executive Officer, an accounting counselor, a general manager or other employee of Sony and (b) he/she shall meet the independence requirements or such other equivalent requirements of the U.S. securities laws and regulations as may from time to time be applicable to Sony Corporation. The chair is to be selected from among the outside Directors. No Audit Committee Member shall become, as a general rule, a member of the Nominating Committee or the Compensation Committee. Moreover, at least one Audit Committee Member shall meet the audit committee financial expert requirements or such other equivalent requirements of the U.S. securities laws and regulations as may from time to time be applicable to Sony Corporation. The Board makes a determination on whether or not such Audit Committee Members meet these requirements. In determining whether to appoint or remove the Audit Committee Member, continuity of the Audit Committee shall be duly taken into account.

With respect to the candidates for independent auditor nominated by the CEO and other Corporate Executive Officers, the Audit Committee evaluates the nomination, prior to making a decision on the candidates. The Audit Committee continues to evaluate the performance, the independence, the qualification and the reasonableness of the independent auditor so appointed.

The Audit Committee is comprised of the following members as of June 19, 2018: Kazuo Matsunaga, who is the Chair of the Audit Committee and an outside Director, and Kunihito Minakawa and Toshiko Oka, who are each outside Directors. Kunihito Minakawa and Toshiko Oka are “audit committee financial experts” within the meaning of Item 16A of this report.

Compensation Committee

The primary roles of the Compensation Committee are to: (a) set policy on the content of individual compensation for Directors, Corporate Executive Officers and other officers and (b) determine the amount and content of individual compensation of Directors, Corporate Executive Officer and other Senior Executives in accordance with the policy.

As stated above, under the Companies Act, the Compensation Committee must consist of at least three Directors, the majority of whom must be outside Directors, and a Director who is a CEO, a Chief Operating Officer or a Chief Financial Officer of Sony or who holds any equivalent position shall not be a member of the Compensation Committee. In determining whether to appoint or remove a member of the Compensation Committee, continuity of the Compensation Committee shall be duly taken into account.

The Compensation Committee is comprised of the following members as of June 19, 2018: Eikoh Harada, who is the Chair of the Compensation Committee and an outside Director; and Eriko Sakurai and Nicholas Donatiello, Jr. who are each outside Directors.

Corporate Executive Officers

As stated above, the Board must appoint one or more Corporate Executive Officers who make decisions regarding the execution of Sony’s business activities within the scope of authority delegated by the Board. As of June 19, 2018, there are five Corporate Executive Officers, one of whom is also a Director. Significant decision-making authority has been delegated to each Corporate Executive Officer, including the CEO, with respect to investments, strategic alliances and other actions related to the execution of business operations. Sony Corporation believes that this significant delegation enables Sony to be managed in a dynamic and responsive manner. The terms of office of Corporate Executive Officers expire at the conclusion of the first meeting of the Board held immediately after the conclusion of the Ordinary General Meeting of Shareholders held with respect to the last business year ending within one year after their election. From among those Corporate Executive Officers who, as a general rule, are also Directors, the Board shall elect Representative Corporate Executive Officers. Each Representative Corporate Executive Officer has the statutory authority to represent Sony Corporation in the conduct of its affairs. The appointment and dismissal of Corporate Executive Officers and the assignment of roles and responsibilities for Corporate Executive Officers are made by the Board. In making these decisions, the Board, especially outside Directors, considers whether candidates have the necessary skills, capabilities, experiences and achievements that correspond to the Corporate Executive Officers’ expected roles and responsibilities in executing relevant business operations. For a list of the Corporate Executive Officers as of June 19, 2018, refer to “Directors and Senior Management” in “Item 6.A Directors, Senior Management and Employees.”

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The Board determines the fundamental management policies and other material matters related to the operation of Sony’s business. The Board assigns the duties of Corporate Executive Officers by determining the areas over which each Corporate Executive Officer is in charge and delegating its decision-making authority to the Corporate Executive Officers accordingly, with a view to promoting timely and efficient decision-making within the Sony Group. Please refer to the Board Charter, attached as Exhibit 1.3 hereto, which details the processes and policies for reporting by the Corporate Executive Officers to the Board and matters requiring Board approval.

Meeting Record and Other Information

During the fiscal year ended March 31, 2018, the Board convened eight times. The Nominating Committee met five times, the Audit Committee met six times and the Compensation Committee met six times. All ten outside Directors, including Joichi Ito who retired in June 2017, participated in all meetings of the Board held during their tenure period in the fiscal year ended March 31, 2018. Also, all nine outside Directors who are members of Committees participated in all of the meetings of each Committee held during the fiscal year ended March 31, 2018. The Board conducted outside Directors’ meetings, Directors’ corporate strategic workshops with management, site visits by outside Directors and meetings of the Chairman of the Board and the CEO. These activities were aimed at enhancing the oversight function of the Board, securing better understanding by outside Directors of Sony’s business and management’s initiatives and encouraging corporate strategic discussions among Directors.

No Directors have executed service contracts with Sony providing for benefits upon termination of service as a Director.

Under the Companies Act and the Articles of Incorporation of Sony Corporation, Sony Corporation may, by a resolution of the Board, exempt Directors from liabilities to Sony Corporation to the extent permitted by law arising in connection with their failure to execute their duties. Also, in accordance with the Companies Act and its Articles of Incorporation, Sony Corporation has entered into a liability limitation agreement with each outside Director and one non-executive Director that limits the maximum amount of liabilities owed by each such Director to Sony Corporation arising in connection with their failure to execute their duties to the greater of either 30 million yen or an amount equal to the aggregate sum of the amounts prescribed in each item of Article 425, Paragraph 1 of the Companies Act.

At a Board meeting held on April 26, 2006, the Board reaffirmed the internal control and governance framework in effect as of the date of determination and determined to continue to evaluate and improve such framework going forward, as appropriate. At a Board meeting held on May 13, 2009 and April 30, 2015, the Board amended and updated the internal control and governance framework, and at a Board meeting held on April 27, 2018, the Board reaffirmed such framework in effect and determined to continue to evaluate and improve such framework going forward, as appropriate. These determinations were required by and met the requirements of the Companies Act.

D. Employees

As of March 31, 2018, Sony had approximately 117,300 employees, a decrease of approximately 11,100 employees from March 31, 2017. During the fiscal year ended March 31, 2018, although there was an increase of employees in the Financial Services and Pictures segments, there was a significant decrease of employees in the Electronics segment mainly due to the transfer of the battery business. Approximately 14% of the total number of employees were members of labor unions.

As of March 31, 2017, Sony had approximately 128,400 employees, an increase of approximately 3,100 employees from March 31, 2016. During the fiscal year ended March 31, 2017, there was an increase of employees mainly in the Electronics segment due to an increase at manufacturing sites in Asia Pacific, and Japan due to the acquisition of the semiconductor business from Toshiba Corporation. Approximately 20% of the total number of employees were members of labor unions.

As of March 31, 2016, Sony had approximately 125,300 employees, a decrease of approximately 6,400 employees from March 31, 2015. During the fiscal year ended March 31, 2016, while employees of the Pictures, Music and Financial Services segments increased due to the expansion of these businesses, the total number of Electronics employees decreased due to production adjustments implemented at manufacturing sites in East Asia (except Japan) and restructuring initiatives taken mainly in the MC segment. The number of employees in All Other also decreased compared to March 31, 2015, reflecting the decrease of employees in the disc manufacturing business worldwide. Approximately 23% of the total number of employees were members of labor unions.

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The following table shows the number of employees of Sony by segment and region as of March 31, 2016, 2017 and 2018.

Number of Employees by Segment and Region

	March 31
	2016		2017		2018
By segment:
Electronics*		88,000		91,100		77,400
Music		7,900		8,200		8,200
Pictures		8,700		9,000		9,800
Financial Services		9,400		10,100		11,400
All Other		4,700		4,600		5,300
Unallocated — Corporate employees		6,600		5,400		5,200
By region:
Japan		49,000		51,400		51,500
Outside of Japan		76,300		77,000		65,800
Total		125,300		128,400		117,300

* The term “Electronics” refers to the sum of the G&NS, HE&S, IP&S, MC and Semiconductors segments.

In addition, the average number of employees for the fiscal years ended March 31, 2016, 2017 and 2018 calculated by averaging the total number of employees at the end of each quarter, was approximately 128,700, 128,000 and 118,900 respectively.

Sony generally considers its labor relations to be good.

In Japan, Sony Corporation and several subsidiaries have labor unions.

In Electronics, Sony owns many manufacturing sites, particularly in Asia, where a few sites have labor unions that have union contracts. In China, most employees are members of labor unions. In the Americas, some manufacturing sites have labor unions. Sony has generally maintained good relationships with these labor unions. In Europe, Sony maintains good labor relations with the Work Councils in each country.

In the Music segment, Sony has several labor unions and generally considers its labor relations to be good.

In the Pictures segment, Sony also generally considers its labor relations to be good. A number of Pictures’ subsidiaries are signatories to union contracts. During the fiscal year ended March 31, 2018, negotiations were successfully concluded for a new three-year agreement with each of the following: the Screen Actors Guild-American Federation of Television and Radio Artists (“SAG-AFTRA”) Codified Basic Agreement and Television Agreement; the Screen Actors Guild (“SAG”) Basic Cable Agreement; Union of British Columbia Performers; the British Columbia Council of Film Unions Master Agreement; and the Directors Guild of Canada; and for a one-year agreement with the American Federation of Musicians for its Agreements covering Theatrical and Televised Motion Pictures. Negotiations have commenced with the International Alliance of Theatrical and Stage Employees (“IATSE”) for the Basic Agreement, its Local Agreements in Los Angeles, and its Area Standards Agreement, with the Communication Workers of America covering parking production assistants in New York and with SAG for the Animation Agreement. Negotiations will commence shortly with the Teamsters for agreements covering Drivers in Los Angeles and Miami, and for agreements covering Location Managers and Casting Directors in New York and Los Angeles. Negotiations will also commence shortly for agreements with the International Brotherhood of Electrical Workers Local 40, the Southern California District Council of Laborers and its affiliate, Studio Utility Employees, Local 724, the Operative Plasterers and Cement Masons International Association of the United States and Canada, Local 755, the United Association of Journeymen and Apprentices of the Plumbing and Pipe Fitting Industry of the United States and Canada, Local 78, and the IATSE Mechanics Local and Art Directors Local in New York. It is not anticipated that these negotiations will result in an interruption in production.

Sony continuously strives to provide competitive wages and benefits and good working conditions for all of its employees.

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E. Share Ownership

The total number of shares of Common Stock beneficially owned by Directors and Corporate Executive Officers (15 people) listed in “Directors and Senior Management” above was approximately 0.016% percent of the total shares outstanding as of May 30, 2018. Refer to “Board Practices” above.

During the fiscal year ended March 31, 2018, Sony granted stock acquisition rights, which represent rights to subscribe for shares of Common Stock, to Corporate Executive Officers, Corporate Executives, Group Executives, and selected employees. The stock acquisition rights cannot be exercised for one year from the date of grant and generally vest ratably up to three years from the date of grant and are generally exercisable up to ten years from the date of grant. The following table shows the portion of those stock acquisition rights which were granted by Sony to Directors and Corporate Executive Officers as of May 30, 2018 and which were outstanding as of the same date.

Year granted (Fiscal year ended March 31)	Total number of shares subject to stock acquisition rights		Exercise price per share
	(in thousands)
2018		200	45.73 U.S. dollars
2018		320	5,231yen
2017		300	31.06 U.S. dollars
2017		480	3,364 yen
2016		200	27.51 U.S. dollars
2016		286	3,404 yen
2015		100	20.67 U.S. dollars
2015		178	2,410.5 yen
2014		200	20.01 U.S. dollars
2014		60	2,007 yen
2013		200	11.23 U.S. dollars
2013		14	932 yen
2012		80	19.44 U.S. dollars
2012		20	1,523 yen
2011		50	35.48 U.S. dollars
2011		30	2,945 yen
2010		50	29.56 U.S. dollars
2010		25	2,595 yen
2009		30	30.24 U.S. dollars
2009		11	2,987 yen

Regarding the above compensation plans, refer to Note 17 of the consolidated financial statements.

Item 7. Major Shareholders and Related Party Transactions

A. Major Shareholders

As of March 31, 2018, there were 1,266,552,149 shares of Common Stock outstanding, including 1,127,101 shares of treasury stock. Out of the total outstanding shares, 113,751,938 shares were in the form of ADRs and 299,563,576 shares were held of record in the form of Common Stock by residents in the U.S. As of March 31, 2018, the number of registered ADR holders was 5,306 and the number of registered holders of Common Stock in the U.S. was 367.

The Financial Instruments and Exchange Act of Japan requires any person who solely or jointly owns more than 5% of total issued voting shares of a company listed on any Japanese stock exchange to file with the Bureau a Bulk Shareholding Report. The following table summarizes the Bulk Shareholding Reports related to Sony (each a “Report”) submitted to the Bureau, where it is reported that ownership percentage by the reported entity exceeds 5% in the most recent updated Report. The Reports do not specify whether reported ownership is direct or beneficial.

Date of Report*	Reported entities	Reported number of direct or indirect owned and deemed owned shares**		Reported percentage of direct or indirect owned and deemed owned shares**
April 4, 2014	Sumitomo Mitsui Trust Bank, Limited		52,312,421		5.04
March 22, 2017	BlackRock Japan Co., Ltd.		79,184,569		6.27
March 23, 2018	Capital Research and Management Company		77,416,538		6.12

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* The table above contains information from the most recent updated Reports.

** Shares issuable or transferable upon exchange of exchangeable securities, conversion of convertible securities or exercise of warrants or stock acquisition rights (including those incorporated in bonds with stock acquisition rights) are taken into account in determining both the size of the reported entity’s holding and Sony’s total issued share capital.

To the knowledge of Sony Corporation, it is not directly or indirectly owned or controlled by any other corporation, by any foreign government or by any other natural or legal person either severally or jointly. As far as is known to Sony Corporation, there are no arrangements the operation of which may, at a subsequent date, result in a change in control of Sony Corporation.

To the knowledge of Sony Corporation, there were no significant changes in the percentage ownership held by any other major beneficial shareholders during the past three fiscal years. Major shareholders of Sony Corporation do not have different voting rights from other shareholders.

B. Related Party Transactions

In the ordinary course of business, Sony purchases materials, supplies, and services from numerous suppliers throughout the world, including firms with which certain members of the Board of Directors are affiliated.

In addition, in the fiscal year ended March 31, 2018, sales to affiliates accounted for under the equity method totaled 45.4 billion yen and purchases from those equity affiliates totaled 3.2 billion yen. Although there were 107 equity affiliates accounted for under the equity method at March 31, 2018, there were no individually significant investments.

As of March 31, 2018, Sony had accounts receivable, trade of 15.5 billion yen due from its equity affiliates and had accounts payable, trade of 2.6 billion yen due to its equity affiliates. Due to the size of these transactions, Sony does not consider the amount involved to be material to its business. Refer to Note 5 of the consolidated financial statements for additional information regarding Sony’s investments in and transactions with equity affiliates.

C. Interests of Experts and Counsel

Not Applicable

Item 8. Financial Information

A. Consolidated Statements and Other Financial Information

Refer to the consolidated financial statements and the notes of the consolidated financial statements.

Legal Proceedings

Beginning in 2009, the U.S. Department of Justice (“DOJ”), the European Commission and certain other governmental agencies outside the United States have conducted investigations relating to competition in the optical disk drives market. Sony Corporation and/or certain of its subsidiaries have been subject to these investigations. Sony understands that the investigations of several governmental agencies, including the DOJ, have ended, and the only remaining investigation has reached a settlement, which is subject to a final ruling from the relevant agency. However, proceedings initiated by the European Commission as a result of its investigation continue. In October 2015, the European Commission adopted a decision in which it fined Sony Corporation and certain of its subsidiaries 31 million euros; however, Sony filed an appeal against the decision with the European Union’s General Court. In addition, a number of direct and indirect purchaser lawsuits, including class actions, have been filed in certain jurisdictions in which the plaintiffs allege that Sony Corporation and certain of its subsidiaries violated antitrust laws and seek recovery of damages and other remedies. Certain of these lawsuits have been settled, including the class actions brought by the direct and indirect purchasers in the United States; however, certain other lawsuits continue. Based on the stage of the pending proceedings, it is not possible to estimate the amount of losses or range of possible losses, if any, that might ultimately result from adverse judgments, settlements or other resolution of all of these matters.

Since 2011, in relation to the secondary batteries business that was operated by Sony and certain of its subsidiaries, a number of direct and indirect purchaser lawsuits, including class actions, have been filed in certain

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jurisdictions in which the plaintiffs allege that Sony Corporation and certain of its subsidiaries violated antitrust laws and seek recovery of damages and other remedies. Certain of these lawsuits have been settled, including the class actions brought by the direct and indirect purchasers in the United States; however, certain other lawsuits are still pending. Based on the stage of the pending proceedings, it is not possible to estimate the amount of losses or range of possible losses, if any, that might ultimately result from adverse judgments, settlements or other resolution of all of these matters.

In addition, Sony Corporation and certain of its subsidiaries are defendants or otherwise involved in other pending legal and regulatory proceedings. However, based upon the information currently available, Sony believes that the outcome from such legal and regulatory proceedings would not have a material impact on Sony’s results of operations and financial position.

Dividend Policy

Sony believes that continuously increasing corporate value and providing dividends are essential to rewarding shareholders. It is Sony’s policy to utilize retained earnings, after ensuring the perpetuation of stable dividends, to carry out various investments that contribute to an increase in corporate value such as those that ensure future growth and strengthen competitiveness. Going forward, Sony will determine the amount of dividends based on an overall consideration of Sony’s consolidated operating results, financial condition and future business expectations.

A fiscal year-end dividend of 15 yen per share of Common Stock of Sony Corporation was approved at the Board of Directors meeting held on April 27, 2018 and the payment of such dividend started on May 30, 2018. Sony Corporation has already paid an interim dividend for Common Stock of 12.5 yen per share to each shareholder; accordingly, the total annual dividend per share of Common Stock for the fiscal year ended March 31, 2018 is 27.5 yen.

B. Significant Changes

No significant change has occurred since the date of the annual financial statements included in this annual report.

Item 9. The Offer and Listing

A. Offer and Listing Details

Trading Markets

The principal trading markets for Sony Corporation’s ordinary shares are the TSE in the form of Common Stock and the NYSE in the form of ADSs evidenced by American Depositary Receipts (“ADRs”). Each ADS represents one share of Common Stock.

Sony Corporation’s Common Stock, with no par value per share, has been listed on the TSE since 1958.

Sony Corporation’s ADRs have been traded in the U.S. since 1961 and have been listed on the NYSE since 1970 under the symbol “SNE.” Sony Corporation’s ADRs are issued and exchanged by Citibank, N.A., as the Depositary.

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Trading on the TSE and the NYSE

The following table sets forth for the periods indicated the reported high and low sales prices per share of Sony Corporation’s Common Stock on the TSE and the reported high and low sales prices per share of Sony Corporation’s ADS on the NYSE.

	Tokyo Stock Exchange price per share of Common Stock				New York Stock Exchange price per share of ADS
	High		Low		High		Low
	(yen)				(U.S. dollars)
Annual highs and lows*
The fiscal year ended March 31, 2014		2,413		1,497		23.38		15.23
The fiscal year ended March 31, 2015		3,450		1,588		28.65		15.93
The fiscal year ended March 31, 2016		3,970		2,199		32.95		19.90
Quarterly highs and lows*
The fiscal year ended March 31, 2017		3,792		2,541		34.17		23.62
1st quarter		3,122		2,541		29.45		23.62
2nd quarter		3,450		2,953		34.17		29.03
3rd quarter		3,493		2,930		33.67		27.72
4th quarter		3,792		3,269		33.78		28.04
Quarterly highs and lows*
The fiscal year ended March 31, 2018		5,738		3,402		53.91		31.21
1st quarter		4,408		3,402		38.94		31.21
2nd quarter		4,616		4,067		41.65		36.38
3rd quarter		5,485		4,039		48.33		36.25
4th quarter		5,738		4,959		53.91		45.24
Monthly highs and lows*
2017
December		5,266		4,976		46.34		44.37
2018
January		5,738		5,148		51.94		45.24
February		5,671		5,007		53.91		45.33
March		5,500		4,959		51.59		47.55
April		5,468		5,089		50.61		44.53
May		5,460		5,031		48.98		45.63

* Stock price data are based on prices throughout the sessions for each corresponding period at each stock exchange.

B. Plan of Distribution

Not Applicable

C. Markets

Please refer to Item 9 A “Offer and Listing Details.”

D. Selling Shareholders

Not Applicable

E. Dilution

Not Applicable

F. Expenses of the Issue

Not Applicable

Item 10. Additional Information

A. Share Capital

Not Applicable

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B. Memorandum and Articles of Association

Organization

Sony Corporation is a joint stock corporation (Kabushiki Kaisha) incorporated in Japan under the Companies Act (Kaishaho) of Japan. It is registered in the Commercial Register (Shogyo Tokibo) maintained by the Minato Branch Office of the Tokyo Legal Affairs Bureau.

Objects and purposes

The Articles of Incorporation of Sony Corporation provide that its purpose is to engage in the following business activities:

(i) manufacture and sale of electronic and electrical machines and equipment, medical instruments, optical instruments and other equipment, machines and instruments;

(ii) planning, production and sale of audio-visual software and computer software programs;

(iii) manufacture and sale of metal industrial products, chemical industrial products and ceramic industrial products, textile products, paper products and wood-crafted articles, daily necessities, foodstuffs and toys, transportation machines and equipment, and petroleum and coal products;

(iv) real estate activities, construction business, transportation business and warehousing business;

(v) publishing business and printing business;

(vi) advertising agency business, insurance agency business, broadcasting enterprise, recreation business such as travel, management of sporting facilities, etc. and other service enterprises;

(vii) financial business;

(viii) Type I and Type II telecommunications business under the Telecommunications Business Law;

(ix) investing in stocks and bonds, etc.;

(x) manufacture, sale, export and import of products which are incidental to or related to those mentioned above;

(xi) rendering of services related to those mentioned above;

(xii) investment in businesses mentioned above operated by other companies or persons; and

(xiii) all businesses which are incidental to or related to those mentioned above.

Directors

Under the Companies Act, because Sony Corporation has adopted the “Company with Three Committees” system, Directors have no power to execute the business of Sony Corporation except in limited circumstances as permitted by law. If a Director also serves concurrently as a Corporate Executive Officer, then he or she can execute the business of Sony Corporation in the capacity of Corporate Executive Officer. Under the Companies Act, Directors must refrain from engaging in any business competing with Sony Corporation unless approved by the Board of Directors, and any Director who has a material interest in the subject matter of a resolution to be taken by the Board of Directors cannot vote on such resolution. The amount of remuneration to each Director is determined by the Compensation Committee, which consists of Directors, the majority of whom are outside Directors (Refer to “Board Practices” in “Item 6. Directors, Senior Management and Employees”). No member of the Compensation Committee may vote on a resolution with respect to his or her own compensation as a Director or a Corporate Executive Officer.

Neither the Companies Act nor Sony Corporation’s Articles of Incorporation make a special provision as to the borrowing powers exercisable by Directors (subject to requisite internal authorizations as required by the Companies Act), their retirement age, or a requirement to hold any shares of capital stock of Sony Corporation.

For more information on Directors, refer to “Board Practices” in “Item 6. Directors, Senior Management and Employees.”

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Capital stock

(General)

Unless indicated otherwise, set forth below is information relating to Sony Corporation’s capital stock, including brief summaries of the relevant provisions of Sony Corporation’s Articles of Incorporation and Share Handling Regulations, currently in effect, and of the Companies Act and related regulations.

On January 5, 2009, a central book-entry transfer system for shares of Japanese listed companies was established pursuant to the Act Concerning Book-entry Transfer of Corporate Bonds, Shares, etc. (including regulations promulgated thereunder, “Book-entry Transfer Act”), and this system is applied to the shares of Common Stock of Sony Corporation. Under this system, shares of all Japanese companies listed on any Japanese stock exchange are dematerialized, and shareholders must have accounts at account management institutions to hold their shares unless such shareholder has an account at Japan Securities Depository Center, Inc. (“JASDEC”). “Account management institutions” are financial instruments traders (i.e., securities companies), banks, trust companies and certain other financial institutions that meet the requirements prescribed by the Book-entry Transfer Act. Transfer of the shares of Common Stock of Sony Corporation is effected exclusively through entry in the records maintained by JASDEC and the account management institutions, and title to the shares passes to the transferee at the time when the transfer of the shares is recorded at the transferee’s account at an account management institution. The holder of an account at an account management institution is presumed to be the legal holder of the shares recorded in such account.

Under the Companies Act and the Book-entry Transfer Act, in order to assert shareholders’ rights against Sony Corporation, a shareholder of shares must have its name and address registered in Sony Corporation’s register of shareholders. Under the central book-entry transfer system operated by JASDEC, shareholders shall notify the relevant account management institutions of certain information prescribed under the Book-entry Transfer Act or Sony Corporation’s Share Handling Regulations, including their names and addresses, and the registration on Sony Corporation’s register of shareholders is updated upon receipt by Sony Corporation of necessary information from JASDEC (as described in “(Record date)”). On the other hand, in order to assert, against Sony Corporation, shareholders’ rights to which shareholders are entitled, regardless of whether such shareholder held shares on the requisite record date, such as minority shareholders’ rights, including the right to propose a matter to be considered at a General Meeting of Shareholders, except for shareholders’ rights to request that Sony Corporation purchase or sell shares constituting less than a full unit (as described in “(Unit share system)”), JASDEC shall, upon the shareholder’s request, issue a notice of certain information, including the name and address of such shareholder, to Sony Corporation.

Thereafter, such shareholder is required to present Sony Corporation a receipt of the notice request in accordance with the Sony Corporation’s Share Handling Regulations. Under the Book-entry Transfer Act, the shareholder shall exercise such shareholders’ right within four weeks after the notice above has been given to Sony Corporation.

Mitsubishi UFJ Trust and Banking Corporation is the transfer agent for Sony Corporation’s capital stock. As such, it keeps Sony Corporation’s register of shareholders in its office at 4-5, Marunouchi 1-chome, Chiyoda-ku, Tokyo.

Non-resident shareholders are required to appoint a standing proxy in Japan or file notice of a mailing address in Japan. Notices from Sony Corporation to non-resident shareholders are delivered to such standing proxies or mailing address. Japanese securities companies and commercial banks customarily act as standing proxies and provide related services for standard fees. The recorded holder of deposited shares underlying the ADSs is the depositary for the ADSs. Accordingly, holders of ADSs will not be able to directly assert shareholders’ rights against Sony Corporation.

(Authorized capital)

Under the Articles of Incorporation of Sony Corporation, Sony Corporation may only issue shares of Common Stock. Sony Corporation’s Articles of Incorporation provide that the total number of shares authorized to be issued by Sony Corporation is 3.6 billion shares.

All shares of capital stock of Sony Corporation have no par value. All issued shares are fully-paid and non-assessable.

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(Distribution of Surplus)

Distribution of Surplus — General

Under the Companies Act, distributions of cash or other assets by joint stock corporations to their shareholders, so called “dividends,” are referred to as “distributions of Surplus” (“Surplus” is defined in “— Restriction on distribution of Surplus”). Sony Corporation may make distributions of Surplus to shareholders any number of times per business year, subject to certain limitations described in “— Restriction on distribution of Surplus.” Distributions of Surplus are required in principle to be authorized by a resolution of a General Meeting of Shareholders, but Sony Corporation may authorize distributions of Surplus by a resolution of the Board of Directors as long as its non-consolidated annual financial statements and certain documents for the last business year present fairly its assets and profit or loss, as required by ordinances of the Ministry of Justice.

Distributions of Surplus may be made in cash or in kind in proportion to the number of shares of Common Stock held by each shareholder. A resolution of the Board of Directors or a General Meeting of Shareholders authorizing a distribution of Surplus must specify the kind and aggregate book value of the assets to be distributed, the manner of allocation of such assets to shareholders, and the effective date of the distribution. If a distribution of Surplus is to be made in kind, Sony Corporation may, pursuant to a resolution of the Board of Directors or (as the case may be) a General Meeting of Shareholders, grant a right to the shareholders to require Sony Corporation to make such distribution in cash instead of in kind. If no such right is granted to shareholders, the relevant distribution of Surplus must be approved by a special resolution of a General Meeting of Shareholders (refer to “(Voting rights)” with respect to a “special resolution”).

Under the Articles of Incorporation of Sony Corporation, year-end dividends and interim dividends may be distributed in cash to shareholders appearing in Sony Corporation’s register of shareholders as of March 31 and September 30 each year, respectively, in proportion to the number of shares of Common Stock held by each shareholder following approval by the Board of Directors or (as the case may be) the General Meeting of Shareholders. Sony Corporation is not obliged to pay any dividends in cash unclaimed for a period of five years after the date on which they first became payable.

In Japan, the ex-dividend date and the record date for dividends precede the date of determination of the amount of the dividends to be paid. The price of the shares of Common Stock generally goes ex-dividend on the second business day prior to the record date (or if the record date is not a business day, the third business day prior thereto).

Distribution of Surplus — Restriction on distribution of Surplus

In making a distribution of Surplus, Sony Corporation must, until the sum of its additional paid-in capital and legal reserve reaches one quarter of its stated capital, set aside in its additional paid-in capital and/or legal reserve an amount equal to one-tenth of the amount of Surplus so distributed.

The amount of Surplus at any given time must be calculated in accordance with the following formula:

A + B + C + D - (E + F + G)

In the above formula:

“A” =	the total amount of other capital surplus and other retained earnings, each such amount being that appearing on the non-consolidated balance sheet as of the end of the last business year
“B” =	(if Sony Corporation has disposed of its treasury stock after the end of the last business year) the amount of the consideration for such treasury stock received by Sony Corporation less the book value thereof
“C” =	(if Sony Corporation has reduced its stated capital after the end of the last business year) the amount of such reduction less the portion thereof that has been transferred to additional paid-in capital or legal reserve (if any)
“D” =	(if Sony Corporation has reduced its additional paid-in capital or legal reserve after the end of the last business year) the amount of such reduction less the portion thereof that has been transferred to stated capital (if any)
“E” =	(if Sony Corporation has cancelled its treasury stock after the end of the last business year) the book value of such treasury stock

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“F” =

(if Sony Corporation has distributed Surplus to its shareholders after the end of the last business year) the total book value of the Surplus so distributed

“G” =

certain other amounts set forth in ordinances of the Ministry of Justice, including (if Sony Corporation has reduced Surplus and increased its stated capital, additional paid-in capital or legal reserve after the end of the last business year) the amount of such reduction and (if Sony Corporation has distributed Surplus to the shareholders after the end of the last business year) the amount set aside in additional paid-in capital or legal reserve (if any) as required by ordinances of the Ministry of Justice.

The aggregate book value of Surplus distributed by Sony Corporation may not exceed a prescribed distributable amount (the “Distributable Amount”), as calculated on the effective date of such distribution. The Distributable Amount at any given time shall be equal to the amount of Surplus less the aggregate of the following:

(a) the book value of its treasury stock;

(b) the amount of consideration for any of treasury stock disposed of by Sony Corporation after the end of the last business year; and

(c) certain other amounts set forth in ordinances of the Ministry of Justice, including (if the sum of one-half of goodwill and the deferred assets exceeds the total of stated capital, additional paid-in capital and legal reserve, each such amount being that appearing on the non-consolidated balance sheet as of the end of the last business year) all or certain part of such exceeding amount as calculated in accordance with ordinances of the Ministry of Justice.

As Sony Corporation has become a company with respect to which consolidated balance sheets should also be considered in the calculation of the Distributable Amount (renketsu haito kisei tekiyo kaisha), Sony Corporation must further deduct from the amount of Surplus the excess amount, if any, of (x) the total amount of stockholders’ equity appearing on the non-consolidated balance sheet as of the end of the last business year and certain other amounts set forth by an ordinance of the Ministry of Justice over (y) the total amount of stockholders’ equity and certain other amounts set forth by an ordinance of the Ministry of Justice appearing on the consolidated balance sheet as of the end of the last business year.

If Sony Corporation has prepared interim financial statements as described below, and if such interim financial statements have been approved by the Board of Directors or (if so required by the Companies Act) by a General Meeting of Shareholders, then the Distributable Amount must be adjusted to take into account the amount of profit or loss, and the amount of consideration for any of the treasury stock disposed of by Sony Corporation, during the period in respect of which such interim financial statements have been prepared. Sony Corporation may prepare non-consolidated interim financial statements consisting of a balance sheet as of any date subsequent to the end of the last business year and an income statement for the period from the first day of the current business year to the date of such balance sheet. Interim financial statements so prepared by Sony Corporation must be audited by the Audit Committee and the independent auditor, as required by the Companies Act and in accordance with the details prescribed by ordinances of the Ministry of Justice.

(Capital and reserves)

Sony Corporation may generally reduce its additional paid-in capital or legal reserve by resolution of a General Meeting of Shareholders and, if so decided by the same resolution, may account for the whole or any part of the amount of such reduction as stated capital. On the other hand, Sony Corporation may generally reduce its stated capital by a special shareholders’ resolution (as defined in “(Voting rights)”) and, if so decided by the same resolution, may account for the whole or any part of the amount of such reduction as additional paid-in capital. In addition, Sony Corporation may reduce its Surplus and increase either (i) stated capital or (ii) additional paid-in capital and/or legal reserve by the same amount, in either case by resolution of a General Meeting of Shareholders.

(Stock splits)

Sony Corporation may at any time split shares in issue into a greater number of shares at the determination of the CEO, and may amend its Articles of Incorporation to increase the number of the authorized shares to be issued to allow such stock split pursuant to a resolution of the Board of Directors or a determination by a Corporate Executive Officer to whom the authority to make such determination has been delegated by a resolution of the Board of Directors, rather than relying on a special shareholders’ resolution, which is otherwise required for amending the Articles of Incorporation.

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When a stock split is to be made, Sony Corporation must give public notice of the stock split, specifying the record date thereof, at least two weeks prior to such record date. Under the central book-entry transfer system operated by JASDEC, Sony Corporation must also give notice to JASDEC regarding a stock split at least two weeks prior to the relevant effective date of the stock split. On the effective date of the stock split, the numbers of shares recorded in all accounts held by Sony Corporation’s shareholders at account managing institutions or JASDEC will be increased in accordance with the applicable ratio.

(Consolidation of shares)

Sony Corporation may at any time consolidate issued shares into a smaller number of shares by a special shareholders’ resolution. When a consolidation of shares is to be made, Sony Corporation must give public notice or notice to each shareholder at least two weeks prior to the effective date of the consolidation of shares. Under the central book-entry transfer system operated by JASDEC, Sony Corporation must also give notice to JASDEC regarding a consolidation of shares at least two weeks prior to the effective date of the consolidation of shares. On the effective date of the consolidation of shares, the numbers of shares recorded in all accounts held by Sony Corporation’s shareholders at account managing institutions or JASDEC will be decreased in accordance with the applicable ratio. Sony Corporation must disclose the reason for the consolidation of shares at a General Meeting of Shareholders.

(General Meeting of Shareholders)

The Ordinary General Meeting of Shareholders of Sony Corporation for each business year is normally held in June of each year in Tokyo, Japan. In addition, Sony Corporation may hold an Extraordinary General Meeting of Shareholders whenever necessary by giving notice thereof at least two weeks prior to the date set for the meeting.

Notice of a shareholders’ meeting setting forth the place, time and purpose thereof must be mailed to each shareholder having voting rights (or, in the case of a non-resident shareholder, to such shareholder’s resident proxy or mailing address in Japan) at least two weeks prior to the date set for the meeting. Under the Companies Act, such notice may be given to shareholders by electronic means, subject to obtaining consent by the relevant shareholders. The record date for an Ordinary General Meeting of Shareholders is March 31 of each year.

Any shareholder or group of shareholders holding at least three percent of the total number of voting rights for a period of six months or more may require the convocation of a General Meeting of Shareholders for a particular purpose. Unless such a shareholders’ meeting is convened promptly or a convocation notice of a meeting which is to be held not later than eight weeks from the day of such demand is dispatched, the requiring shareholder may, upon obtaining a court approval, convene such a shareholders’ meeting.

Any shareholder or group of shareholders holding at least 300 voting rights or one percent of the total number of voting rights for a period of six months or more may propose a matter to be considered at a General Meeting of Shareholders by submitting a written request to Sony Corporation at least eight weeks prior to the date set for such meeting.

If the Articles of Incorporation so provide, any of the minimum voting rights or percentages, time periods and number of voting rights necessary for exercising the minority shareholder rights described above may be decreased or shortened. Sony Corporation’s Articles of Incorporation currently do not include any such provisions.

(Voting rights)

So long as Sony Corporation maintains the unit share system, a holder of shares constituting one or more units is entitled to one vote for each such unit of stock (refer to “(Unit share system)” below; currently 100 shares constitute one unit), except that no voting rights with respect to shares of capital stock of Sony Corporation are afforded to Sony Corporation or any corporate or certain other entities more than one-quarter of the total voting rights of which are directly or indirectly held by Sony Corporation. If Sony Corporation eliminates from its Articles of Incorporation the provisions relating to units of stock, holders of capital stock will have one vote for each share they hold. Except as otherwise provided by law or by the Articles of Incorporation of Sony Corporation, a resolution can be adopted at a General Meeting of Shareholders by a majority of the number of voting rights of all the shareholders represented at the meeting. The Companies Act and Sony Corporation’s Articles of Incorporation provide, however, that the quorum for the election of Directors shall be one-third of the total number of voting rights of all the shareholders. Sony Corporation’s shareholders are not entitled to cumulative voting in the election of Directors. Shareholders may cast their votes in writing and may also exercise

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their voting rights through proxies, provided that the proxies are also shareholders holding voting rights. Shareholders may also exercise their voting rights by electronic means pursuant to the method designated by Sony Corporation.

The Companies Act and the Articles of Incorporation of Sony Corporation provide that in order to amend the Articles of Incorporation and in certain other instances, including:

(1) acquisition of its own shares from a specific party other than its subsidiaries;

(2) consolidation of shares;

(3) any offering of new shares or existing shares held by Sony Corporation as treasury stock at a “specially favorable” price (or any offering of stock acquisition rights to acquire shares of capital stock, or bonds with stock acquisition rights on “specially favorable” conditions) to any persons other than shareholders;

(4) the exemption of liability of a Director, Corporate Executive Officer or independent auditor with certain exceptions;

(5) a reduction of stated capital with certain exceptions;

(6) a distribution of in-kind dividends which meets certain requirements;

(7) dissolution, merger, consolidation, or corporate split with certain exceptions;

(8) the transfer of the whole or a material part of the business;

(9) the transfer of the whole or a part of the shares or equity interests in a subsidiary which meets certain requirements;

(10) the taking over of the whole of the business of any other corporation with certain exceptions; or

(11) share exchange or share transfer for the purpose of establishing 100 percent parent-subsidiary relationships with certain exceptions,

the quorum shall be one-third of the total number of voting rights of all the shareholders, and the approval by at least two-thirds of the number of voting rights of all the shareholders represented at the meeting is required (the “special shareholders’ resolutions”).

(Issue of additional shares and pre-emptive rights)

Holders of Sony Corporation’s shares of capital stock have no pre-emptive rights under its Articles of Incorporation. Authorized but unissued shares may be issued, or existing shares held by Sony Corporation as treasury stock may be transferred, at such times and upon such terms as the Board of Directors or the CEO determines, subject to the limitations as to the offering of new shares or transfer of existing shares held by Sony Corporation as treasury stock at a “specially favorable” price mentioned under “(Voting rights)” above.

In the case of an issuance of shares (including a transfer of existing shares held by Sony Corporation as treasury stock) or stock acquisition rights whereby any subscriber will hold more than 50 percent of the voting rights of all shareholders, generally Sony Corporation shall give public notice at least two weeks prior to the payment date for such issuance, and if shareholders who hold one-tenth or more of the voting rights of all shareholders dissent from the issuance of shares or stock acquisition rights, the approval by a resolution of a General Meeting of Shareholders is generally required before the payment date pursuant to the Companies Act. In addition, in the case of an issuance of shares (including a transfer of existing shares held by Sony Corporation as treasury stock) or stock acquisition rights by way of an allotment to a third party which would dilute the outstanding voting shares by 25 percent or more or change the controlling shareholder, in addition to a resolution of the Board of Directors, the approval of the shareholders or an affirmative vote from a person independent of the management is generally required pursuant to the rules of the TSE. The Board of Directors or the CEO may, however, determine that shareholders shall be given subscription rights regarding a particular issue of new shares, in which case such rights must be given on uniform terms to all shareholders as of a record date of which not less than two weeks’ prior public notice is given. Each of the shareholders to whom such rights are given must also be given notice of the expiry thereof at least two weeks prior to the date on which such rights expire.

Subject to certain conditions, Sony Corporation may issue stock acquisition rights by a resolution of the Board of Directors or a determination by the CEO. Holders of stock acquisition rights may exercise their rights to

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acquire a certain number of shares within the exercise period as prescribed in the terms of their stock acquisition rights. Upon exercise of stock acquisition rights, Sony Corporation will be obliged to issue the relevant number of new shares or alternatively to transfer the necessary number of treasury stock held by it.

In cases where a particular issue of new shares or stock acquisition rights (i) violates laws and regulations or Sony Corporation’s Articles of Incorporation, or (ii) will be performed in a materially unfair manner, and shareholders may suffer disadvantages therefrom, such shareholders may file an injunction to enjoin such issue with a court.

(Liquidation rights)

In the event of a liquidation of Sony Corporation, the assets remaining after payment of all debts, liquidation expenses and taxes will be distributed among the holders of shares of Common Stock in proportion to the respective numbers of shares of Common Stock held.

(Record date)

March 31 is the record date for Sony Corporation’s year-end dividends, if declared. So long as Sony Corporation maintains the unit share system, shareholders who are registered as the holders of one or more unit of stock in Sony Corporation’s register of shareholders at the end of each March 31 are also entitled to exercise shareholders’ rights at the Ordinary General Meeting of Shareholders with respect to the business year ending on such March 31. September 30 is the record date for interim dividends, if declared. In addition, Sony Corporation may set a record date for determining the shareholders entitled to other rights and for other purposes by giving at least two weeks’ prior public notice.

JASDEC is required to promptly give Sony Corporation notice of the names and addresses of Sony Corporation’s shareholders, the numbers of shares of Common Stock held by them and other relevant information as of such respective record dates.

The price of shares generally goes ex-dividends or ex-rights on Japanese stock exchanges on the second business day prior to a record date (or if the record date is not a business day, the third business day prior thereto), for the purpose of dividends or rights offerings.

(Acquisition by Sony Corporation of its capital stock)

Under the Companies Act and the Articles of Incorporation of Sony Corporation, Sony Corporation may acquire shares of Common Stock (i) from a specific shareholder other than any of its subsidiaries (pursuant to the special shareholders’ resolution), (ii) from any of its subsidiaries (pursuant to a determination by the CEO as delegated by the Board of Directors), or (iii) by way of purchase on any Japanese stock exchange on which Sony Corporation’s shares of Common Stock are listed or by way of tender offer (pursuant to a resolution of the Board of Directors, as long as its non-consolidated annual financial statements and certain documents for the last business year present fairly its assets and profit or loss, as required by ordinances of the Ministry of Justice).

In the case of (i) above, any other shareholder may make a request to Sony Corporation that such other shareholder be included as a seller in the proposed purchase, provided that no such right will be available if the purchase price or any other consideration to be received by the relevant specific shareholder will not exceed the last trading price of the shares on the relevant stock exchange on the day immediately preceding the date on which the resolution mentioned in (i) above was adopted (or, if there is no trading in the shares on the stock exchange or if the stock exchange is not open on such day, the price at which the shares are first traded on such stock exchange thereafter).

The total amount of the purchase price of shares of Common Stock may not exceed the Distributable Amount, as described in “(Distribution of Surplus) — Distributions of Surplus — Restriction on distribution of Surplus.”

Shares acquired by Sony Corporation may be held for any period or may be retired at the determination of the CEO. Sony Corporation may also transfer (by public or private sale or otherwise) to any person the treasury stock held by it, subject to a determination by the CEO, and subject also to other requirements similar to those applicable to the issuance of new shares, as described in “(Issue of additional shares and pre-emptive rights)” above. Sony Corporation may also utilize its treasury stock for the purpose of transfer to any person upon exercise of stock acquisition rights or for the purpose of acquiring another company by way of merger, share exchange or corporate split through exchange of treasury stock for shares or assets of the acquired company.

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(Unit share system)

The Articles of Incorporation of Sony Corporation provide that 100 shares constitute one “unit” of shares of stock. The Board of Directors or the Corporate Executive Officer to whom the authority to make such a determination has been delegated by a resolution of the Board of Directors is permitted to amend the Articles of Incorporation to reduce the number of shares that constitute a unit or to abolish the unit share system entirely. Under the Companies Act, the number of shares constituting one unit cannot exceed 1,000 shares nor 0.5 percent of the total number of issued shares.

Under the unit share system, shareholders have one voting right for each unit of stock that they hold. Any number of shares less than one full unit have neither voting rights nor rights related to voting rights. Holders of shares constituting less than one unit will have no other shareholder rights if Sony Corporation’s Articles of Incorporation so provide, except that such holders may not be deprived of certain rights specified in the Companies Act or an ordinance of the Ministry of Justice, including the right to receive distribution of Surplus.

A holder of shares constituting less than one full unit may require Sony Corporation to purchase such shares at their market value in accordance with the provisions of the Share Handling Regulations of Sony Corporation. In addition, the Articles of Incorporation of Sony Corporation provide that a holder of shares constituting less than one full unit may request Sony Corporation to sell to such holder such amount of shares which will, when added together with the shares constituting less than one full unit, constitute one full unit of stock. Such request by a holder and the sale by Sony Corporation must be made in accordance with the provisions of the Share Handling Regulations of Sony Corporation. As prescribed in the Share Handling Regulations, such requests shall be made through an account management institution and JASDEC pursuant to the rules set by JASDEC, without going through the notification procedure required for the exercise of the shareholders’ rights to which shareholders are entitled, regardless of whether such shareholder held shares on the requisite record date, as described in “(General).” Shares constituting less than a full unit are transferable, under the central book-entry transfer system described in “(General).” Under the rules of the Japanese stock exchanges, however, shares constituting less than a full unit do not comprise a trading unit, except in limited circumstances, and accordingly may not be sold on the Japanese stock exchanges.

(Sale by Sony Corporation of shares held by shareholders whose location is unknown)

Sony Corporation is not required to send a notice to a shareholder if a notice to such shareholder fails to arrive at the registered address of the shareholder in Sony Corporation’s register of shareholders or at the address otherwise notified to Sony Corporation continuously for five years or more.

In addition, Sony Corporation may sell or otherwise dispose of shares of capital stock for which the location of the shareholder is unknown. Generally, if (i) notices to a shareholder fail to arrive continuously for five years or more at the shareholder’s registered address in Sony Corporation’s register of shareholders or at the address otherwise notified to Sony Corporation, and (ii) the shareholder fails to receive distributions of Surplus on the shares continuously for five years or more at the address registered in Sony Corporation’s register of shareholders or at the address otherwise notified to Sony Corporation, Sony Corporation may sell or otherwise dispose of such shareholder’s shares at the then market price of the shares by a determination of a Corporate Executive Officer and after giving at least three months’ prior public and individual notice, and hold or deposit the proceeds of such sale or disposal of shares for such shareholder.

Reporting of substantial shareholdings

The Financial Instruments and Exchange Act of Japan and its related regulations require any person, regardless of residence, who has become, beneficially and solely or jointly, a holder of more than five percent of the total issued shares of capital stock of a company listed on any Japanese stock exchange or whose shares are traded on the over-the-counter market in Japan to file with the Director General of the competent Local Finance Bureau of the Ministry of Finance within five business days a report concerning such shareholdings. A similar report must also be filed in respect of any subsequent change of one percent or more in any such holding, or any change in material matters set out in reports previously filed, with certain exceptions. For this purpose, shares issuable to such persons upon conversion of convertible securities or exercise of share subscription warrants or stock acquisition rights are taken into account in determining both the number of shares held by such holders and the issuer’s total issued share capital. Any such report shall be filed with the Director General of the relevant Local Finance Bureau of the Ministry of Finance through the Electronic Disclosure for Investors’ Network (EDINET) system.

Except for the general limitation under Japanese anti-trust and anti-monopoly regulations against holding of shares of capital stock of a Japanese corporation which leads or may lead to a restraint of trade or monopoly,

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except for the limitations under the Foreign Exchange Regulations as described in “D. Exchange Controls” below, and except for general limitations under the Companies Act or Sony Corporation’s Articles of Incorporation on the rights of shareholders applicable regardless of residence or nationality, there is no limitation under Japanese laws and regulations applicable to Sony Corporation or under its Articles of Incorporation on the rights of non-residents or foreign shareholders to hold or exercise voting rights on the shares of capital stock of Sony Corporation.

There is no provision in Sony Corporation’s Articles of Incorporation or internal regulations that would have an effect of delaying, deferring or preventing a change in control of Sony Corporation and that would operate only with respect to merger, acquisition or corporate restructuring involving Sony Corporation.

C. Material Contracts

None

D. Exchange Controls

The Foreign Exchange and Foreign Trade Act of Japan and its related cabinet orders and ministerial ordinances (the “Foreign Exchange Regulations”) govern the acquisition and holding of shares of capital stock of Sony Corporation by “exchange non-residents” and by “foreign investors.” The Foreign Exchange Regulations currently in effect do not, however, affect transactions between exchange non-residents to purchase or sell shares outside Japan using currencies other than Japanese yen.

Exchange non-residents are:

• individuals who do not reside in Japan; and

• corporations whose principal offices are located outside Japan.

Generally, branches and other offices of non-resident corporations that are located within Japan are regarded as residents of Japan. Conversely, branches and other offices of Japanese corporations located outside Japan are regarded as exchange non-residents.

Foreign investors are:

• individuals who are exchange non-residents;

• corporations that are organized under the laws of foreign countries or whose principal offices are located outside of Japan; and

• corporations (i) 50 percent or more of whose shares are held, directly or indirectly, by individuals who are exchange non-residents and/or corporations (a) that are organized under the laws of foreign countries or (b) whose principal offices are located outside of Japan or (ii) a majority of whose officers, or officers having the power of representation, are individuals who are exchange non-residents.

In general, the acquisition of shares of a Japanese company (such as the shares of capital stock of Sony Corporation) by an exchange non-resident from a resident of Japan is not subject to any prior filing requirements. In certain limited circumstances, however, the Minister of Finance may require prior approval of an acquisition of this type. While prior approval, as described above, is not required, in the case where a resident of Japan transfers shares of a Japanese company (such as the shares of capital stock of Sony Corporation) for consideration exceeding 100 million yen to an exchange non-resident, the resident of Japan who transfers the shares is required to report on the transfer to the Minister of Finance through the Bank of Japan within 20 days from the date of the transfer or the date of the receipt of payment, whichever comes later, unless the transfer was made through a bank or financial instruments business operator registered under Japanese law.

If a foreign investor acquires shares of a Japanese company that is listed on a Japanese stock exchange (such as the shares of capital stock of Sony Corporation) or that is traded on an over-the-counter market in Japan and, as a result of the acquisition, the foreign investor, in combination with any existing holdings, directly or indirectly holds 10 percent or more of the issued shares of the relevant company, the foreign investor, in general, must file a report of the acquisition with the Minister of Finance and any other competent Ministers having jurisdiction over that Japanese company by the 15th day of the month immediately following the month in which such acquisition took place. In limited circumstances, such as where the foreign investor is in a country that is not listed on an exemption schedule in the Foreign Exchange Regulations, or where that Japanese company is

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engaged in certain businesses designated by the Foreign Exchange Regulations, a prior notification of the acquisition must be filed with the Minister of Finance and any other competent Ministers, who may then modify or prohibit the proposed acquisition.

Under the Foreign Exchange Regulations, dividends paid on and the proceeds from sales in Japan of shares of capital stock of Sony Corporation held by non-residents of Japan may generally be converted into any foreign currency and repatriated abroad.

E. Taxation

The following is a summary of the major Japanese national tax and U.S. federal income tax consequences of the ownership, acquisition and disposition of shares of Common Stock of Sony Corporation and of ADRs evidencing ADSs representing shares of Common Stock of Sony Corporation by a non-resident of Japan or a non-Japanese corporation without a permanent establishment in Japan. The summary does not purport to be a comprehensive description of all of the tax considerations that may be relevant to any particular investor, and does not take into account any specific individual circumstances of any particular investor. Accordingly, holders of shares of Common Stock or ADSs of Sony Corporation are encouraged to consult their tax advisors regarding the application of the considerations discussed below to their particular circumstances.

This summary is based upon the representations of the depositary and the assumption that each obligation in the deposit agreement in relation to the ADSs dated as of October 15, 2014, and in any related agreement, will be performed in accordance with its terms.

For purposes of the income tax convention between Japan and the United States (the “Treaty”) and the U.S. Internal Revenue Code of 1986, as amended (the “Code”), U.S. holders of ADSs generally will be treated as owning shares of Common Stock of Sony Corporation underlying the ADSs evidenced by the ADRs. For the purposes of the following discussion, a “U.S. holder” is a holder that:

(i) is a resident of the U.S. for purposes of the Treaty;

(ii) does not maintain a permanent establishment in Japan (a) with which shares of Common Stock or ADSs of Sony Corporation are effectively connected and through which the U.S. holder carries on or has carried on business or (b) of which shares of Common Stock or ADSs of Sony Corporation form part of the business property; and

(iii) is eligible for benefits under the Treaty with respect to income and gain derived in connection with shares of Common Stock or ADSs of Sony Corporation.

The following is a summary of the principal Japanese tax consequences (limited to national taxes) to non-residents of Japan or non-Japanese corporations without a permanent establishment in Japan (“non-resident Holders”) who are holders of shares of Common Stock of Sony Corporation or of ADRs evidencing ADSs representing shares of Common Stock of Sony Corporation. The information given below regarding Japanese taxation is based on the tax laws and tax treaties in force and their interpretations by the Japanese tax authorities as of June 19, 2018. Tax laws and tax treaties as well as their interpretations may change at any time, possibly with retroactive effect. Sony Corporation will not update this summary for any changes in the tax laws or tax treaties or their interpretation that occurs after such date.

Generally, non-resident Holders are subject to Japanese withholding tax on dividends paid by Japanese corporations. Such taxes are withheld prior to payment of dividends as required by Japanese law. Stock splits are, in general, not a taxable event.

In the absence of an applicable tax treaty, convention or agreement reducing the maximum rate of Japanese withholding tax or allowing exemption from Japanese withholding tax, the rate of Japanese withholding tax applicable to dividends paid by Japanese corporations to non-resident Holders is generally 20.42 percent, provided, with respect to dividends paid on listed shares issued by a Japanese corporation (such as the shares of Common Stock or ADSs of Sony Corporation) to non-resident Holders other than any individual shareholder who holds 3 percent or more of the total shares issued by the relevant Japanese corporation, the aforementioned 20.42 percent withholding tax rate is reduced to 15.315 percent for dividends due and payable on or before December 31, 2037. Due to the imposition of a special additional withholding tax (2.1 percent of the original withholding tax amount) to secure funds for reconstruction from the Great East Japan Earthquake, the original withholding tax rates of 15 percent and 20 percent as applicable, have been effectively increased to 15.315 percent and 20.42 percent, respectively, until December 31, 2037.

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As of the date of this document, Japan has income tax treaties, conventions or agreements in force, whereby the above-mentioned withholding tax rate is reduced, in most cases to 15 percent or 10 percent for portfolio investors (15 percent under the income tax treaties with, among other countries, Canada, Denmark, Finland, Germany, Ireland, Italy, Luxembourg, New Zealand, Norway, Singapore and Spain, and 10 percent under the income tax treaties with, among other countries, Australia, France, Hong Kong, the Netherlands, Portugal, Sweden, Switzerland, the U.K. and the United States). Under the Treaty, the maximum rate of Japanese withholding tax that may be imposed on dividends paid by a Japanese corporation to a U.S. holder that does not own directly or indirectly at least 10 percent of the voting stock of the Japanese corporation is generally reduced to 10 percent of the gross amount actually distributed, and dividends paid by a Japanese corporation to a U.S. holder that is a pension fund are exempt from Japanese income taxation by way of withholding or otherwise unless such dividends are derived from the carrying on of a business, directly or indirectly, by such pension fund.

If the maximum tax rate provided for in the income tax treaty applicable to dividends paid by Sony Corporation to any particular non-resident Holder is lower than the withholding tax rate otherwise applicable under Japanese tax law, or if any particular non-resident Holder is exempt from Japanese income tax with respect to such dividends under the income tax treaty applicable to such particular non-resident Holder, such non-resident Holder who is entitled to a reduced rate of or exemption from Japanese withholding tax on payment of dividends on shares of Common Stock by Sony Corporation is, in principle, required to submit an Application Form for Income Tax Convention Regarding Relief from Japanese Income Tax and Special Income Tax for Reconstruction on Dividends (together with any other required forms and documents) in advance through the withholding agent to the relevant tax authority before the payment of dividends. A standing proxy for non-resident Holders of a Japanese corporation may provide this application service. In this regard, a certain simplified special filing procedure is available for non-resident Holders to claim treaty benefits of exemption from or reduction of Japanese withholding tax, by submitting a Special Application Form for Income Tax Convention Regarding Relief from Japanese Tax and Special Income Tax for Reconstruction on Dividends of Listed Stock (together with any other required forms and documents). With respect to ADSs, this reduced rate or exemption is applicable if the depositary or its agent submits two Application Forms (one before payment of dividends and the other within eight months after the record date concerning such payment of dividends). To claim this reduced rate or exemption, a non-resident Holder of ADSs will be required to file a proof of taxpayer status, residence and beneficial ownership (as applicable) and to provide other information or documents as may be required by the depositary. A non-resident Holder who is entitled, under an applicable income tax treaty, to a reduced rate which is lower than the withholding tax rate otherwise applicable under Japanese tax law or an exemption from the withholding tax, but failed to submit the required application in advance will be entitled to claim the refund of taxes withheld in excess of the rate under an applicable tax treaty (if such non-resident Holder is entitled to a reduced treaty rate under the applicable income tax treaty) or the full amount of tax withheld (if such non-resident Holder is entitled to an exemption under the applicable income tax treaty) from the relevant Japanese tax authority, by complying with a certain subsequent filing procedure. Sony Corporation does not assume any responsibility to ensure withholding at the reduced treaty rate or to ensure the absence of withholding for shareholders who would be so eligible under any applicable income tax treaty but where the required procedures as stated above are not followed.

Gains derived from the sale of shares of Common Stock or ADSs of Sony Corporation outside Japan by a non-resident Holder holding such shares or ADSs as portfolio investors are, in general, not subject to Japanese income tax or corporation tax under Japanese tax law. U.S. holders are not subject to Japanese income or corporation tax with respect to such gains under the Treaty.

Japanese inheritance tax and gift tax at progressive rates may be payable by an individual who has acquired from another individual shares of Common Stock or ADSs of Sony Corporation as a legatee, heir or donee even though neither the acquiring individual nor the deceased nor donor is a Japanese resident.

Holders of shares of Common Stock or ADSs of Sony Corporation should consult their tax advisors regarding the effect of these taxes and, in the case of U.S. holders, the possible application of the Estate and Gift Tax Treaty between the U.S. and Japan.

United States Taxation with respect to shares of Common Stock and ADSs

The U.S. dollar amount of dividends received (prior to deduction of Japanese taxes) by a U.S. holder of ADSs or Common Stock of Sony Corporation will be included in income as ordinary income for U.S. federal income tax purposes to the extent paid out of current or accumulated earnings and profits of Sony Corporation as determined for U.S. federal income tax purposes. Subject to certain exceptions for short-term and hedged positions, the U.S. dollar amount of dividends received by a non-corporate U.S. holder with respect to the ADSs

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or Common Stock will be subject to taxation at a reduced rate if the dividends are “qualified dividends.” Dividends paid on the ADSs or Common Stock will be treated as qualified dividends if Sony Corporation was not, in the year prior to the year in which the dividend was paid, and is not, in the year in which the dividend is paid a passive foreign investment company (“PFIC”). Based on Sony Corporation’s audited financial statements and relevant market and shareholder data, Sony Corporation believes that it was not treated as a PFIC for U.S. federal income tax purposes with respect to its 2017 taxable year. In addition, based on Sony Corporation’s audited financial statements and Sony Corporation’s current expectations regarding the value and nature of its assets, the sources and nature of its income, and relevant market and shareholder data, Sony Corporation does not anticipate becoming a PFIC for the 2018 taxable year. Holders of ADSs and Common Stock of Sony Corporation should consult their own tax advisors regarding the availability of the reduced dividend tax rate in light of the considerations discussed above and their own particular circumstances.

Subject to applicable limitations and special considerations discussed below, a U.S. holder of ADSs or Common Stock of Sony Corporation will be entitled to a credit for Japanese tax withheld in accordance with the Treaty from dividends paid by Sony Corporation. For purposes of the foreign tax credit limitation, dividends will be foreign source income, and will generally constitute “passive” income. Foreign tax credits will not be allowed for withholding taxes imposed in respect of certain short-term or hedged positions and may not be allowed in respect of arrangements in which economic profit, after non-U.S. taxes, is insubstantial. Holders of ADSs and Common Stock of Sony Corporation should consult their own tax advisors regarding the implications of these rules in light of their particular circumstances.

Dividends paid by Sony Corporation to U.S. corporate holders of ADSs or Common Stock of Sony Corporation will not be eligible for the dividends-received deduction.

In general, a U.S. holder will recognize capital gain or loss upon the sale or other disposition of ADSs or Common Stock of Sony Corporation equal to the difference between the amount realized on the sale or disposition and the U.S. holder’s tax basis in the ADSs or Common Stock. Such capital gain or loss will be long-term capital gain or loss if the ADSs or Common Stock have been held for more than one year on the date of the sale or disposition. The net amount of long-term capital gain recognized by an individual holder is subject to lower rates of federal income taxation than ordinary income or short-term capital gain rates.

Under the Code, a U.S. holder of ADSs or Common Stock of Sony Corporation may be subject, under certain circumstances, to information reporting and possibly backup withholding with respect to dividends and proceeds from the sale or other disposition of ADSs or Common Stock, unless the U.S. holder provides proof of an applicable exemption or correct taxpayer identification number and otherwise complies with applicable requirements of the backup withholding rules. Any amount withheld under the backup withholding rules is not an additional tax and may be refunded or credited against the U.S. holder’s federal income tax liability, so long as the required information is furnished to the U.S. Internal Revenue Service.

F. Dividends and Paying Agent

Not Applicable

G. Statement by Experts

Not Applicable

H. Documents on Display

It is possible to read and copy documents referred to in this annual report on Form 20-F that have been filed with the SEC at the SEC’s public reference room located at 100 F Street, N.E., Washington, D.C. 20549. Please call the SEC at 1-800-SEC-0330 for further information on the public reference rooms and their copy charges. You can also access the documents at the SEC’s home page (http://www.sec.gov/index.html).

I. Subsidiary Information

Not Applicable

Item 11. Quantitative and Qualitative Disclosures about Market Risk

Sony’s business is continuously exposed to market fluctuation, such as fluctuations in currency exchange rates, interest rates or stock prices. Sony utilizes several derivative instruments, such as foreign exchange forward

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contracts, foreign currency option contracts, interest rate swap agreements and currency swap agreements in order to hedge the potential downside risk on the cash flow from the normal course of business caused by market fluctuation. Sony uses foreign exchange forward contracts and foreign currency option contracts primarily to reduce the foreign exchange volatility risk that transactions and accounts receivable or accounts payable denominated in yen, U.S. dollars, euros or other currencies have through the normal course of Sony’s worldwide business. Interest rate swap agreements and currency swap agreements are utilized to diversify funding conditions or to reduce funding costs, and in the Financial Services segment, these transactions are used for asset liability management. Sony uses these derivative financial instruments mainly for risk-hedging purposes as described above, and some derivative transactions, such as bond futures and bond options, are held or utilized for trading purposes in the Financial Services segment. If hedge accounting cannot be applied because the accounts receivable or accounts payable to be hedged are not yet booked, or because cash flows from derivative transactions do not coincide with the underlying exposures recorded on Sony’s balance sheet, such derivatives agreements are subject to a mark-to-market evaluation and their unrealized gains or losses are recognized in earnings. In addition, Sony holds marketable securities, such as straight bonds and stocks in yen or other currencies, in the Financial Services segment to obtain interest income or capital gain on the financial assets under management. These securities include a concentration of investments in long-term Japanese national government bonds, for which Sony monitors the related credit ratings and other market information on an ongoing basis. Investments in marketable securities are also subject to market fluctuation.

Sony measures the economic impact of market fluctuations on the value of derivatives agreements and marketable securities by using Value-at-Risk (“VaR”) analysis in order to comply with Item 11 disclosure requirements. VaR in this context indicates the potential maximum amount of loss in fair value resulting from adverse market fluctuations for a selected period of time and at a selected level of confidence.

The following table shows the results of VaR. These analyses for the fiscal year ended March 31, 2018 indicate the potential maximum loss in fair value as predicted by the VaR analysis resulting from market fluctuations in one day at a 95 percent confidence level. The VaR of currency exchange rate risk principally consists of risks arising from the volatility of the exchange rates between the yen and the U.S. dollar and between the yen and the euro, the currencies in which a significant amount of financial assets and liabilities and derivative transactions are maintained on a consolidated basis. The VaR of interest rate risk and stock price risk consists of risks arising from the volatility of the interest rates and stock prices against invested securities and derivatives transactions in the Financial Services segment.

The net VaR for Sony’s entire portfolio is smaller than the simple aggregate of VaR for each component of market risk. This is due to the fact that market risk factors such as currency exchange rates, interest rates and stock prices are not completely independent and potential profits and losses arising from each market risk may be mutually offsetting to some degree.

The disclosed VaR amounts simply represent the calculated maximum potential loss on the specified date and do not necessarily indicate an estimate of actual or future loss.

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Consolidated

	June 30, 2017		September 30, 2017		December 31, 2017		March 31, 2018
	(Yen in billions)
Net VaR		1.2		1.2		1.0		0.9
VaR of currency exchange rate risk		1.2		1.1		0.9		0.9
VaR of interest rate risk		0.1		0.1		0.1		0.1
VaR of stock price risk		0.0		0.0		0.0		0.0

Financial Services

	June 30, 2017		September 30, 2017		December 31, 2017		March 31, 2018
	(Yen in billions)
Net VaR		1.2		1.0		0.8		0.7
VaR of currency exchange rate risk		1.1		0.9		0.7		0.7
VaR of interest rate risk		0.1		0.1		0.1		0.1
VaR of stock price risk		0.0		0.0		0.0		0.0

Sony without the Financial Services segment

	June 30, 2017		September 30, 2017		December 31, 2017		March 31, 2018
	(Yen in billions)
Net VaR		0.8		0.7		0.4		0.5
VaR of currency exchange rate risk		0.8		0.7		0.4		0.5
VaR of interest rate risk		0.0		0.0		0.0		0.0
VaR of stock price risk		0.0		0.0		0.0		0.0

Item 12. Description of Securities Other Than Equity Securities

A. Debt Securities

Not Applicable

B. Warrants and Rights

Not Applicable

C. Other Securities

Not Applicable

D. American Depositary Shares

Citibank N.A. (the “Depositary”) serves as the depositary for Sony Corporation’s ADSs. ADS holders (“Holders”) may be required to pay various fees to the Depositary and the Depositary may refuse to provide any service for which a fee is assessed until the applicable fee has been paid. The following fees may at any time and from time to time be changed by agreement (the “Deposit Agreement”) between Sony Corporation and the Depositary.

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Under the terms of the Deposit Agreement, Holders may have to pay the following service fees to the Depositary.

Service	Rate	By Whom Paid
Issuance of ADSs upon deposit of Sony Corporation’s Common Stock	Up to 5.00 U.S. dollar per 100 ADSs (or fraction thereof) issued	Person depositing Sony Corporation’s Common Stock or person receiving ADSs
Delivery of deposited securities against surrender of ADSs	Up to 5.00 U.S. dollar per 100 ADSs (or fraction thereof) surrendered	Person surrendering ADSs for the purpose of withdrawal of deposited securities or person to whom deposited securities are delivered
Distribution of cash dividends or other cash distributions (i.e., sale of rights and other entitlements)	Up to 5.00 U.S. dollar per 100 ADSs (or fraction thereof) held	Person to whom distribution is made
Distribution of ADSs pursuant to (i) stock dividends or other free stock distributions, (ii) exercise of rights to purchase additional ADSs	Up to 5.00 U.S. dollar per 100 ADSs (or fraction thereof) held	Person to whom distribution is made
Distribution of securities other than ADSs or rights purchase Additional ADSs (i.e., spin-off shares)	Up to 5.00 U.S. dollar per 100 ADSs (or fraction thereof) held	Person to whom distribution is made
ADS Services	Up to 5.00 U.S. dollar per 100 ADSs (or fraction thereof) held on the applicable record date(s) established by the Depositary	Person holding ADSs on the applicable record date(s) established by the Depositary

The Company, Holders, beneficial owners of ADSs, persons depositing Sony Corporation’s Common Stock and persons surrendering ADSs for cancellation and for the purpose of withdrawing deposited securities shall be responsible for the following ADS charges under the term of the Deposit Agreement: (i) taxes (including applicable interest and penalties) and other governmental charges; (ii) such registration fees as may from time to time be in effect for the registration of Sony Corporation’s Common Stock or other deposited securities on the share register and applicable to transfer of Sony Corporation’s Common Stock or other deposited securities to or from the name of the custodian, the Depositary or any nominees upon the making of deposits and withdrawals, respectively; (iii) such cable, telex and facsimile transmission and delivery expenses as are expressly provided in the Deposit Agreement to be at the expense of the person depositing Sony Corporation’s Common Stock or withdrawing deposited securities or of the Holders and beneficial owners of ADSs; (iv) the expenses and charges incurred by the Depositary in the conversion of foreign currency; (v) such fees and expenses as are incurred by the Depositary in connection with compliance with exchange control regulations and other regulatory requirements applicable to Sony Corporation’s Common Stock, deposited securities, ADSs and ADRs; and (vi) the fees and expenses incurred by the Depositary, the custodian, or any nominee in connection with the servicing or delivery of deposited property.

Direct and Indirect Payments by the Depositary to Sony

The Depositary reimburses Sony for certain expenses Sony incurs in connection with its ADR program, subject to certain ceilings. These reimbursable expenses currently include, but are not limited to, legal and accounting fees, investor relations expenses and fees payable to service providers for the distribution of material to ADR holders. For the fiscal year ended March 31, 2018, such reimbursements totaled approximately 742,050 U.S. dollars.

In addition, as part of its service to Sony, the Depositary waives fees in connection with its ADR program, subject to a ceiling. These waived expenses currently include, but are not limited to, standard costs associated with the administration of the ADR program, associated operating expenses, investor relations advice and access to an internet-based tool used in Sony’s investor relations activities. For the fiscal year ended March 31, 2018, the amount of such indirect payments was estimated to total 5,000 U.S. dollars.

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Item 13. Defaults, Dividend Arrearages and Delinquencies

None

Item 14. Material Modifications to the Rights of Security Holders and Use of Proceeds

None

Item 15. Controls and Procedures

Item 15(a). Disclosure Controls and Procedures

Sony has carried out an evaluation under the supervision and with the participation of Sony’s management, including the CEO and CFO, of the effectiveness of the design and operation of Sony’s disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as of March 31, 2018. Disclosure controls and procedures require that information to be disclosed in the reports Sony files or submits under the Securities and Exchange Act of 1934 is recorded, processed, summarized and reported as and when required, within the time periods specified in the applicable rules and forms, and that such information is accumulated and communicated to Sony’s management, including the CEO and CFO, as appropriate to allow timely decisions regarding required disclosure. There are inherent limitations to the effectiveness of any system of disclosure controls and procedures, including the possibility of human error and the circumvention or overriding of the controls and procedures. Accordingly, even effective disclosure controls and procedures can only provide reasonable assurance of achieving their control objectives. Based upon Sony’s evaluation, the CEO and CFO have concluded that, as of March 31, 2018, the disclosure controls and procedures were effective at the reasonable assurance level.

Item 15(b). Management’s Annual Report on Internal Control over Financial Reporting

Sony’s management is responsible for establishing and maintaining adequate internal control over financial reporting, as defined in Rules 13a-15(f) and 15d-15(f) under the Securities Exchange Act of 1934. Sony’s internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles in the United States of America. Sony’s internal control over financial reporting includes those policies and procedures that:

(i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of Sony;

(ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of Sony are being made only in accordance with authorizations of management and directors; and

(iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of Sony’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Sony’s management evaluated the effectiveness of Sony’s internal control over financial reporting as of March 31, 2018 based on the criteria established in “Internal Control — Integrated Framework (2013)” issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Based on the evaluation, management has concluded that Sony maintained effective internal control over financial reporting as of March 31, 2018.

Sony’s independent registered public accounting firm, PricewaterhouseCoopers Aarata LLC, has issued an audit report on Sony’s internal control over financial reporting as of March 31, 2018, presented on page (F-2).

Item 15(c). Attestation Report of the Registered Public Accounting Firm

Refer to the Report of Independent Registered Public Accounting Firm on page (F-2).

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Item 15(d). Changes in Internal Control over Financial Reporting

There has been no change in Sony’s internal control over financial reporting during the fiscal year ended March 31, 2018 that has materially affected, or is reasonably likely to materially affect, Sony’s internal control over financial reporting.

Item 16. [Reserved]

Item 16A. Audit Committee Financial Expert

Sony’s Board of Directors has determined that Kunihito Minakawa and Toshiko Oka each qualifies as an “audit committee financial expert” as defined in Item 16A of Form 20-F under the Securities Exchange Act of 1934, as amended. In addition, both are determined to be independent as defined under the NYSE Corporate Governance Standards.

Item 16B. Code of Ethics

Sony has adopted a code of ethics, as defined in Item 16B of Form 20-F under the Securities Exchange Act of 1934, as amended. The code of ethics applies to Sony’s Chief Executive Officer, Chief Financial Officer, chief accounting officer and persons performing similar functions, as well as to directors and all other officers and employees of Sony, as defined in the code of ethics. The code of ethics is available at http://www.sony.net/code.

Item 16C. Principal Accountant Fees and Services

Audit and Non-Audit Fees

The following table presents fees for audit and other services rendered by PricewaterhouseCoopers for the fiscal years ended March 31, 2017 and 2018.

	Fiscal year ended March 31
	2017		2018
	Yen in millions
Audit Fees (1)		3,401		3,562
Audit-Related Fees (2)		177		446
Tax Fees (3)		—		1
All Other Fees (4)		61		68
		3,639		4,077

(1) Audit Fees consist of fees for the annual audit services engagement and other audit services, which are those services that only the external auditor can provide.

(2) Audit-Related Fees consist of fees billed for assurance and related services, and audit services relating to benefit plans, business acquisitions and dispositions.

(3) Tax Fees primarily consist of fees for tax advice.

(4) All Other Fees consist of fees primarily for services rendered with respect to advisory services.

Audit Committee’s Pre-Approval Policies and Procedures

Consistent with the U.S. Securities and Exchange Commission rules regarding auditor independence, Sony Corporation’s Audit Committee is responsible for appointing, reviewing and setting compensation, retaining, and overseeing the work of Sony’s independent auditor, so that the auditor’s independence will not be impaired. The Audit Committee established a formal policy requiring pre-approval of all audit and permissible non-audit services provided by the independent auditor to Sony Corporation or any of its subsidiaries. The Audit Committee periodically reviews this policy with due regard for compliance with laws and regulations of host countries where Sony Corporation is listed.

Prior to the engagement of the independent auditor for the following fiscal year’s audit, management submits an application form to the Audit Committee for comprehensive pre-approval of all recurring services expected to be rendered during that year. In order to obtain comprehensive pre-approval, management provides sufficient information regarding each service so that each service can be classified into one of four categories (Audit, Audit-Related, Tax, or All Other) as well as information regarding the fees expected to be budgeted for each service. Management describes each service in detail and indicates precisely and unambiguously the nature

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and scope of each particular service. Any additional services not contemplated in the application form require the Audit Committee’s separate pre-approval on an individual basis. The Audit Committee approves, if necessary, any changes in terms, conditions and fees resulting from changes in the scope of services to be provided or from other circumstances. The Audit Committee Chair retains pre-approval authority and evaluates items for approval upon request. The Audit Committee or its designee establishes procedures to assure that the independent auditor is aware in a timely manner of the services that have been pre-approved.

Item 16D. Exemptions from the Listing Standards for Audit Committees

Not Applicable

Item 16E. Purchases of Equity Securities by the Issuer and Affiliated Purchasers

The following table sets out information concerning purchases made by Sony Corporation during the fiscal year ended March 31, 2018.

Period	(a) Total number of shares purchased		(b) Average price paid per share (yen)		(c) Total number of shares purchased as part of publicly announced plans or programs		(d) Maximum number of shares that may yet be purchased under the plans or programs
April 1 — 30, 2017		1,544		3,581.32		N/A		N/A
May 1 — 31, 2017		2,472		3,926.96		N/A		N/A
June 1 — 30, 2017		5,196		4,167.39		N/A		N/A
July 1 — 31, 2017		4,462		4,391.01		N/A		N/A
August 1 — 31, 2017		3,500		4,369.79		N/A		N/A
September 1 — 30, 2017		2,209		4,280.17		N/A		N/A
October 1 — 31, 2017		2,959		4,172.74		N/A		N/A
November 1 — 30, 2017		4,393		5,105.24		N/A		N/A
December 1 — 31, 2017		6,251		5,133.24		N/A		N/A
January 1 — 31, 2018		4,345		5,462.68		N/A		N/A
February 1 — 28, 2018		2,821		5,328.96		N/A		N/A
March 1 — 31, 2018		2,132		5,317.52		N/A		N/A
Total		42,284		4,687.36		N/A		N/A

Under the Companies Act, a holder of shares constituting less than one full unit may require Sony Corporation to purchase such shares at their market value (Refer to “B. Memorandum and Articles of Association — Capital stock — (Unit share system)” in “Item 10. Additional Information”). During the fiscal year ended March 31, 2018, Sony Corporation purchased 42,284 shares of Common Stock for a total purchase price of 198,200,165 yen upon such requests from holders of shares constituting less than one full unit.

Item 16F. Change in Registrant’s Certifying Accountant

Not Applicable

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Item 16G. Disclosure About Differences in Corporate Governance

The table below discloses the significant ways in which Sony’s corporate governance practices differ from those required for U.S. companies under the listing standards of the NYSE. As a foreign private issuer listed on the NYSE, Sony is exempt from most of the exchange’s corporate governance standards requirements. For further information on Sony’s corporate governance practices and history, please refer to “Board Practices” in “Item 6. Director, Senior Management and Employees.” In the table below, any reference to “Sony” shall mean Sony Corporation.

NYSE Standards	Sony’s Corporate Governance Practices
Board Independence. A majority of board directors must be independent.	Sony has adopted the “Company with Three Committees” system under the Companies Act. Sony’s Charter of the Board of Directors (attached as an exhibit 1.3 to this report) requires its board to consist of between 10 to 20 directors. The Companies Act does not require Sony to have a majority of “independent” (in the meaning given by the NYSE Corporate Governance Standards) directors on its board; rather, it requires Sony to have a majority of “outside” directors (the definition of the term “outside” director is summarized below) on each of three statutory committees (the Nominating Committee, the Audit Committee and the Compensation Committee).
Director Independence. A director is not independent if such director is (i) a person who the board determines has a material direct or indirect relationship with the company, its parent or a consolidated subsidiary; (ii) a person who, within the last three years, has been an employee of the company or has an immediate family member of an executive officer of the company, its parent or a consolidated subsidiary; (iii) a person who had received, or whose immediate family member had received, during any 12-month period within the last three years, more than 120,000 U.S. dollars per year in direct compensation from the company, its parent or a consolidated subsidiary, other than director and committee fees or deferred compensation for prior services (provided such compensation is not contingent in any way on continued service); (iv) (A) a person who is, or whose immediate family member is, a current partner or employee of a firm that is the company’s internal or external auditor; (B) a person whose immediate family member is a partner of such a firm; (C) a person who has an immediate family member who is a current employee of such a firm and who personally participates in the firm’s audit, assurance or tax compliance (but not tax planning) practice; or (D) a person who was, or has an immediate family member who was, within the last three years, a partner or employee of such a firm and personally worked on the listed company’s audit within that time;	“Outside” director is defined in the Companies Act as a person who satisfies all of the requirements (i) through (v) below: (i) a person who is not a director of Sony Corporation or any of its subsidiaries engaged in the business operations of Sony Corporation or such subsidiaries, as the case may be, or a Corporate Executive Officer or general manager or other employee (“Group Executive Director, etc.”) of Sony Corporation or any of its subsidiaries and who has not been a Group Executive Director, etc. of Sony Corporation or any of its subsidiaries for ten years prior to assuming his/her office; (ii) if a person who has been a director, accounting counselor (if the accounting counselor is a juridical person, a member who is in charge of the affairs), or corporate auditor of Sony Corporation or any of its subsidiaries (excluding a person who has been a Group Executive Director, etc.) at the time within ten years prior to assuming his/her office, a person who has not been a Group Executive Director, etc. of Sony Corporation or any of its subsidiaries for ten years prior to assuming his/her office as a director, an accounting counselor, or a corporate auditor; (iii) a person who is not a director or a Corporate Executive Officer or general manager or other employee of a parent company or any entity which controls the management of Sony Corporation; (iv) a person who is not a Group Executive Director, etc. of a direct/indirect subsidiary of Sony Corporation or any entity the management of which is directly or indirectly controlled by Sony Corporation; and (v) a person who is not a spouse or relative within the second degree of kinship of a

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NYSE Standards	Sony’s Corporate Governance Practices
(v) a person who is, or whose immediate family member is, or has been within the last three years, employed as an executive officer of another company where any of the listed company’s present executive officers at the same time serves or served on that company’s compensation committee; or (vi) an executive officer or employee of a company, or has an immediate family member of an executive officer of a company, that makes payments to, or receives payments from, the listed company, its parent or a consolidated subsidiary for property or services in an amount which, in any of the last three fiscal years, exceeds the greater of 1 million U.S. dollars or 2 percent of such other company’s consolidated gross revenues.	director or a Corporate Executive Officer or general manager or other employee of Sony Corporation. Under the Companies Act, a director’s status as an “outside” director is unaffected by the director’s compensation, his or her affiliation with business partners, or the board’s affirmative determination of independence. On the other hand, under the Companies Act, a director who has had a career as a management director, corporate executive officer, or other employee of the company, its subsidiaries or other group companies is by definition not an “outside” director.
	Sony’s Charter of the Board of Directors includes a provision requiring that each “outside” director: (i) Shall not have received directly from Sony Group, during any consecutive 12-month period within the last three years, more than an amount equivalent to 120,000 U.S. dollars, other than director and committee fees and pension or other forms of deferred compensation for prior service (provided such compensation is not contingent in any way on continued service); and (ii) Shall not be an executive director, a corporate executive officer, a general manager or other employee of any company whose aggregate amount of transactions with Sony Group, in any of the last three fiscal years, exceeds the greater of an amount equivalent to 1,000,000 U.S. dollars, or 2 percent of the annual consolidated sales of such company;
	In addition, the Securities Listing Regulations of the Tokyo Stock Exchange require Sony to make efforts to have at least one “Independent Director” on the Board of Directors. “Independent Director” is defined in the Securities Listing Regulations of the Tokyo Stock Exchange as an “outside” director who is unlikely to have conflicts of interest with shareholders. According to the guidelines of the Tokyo Stock Exchange, if a person falls in any of the categories listed below, such person, in principle, will be considered to have a conflict of interest with shareholders of the listed company. (1)   A person for which the listed company is a major client or a person who executes business of a person for which the listed company is a major client; (2)   A major client of the listed company or a person who executes business of a major client of the listed company; (3)   A consultant, accounting professional, or legal professional (or, if such consultant, accounting professional, or legal professional is a juridical person, a member of such juridical person) of

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NYSE Standards	Sony’s Corporate Governance Practices
	the listed company who receives a large amount of money or other consideration other than remuneration for directorship/auditorship from such listed company;
	(4)   A person who has fallen in any of categories (a) through (d) listed below until recently:         (a)   A person who falls in any of (1) through (3) listed above;         (b)   A person who executes business of a parent company of the listed company or a director who does not execute business of a parent company of the listed company;         (c)   A corporate auditor of a parent company of the listed company; or         (d)   A person who executes business of a fellow subsidiary of the listed company.
	(5)   A close relative of a person who falls in any of categories (a) through (h) listed below (only if such person is significant):         (a)   A person who falls in any of (1) through (4) listed above;         (b)   An accounting counselor of the listed company;         (c)   A person who executes business of a subsidiary of the listed company;         (d)   A director who does not execute business of a subsidiary of the listed company or an accounting counselor of a subsidiary of the listed company;         (e)   A person who executes business of a parent company of the listed company or a director who does not execute business of a parent company of the listed company;         (f)   A corporate auditor of a parent company of the listed company;         (g)   A person who executes business of a fellow subsidiary of the listed company; or         (h)   A person who has fallen in any of categories (b) through (d) listed above or a person who has executed business of the listed company until recently.
	As of June 19, 2018, 10 of the 13 members of Sony’s Board of Directors qualified as “outside” directors. In addition, all 10 “outside” directors are qualified and designated as “Independent Directors” under the Securities Listing Regulations of the Tokyo Stock Exchange.

106

NYSE Standards	Sony’s Corporate Governance Practices
Executive Sessions. Non-management directors must meet in regularly scheduled executive sessions without management. Independent directors should meet alone in an executive session at least once a year.	An “outside” director, as defined under the Companies Act, is equivalent to a “non-management director” under the NYSE rules because an “outside” director does not engage in the execution of business operations of the company. The outside/non-management directors generally meet several times a year without management, though neither the Companies Act nor Sony’s Charter of the Board of Directors requires non-management directors to meet regularly without management and there is no requirement for the outside directors to meet alone in an executive session at least once a year.
Nominating/Corporate Governance Committee. A nominating/corporate governance committee of independent directors is required. The committee must have a charter that addresses the purpose, responsibilities (including development of corporate governance guidelines) and annual performance evaluation of the committee.	Sony’s Nominating Committee consists of at least three directors. Under the Companies Act, the Committee is responsible for determining the contents of proposals regarding the appointment and dismissal of directors to be submitted for approval to the shareholders’ meeting. Unlike listed U.S. companies under NYSE rules, it is not responsible for developing governance guidelines or overseeing the evaluation of the board and management. Under the Companies Act, a majority of its members must be “outside” directors, as defined under the Companies Act. Sony’s Charter of the Board of Directors requires at least one of the directors on the Committee to be a corporate executive officer.
Compensation Committee. A compensation committee of independent directors is required. The committee must have a charter that addresses the purpose, responsibilities and annual performance evaluation of the committee. In addition, in accordance with the SEC rules adopted pursuant to Section 952 of the Dodd-Frank Act, NYSE listing standards expanded the factors relevant in determining whether a committee member has a relationship to the company that will materially affect that member’s duties to the compensation committee and provided compensation committees the authority to engage compensation advisers. Additionally, the committee may obtain or retain the advice of a compensation adviser only after taking into consideration all factors relevant to determining that adviser’s independence from management, unless the adviser’s role is (i) limited to consulting on a generally applicable broad-based plan or (ii) is providing information that is not customized for the issuer or is not customized by the adviser and about which the adviser does not provide advice.	Sony’s Compensation Committee consists of at least three directors. Under the Companies Act, a majority of its members must be “outside” directors, as defined under the Companies Act. Sony’s Charter of the Board of Directors prohibits the CEO, the COO and/or the CFO (or a person at any equivalent position) from serving on the Compensation Committee. Under the Companies Act, the Committee is responsible for, among others, determining the compensation of each director and corporate executive officer.

107

NYSE Standards	Sony’s Corporate Governance Practices
Audit Committee. An audit committee satisfying the independence and other requirements of Rule 10A-3 under the Exchange Act is required. The committee must have at least three members. All members must be independent. The committee must have a charter addressing the committee’s purpose, an annual performance evaluation of the committee and the duties and responsibilities of the committee.	Sony’s Audit Committee consists of at least three directors. Under the Companies Act, a majority of its members must be “outside” directors, as defined under the Companies Act. In addition, pursuant to the Companies Act, no member of the Committee shall be a director of the company or any of its subsidiaries who is engaged in the business operations of the company or such subsidiary, as the case may be, or a corporate executive officer of the company or any of its subsidiaries, or an accounting counselor, general manager or other employee of any of such subsidiaries. Sony’s Charter of the Board of Directors also requires each member of the Audit Committee to meet the independence requirements of the applicable U.S. securities laws and regulations, and requires at least one member to meet the audit committee financial expert requirements. Currently, all the members of Sony’s Audit Committee are also “independent” as defined in the NYSE Corporate Governance Standards, and two members of the Committee are qualified as audit committee financial experts. Sony’s Charter of the Board of Directors discourages any Audit Committee member from concurrently being a member of other Committees.
Equity Compensation Plans. Equity compensation plans require shareholder approval, subject to limited exemptions.	Under the Companies Act, if Sony wishes to adopt an equity compensation plan under which stock acquisition rights or shares of common stock are granted on specially favorable conditions, except where all of its shareholders are granted rights to subscribe for such stock acquisition rights/shares of common stock or such stock acquisition rights/shares of common stock are gratuitously allocated to all of its shareholders, each on a pro rata basis, then Sony must obtain shareholder approval by a “special resolution” of a general meeting of shareholders, where the quorum is one-third of the total number of voting rights of all of its shareholders and the approval by at least two-thirds of the number of voting rights of all the shareholders represented at the meeting is required under Sony’s Articles of Incorporation. On the other hand, under the Companies Act, if Sony wishes to adopt an equity compensation plan under which stock acquisition rights or shares of common stock are granted against fair value thereof, such plan can be adopted by the resolution of Sony’s Compensation Committee, and grants of stock acquisition rights or shares pursuant to such plan may be decided by a resolution of the Board of Directors or a determination by a Corporate Executive Officer to whom the authority to make such determination has been delegated, and no shareholder approval is required.

108

NYSE Standards	Sony’s Corporate Governance Practices
Corporate Governance Guidelines. Corporate governance guidelines must be adopted and disclosed.	Sony is required to disclose the status of its corporate governance under the Companies Act, Financial Instruments and Exchange Act and its related regulations, and the Securities Listing Regulations of the Tokyo Stock Exchange; however, Sony does not have corporate governance guidelines that cover all the requirements described in the NYSE Corporate Governance Standards, as many of the provisions do not apply to Sony. Details of the status are posted on the following website: http://www.sony.net/SonyInfo/csr_report/governance/
Code of Ethics. A code of business conduct and ethics for directors, officers and employees must be adopted and disclosed, along with any waivers of the code for directors or executive officers.	Although this provision of the NYSE Corporate Governance Standards does not apply to Sony, Sony has adopted a code of conduct to be observed by all its directors, officers and other employees. The code of conduct is available at http://www.sony.net/code The code’s content covers principal items described in the NYSE Corporate Governance Standards.

Item 16H. Mine Safety Disclosure

Not Applicable

Item 17. Financial Statements

Not Applicable

Item 18. Financial Statements

Refer to the consolidated financial statements.

109

Item 19. Exhibits

Documents filed as exhibits to this annual report:

1.1	Articles of Incorporation of Sony Corporation (English Translation), incorporated by reference to Exhibit 1.1 to Sony’s annual report on Form 20-F for the fiscal year ended March 31, 2015 (Commission file number 001-06439) filed on June 23, 2015
1.2	Share Handling Regulations (English Translation), incorporated by reference to Exhibit 1.2 to Sony’s annual report on Form 20-F for the fiscal year ended March 31, 2010 (Commission file number 001-06439) filed on June 28, 2010
1.3	Charter of the Board of Directors, as amended (English Translation)
8.1	Significant subsidiaries (as defined in §210.1-02(w) of Regulation S-X) of Sony Corporation, including additional subsidiaries that management has deemed to be significant, as of March 31, 2018: Incorporated by reference to “Business Overview” and “Organizational Structure” in “Item 4. Information on the Company”
12.1	302 Certification
12.2	302 Certification
13.1	906 Certification
15.1	Consent of PricewaterhouseCoopers Aarata LLC
101.1	XBRL INSTANCE DOCUMENT
101.1	XBRL TAXONOMY EXTENSION SCHEMA
101.1	XBRL TAXONOMY EXTENSION CALCULATION LINKBASE
101.1	XBRL TAXONOMY EXTENSION DEFINITION LINKBASE
101.1	XBRL TAXONOMY EXTENSION LABEL LINKBASE
101.1	XBRL TAXONOMY EXTENSION PRESENTATION LINKBASE

110

SIGNATURES

Pursuant to the requirements of Section 12 of the Securities Exchange Act of 1934, the registrant hereby certifies that it meets all of the requirements for filing on Form 20-F and that it has duly caused and authorized the undersigned to sign this annual report on its behalf.

SONY CORPORATION
(Registrant)
By:	/s/  HIROKI TOTOKI
	(Signature)
	Hiroki Totoki
	Senior Executive Vice President, Chief Financial Officer

Date: June 19, 2018

111

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

SONY CORPORATION AND CONSOLIDATED SUBSIDIARIES

	Page
Report of Independent Registered Public Accounting Firm	F-2
Consolidated Balance Sheets at March 31, 2017 and 2018	F-4
Consolidated Statements of Income for the years ended March  31, 2016, 2017 and 2018	F-6
Consolidated Statements of Comprehensive Income for the years ended March 31, 2016, 2017 and 2018	F-7
Consolidated Statements of Cash Flows for the years ended March  31, 2016, 2017 and 2018	F-8
Consolidated Statements of Changes in Stockholders’ Equity for the years ended March 31, 2016, 2017 and 2018	F-10
Index to Notes to Consolidated Financial Statements	F-13
Notes to Consolidated Financial Statements	F-14
Financial Statement Schedule II for the years ended March  31, 2016, 2017 and 2018 — Valuation and Qualifying Accounts	F-81

All other schedules are omitted because they are not applicable or the required information is shown in the financial statements or the notes thereto.

F-1

Report of Independent Registered Public Accounting Firm

To the Board of Directors and Stockholders of Sony Corporation (Sony Kabushiki Kaisha)

Opinions on the Financial Statements and Internal Control over Financial Reporting

We have audited the accompanying consolidated balance sheets of Sony Corporation and its subsidiaries (the “Company”) as of March 31, 2018 and 2017, and the related consolidated statements of income, comprehensive income, cash flows and changes in stockholders’ equity for each of the three years in the period ended March 31, 2018, including the related notes and financial statement schedule listed in the accompanying index (collectively referred to as the “consolidated financial statements”). We also have audited the Company’s internal control over financial reporting as of March 31, 2018, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of March 31, 2018 and 2017, and the results of their operations and their cash flows for each of the three years in the period ended March 31, 2018 in conformity with accounting principles generally accepted in the United States of America. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of March 31, 2018, based on criteria established in Internal Control — Integrated Framework (2013) issued by the COSO.

Basis for Opinions

The Company’s management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in the Management’s Annual Report on Internal Control over Financial Reporting appearing under Item 15(b). Our responsibility is to express opinions on the Company’s consolidated financial statements and on the Company’s internal control over financial reporting based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects.

Our audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.

Definition and Limitations of Internal Control over Financial Reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

/s/ PricewaterhouseCoopers Aarata LLC

Tokyo, Japan

May 21, 2018,

except for Note 29 (2),

as to which the date is June 19, 2018

We have served as the Company’s auditor since 2006.

F-2

[THIS PAGE IS INTENTIONALLY LEFT BLANK]

F-3

SONY CORPORATION AND CONSOLIDATED SUBSIDIARIES

Consolidated Balance Sheets

March 31

	Yen in millions
	2017			2018
ASSETS
Current assets:
Cash and cash equivalents		960,142			1,586,329
Marketable securities		1,051,441			1,176,601
Notes and accounts receivable, trade		1,006,961			1,061,442
Allowance for doubtful accounts and sales returns		(53,150	)		(48,663	)
Inventories		640,835			692,937
Other receivables		223,632			190,706
Prepaid expenses and other current assets		525,861			516,744
Total current assets		4,355,722			5,176,096
Film costs		336,928			327,645
Investments and advances:
Affiliated companies		149,371			157,389
Securities investments and other		9,962,422			10,598,669
		10,111,793			10,756,058
Property, plant and equipment:
Land		117,293			84,358
Buildings		666,381			655,434
Machinery and equipment		1,842,852			1,798,722
Construction in progress		28,779			38,295
		2,655,305			2,576,809
Less — Accumulated depreciation		1,897,106			1,837,339
		758,199			739,470
Other assets:
Intangibles, net		584,185			527,168
Goodwill		522,538			530,492
Deferred insurance acquisition costs		568,837			586,670
Deferred income taxes		98,958			96,772
Other		323,396			325,167
		2,097,914			2,066,269
Total assets		17,660,556			19,065,538

(Continued on following page.)

F-4

SONY CORPORATION AND CONSOLIDATED SUBSIDIARIES

Consolidated Balance Sheets (Continued)

	Yen in millions
	2017			2018
LIABILITIES
Current liabilities:
Short-term borrowings		464,655			496,093
Current portion of long-term debt		53,424			225,522
Notes and accounts payable, trade		539,900			468,550
Accounts payable, other and accrued expenses		1,394,758			1,514,433
Accrued income and other taxes		106,037			145,905
Deposits from customers in the banking business		2,071,091			2,159,246
Other		591,874			610,792
Total current liabilities		5,221,739			5,620,541
Long-term debt		681,462			623,451
Accrued pension and severance costs		396,715			394,504
Deferred income taxes		432,824			449,863
Future insurance policy benefits and other		4,834,492			5,221,772
Policyholders’ account in the life insurance business		2,631,073			2,820,702
Other		314,771			278,338
Total liabilities		14,513,076			15,409,171
Redeemable noncontrolling interest		12,058			9,210
Commitments and contingent liabilities
EQUITY
Sony Corporation’s stockholders’ equity:
Common stock, no par value —
2017 — Shares authorized: 3,600,000,000; shares issued: 1,263,763,660		860,645
2018 — Shares authorized: 3,600,000,000; shares issued: 1,266,552,149					865,678
Additional paid-in capital		1,275,337			1,282,577
Retained earnings		984,368			1,440,387
Accumulated other comprehensive income —
Unrealized gains on securities, net		126,635			126,191
Unrealized losses on derivative instruments, net		(58	)		(1,242	)
Pension liability adjustment		(308,736	)		(296,444	)
Foreign currency translation adjustments		(436,610	)		(445,251	)
		(618,769	)		(616,746	)
Treasury stock, at cost
Common stock
2017 — 1,073,222 shares		(4,335	)
2018 — 1,127,101 shares					(4,530	)
		2,497,246			2,967,366
Noncontrolling interests		638,176			679,791
Total equity		3,135,422			3,647,157
Total liabilities and equity		17,660,556			19,065,538

The accompanying notes are an integral part of these statements.

F-5

SONY CORPORATION AND CONSOLIDATED SUBSIDIARIES

Consolidated Statements of Income

Fiscal year ended March 31

	Yen in millions
	2016		2017		2018
Sales and operating revenue:
Net sales		6,949,357		6,443,328		7,231,613
Financial services revenue		1,066,319		1,080,284		1,221,235
Other operating revenue		90,036		79,638		91,134
		8,105,712		7,603,250		8,543,982
Costs and expenses:
Cost of sales		5,166,894		4,753,010		5,188,259
Selling, general and administrative		1,691,930		1,505,956		1,583,197
Financial services expenses		907,758		910,144		1,042,163
Other operating expense, net		47,171		149,001		4,072
		7,813,753		7,318,111		7,817,691
Equity in net income of affiliated companies		2,238		3,563		8,569
Operating income		294,197		288,702		734,860
Other income:
Interest and dividends		12,455		11,459		19,784
Gain on sale of securities investments, net		52,068		225		1,517
Other		2,326		2,734		2,427
		66,849		14,418		23,728
Other expenses:
Interest		25,286		14,544		13,566
Loss on devaluation of securities investments		3,309		7,629		4,955
Foreign exchange loss, net		20,565		22,181		30,634
Other		7,382		7,147		10,384
		56,542		51,501		59,539
Income before income taxes		304,504		251,619		699,049
Income taxes:
Current		94,578		100,260		127,685
Deferred		211		23,798		24,085
		94,789		124,058		151,770
Net income		209,715		127,561		547,279
Less — Net income attributable to noncontrolling interests		61,924		54,272		56,485
Net income attributable to Sony Corporation’s stockholders		147,791		73,289		490,794

	Yen
	2016		2017		2018
Per share data:
Common stock
Net income attributable to Sony Corporation’s stockholders
— Basic		119.40		58.07		388.32
— Diluted		117.49		56.89		379.75
Cash dividends		20.00		20.00		27.50

The accompanying notes are an integral part of these statements.

F-6

SONY CORPORATION AND CONSOLIDATED SUBSIDIARIES

Consolidated Statements of Comprehensive Income

Fiscal year ended March 31

	Yen in millions
	2016			2017			2018
Net income		209,715			127,561			547,279
Other comprehensive income, net of tax —
Unrealized gains (losses) on securities		2,220			(30,293	)		1,070
Unrealized gains (losses) on derivative instruments		(1,198	)		1,140			(1,184	)
Pension liability adjustment		(171,753	)		63,232			12,390
Foreign currency translation adjustments		(83,899	)		(17,988	)		(6,335	)
Total comprehensive income (loss)		(44,915	)		143,652			553,220
Less — Comprehensive income attributable to noncontrolling interests		75,329			35,814			60,403
Comprehensive income (loss) attributable to Sony Corporation’s stockholders		(120,244	)		107,838			492,817

The accompanying notes are an integral part of these statements.

F-7

SONY CORPORATION AND CONSOLIDATED SUBSIDIARIES

Consolidated Statements of Cash Flows

Fiscal year ended March 31

	Yen in millions
	2016			2017			2018
Cash flows from operating activities:
Net income		209,715			127,561			547,279
Adjustments to reconcile net income to net cash provided by operating activities —
Depreciation and amortization, including amortization of deferred insurance acquisition costs		397,091			327,048			361,444
Amortization of film costs		299,587			297,505			359,274
Accrual for pension and severance costs, less payments		(6,383	)		9,297			4,113
Other operating expense, net		47,171			149,001			4,072
(Gain) loss on sale or devaluation of securities investments, net		(48,857	)		7,404			3,438
(Gain) loss on revaluation of marketable securities held in the financial services business for trading purposes, net		44,821			(55,789	)		(47,339	)
Loss on revaluation or impairment of securities investments held in the financial services business, net		2,653			47			220
Deferred income taxes		211			23,798			24,085
Equity in net (income) loss of affiliated companies, net of dividends		5,045			4,409			(2,956	)
Changes in assets and liabilities:
Increase in notes and accounts receivable, trade		(5,828	)		(37,529	)		(80,004	)
(Increase) decrease in inventories		(57,804	)		11,199			(51,508	)
Increase in film costs		(318,391	)		(331,179	)		(362,496	)
Decrease in notes and accounts payable, trade		(49,525	)		(1,386	)		(87,939	)
Increase (decrease) in accrued income and other taxes		(23,607	)		26,701			29,181
Increase in future insurance policy benefits and other		403,392			433,803			495,419
Increase in deferred insurance acquisition costs		(83,774	)		(93,234	)		(86,779	)
Increase in marketable securities held in the financial services business for trading purposes		(107,433	)		(81,456	)		(89,797	)
(Increase) decrease in other current assets		21,299			(21,402	)		3,776
Increase (decrease) in other current liabilities		(25,751	)		79,114			151,805
Other		45,457			(65,650	)		79,684
Net cash provided by operating activities		749,089			809,262			1,254,972
Cash flows from investing activities:
Payments for purchases of fixed assets		(375,411	)		(333,509	)		(262,989	)
Proceeds from sales of fixed assets		26,472			13,098			60,599
Payments for investments and advances by financial services business		(1,221,093	)		(1,233,290	)		(963,210	)
Payments for investments and advances (other than financial services business)		(20,830	)		(17,208	)		(13,801	)
Proceeds from sales or return of investments and collections of advances by financial services business		534,072			289,901			317,159
Proceeds from sales or return of investments and collections of advances (other than financial services business)		81,535			16,078			6,596
Proceeds from sales of businesses		17,790			3,262			44,624
Other		(72,938	)		7,695			(11,175	)
Net cash used in investing activities		(1,030,403	)		(1,253,973	)		(822,197	)

(Continued on following page.)

F-8

SONY CORPORATION AND CONSOLIDATED SUBSIDIARIES

Consolidated Statements of Cash Flows (Continued)

	Yen in millions
	2016			2017			2018
Cash flows from financing activities:
Proceeds from issuance of long-term debt		19,076			254,695			125,092
Payments of long-term debt		(270,669	)		(261,299	)		(44,561	)
Increase in short-term borrowings, net		92,153			317,827			35,145
Increase in deposits from customers in the financial services business, net		165,169			277,152			169,479
Proceeds from issuance of convertible bonds		120,000			—			—
Proceeds from issuance of new shares of common stock		301,708			—			—
Dividends paid		(12,751	)		(25,301	)		(28,490	)
Payment for purchase of Sony/ATV shares from noncontrolling interests		—			(76,565	)		—
Other		(34,564	)		(34,207	)		(10,209	)
Net cash provided by financing activities		380,122			452,302			246,456
Effect of exchange rate changes on cash and cash equivalents		(64,609	)		(31,061	)		(53,044	)
Net increase (decrease) in cash and cash equivalents		34,199			(23,470	)		626,187
Cash and cash equivalents at beginning of the fiscal year		949,413			983,612			960,142
Cash and cash equivalents at end of the fiscal year		983,612			960,142			1,586,329
Supplemental data:
Cash paid during the fiscal year for —
Income taxes		138,770			106,054			101,092
Interest		26,166			13,877			12,169
Non-cash investing and financing activities —
Obtaining assets by entering into capital leases		14,759			8,457			21,762

The accompanying notes are an integral part of these statements.

F-9

SONY CORPORATION AND CONSOLIDATED SUBSIDIARIES

Consolidated Statements of Changes in Stockholders’ Equity

	Yen in millions
	Common stock		Additional paid-in capital			Retained earnings			Accumulated other comprehensive income			Treasury stock, at cost			Sony Corporation’s stockholders’ equity			Noncontrolling interests			Total equity
Balance at March 31, 2015		707,038		1,185,777			813,765			(385,283	)		(4,220	)		2,317,077			611,392			2,928,469
Issuance of new shares		150,854		150,854												301,708						301,708
Exercise of stock acquisition rights		975		975												1,950						1,950
Stock-based compensation				1,516												1,516						1,516
Comprehensive income:
Net income							147,791									147,791			61,924			209,715
Other comprehensive income, net of tax —
Unrealized gains (losses) on securities										(13,417	)					(13,417	)		15,637			2,220
Unrealized losses on derivative instruments										(1,198	)					(1,198	)					(1,198	)
Pension liability adjustment										(170,608	)					(170,608	)		(1,145	)		(171,753	)
Foreign currency translation adjustments										(82,812	)					(82,812	)		(1,087	)		(83,899	)
Total comprehensive income (loss)																(120,244	)		75,329			(44,915	)
Stock issue costs, net of tax				(1,478	)											(1,478	)					(1,478	)
Dividends declared							(25,225	)								(25,225	)		(20,868	)		(46,093	)
Purchase of treasury stock													(110	)		(110	)					(110	)
Reissuance of treasury stock				(12	)								71			59						59
Transactions with noncontrolling interests shareholders and other				(11,913	)											(11,913	)		(4,783	)		(16,696	)
Balance at March 31, 2016		858,867		1,325,719			936,331			(653,318	)		(4,259	)		2,463,340			661,070			3,124,410

(Continued on following page.)

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SONY CORPORATION AND CONSOLIDATED SUBSIDIARIES

Consolidated Statements of Changes in Stockholders’ Equity (Continued)

	Yen in millions
	Common stock		Additional paid-in capital			Retained earnings			Accumulated other comprehensive income			Treasury stock, at cost			Sony Corporation’s stockholders’ equity			Noncontrolling interests			Total equity
Balance at March 31, 2016		858,867		1,325,719			936,331			(653,318	)		(4,259	)		2,463,340			661,070			3,124,410
Exercise of stock acquisition rights		1,778		1,778												3,556						3,556
Stock-based compensation				1,601												1,601						1,601
Comprehensive income:
Net income							73,289									73,289			54,272			127,561
Other comprehensive income, net of tax —
Unrealized losses on securities										(14,101	)					(14,101	)		(16,192	)		(30,293	)
Unrealized gains on derivative instruments										1,140						1,140						1,140
Pension liability adjustment										63,003						63,003			229			63,232
Foreign currency translation adjustments										(15,493	)					(15,493	)		(2,495	)		(17,988	)
Total comprehensive income																107,838			35,814			143,652
Stock issue costs, net of tax				(30	)											(30	)					(30	)
Dividends declared							(25,252	)								(25,252	)		(17,068	)		(42,320	)
Purchase of treasury stock													(114	)		(114	)					(114	)
Reissuance of treasury stock				(10	)								38			28						28
Transactions with noncontrolling interests shareholders and other				(53,721	)											(53,721	)		(41,640	)		(95,361	)
Balance at March 31, 2017		860,645		1,275,337			984,368			(618,769	)		(4,335	)		2,497,246			638,176			3,135,422

(Continued on following page.)

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SONY CORPORATION AND CONSOLIDATED SUBSIDIARIES

Consolidated Statements of Changes in Stockholders’ Equity (Continued)

	Yen in millions
	Common stock		Additional paid-in capital			Retained earnings			Accumulated other comprehensive income			Treasury stock, at cost			Sony Corporation’s stockholders’ equity			Noncontrolling interests			Total equity
Balance at March 31, 2017		860,645		1,275,337			984,368			(618,769	)		(4,335	)		2,497,246			638,176			3,135,422
Issuance of new shares		488		488												976						976
Exercise of stock acquisition rights		4,533		4,532												9,065						9,065
Conversion of convertible bonds		12		12												24						24
Stock-based compensation				3,160												3,160						3,160
Comprehensive income:
Net income							490,794									490,794			56,485			547,279
Other comprehensive income, net of tax —
Unrealized gains (losses) on securities										(444	)					(444	)		1,514			1,070
Unrealized losses on derivative instruments										(1,184	)					(1,184	)					(1,184	)
Pension liability adjustment										12,292						12,292			98			12,390
Foreign currency translation adjustments										(8,641	)					(8,641	)		2,306			(6,335	)
Total comprehensive income																492,817			60,403			553,220
Stock issue costs, net of tax				(879	)											(879	)					(879	)
Dividends declared							(34,775	)								(34,775	)		(14,361	)		(49,136	)
Purchase of treasury stock													(199	)		(199	)					(199	)
Reissuance of treasury stock				0									4			4						4
Transactions with noncontrolling interests shareholders and other				(73	)											(73	)		(4,427	)		(4,500	)
Balance at March 31, 2018		865,678		1,282,577			1,440,387			(616,746	)		(4,530	)		2,967,366			679,791			3,647,157

The accompanying notes are an integral part of these statements.

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Index to Notes to Consolidated Financial Statements

Sony Corporation and Consolidated Subsidiaries

		Page
Notes to Consolidated Financial Statements
1.	Nature of operations		F-14
2.	Summary of significant accounting policies		F-14
3.	Inventories		F-26
4.	Film costs		F-26
5.	Investments in affiliated companies		F-27
6.	Transfer of financial assets		F-28
7.	Marketable securities and securities investments		F-29
8.	Leases		F-31
9.	Goodwill and other intangible assets		F-33
10.	Insurance-related accounts		F-35
11.	Short-term borrowings and long-term debt		F-36
12.	Housing loans and deposits from customers in the banking business		F-38
13.	Fair value measurements		F-39
14.	Derivative instruments and hedging activities		F-45
15.	Pension and severance plans		F-50
16.	Stockholders’ equity		F-57
17.	Stock-based compensation plans		F-60
18.	Kumamoto Earthquake		F-61
19.	Restructuring charges		F-61
20.	Supplemental consolidated statements of income information		F-64
21.	Income taxes		F-65
22.	Reconciliation of the differences between basic and diluted EPS		F-69
23.	Variable interest entities		F-69
24.	Acquisitions		F-70
25.	Divestitures		F-71
26.	Collaborative arrangements		F-72
27.	Commitments, contingent liabilities and other		F-72
28.	Business segment information		F-74
29.	Subsequent events		F-79

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SONY CORPORATION AND CONSOLIDATED SUBSIDIARIES

Notes to Consolidated Financial Statements

Sony Corporation and Consolidated Subsidiaries

1. Nature of operations

Sony Corporation and its consolidated subsidiaries (hereinafter collectively referred to as “Sony”) are engaged in the development, design, production, manufacture, offer and sale of various kinds of electronic equipment, instruments and devices for consumer, professional and industrial markets such as network services, game hardware and software, televisions, audio and video recorders and players, still and video cameras, mobile phones, and semiconductors. Sony’s primary manufacturing facilities are located in Asia including Japan. Sony also utilizes third-party contract manufacturers for certain products. Sony’s products and services are marketed throughout the world by sales subsidiaries and unaffiliated distributors as well as direct sales and offers via the internet. Sony is engaged in the development, production, manufacture, and distribution of recorded music and the management and licensing of the words and music of songs as well as production and distribution of animation titles, including game applications based on the animation titles. Sony is also engaged in the production, acquisition and distribution of motion pictures and television programming and the operation of television and digital networks. Further, Sony is also engaged in various financial services businesses, including life and non-life insurance operations through its Japanese insurance subsidiaries and banking operations through a Japanese internet-based banking subsidiary.

2. Summary of significant accounting policies

The accompanying consolidated financial statements are presented in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Certain adjustments and reclassifications have been incorporated in the accompanying consolidated financial statements to conform with U.S. GAAP. These adjustments were not recorded in the statutory books and records as Sony Corporation and its subsidiaries in Japan maintain their records and prepare their statutory financial statements in accordance with accounting principles generally accepted in Japan, while its foreign subsidiaries maintain their records and prepare their financial statements in conformity with accounting principles generally accepted in the countries of their domicile.

(1) Significant accounting policies

Basis of consolidation and accounting for investments in affiliated companies -

The consolidated financial statements include the accounts of Sony Corporation and its majority-owned subsidiary companies, general partnerships and other entities in which Sony has a controlling interest, and variable interest entities for which Sony is the primary beneficiary. All intercompany transactions and accounts are eliminated. Investments in business entities in which Sony does not have control, but has the ability to exercise significant influence over operating and financial policies, generally through 20-50% ownership, are accounted for under the equity method. In addition, investments in general partnerships in which Sony does not have a controlling interest and limited partnerships are also accounted for under the equity method if more than minor influence over the operation of the investee exists (generally through more than 3-5% ownership). When the interest in the partnership is so minor that Sony has no significant influence over the operation of the investee, the cost method is used. Under the equity method, investments are stated at cost plus/minus Sony’s portion of equity in undistributed earnings or losses. Sony’s equity in current earnings or losses of such entities is reported net of income taxes and is included in operating income (loss) after the elimination of unrealized intercompany profits. If the value of an investment has declined and is judged to be other-than-temporary, the investment is written down to its estimated fair value.

On occasion, a consolidated subsidiary or an affiliated company accounted for by the equity method may issue its shares to third parties in either a public or private offering or upon conversion of convertible debt to common stock at amounts per share in excess of or less than Sony’s average per share carrying value. With respect to such transactions, the resulting gains or losses arising from the change in ownership interest are recorded in earnings within the fiscal year in which the change in interest transactions occur.

Gains or losses that result from a loss of a controlling financial interest in a subsidiary are recorded in earnings along with fair value remeasurement gains or losses on any retained investment in the entity, while a change in interest of a consolidated subsidiary that does not result in a change in control is accounted for as a capital transaction and no gains or losses are recorded in earnings.

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The excess of the cost over the underlying net equity of investments in consolidated subsidiaries and affiliated companies accounted for on an equity basis is allocated to identifiable tangible and intangible assets and liabilities based on fair values at the date of acquisition. The unassigned residual value of the excess of the cost over Sony’s underlying net equity is recognized as goodwill as a component of the investment balance.

Use of estimates -

The preparation of the consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The most significant estimates include those used in determining the valuation of investment securities, valuation of inventories, fair values of long-lived assets, fair values of goodwill and other intangible assets, fair values of assets and liabilities assumed in business combinations, product warranty liability, pension and severance plans, valuation of deferred tax assets, uncertain tax positions, film costs, and insurance related liabilities. Actual results could significantly differ from those estimates.

Translation of foreign currencies -

All asset and liability accounts of foreign subsidiaries and affiliates are translated into Japanese yen at appropriate fiscal year end exchange rates and all income and expense accounts are translated at exchange rates that approximate those rates prevailing at the time of the transactions. The resulting translation adjustments are accumulated as a component of accumulated other comprehensive income. Upon remeasurement of a previously held equity interest in accordance with the accounting guidance for business combinations achieved in stages, accumulated translation adjustments, if any, are included in earnings.

Receivables and payables denominated in foreign currencies are translated at appropriate fiscal year end exchange rates and the resulting translation gains or losses are recognized into income.

Cash and cash equivalents -

Cash and cash equivalents include all highly liquid investments, with original maturities of three months or less, that are readily convertible to known amounts of cash and are so near maturity that they present insignificant risk of changes in value because of changes in interest rates.

Marketable debt and equity securities -

Debt and equity securities designated as available-for-sale, whose fair values are readily determinable, are carried at fair value with unrealized gains or losses included as a component of accumulated other comprehensive income, net of applicable taxes. Debt and equity securities classified as trading securities are carried at fair value with unrealized gains or losses included in income. Debt securities that are expected to be held-to-maturity are carried at amortized cost. Individual securities classified as either available-for-sale or held-to-maturity are reduced to fair value by a charge to income when an other-than-temporary impairment is recognized. Realized gains and losses are determined on the average cost method and are reflected in income.

Sony regularly evaluates its investment portfolio to identify other-than-temporary impairments of individual securities. Factors that are considered by Sony in determining whether an other-than-temporary decline in value has occurred include: the length of time and extent to which the market value of the security has been less than its original cost, the financial condition, operating results, business plans and estimated future cash flows of the issuer of the security, other specific factors affecting the market value, deterioration of the credit condition of the issuer, sovereign risk, and whether or not Sony is able to retain the investment for a period of time sufficient to allow for the anticipated recovery in market value.

In evaluating the factors for available-for-sale securities whose fair values are readily determinable, Sony presumes a decline in value to be other-than-temporary if the fair value of the security is 20 percent or more below its original cost for an extended period of time (generally for a period of up to six months). This criterion is employed as a threshold to identify securities which may have a decline in value that is other-than-temporary. The presumption of an other-than-temporary impairment in such cases may be overcome if there is evidence to support that the decline is temporary in nature due to the existence of other factors which overcome the duration

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SONY CORPORATION AND CONSOLIDATED SUBSIDIARIES

or magnitude of the decline. On the other hand, there may be cases where impairment losses are recognized when the decline in the fair value of the security is not more than 20 percent or such decline has not existed for an extended period of time, as a result of considering specific factors which may indicate that the decline in the fair value is other-than-temporary.

When an other-than-temporary impairment of a held-to-maturity debt security has occurred, the amount of the other-than-temporary impairment recognized in income depends on whether Sony intends to sell the security or more likely than not will be required to sell the security before recovery of its amortized cost. If the debt security meets either of these two criteria, the other-than-temporary impairment is recognized in income, measured as the entire difference between the security’s amortized cost and its fair value at the impairment measurement date. For other-than-temporary impairments of debt securities that do not meet these two criteria, the net amount recognized in income is a credit loss equal to the difference between the amortized cost of the debt security and its net present value calculated by discounting Sony’s best estimate of projected future cash flows at the effective interest rate implicit in the debt security prior to impairment. Any difference between the fair value and the net present value of the debt security at the impairment measurement date is recorded in accumulated other comprehensive income. Unrealized gains or losses on securities for which an other-than-temporary impairment has been recognized in income are presented as a separate component of accumulated other comprehensive income.

Equity securities in non-public companies -

Equity securities in non-public companies are primarily carried at cost if fair value is not readily determinable. If the value of a non-public equity investment is estimated to have declined and such decline is judged to be other-than-temporary, Sony recognizes the impairment of the investment and the carrying value is reduced to its fair value. Determination of impairment is based on the consideration of several factors, including operating results, business plans and estimated future cash flows. Fair value is determined through the use of various methodologies such as discounted cash flows, valuation of recent financings and comparable valuations of similar companies.

Allowance for doubtful accounts -

Sony maintains an allowance for doubtful accounts to reserve for potentially uncollectible receivables. Sony reviews accounts receivable by amounts due from customers which are past due to identify specific customers with known disputes or collectability issues. In determining the amount of the reserve, Sony makes judgments about the creditworthiness of customers based on past collection experience and ongoing credit risk evaluations.

Inventories -

Inventories in the Game & Network Services (“G&NS”), Music, Home Entertainment & Sound (“HE&S”), Imaging Products & Solutions (“IP&S”), Mobile Communications (“MC”) and Semiconductors segments as well as non-film inventories for the Pictures segment are valued at cost, not in excess of the net realizable value – i.e., estimated selling price in the ordinary course of business less predictable costs of completion and disposal, cost being determined on the “average cost” basis, except for the cost of finished products carried by certain subsidiary companies which is determined on the “first-in, first-out” basis.

Other receivables -

Other receivables include receivables which relate to arrangements with certain component manufacturers whereby Sony procures goods, including product components, for these component manufacturers and is reimbursed for the related purchases. No revenue or profit is recognized on these transfers. Sony will repurchase the inventory at a later date from the component manufacturers as either finished goods inventory or as partially assembled product.

Film costs -

Film costs include direct production costs, production overhead and acquisition costs for both motion picture and television productions and are stated at the lower of unamortized cost or estimated fair value and classified as noncurrent assets. Film costs are amortized, and the estimated liabilities for residuals and participations are accrued using an individual-film-forecast method based on the ratio of current period actual

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SONY CORPORATION AND CONSOLIDATED SUBSIDIARIES

revenues to the estimated remaining total revenues. Film costs also include broadcasting rights, which are recognized when the license period begins and the program is available for use, and consist of acquired programming to be aired on Sony’s worldwide channel network. Broadcasting rights are stated at the lower of unamortized cost or net realizable value, classified as either current or noncurrent assets based on timing of expected use. Broadcasting rights are amortized based on estimated usage or on a straight-line basis over the useful life, as appropriate, although broadcasting rights licensed under multi-year live-event sports programming agreements are generally amortized based on the ratio of the current period’s actual advertising revenue and an allocation of subscription fee revenue to the estimated total remaining attributable revenues. Estimates used in calculating the fair value of film costs and the net realizable value of broadcasting rights are based upon assumptions about future demand and market conditions and are reviewed on a periodic basis.

Property, plant and equipment and depreciation -

Property, plant and equipment are stated at cost. Depreciation is computed using the straight-line method. Useful lives for depreciation range from two to 50 years for buildings and from two to 10 years for machinery and equipment. Significant renewals and additions are capitalized at cost. Maintenance and repairs, and minor renewals and betterments are charged to income as incurred.

Goodwill and other intangible assets -

Goodwill and indefinite lived intangible assets are tested annually for impairment during the fourth quarter of the fiscal year and between annual tests if an event occurs or circumstances change that would more likely than not reduce the fair value below its carrying amount. Such an event or change in circumstances would include unfavorable variances from established business plans, significant changes in forecasted results or volatility inherent to external markets and industries, which are periodically reviewed by Sony’s management.

In the fiscal year ended March 31, 2018, Sony elected not to perform an optional qualitative assessment of goodwill and instead proceeded directly to a quantitative impairment test by comparing the fair value of a reporting unit with its carrying amount. Reporting units are Sony’s operating segments or one level below the operating segments. If the fair value of a reporting unit exceeds its carrying amount, goodwill of the reporting unit is not considered impaired. If the carrying amount of a reporting unit exceeds its fair value, an impairment loss is recognized in an amount equal to that excess, not to exceed the total amount of goodwill allocated to the reporting unit. Indefinite lived intangible assets are tested for impairment by comparing the fair value of the intangible asset with its carrying value, and if the carrying value of the intangible asset exceeds its fair value, an impairment loss is recognized in an amount equal to that excess.

The fair value of a reporting unit or indefinite lived intangible asset is generally determined using a discounted cash flow analysis. This approach uses significant estimates and assumptions, including projected future cash flows, the timing of such cash flows, discount rates reflecting the risk inherent in future cash flows, perpetual growth rates, earnings multiples, the determination of appropriate comparable entities and the determination of whether a premium or discount should be applied to comparables. Consideration is also given to Sony’s market capitalization in relation to the sum of the calculated fair values of the reporting units, including reporting units with no goodwill, and taking into account corporate level assets and liabilities not assigned to individual reporting units as well as a reasonable control premium.

The assumptions used for projected future cash flows and the timing of such cash flows are based on the forecast and mid-range plan (“MRP”) of each reporting unit and take into account such factors as historical experience, market and industry information, and current and forecasted economic conditions. Perpetual growth rates are utilized to determine a terminal cash flow value and are generally set after the three-year forecasted period for the MRP. Certain reporting units, such as those in the Pictures segment, utilize longer forecast periods and base the terminal value on an exit price using an earnings multiple applied to the final year of the forecasted earnings, which also takes into consideration a control premium. Discount rates are derived from the weighted average cost of capital of market participants in similar businesses.

When a business within a reporting unit is disposed of, goodwill is allocated to the disposed business using the relative fair value method.

Intangible assets with finite useful lives mainly consist of patent rights, know-how, license agreements, customer relationships, trademarks, software to be sold, leased or otherwise marketed, internal-use software, music catalogs, artist contracts, and television carriage contracts (broadcasting agreements). Patent rights,

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SONY CORPORATION AND CONSOLIDATED SUBSIDIARIES

know-how, license agreements, trademarks, software to be sold, leased or otherwise marketed, and internal-use software are generally amortized on a straight-line basis over three to 10 years. Customer relationships, music catalogs, artist contracts and television carriage contracts (broadcasting agreements) are amortized on a straight-line basis, generally, over 10 to 40 years.

Capitalized software -

The costs related to establishing the technological feasibility of software to be sold, leased or otherwise marketed are expensed as incurred as a part of research and development in cost of sales. Costs that are incurred to produce the finished product after technological feasibility is established are capitalized and amortized to cost of sales over the estimated economic life, which is generally three years. The technological feasibility of game software is established when the product master is completed. Consideration to capitalize game software development costs before this point is limited to the development costs of games for which technological feasibility can be proven at an earlier stage. At each balance sheet date, Sony performs reviews to ensure that unamortized capitalized software costs remain recoverable from future profits of the related software products.

The costs incurred for internal-use software during the application development stage are capitalized and amortized, mainly to selling, general and administrative expenses, on a straight-line basis over the estimated useful life. Costs related to the preliminary project stage and post implementation activities are expensed as incurred.

Deferred insurance acquisition costs -

Costs that vary with and are directly related to acquiring new insurance policies are deferred as long as they are recoverable. The deferred insurance acquisition costs include such items as commissions, medical examination costs and inspection report fees, and are subject to recoverability testing at least annually to ensure that the capitalized amounts do not exceed the present value of anticipated gross profits or premiums less benefits and maintenance expenses, as applicable. The deferred insurance acquisition costs for traditional life insurance contracts are amortized over the premium-paying period of the related insurance policies using assumptions consistent with those used in computing policy reserves. The deferred insurance acquisition costs for non-traditional life insurance contracts are amortized over the expected life in proportion to the estimated gross profits.

Product warranty -

Sony provides for the estimated cost of product warranties at the time revenue is recognized. The product warranty is calculated based upon product sales, estimated probability of failure and estimated cost per claim. The variables used in the calculation of the provision are reviewed on a periodic basis.

Certain subsidiaries in the G&NS, HE&S, IP&S, and MC segments offer extended warranty programs. The consideration received for extended warranty service is deferred and recognized as revenue on a straight-line basis over the term of the extended warranty.

Future insurance policy benefits -

Liabilities for future insurance policy benefits are primarily comprised of the present value of estimated future payments to policyholders. These liabilities are computed by the net level premium method based upon the assumptions as to future investment yield, morbidity, mortality, withdrawals and other factors. These assumptions are reviewed on a periodic basis. Liabilities for future insurance policy benefits also include liabilities for guaranteed benefits related to certain non-traditional life and annuity contracts.

Policyholders’ account in the life insurance business -

Liabilities for policyholders’ account in the life insurance business represent the contract value that has accrued to the benefit of the policyholders as of the balance sheet date. This liability is generally equal to the accumulated account deposits, plus interest credited, less policyholder withdrawals and other charges assessed against the account balances.

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SONY CORPORATION AND CONSOLIDATED SUBSIDIARIES

Impairment of long-lived assets -

Sony reviews the recoverability of the carrying value of its long-lived assets held and used, other than goodwill and intangible assets with indefinite lives, and assets to be disposed of, whenever events or changes in circumstances indicate that the individual carrying amount of an asset or asset group may not be recoverable. Long-lived assets to be held and used are reviewed for impairment by comparing the carrying value of the asset or asset group with their estimated undiscounted future cash flows. If the cash flows are determined to be less than the carrying value of the asset or asset group, an impairment loss would be recognized during the period for the amount by which the carrying value of the asset or asset group exceeds estimated fair value. Long-lived assets that are to be disposed of other than by sale are considered held and used until they are disposed of. Long-lived assets that are to be disposed of by sale are reported at the lower of their carrying value or fair value less cost to sell and are not depreciated. Fair value is determined using the present value of estimated net cash flows or comparable market values. This approach uses significant estimates and assumptions including projected future cash flows, the timing of such cash flows, discount rates reflecting the risk inherent in future cash flows, perpetual growth rates applied to determine terminal values, determination of appropriate market comparables and the determination of whether a premium or discount should be applied to comparables.

Fair value measurement -

Sony measures fair value as an exit price, or the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants as of the measurement date. Sony has elected the fair value option in the banking business for certain foreign securities. The election was made to mitigate accounting mismatches related to fluctuations of foreign exchange rates by allowing the gains and losses on the translation of these securities to be included in current earnings.

The accounting guidance for fair value measurements specifies a hierarchy of inputs to valuation techniques based on the extent to which inputs used in measuring fair value are observable in the market. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect Sony’s assumptions about the assumptions that market participants would use in pricing the asset or liability. Observable market data is used if such data is available without undue cost and effort. Each fair value measurement is reported in one of three levels which is determined by the lowest level input that is significant to the fair value measurement in its entirety.

These levels are:

Level 1	—	Inputs are unadjusted quoted prices for identical assets and liabilities in active markets.
Level 2	—	Inputs are based on observable inputs other than level 1 prices, such as quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active and model-derived valuations, in which all significant inputs are observable in active markets.
Level 3	—	One or more significant inputs are unobservable.

When available, Sony uses unadjusted quoted market prices in active markets to measure fair value and classifies such items within level 1. If quoted market prices are not available, fair value is based upon internally developed valuation techniques that use, where possible, current market-based or independently sourced market parameters, such as interest rates, currency rates and option volatilities. Items valued using internally generated models are classified according to the lowest level input that is significant to the valuation. For certain financial assets and liabilities, Sony determines fair value using third-party information such as indicative quotes from dealers and quantitative input from investment advisors following Sony’s established valuation procedures including validation against internally developed prices. Additionally, Sony considers both counterparty credit risk and Sony’s own creditworthiness in determining fair value. Sony attempts to mitigate credit risk to third parties by entering into netting agreements and actively monitoring the creditworthiness of counterparties and its exposure to credit risk through the use of credit limits and by selecting major international banks and financial institutions as counterparties.

Transfers between levels are deemed to have occurred at the beginning of the interim period in which the transfers occur.

Derivative financial instruments -

All derivatives are recognized as either assets or liabilities in the consolidated balance sheets at fair value on a gross basis. Changes in the fair value of derivative financial instruments are either recognized periodically in

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SONY CORPORATION AND CONSOLIDATED SUBSIDIARIES

income or stockholders’ equity (as a component of accumulated other comprehensive income), depending on whether the derivative financial instrument qualifies as a hedge and the derivative is being used to hedge changes in fair value or cash flows.

The accounting guidance for hybrid financial instruments permits an entity to elect fair value remeasurement for any hybrid financial instrument if the hybrid instrument contains an embedded derivative that would otherwise be required to be bifurcated and accounted for separately under accounting guidance for derivative instruments and hedging activities. The election to measure the hybrid instrument at fair value is made on an instrument-by-instrument basis and is irreversible. Certain subsidiaries in the Financial Services segment had hybrid financial instruments, disclosed in Note 7 as debt securities, that contain embedded derivatives where the entire instrument was carried at fair value.

In accordance with accounting guidance for derivative instruments and hedging activities, various derivative financial instruments held by Sony are classified and accounted for as described below.

Fair value hedges

Changes in the fair value of derivatives designated and effective as fair value hedges for recognized assets or liabilities or unrecognized firm commitments are recognized in earnings as offsets to changes in the fair value of the related hedged assets or liabilities.

Cash flow hedges

Changes in the fair value of derivatives designated and effective as cash flow hedges for forecasted transactions or exposures associated with recognized assets or liabilities are initially recorded in other comprehensive income and reclassified into earnings when the hedged transaction affects earnings. Changes in the fair value of the ineffective portion are recognized immediately in earnings.

Derivatives not designated as hedges

Changes in the fair value of derivatives that are not designated as hedges are recognized immediately in earnings.

Assessment of hedges

When applying hedge accounting, Sony formally documents all hedging relationships between the derivatives designated as hedges and the hedged items, as well as its risk management objectives and strategies for undertaking various hedging activities. Sony links all hedges that are designated as fair value or cash flow hedges to specific assets or liabilities on the consolidated balance sheets or to the specific forecasted transactions. Sony also assesses, both at the inception of the hedge and on an on-going basis, whether the derivatives that are designated as hedges are highly effective in offsetting changes in fair value or cash flows of hedged items. When it is determined that a derivative is not highly effective as a hedge, Sony discontinues hedge accounting. Hedge ineffectiveness, if any, is included immediately in earnings.

Stock-based compensation -

Sony accounts for stock-based compensation using the fair value based method, measured on the date of grant using the Black-Scholes option-pricing model. The expense is mainly included in selling, general and administrative expenses. Stock-based compensation is recognized, net of an estimated forfeiture rate, over the requisite service period using the accelerated method of amortization for grants with graded vesting. The estimated forfeiture rate is based on Sony’s historical experience in the stock acquisition rights plans where the majority of the vesting terms have been satisfied.

Revenue recognition -

Revenues from sales in the G&NS, Music, HE&S, IP&S, MC and Semiconductors segments are recognized when persuasive evidence of an arrangement exists, delivery has occurred or services have been rendered, the sales price is fixed or determinable, and collectability is reasonably assured. Delivery is considered to have occurred when the customer has taken title to the product and the risks and rewards of ownership have been

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substantively transferred. If the sales contract contains a customer acceptance provision, then sales are recognized after customer acceptance occurs or the acceptance provisions lapse. Revenues are recognized net of anticipated returns and sales incentives. Revenues from prepaid subscription fees, such as within the G&NS segment, are recognized ratably over the subscription term.

Revenue arrangements with customers may include multiple elements, including any combination of products, services and software. An example includes sales of electronics products with rights to receive promotional goods. For Sony’s multiple element arrangements where at least one of the elements is not subject to existing software or film revenue recognition guidance, elements are separated into more than one unit of accounting when the delivered element(s) have value to the customer on a standalone basis, and delivery of the undelivered element(s) is probable and substantially in the control of Sony. Revenue is then allocated to each unit of accounting based on the relative selling price of each unit of accounting based first on vendor-specific objective evidence of selling price (“VSOE”) if it exists, based next on third-party evidence of selling price (“TPE”) if VSOE does not exist, and, finally, if both VSOE and TPE do not exist, based on estimated selling prices (“ESP”). VSOE is limited to either the price charged for an element when it is sold separately or, for an element not yet being sold separately, the price established by management having the relevant authority; it must be probable that the price, once established, will not change before the separate introduction of the element into the market place. TPE is the price of Sony’s or any competitor’s largely interchangeable products or services in standalone sales to similarly situated customers. ESP is the price at which Sony would transact if the element were sold by Sony regularly on a standalone basis. When determining ESP, Sony considers all relevant inputs, including sales, cost and margin analysis of the product, targeted rate of return of the product, competitors’ and Sony’s pricing practices and customer perspectives.

Certain software products published by Sony provide limited online features at no additional cost to the customer. Generally, such features are considered to be incidental to the overall software product and an inconsequential deliverable. Accordingly, revenue related to software products containing these limited online features is not deferred.

Revenues from sales in the Pictures segment are recognized when persuasive evidence of an arrangement exists, the sales price is fixed or determinable and collectability is reasonably assured. Revenues from the theatrical exhibition of motion pictures are recognized as the customer exhibits the film. Revenues from the licensing of motion picture and television programming for pay and free television exhibition and other markets are recognized when the product is available for exploitation by the licensee and when any restrictions regarding the use of the product lapse. For home entertainment distribution, revenues from the sale of DVDs and Blu-ray Disc^TM, net of anticipated returns and sales incentives, are recognized when delivery has occurred and the product is available for sale to the public, and revenues from electronic sell-through and video-on-demand are recognized when the product is made available for viewing via digital distribution platforms. Certain motion picture and television program licensing arrangements involve an allocation to multiple elements, for example a fee for multiple territories and availability dates, that is based on relative fair value using management’s best estimate. Revenues from the sale of broadcast advertising are recognized when the advertisement is aired. Revenues from subscription fees received by television networks are recognized when the service is provided.

Traditional life insurance policies that the life insurance subsidiary underwrites, most of which are categorized as long-duration contracts, mainly consist of whole life, term life and accident and health insurance contracts. Premiums from these policies are reported as revenue when due from policyholders.

Amounts received as payment for non-traditional contracts such as interest sensitive whole life contracts, individual annuity contracts and other contracts without life contingencies are recognized in policyholders’ account in the life insurance business. Revenues from these contracts are comprised of fees earned for administrative and contract-holder services, which are recognized over the period of the contracts, and included in financial services revenue.

Property and casualty insurance policies that the non-life insurance subsidiary underwrites are primarily automotive insurance contracts which are categorized as short-duration contracts. Premiums from these policies are reported as revenue over the period of the contract in proportion to the amount of insurance protection provided.

Revenue is recognized net of any taxes collected from customers and subsequently remitted to governmental authorities.

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Consideration given to a customer or a reseller -

Sales incentives or other cash consideration given to a customer or a reseller, including payments for buydowns, slotting fees and cooperative advertising programs, are accounted for as a reduction of revenue unless Sony receives an identifiable benefit (goods or services) in exchange for the consideration, the fair value of the benefit is reasonably estimated and documentation from the reseller is received to support the amounts paid to the reseller. Payments meeting these criteria are recorded as selling, general and administrative expenses. For the fiscal years ended March 31, 2016, 2017 and 2018, consideration given to a reseller, primarily for free promotional shipping and cooperative advertising programs included in selling, general and administrative expenses, totaled 13,178 million yen, 12,046 million yen and 12,319 million yen, respectively.

Cost of sales -

Costs classified as cost of sales relate to the producing and manufacturing of products and include items such as material cost, subcontractor cost, depreciation of fixed assets, amortization of intangible assets, personnel expenses, research and development costs, and amortization of film costs related to motion picture and television productions.

Research and development costs -

Research and development costs, included in cost of sales, include items such as salaries, personnel expenses and other direct and indirect expenses associated with research and product development. Research and development costs are expensed as incurred.

Selling, general and administrative -

Costs classified as selling expenses relate to promoting and selling products and include items such as advertising, promotion, shipping and warranty expenses. General and administrative expenses include operating items such as officers’ salaries, personnel expenses, depreciation of fixed assets, office rental for sales, marketing and administrative divisions, a provision for doubtful accounts and amortization of intangible assets.

Financial services expenses -

Financial services expenses include a provision for policy reserves and amortization of deferred insurance acquisition costs, and all other operating costs, such as personnel expenses, depreciation of fixed assets, and office rental of subsidiaries, in the Financial Services segment.

Advertising costs -

Advertising costs are expensed when the advertisement or commercial appears in the selected media.

Shipping and handling costs -

The majority of shipping and handling, warehousing and internal transfer costs for finished goods are included in selling, general and administrative expenses. An exception to this is in the Pictures segment where such costs are charged to cost of sales as they are an integral part of producing and distributing motion pictures and television programming. All other costs related to Sony’s distribution network are included in cost of sales, including inbound freight charges, purchasing and receiving costs, inspection costs and warehousing costs for raw materials and in-process inventory. Amounts paid by customers for shipping and handling costs are included in net sales.

Income taxes -

The provision for income taxes is computed based on the pretax income included in the consolidated statements of income, and the tax liability attributed to undistributed earnings of subsidiaries and affiliated companies accounted for by the equity method expected to be remitted in the foreseeable future. The asset and liability approach is used to recognize deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the carrying amounts and the tax bases of assets and liabilities.

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Carrying amounts of deferred tax assets require a reduction by a valuation allowance if, based on the available evidence, it is more likely than not that such assets will not be realized. Accordingly, the need to establish valuation allowances for deferred tax assets is assessed periodically with appropriate consideration given to all positive and negative evidence related to the realization of the deferred tax assets. Management’s judgments related to this assessment consider, among other matters, the nature, frequency and severity of current and cumulative losses on an individual tax jurisdiction basis, forecasts of future profitability after consideration of uncertain tax positions, excess of appreciated asset value over the tax basis of net assets, the duration of statutory carryforward periods, the past utilization of net operating loss carryforwards prior to expiration, as well as prudent and feasible tax planning strategies which would be employed by Sony to prevent net operating loss and tax credit carryforwards from expiring unutilized.

Sony records assets and liabilities for unrecognized tax benefits resulting from uncertain tax positions taken or expected to be taken in a tax return. Sony continues to recognize interest and penalties, if any, with respect to income taxes, including unrecognized tax benefits, as interest expense and as income tax expense, respectively, in the consolidated statements of income. The amount of income taxes Sony pays is subject to ongoing audits by various taxing authorities, which may result in proposed assessments. In addition, several significant items related to intercompany transfer pricing are currently the subject of negotiations between taxing authorities in different jurisdictions as a result of pending advance pricing agreement applications and competent authority requests. Sony’s estimate for the potential outcome for any uncertain tax issues is judgmental and requires significant estimates. Sony assesses its income tax positions and records tax benefits for all years subject to examinations based upon the evaluation of the facts, circumstances and information available at that reporting date. For those tax positions for which it is more likely than not that a tax benefit will be sustained, Sony records the amount that has a greater than 50% likelihood of being realized upon settlement with a taxing authority that has full knowledge of all relevant information. If Sony does not believe that it is more likely than not that a tax benefit will be sustained, no tax benefit is recognized. However, Sony’s future results may include favorable or unfavorable adjustments to Sony’s estimated tax liabilities due to closure of income tax examinations, the outcome of negotiations between taxing authorities in different jurisdictions, new regulatory or judicial pronouncements or other relevant events. As a result, the amount of unrecognized tax benefits, and the effective tax rate, may fluctuate significantly.

The impact of the U.S. Tax Cuts and Jobs Act of 2017 (the “U.S. Tax Reform Act”) has been recorded on a provisional basis as defined in Staff Accounting Bulletin No. 118 (“SAB 118”) and additional guidance is to be issued by the U.S. Department of the Treasury on several provisions including the computation of the transition tax on historic foreign earnings. Additional guidance issued during the fiscal year ending March 31, 2019 could impact the information required for, and the calculation of, the transition tax charge. Further analysis performed and conclusions reached as part of the tax return filing process and the issuance of additional guidance related to the U.S. Tax Reform Act could affect the provisional amount recorded. Sony expects to complete its analysis of the impact of the U.S. Tax Reform Act no later than December 22, 2018.

Net income (loss) attributable to Sony Corporation’s stockholders per share (“EPS”) -

Basic EPS is computed based on the weighted-average number of shares of common stock outstanding during each period. The computation of diluted EPS reflects the maximum possible dilution from conversion, exercise, or contingent issuance of securities. All potentially dilutive securities are excluded from the calculation in a situation where there is a net loss attributable to Sony Corporation’s stockholders.

(2) Recently adopted accounting pronouncements

Simplifying the test for goodwill impairment -

In January 2017, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2017-04 to simplify the accounting for goodwill impairment. This ASU eliminates the second step from the goodwill impairment test. Instead, an entity should perform its annual or interim goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount and recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value, not to exceed the total amount of goodwill allocated to the reporting unit. Sony has early adopted this ASU in the fiscal year ended March 31, 2018. The adoption of this ASU did not have a material impact on Sony’s results of operations and financial position.

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(3) Recent accounting pronouncements not yet adopted

Revenue from contracts with customers -

In May 2014, the FASB issued ASU 2014-09 addressing revenue recognition which will supersede the current revenue recognition requirements, including most industry-specific guidance. The guidance requires an entity to recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services.

This guidance will be effective from the first quarter of Sony’s fiscal year beginning April 1, 2018. The guidance permits two methods of adoption: retrospectively to each prior period presented (“full retrospective method”), or retrospectively with the cumulative effect of initially applying the guidance recognized at the date of initial application (“modified retrospective method”). Sony will adopt this guidance using the modified retrospective method.

Sony has substantially completed its assessment of the impact of adopting this new guidance and does not expect that the adoption will have a material impact on Sony’s results of operations and financial position. Although Sony does not expect the impact of adopting the guidance to be material, there are several areas where Sony’s revenue recognition is expected to change as compared with historical U.S. GAAP. The more significant of these areas are as follows:

In the Pictures segment, (1) licensing revenue associated with certain renewals or extensions of existing agreements for motion pictures and television programming will be recognized at a later point in time, which is when the licensee can use and benefit from the content, instead of when the agreement is renewed or extended, and (2) licensing revenue associated with minimum guarantees for symbolic intellectual property (e.g., brands, trademarks and logos) will be recognized over the license term instead of at the inception of the license term.

In the MC segment, incremental costs of obtaining contracts for internet-related service business will be recognized as assets and amortized to expense over the contract period.

In addition, the ASU will change the presentation of certain items in the consolidated financial statements, such as sales returns, with no impact to the timing of the recognition of revenue or expense.

Recognition and measurement of financial assets and financial liabilities -

In January 2016, the FASB issued ASU 2016-01 amending various aspects of the recognition, measurement, presentation, and disclosure requirements for financial instruments. The changes mainly relate to the requirement to measure equity investments in unconsolidated subsidiaries, other than those accounted for under the equity method of accounting, at fair value with changes in fair value recognized in earnings. However, this ASU permits entities to elect to measure equity investments that do not have readily determinable fair values at cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer. This ASU will be effective for Sony as of April 1, 2018. As a result of the adoption of this ASU, Sony will reclassify the unrealized gains and losses, net of tax, on equity securities previously classified as available-for-sale, from accumulated other comprehensive income to retained earnings. Sony anticipates that the adoption of this ASU will increase the volatility of Sony’s other income (expenses), net, resulting from the remeasurement of Sony’s equity investments.

Leases -

In February 2016, the FASB issued ASU 2016-02, which amends current leasing guidance. The ASU requires substantially all leases to be recognized on the balance sheet. This ASU will be effective for Sony as of the fiscal year beginning April 1, 2019, and early adoption is permitted. The impact of this ASU on Sony’s results of operations and financial position is being evaluated.

Measurement of credit losses on financial instruments -

In June 2016, the FASB issued ASU 2016-13, which amends the accounting guidance for credit losses on financial instruments. The ASU requires the consideration of all available relevant information when estimating expected credit losses, including past events, current conditions and forecasts and their implications for expected credit losses. This ASU will be effective for Sony as of the fiscal year beginning April 1, 2020, with early adoption permitted for the first quarter of the fiscal year beginning April 1, 2019. The impact of this ASU on Sony’s results of operations and financial position is being evaluated.

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Classification of certain cash receipts and cash payments -

In August 2016, the FASB issued ASU 2016-15, which clarifies the classification of certain cash receipts and cash payments in the statement of cash flows. This guidance is effective from the first quarter of Sony’s fiscal year beginning April 1, 2018. Sony does not expect the impact on its consolidated financial statements to be material.

Intra-entity transfers of assets other than inventory -

In October 2016, the FASB issued ASU 2016-16, which amends the accounting for income taxes. This update requires recognition of the income tax consequences of an intra-entity transfer of assets other than inventory when the transfer occurs. Under current U.S. GAAP, recognition of the income tax consequences for asset transfers other than inventory cannot be recognized until the asset is sold to a third party. This ASU is required to be applied on a modified retrospective basis through a cumulative-effect adjustment to retained earnings as of the beginning of the period of adoption. This ASU will be effective for Sony as of the fiscal year beginning April 1, 2018. The adoption of this ASU is not expected to have a material impact on Sony’s results of operations and financial position.

Restricted cash -

In November 2016, the FASB issued ASU 2016-18, which requires that restricted cash and restricted cash equivalents be included with cash and cash equivalents in the statement of cash flows. This guidance also requires entities to disclose how the statement of cash flows that includes restricted cash and restricted cash equivalents with cash and cash equivalents reconciles to the balance sheet. The guidance is effective from the first quarter of Sony’s fiscal year beginning April 1, 2018. Sony does not expect the impact on its consolidated financial statements to be material.

Clarifying the definition of a business -

In January 2017, the FASB issued ASU 2017-01 which clarifies the definition of a business. The ASU requires an entity first to determine whether substantially all of the fair value of a set of assets acquired is concentrated in either a single identifiable asset or a group of similar identifiable assets. If this criterion is met, the acquired set of assets is not deemed to be a business. If the criterion is not met, the entity then must evaluate whether the set of assets meets the requirement to be deemed a business. To be considered a business, the acquired set of assets would have to include an input and a substantive process that together significantly contribute to the ability to create outputs. This ASU is effective for Sony as of the fiscal year beginning April 1, 2018. The adoption of this ASU is not expected to have a material impact on Sony’s results of operations and financial position.

Presentation of net periodic pension and postretirement benefit costs -

In March 2017, the FASB issued ASU 2017-07, which requires separate presentation of service costs and other components of net benefit costs. The service costs will only be presented with other employee compensation costs in operating income or capitalized, while the other components of net benefit costs will be presented outside of operating income, and will not be eligible for capitalization. This ASU will be effective for Sony as of the fiscal year beginning April 1, 2018. This ASU is required to be applied on a retrospective basis for the presentation of service costs and other components of net benefit costs, and on a prospective basis for the capitalization of only the service costs component of net benefit costs. The adoption of this ASU is not expected to have a material impact on Sony’s results of operations and financial position.

Premium amortization on purchased callable debt securities -

In March 2017, the FASB issued ASU 2017-08, which requires certain premiums on callable debt securities to be amortized to the earliest call date. The amortization period for callable debt securities purchased at a discount will not be affected. This ASU will be effective for Sony as of April 1, 2019. The impact of this ASU on Sony’s results of operations and financial position is being evaluated.

Targeted improvements to accounting for hedging activities -

In August 2017, the FASB issued ASU 2017-12, which made targeted improvements to the accounting for hedging activities. The amendments in this update simplify certain aspects of hedge accounting for both

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non-financial and financial risks and better align the recognition and measurement of hedge results with an entity’s risk management activities. This ASU also amends certain presentation and disclosure requirements for hedging activities and changes how an entity assesses hedge effectiveness. This ASU will be effective for Sony as of the fiscal year beginning April 1, 2019. The impact of this ASU on Sony’s results of operations and financial position is being evaluated.

(4) Reclassifications

Certain reclassifications of the financial statements and accompanying footnotes for the fiscal years ended March 31, 2016 and 2017 have been made to conform to the presentation for the fiscal year ended March 31, 2018.

(5) Out-of-period adjustments

For the fiscal year ended March 31, 2016, Sony recorded an out-of-period adjustment to correct an error in the amount of accruals for certain sales incentives being recorded at a subsidiary. The error began in the fiscal year ended March 31, 2009 and continued until it was identified by Sony during the fiscal year ended March 31, 2016. The adjustment, which related to the HE&S segment, impacted net sales and increased income before income taxes in the consolidated statements of income by 8,447 million yen for the fiscal year ended March 31, 2016. Sony determined that the adjustment was not material to the consolidated financial statements for the fiscal year ended March 31, 2016 or any prior periods.

3. Inventories

Inventories are comprised of the following:

	Yen in millions
	March 31
	2017		2018
Finished products		399,850		422,461
Work in process		140,718		153,257
Raw materials, purchased components and supplies		100,267		117,219
Inventories		640,835		692,937

4. Film costs

Film costs are comprised of the following:

	Yen in millions
	March 31
	2017			2018
Motion picture productions:
Released		80,539			81,755
Completed and not released		5,608			1,728
In production and development		94,197			78,868
Television productions:
Released		120,693			127,790
In production and development		7,707			1,174
Broadcasting rights		65,725			72,125
Less: current portion of broadcasting rights included in inventories		(37,541	)		(35,795	)
Film costs		336,928			327,645

Sony estimates that approximately 91% of the unamortized film costs of released motion picture and television productions at March 31, 2018 will be amortized within the next three years. Approximately 123 billion yen of completed film costs are expected to be amortized during the next twelve months. Approximately 158 billion yen of accrued participation liabilities included in accounts payable, other and accrued expenses are expected to be paid during the next twelve months.

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5. Investments in affiliated companies

The summarized combined financial information that is based on information provided by the equity investees including information for significant equity affiliates and the reconciliation of such information to the consolidated financial statements is shown below:

Balance Sheets

	Yen in millions
	March 31
	2017			2018
Current assets		361,492			404,658
Noncurrent assets		834,765			868,455
Current liabilities		248,450			273,067
Noncurrent liabilities and noncontrolling interests		761,546			768,007
Percentage of ownership in equity investees		20%-50	%		20%-50	%

Statements of Income

	Yen in millions
	Fiscal year ended March 31
	2016			2017			2018
Net revenues		358,256			387,229			468,933
Operating income		32,884			37,800			56,729
Net income attributable to controlling interests		8,388			11,529			27,301
Percentage of ownership in equity investees		20%-50	%		20%-50	%		20%-50	%

On June 29, 2012, an investor group which included a wholly-owned subsidiary of Sony Corporation completed its acquisition of EMI Music Publishing. To effect the acquisition, the investor group formed DH Publishing, L.P. (“DHP”), which acquired EMI Music Publishing for total consideration of 2.2 billion U.S. dollars. Sony invested 320 million U.S. dollars in DHP, through Nile Acquisition LLC, for a 39.8% equity interest. Nile Acquisition LLC is a joint venture with the third-party investor of Sony’s U.S.- based music publishing subsidiary in which Sony holds a 74.9% ownership interest. Sony accounts for its interest in DHP under the equity method. In addition, DHP entered into an agreement with Sony’s U.S.-based music publishing subsidiary in which the subsidiary provides administration services to DHP. DHP was determined to be a variable interest entity (“VIE”) as described in Note 23.

On January 30, 2017, Sony sold 17,302,700 shares of its 127,381,600 shares in its affiliated company M3, Inc. (“M3”) to a third party for cash consideration of 51,968 million yen, which is included within other in the investing activities section of the consolidated statements of cash flows. In connection with the sale, Sony’s share ownership decreased from 39.35% to 34.0% of the issued and outstanding shares of M3 and Sony recorded a gain of 37,167 million yen in other operating expense, net in the consolidated statements of income for the fiscal year ended March 31, 2017. Sony continues to account for its remaining interest in M3 under the equity method. Sony remains a major shareholder of M3 and will continue to pursue opportunities to collaborate with M3 in certain business areas, including medical.

The carrying value of Sony’s investment in M3 exceeded its proportionate share in the underlying net assets of M3 by 98,938 million yen at March 31, 2018. The excess is substantially attributable to the remeasurement to fair value of the remaining shares of M3, and allocated to identifiable tangible and intangible assets. The intangible assets relate primarily to M3’s medical web-portal. The unassigned residual value of the excess is recognized as goodwill as a component of the investment balance. The amounts allocated to intangible assets are amortized net of the related tax effects to equity in net income (loss) of affiliated companies over their respective estimated useful lives, principally 10 years, using the straight-line method.

With the exception of M3 as described above, there was no significant difference between Sony’s proportionate share in the underlying net assets of the investees and the carrying value of investments in affiliated companies at March 31, 2017 and 2018.

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Several affiliated companies are listed on the Tokyo Stock Exchange and Sony’s investments in these companies have an aggregate carrying value and fair value of 99,944 million yen and 533,932 million yen, respectively, as of March 31, 2018.

The number of affiliated companies accounted for under the equity method as of March 31, 2017 and 2018 were 109 and 107, respectively.

Account balances and transactions with affiliated companies accounted for under the equity method are presented below. There are no other material transactions or account balances with any other related parties.

	Yen in millions
	March 31
	2017		2018
Accounts receivable, trade		10,873		15,516
Accounts payable, trade		2,525		2,568
Short-term borrowings		20,650		22,849
Capital lease obligations		10,105		13,294

	Yen in millions
	Fiscal year ended March 31
	2016		2017		2018
Sales		33,569		31,238		45,415
Purchases		2,259		1,966		3,180
Lease payments		32,291		16,492		7,749

Sony entered into sale and leaseback transactions regarding certain machinery and equipment with SFI Leasing Company, Limited (“SFIL”), a leasing company in Japan, in the fiscal years ended March 31, 2016, 2017 and 2018. SFIL is accounted for under the equity method and is 34% owned by Sony. For the transactions with SFIL, refer to Note8.

MITSUI-SOKO Supply Chain Solutions, Inc. is accounted for under the equity method and is 34% owned by Sony as a result of the sale of the logistics business on April 1, 2015. As of the fiscal years ended March 31, 2017 and 2018, account balances with MITSUI-SOKO Supply Chain Solutions, Inc. and its subsidiaries were 4,922 million yen and 3,662 million yen, respectively, which are mainly included in accrued expenses. For the fiscal years ended March 31, 2017 and 2018, transactions were 13,752 million yen and 9,123 million yen, respectively, which are mainly included in general and administrative expenses. Refer to Note 25.

Dividends from affiliated companies accounted for under the equity method for the fiscal years ended March 31, 2016, 2017 and 2018 were 7,282 million yen, 7,970 million yen and 5,613 million yen, respectively.

6. Transfer of financial assets

Sony has established several accounts receivable sales programs mainly within the HE&S, IP&S and MC segments. Through these programs, Sony can sell receivables to a commercial bank or a special purpose entity associated with a sponsor bank. Total receivables sold during the fiscal years ended March 31, 2016, 2017 and 2018 were 53,267 million yen, 73,185 million yen and 84,718 million yen, respectively. These transactions are accounted for as sales in accordance with the accounting guidance for transfers of financial assets, because Sony has relinquished control of the receivables. Sony includes the sales proceeds from these receivables as cash flows within operating activities in the consolidated statement of cash flows because the receivables are the result of operating activities and are short term in nature. Gains and losses from these transactions were insignificant. Although Sony continues servicing the receivables subsequent to being sold or contributed, no servicing assets or liabilities are recorded as the costs of collection of the sold receivables and the income from servicing such receivables are insignificant.

Certain of the accounts receivable sales programs above also involve VIEs. Refer to Note 23.

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7. Marketable securities and securities investments

Marketable securities and securities investments, primarily included in the Financial Services segment, are comprised of debt and equity securities for which the aggregate cost, gross unrealized gains and losses and fair value pertaining to available-for-sale securities and held-to-maturity securities are as follows:

	Yen in millions
	March 31, 2017									March 31, 2018
	Cost		Gross unrealized gains		Gross unrealized losses			Fair value		Cost		Gross unrealized gains		Gross unrealized losses			Fair value
Available-for-sale:
Debt securities:
Japanese national government bonds		1,161,493		182,836		(928	)		1,343,401		1,227,139		182,830		(359	)		1,409,610
Japanese local government bonds		60,450		144		(63	)		60,531		67,574		107		(112	)		67,569
Japanese corporate bonds		163,785		7,864		(1,846	)		169,803		199,880		9,844		(1,016	)		208,708
Foreign government bonds		27,601		359		(918	)		27,042		72,204		622		(3,287	)		69,539
Foreign corporate bonds		396,097		4,168		(719	)		399,546		365,457		1,649		(641	)		366,465
Other		15,192		—		(0	)		15,192		99,349		1		(0	)		99,350
		1,824,618		195,371		(4,474	)		2,015,515		2,031,603		195,053		(5,415	)		2,221,241
Equity securities		55,928		69,937		(377	)		125,488		55,676		71,723		(776	)		126,623
Held-to-maturity securities:
Japanese national government bonds		5,661,191		1,520,904		(30,553	)		7,151,542		5,892,868		1,635,036		(20,890	)		7,507,014
Japanese local government bonds		4,101		449		—			4,550		3,850		413		—			4,263
Japanese corporate bonds		230,011		12,346		(22,071	)		220,286		345,818		16,912		(17,390	)		345,340
Foreign government bonds		253,019		5,269		(22,868	)		235,420		300,220		8,310		(18,570	)		289,960
Foreign corporate bonds		198		18		—			216		198		13		—			211
		6,148,520		1,538,986		(75,492	)		7,612,014		6,542,954		1,660,684		(56,850	)		8,146,788
Total		8,029,066		1,804,294		(80,343	)		9,753,017		8,630,233		1,927,460		(63,041	)		10,494,652

The following table presents the cost and fair value of debt securities classified as available-for-sale securities and held-to-maturity securities by contractual maturity:

	Yen in millions
	March 31, 2018
	Available-for-sale securities				Held-to-maturity securities
	Cost		Fair value		Cost		Fair value
Due in one year or less		125,037		125,290		3,249		3,269
Due after one year through five years		421,676		422,987		27,805		29,417
Due after five years through ten years		542,642		626,888		334,206		382,175
Due after ten years		942,248		1,046,076		6,177,694		7,731,927
Total		2,031,603		2,221,241		6,542,954		8,146,788

Proceeds from sales of available-for-sale securities were 315,043 million yen, 75,319 million yen and 39,982 million yen for the fiscal years ended March 31, 2016, 2017 and 2018, respectively. On these sales, gross realized gains were 67,205 million yen, 2,297 million yen and 1,257 million yen and gross realized losses were 186 million yen, 37 million yen and 2 million yen, respectively, for the fiscal years ended March 31, 2016, 2017 and 2018. Included in the gross realized gains of available-for-sale securities is 46,757 million yen from the sale of Olympus shares in the fiscal year ended March 31, 2016.

Marketable securities classified as trading securities, which consist of debt and equity securities held primarily in the Financial Services segment, totaled 921,320 million yen and 1,048,062 million yen as of March 31, 2017 and 2018, respectively. Sony recorded net unrealized losses of 45,841 million yen, net unrealized gains of 56,593 million yen, and net unrealized gains of 48,047 million yen for the fiscal years ended March 31

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2016, 2017 and 2018, respectively. Changes in the fair value of trading securities are primarily recognized in financial services revenue in the consolidated statements of income.

In the ordinary course of business, Sony maintains long-term investment securities, included in securities investments and other, issued by a number of non-public companies. The aggregate carrying amounts of the investments in non-public companies as of March 31, 2017 and 2018 totaled 61,323 million yen and 52,361 million yen, respectively. Non-public equity investments are primarily valued at cost as fair value is not readily determinable.

The following tables present the gross unrealized losses on, and fair value of, Sony’s investment securities with unrealized losses, aggregated by investment category and the length of time that individual investment securities have been in a continuous unrealized loss position, at March 31, 2017 and 2018.

	Yen in millions
	March 31, 2017
	Less than 12 months					12 months or more					Total
	Fair value		Unrealized losses			Fair value		Unrealized losses			Fair value		Unrealized losses
Available-for-sale:
Debt securities:
Japanese national government bonds		52,825		(909	)		2,018		(19	)		54,843		(928	)
Japanese local government bonds		3,793		(6	)		14,270		(57	)		18,063		(63	)
Japanese corporate bonds		53,302		(1,761	)		20,489		(85	)		73,791		(1,846	)
Foreign government bonds		10,258		(577	)		7,792		(341	)		18,050		(918	)
Foreign corporate bonds		27,944		(143	)		24,662		(576	)		52,606		(719	)
		148,122		(3,396	)		69,231		(1,078	)		217,353		(4,474	)
Equity securities		11,878		(370	)		9		(7	)		11,887		(377	)
Held-to-maturity securities:
Japanese national government bonds		277,328		(30,553	)		—		—			277,328		(30,553	)
Japanese local government bonds		—		—			—		—			—		—
Japanese corporate bonds		146,004		(22,071	)		—		—			146,004		(22,071	)
Foreign government bonds		196,740		(22,868	)		—		—			196,740		(22,868	)
Foreign corporate bonds		—		—			—		—			—		—
		620,072		(75,492	)		—		—			620,072		(75,492	)
Total		780,072		(79,258	)		69,240		(1,085	)		849,312		(80,343	)

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	Yen in millions
	March 31, 2018
	Less than 12 months					12 months or more					Total
	Fair value		Unrealized losses			Fair value		Unrealized losses			Fair value		Unrealized losses
Available-for-sale:
Debt securities:
Japanese national government bonds		10,118		(11	)		32,836		(348	)		42,954		(359	)
Japanese local government bonds		9,324		(11	)		14,729		(101	)		24,053		(112	)
Japanese corporate bonds		11,046		(10	)		64,119		(1,006	)		75,165		(1,016	)
Foreign government bonds		40,156		(2,281	)		7,752		(1,006	)		47,908		(3,287	)
Foreign corporate bonds		34,840		(69	)		21,191		(572	)		56,031		(641	)
Other		1,840		(0	)		315		(0	)		2,155		(0	)
		107,324		(2,382	)		140,942		(3,033	)		248,266		(5,415	)
Equity securities		13,859		(776	)		15		(0	)		13,874		(776	)
Held-to-maturity securities:
Japanese national government bonds		—		—			304,564		(20,890	)		304,564		(20,890	)
Japanese local government bonds		—		—			—		—			—		—
Japanese corporate bonds		—		—			174,815		(17,390	)		174,815		(17,390	)
Foreign government bonds		20,448		(704	)		134,230		(17,866	)		154,678		(18,570	)
Foreign corporate bonds		—		—			—		—			—		—
		20,448		(704	)		613,609		(56,146	)		634,057		(56,850	)
Total		141,631		(3,862	)		754,566		(59,179	)		896,197		(63,041	)

For the fiscal years ended March 31, 2016, 2017 and 2018, total realized impairment losses were 3,566 million yen, 7,566 million yen and 5,175 million yen, respectively.

At March 31, 2018, Sony determined that the decline in value for securities with unrealized losses shown in the above table is not other-than-temporary in nature.

8. Leases

Sony leases certain communication and commercial equipment, plant, office space, warehouses, employees’ residential facilities and other assets. Certain of these leases have renewal and purchase options. Sony has also entered into capital lease arrangements with third parties to finance certain of its motion picture productions, as well as sale and leaseback transactions for office buildings, machinery and equipment.

(1) Capital leases

Leased assets under capital leases are comprised of the following:

	Yen in millions
	March 31
Class of property	2017			2018
Machinery, equipment and others		66,722			82,260
Film costs		4,943			4,007
Accumulated amortization		(53,330	)		(58,861	)
		18,335			27,406

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The following is a schedule by fiscal year of the future minimum lease payments under capital leases together with the present value of the net minimum lease payments as of March 31, 2018:

Fiscal year ending March 31	Yen in millions
2019		12,326
2020		15,101
2021		8,787
2022		4,773
2023		3,573
Later fiscal years		12,424
Total minimum lease payments		56,984
Less — Amount representing interest		7,150
Present value of net minimum lease payments		49,834
Less — Current obligations		11,432
Long-term capital lease obligations		38,402

(2) Operating leases

The minimum rental payments required under operating leases that have initial or remaining noncancelable lease terms in excess of one year at March 31, 2018 are as follows:

Fiscal year ending March 31	Yen in millions
2019		57,810
2020		64,380
2021		38,495
2022		24,993
2023		20,280
Later fiscal years		81,305
Total minimum future rentals		287,263

Rental expenses under operating leases for the fiscal years ended March 31, 2016, 2017 and 2018 were 94,000 million yen, 77,976 million yen and 77,950 million yen, respectively. Sublease rentals received under operating leases for the fiscal years ended March 31, 2016, 2017 and 2018 were 1,138 million yen, 1,157 million yen and 1,325 million yen, respectively. The total minimum rentals to be received in the future under noncancelable subleases for operating leases as of March 31, 2018 were 2,792 million yen.

(3) Sale and leaseback transactions

Sale and leaseback transactions with SFIL -

Sony entered into sale and leaseback transactions regarding certain machinery and equipment with SFIL. In the fiscal years ended March 31, 2016, 2017 and 2018, transactions with total proceeds of 1,856 million yen, 2,679 million yen and 2,538 million yen, respectively and terms which averaged two years, have been accounted for as financings and are included within proceeds from issuance of long-term debt in the financing activities section of the consolidated statements of cash flows.

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9. Goodwill and other intangible assets

Intangible assets other than goodwill acquired during the fiscal year ended March 31, 2018 totaled 110,788 million yen, of which 110,781 million yen is subject to amortization, and are comprised of the following:

	Intangible assets acquired during the fiscal year		Weighted-average amortization period
	Yen in millions		Years
Patent rights, know-how and license agreements		16,003		4
Software to be sold, leased or otherwise marketed		16,066		3
Internal-use software		69,205		5
Other		9,507		7

In the fiscal year ended March 31, 2018, additions to internal-use software primarily related to the capitalization of new software across several business platforms.

Intangible assets subject to amortization are comprised of the following:

	Yen in millions
	March 31, 2017					March 31, 2018
	Gross carrying amount		Accumulated amortization			Gross carrying amount		Accumulated amortization
Patent rights, know-how and license agreements		317,337		(251,401	)		175,980		(142,724	)
Customer relationships		37,289		(15,585	)		18,881		(7,615	)
Trademarks		31,630		(15,554	)		16,310		(8,451	)
Software to be sold, leased or otherwise marketed		117,897		(86,661	)		123,269		(92,457	)
Internal-use software		473,750		(310,408	)		494,649		(315,516	)
Music catalogs		218,321		(95,367	)		207,789		(94,210	)
Artist contracts		31,393		(29,001	)		28,534		(27,650	)
Television carriage contracts (broadcasting agreements)		74,780		(21,986	)		74,258		(25,884	)
Other		62,212		(46,624	)		58,543		(47,586	)
Total		1,364,609		(872,587	)		1,198,213		(762,093	)

The aggregate amortization expense for intangible assets for the fiscal years ended March 31, 2016, 2017 and 2018 was 125,616 million yen, 121,634 million yen and 123,450 million yen, respectively. The estimated aggregate amortization expense for intangible assets for the next five fiscal years is as follows:

Fiscal year ending March 31	Yen in millions
2019		89,924
2020		73,516
2021		56,485
2022		39,050
2023		27,982

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Total carrying amount of intangible assets having an indefinite life are comprised of the following:

	Yen in millions
	March 31
	2017		2018
Trademarks		70,220		68,922
Distribution agreements		18,834		18,834
Other		3,109		3,292
Total		92,163		91,048

The changes in the carrying amount of goodwill by segment for the fiscal years ended March 31, 2017 and 2018 are as follows:

	Yen in millions
	G&NS			Music			Pictures			HE&S			IP&S			MC			Semiconductors			Financial Services			All Other			Total
Balance, March 31, 2016:
Goodwill — gross		152,293			162,078			221,517			5,320			8,637			179,331			49,621			3,020			31,536			813,353
Accumulated impairments		—			(306	)		—			(5,320	)		(300	)		(176,045	)		—			(706	)		(24,386	)		(207,063	)
Goodwill		152,293			161,772			221,517			—			8,337			3,286			49,621			2,314			7,150			606,290
Increase (decrease) due to:
Acquisitions*1		—			7,689			29,363			—			—			—			—			61			—			37,113
Sales and dispositions		—			—			(60	)		—			—			—			—			—			—			(60	)
Impairments		—			—			(112,069	)		—			—			—			—			—			—			(112,069	)
Translation adjustments		(355	)		(3,351	)		(598	)		—			(186	)		—			(77	)		—			(11	)		(4,578	)
Other		—			—			—			—			—			—			(1,475	)		—			(2,683	)		(4,158	)
Balance, March 31, 2017:
Goodwill — gross		151,938			166,416			246,085			5,320			8,451			179,331			48,069			3,081			28,842			837,533
Accumulated impairments		—			(306	)		(107,932	)		(5,320	)		(300	)		(176,045	)		—			(706	)		(24,386	)		(314,995	)
Goodwill		151,938			166,110			138,153			—			8,151			3,286			48,069			2,375			4,456			522,538
Increase (decrease) due to:
Acquisitions		—			2,877			12,842			—			1,204			—			—			4,850			—			21,773
Sales and dispositions		—			(121	)		—			—			—			—			—			—			—			(121	)
Impairments		—			—			—			—			—			—			—			—			—			—
Translation adjustments		(1,332	)		(3,472	)		(6,583	)		—			162			—			(1,072	)		—			(85	)		(12,382	)
Other		—			—			—			—			—			—			(1,204	)		—			(112	)		(1,316	)
Balance, March 31, 2018:
Goodwill — gross		150,606			165,700			246,620			5,320			9,817			179,331			45,793			7,931			27,912			839,030
Accumulated impairments		—			(306	)		(102,208	)		(5,320	)		(300	)		(176,045	)		—			(706	)		(23,653	)		(308,538	)
Goodwill		150,606			165,394			144,412			—			9,517			3,286			45,793			7,225			4,259			530,492

Sony realigned its business segments from the first quarter of the fiscal year ended March 31, 2018. As a result of this realignment, the operation of the former Components segment is now included in All Other. In connection with this realignment, the carrying amounts of associated goodwill for the former Components segment have been reclassified into All Other for the fiscal years ended March 31, 2016 and 2017. Refer to Note 28.

*1 Acquisitions for the fiscal year ended March 31, 2017 relate mainly to the TEN Sports Network acquisition in the Pictures segment. Refer to Note 24.

Impairment of goodwill in the Pictures segment -

During the fiscal year ended March 31, 2017, Sony made a downward revision in the future profitability projection for the Motion Pictures business within the Pictures segment primarily due to a lowering of previous expectations regarding the home entertainment business, mainly driven by an acceleration of market decline. The future profitability projection for the Motion Pictures business also reflected a reduction in underlying profitability projections of film performance largely mitigated by measures identified to improve the profitability of the Motion Pictures business.

Sony assessed the aforementioned events and circumstances and determined that it was more likely than not that the fair value of the Production & Distribution reporting unit (which includes the Motion Pictures and the Television Productions businesses) was less than its carrying value. Accordingly, Sony conducted the goodwill

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impairment tests using this new profitability projection and recalculated the implied fair value of the goodwill of the reporting unit. As a result of this recalculation, the carrying value of the goodwill was determined to be zero.

Consequently, the entire amount of the goodwill in the Production & Distribution reporting unit, 112,069 million yen, was impaired, in the fiscal year ended March 31, 2017. The impairment loss was included in other operating expense, net in the consolidated statements of income, and was recorded entirely within the Pictures segment.

10. Insurance-related accounts

Sony’s Financial Services segment subsidiaries in Japan maintain their accounting records as described in Note 2 in accordance with the accounting principles and practices generally accepted in Japan, which vary in some respects from U.S. GAAP.

Those differences are mainly that insurance acquisition costs for life and non-life insurance contracts are charged to income when incurred in Japan whereas in the U.S. those costs are deferred and amortized generally over the premium-paying period of the related insurance policies, and that future policy benefits for life insurance contracts calculated locally under the authorization of the supervisory administrative agencies are comprehensively adjusted using the net level premium method with certain adjustments of actuarial assumptions for U.S. GAAP purposes. For the purpose of preparing the consolidated financial statements, appropriate adjustments have been made to reflect the accounting for these items in accordance with U.S. GAAP.

The combined amounts of statutory net equity of the insurance subsidiaries, which is not measured in accordance with U.S. GAAP, as of March 31, 2017 and 2018 were 502,999 million yen and 525,976 million yen, respectively.

(1) Insurance policies

Life insurance policies that a subsidiary in the Financial Services segment underwrites, most of which are categorized as long-duration contracts, mainly consist of whole life, term life and accident and health insurance contracts. The life insurance revenues for the fiscal years ended March 31, 2016, 2017 and 2018 were 803,549 million yen, 754,242 million yen and 857,766 million yen, respectively. Property and casualty insurance policies that a subsidiary in the Financial Services segment underwrites are primarily automotive insurance contracts, which are categorized as short-duration contracts. The non-life insurance revenues for the fiscal years ended March 31, 2016, 2017 and 2018 were 93,928 million yen, 97,581 million yen and 105,497 million yen, respectively.

(2) Deferred insurance acquisition costs

Amortization of deferred insurance acquisition costs charged to income for the fiscal years ended March 31, 2016, 2017 and 2018 amounted to 92,203 million yen, 36,130 million yen and 68,137 million yen, respectively.

(3) Future insurance policy benefits

Liabilities for future policy benefits, which mainly relate to individual life insurance policies, are established in amounts adequate to meet the estimated future obligations of policies in force. These liabilities, which require significant management judgment and estimates, are computed by the net level premium method based upon the assumptions as to future investment yield, morbidity, mortality, withdrawals and other factors. Future policy benefits are computed using interest rates ranging from 1.0% to 4.5% and are based on factors such as market conditions and expected investment returns. Morbidity, mortality and withdrawal assumptions for all policies are based on either the subsidiary’s own experience or various actuarial tables. Generally these assumptions are locked-in throughout the life of the contract upon the issuance of new insurance, although significant changes in experience or assumptions may require Sony to provide for expected future losses. At March 31, 2017 and 2018, future insurance policy benefits amounted to 4,823,687 million yen and 5,211,421 million yen, respectively.

(4) Policyholders’ account in the life insurance business

Policyholders’ account in the life insurance business represents an accumulation of account deposits plus credited interest less withdrawals, expenses and mortality charges. Policyholders’ account includes universal life

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SONY CORPORATION AND CONSOLIDATED SUBSIDIARIES

insurance and investment contracts. Universal life insurance includes interest sensitive whole life contracts and variable contracts. The credited rates associated with interest sensitive whole life contracts range from 1.8% to 2.0%. For variable contracts, policy values are expressed in terms of investment units. Each unit is linked to an asset portfolio. The value of a unit increases or decreases based on the value of the linked asset portfolio. Investment contracts mainly include single payment endowment contracts, single payment educational endowment contracts, individual variable annuities and policies after the start of annuity payments. The credited rates associated with investment contracts, except for individual variable annuities, range from 0.01% to 6.3%. For individual variable annuities, policy values are expressed in terms of investment units. Each unit is linked to an asset portfolio. The value of a unit increases or decreases based on the value of the linked asset portfolio.

Policyholders’ account in the life insurance business is comprised of the following:

	Yen in millions
	March 31
	2017		2018
Universal life insurance		1,809,142		1,951,906
Investment contracts		686,182		738,404
Other		135,749		130,392
Total		2,631,073		2,820,702

11. Short-term borrowings and long-term debt

Short-term borrowings are comprised of the following:

	Yen in millions
	March 31
	2017		2018
Unsecured loans:
with a weighted-average interest rate of 7.29%		64,046
with a weighted-average interest rate of 3.95%				64,480
Secured loans:
with a weighted-average interest rate of 0.00%		20,000
with a weighted-average interest rate of 0.12%				27
Repurchase agreement:
with a weighted-average interest rate of 0.01%		310,609
with a weighted-average interest rate of 0.18%				335,586
Secured call money:
with a weighted-average interest rate of (0.08)%		70,000
with a weighted-average interest rate of (0.07)%				96,000
		464,655		496,093

At March 31, 2018, a certain subsidiary in the Financial Services segment pledged securities investments with a book value of 267,538 million yen as collateral for 335,586 million yen of short-term repurchase agreements. The repurchase agreement provides for net settlement upon a termination event.

At March 31, 2018, a certain subsidiary in the Financial Services segment pledged marketable securities and securities investments with a book value of 119,213 million yen as collateral for 96,000 million yen of secured call money.

In addition, certain subsidiaries in the Financial Services segment pledged marketable securities and securities investments with an aggregate book value of 9,618 million yen as collateral for cash settlements, variation margins of futures markets and certain other purposes.

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Long-term debt is comprised of the following:

	Yen in millions
	March 31
	2017		2018
Unsecured loans, representing obligations principally to banks:
Due 2017 to 2024, with interest rates ranging from 0.24% to 5.10% per annum		63,248
Due 2018 to 2024, with interest rates ranging from 0.01% to 5.10% per annum				49,454
Unsecured 0.43% bonds, due 2018		10,000
Unsecured 0.86% bonds, due 2018		150,000		150,000
Unsecured 2.00% bonds, due 2018		16,300		16,300
Unsecured 0.05% bonds, due 2019		69,793		69,879
Unsecured 2.07% bonds, due 2019		50,000		50,000
Unsecured 0.23% bonds, due 2021		89,670		89,744
Unsecured 0.11% bonds, due 2022				10,000
Unsecured 1.41% bonds, due 2022		10,000		10,000
Unsecured 0.28% bonds, due 2023		15,000		15,000
Unsecured 0.22% bonds, due 2025				10,000
Unsecured 0.42% bonds, due 2026		24,887		24,899
Unsecured zero coupon convertible bonds, due 2022		120,000		119,976
Secured 0.00% loans, due 2019 to 2020		70,000
Secured 0.00% loans, due 2019 to 2022				170,002
Capital lease obligations and other:
Due 2017 to 2027, with interest rates ranging from 0.36% to 8.90% per annum		34,224
Due 2018 to 2047, with interest rates ranging from 0.36% to 11.88% per annum				52,929
Guarantee deposits received		11,764		10,790
		734,886		848,973
Less — Portion due within one year		53,424		225,522
		681,462		623,451

At March 31, 2018, a certain subsidiary in the Financial Services segment pledged marketable securities and securities investments with a book value of 38,375 million yen and housing loans with a book value of 306,589 million yen as collateral for a 170,000 million yen long-term secured loan.

In March 2012, Sony executed a 1,365 million U.S. dollar unsecured bank loan with a group of lenders having six to ten year maturity terms in connection with Sony’s acquisition of Ericsson’s 50% equity interest in Sony Ericsson. This bank loan utilizes the Japan Bank for International Cooperation Facility, which was established to facilitate overseas mergers and acquisitions by Japanese companies as a countermeasure against yen appreciation. The terms of this U.S. dollar loan require accelerated repayment of the entire outstanding balance if Sony Corporation or its wholly-owned subsidiaries discontinue the business of mobile devices featuring telephone functionality. In March 2016, Sony repaid 682 million U.S. dollars of the 1,365 million U.S. dollars. In September 2016, Sony repaid the remaining 683 million U.S. dollars.

On July 21, 2015, Sony issued 120,000 million yen of 130% callable unsecured zero coupon convertible bonds with stock acquisition rights due 2022 (the “Zero Coupon Convertible Bonds”). The bondholders are entitled to stock acquisition rights effective from September 1, 2015 to September 28, 2022. The initial conversion price is 5,008 yen per common share. In addition to the standard anti-dilution provisions, the conversion price is reduced for a certain period before an early redemption triggered upon the occurrence of certain corporate events including a merger, corporate split and delisting event. The reduced amount of the conversion price will be determined by a formula that is based on the effective date of the reduction and Sony’s common stock price. The reduced conversion price ranges from 3,526.5 yen to 5,008.0 yen per common share. The conversion price is also adjusted for dividends in excess of 25 yen per common share per fiscal year. Sony has the option to redeem all of the Zero Coupon Convertible Bonds outstanding at 100% of the principal amount after July 21, 2020, if the closing sales price per share of Sony’s common stock on the Tokyo Stock Exchange is 130% or more of the conversion price of the Zero Coupon Convertible Bonds for 20 consecutive trading days.

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Sony was not required to bifurcate any of the embedded features contained in the Zero Coupon Convertible Bonds for accounting purposes. There are no significant adverse debt covenants under the Zero Coupon Convertible Bonds.

In September 2016, Sony issued unsecured straight bonds in the aggregate principal amount of 200,000 million yen. The proceeds from the issuance of the bonds have been applied to the repayment of borrowings and debt.

There are no significant adverse debt covenants or cross-default provisions related to the other short-term borrowings and long-term debt.

Aggregate amounts of annual maturities of long-term debt are as follows:

Fiscal year ending March 31	Yen in millions
2019		225,522
2020		155,490
2021		58,620
2022		204,428
2023		16,437
Later fiscal years		188,476
Total		848,973

At March 31, 2018, Sony had unused committed lines of credit amounting to 459,860 million yen and can generally borrow up to 180 days from the banks with whom Sony has committed line contracts. Furthermore, at March 31, 2018, Sony has commercial paper programs totaling 818,720 million yen. Sony can issue commercial paper for a period generally not in excess of 270 days up to the size of the programs.

12. Housing loans and deposits from customers in the banking business

(1) Housing loans in the banking business

Sony acquires and holds certain financial receivables in the normal course of business. The majority of financing receivables held by Sony consists of housing loans in the banking business and no other significant financial receivables exist.

A subsidiary in the banking business monitors the credit quality of housing loans based on the classification set by the financial conditions and the past due status of individual obligors. Past due status is monitored on a daily basis and the aforementioned classification is reviewed on a quarterly basis.

The allowance for the credit losses is established based on the aforementioned classifications and the evaluation of collateral. The amount of housing loans in the banking business and the corresponding allowance for credit losses as of March 31, 2017 were 1,449,790 million yen and 866 million yen, respectively, and as of March 31, 2018 were 1,522,415 million yen and 717 million yen, respectively. During the fiscal years ended March 31, 2017 and 2018, charge-offs on housing loans in the banking business and changes in the allowance for credit losses were not significant.

The balance of housing loans placed on nonaccrual status or past due status were not significant as of March 31, 2017 and 2018.

(2) Deposits from customers in the banking business

All deposits from customers in the banking business within the Financial Services segment are interest bearing deposits. At March 31, 2017 and 2018, the balances of time deposits issued in amounts of 10 million yen or more were 275,638 million yen and 279,943 million yen, respectively. These amounts have been classified as current liabilities mainly due to the ability of the customers to make withdrawals prior to maturity.

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At March 31, 2018, aggregate amounts of annual maturities of time deposits with a remaining term of more than one year are as follows:

Fiscal year ending March 31	Yen in millions
2020		39,058
2021		19,395
2022		9,120
2023		11,295
2024		9,736
Later fiscal years		19,203
Total		107,807

13. Fair value measurements

As discussed in Note 2, assets and liabilities subject to the accounting guidance for fair value measurements held by Sony are classified and accounted for as described below.

(1) Assets and liabilities that are measured at fair value on a recurring basis

The following section describes the valuation techniques used by Sony to measure different financial instruments at fair value, including an indication of the level in the fair value hierarchy in which each instrument is generally classified.

Trading securities, available-for-sale securities and other investments

Where quoted prices are available in an active market, securities are classified in level 1 of the fair value hierarchy. Level 1 securities include exchange-traded equities. If quoted market prices are not available for the specific security or the market is inactive, then fair values are estimated by using pricing models, quoted prices of securities with similar characteristics or discounted cash flows and mainly classified in level 2 of the hierarchy. Level 2 securities include debt securities with quoted prices that are traded less frequently than exchange-traded instruments, such as the majority of government bonds and corporate bonds. In certain cases where there is limited activity or less transparency around inputs to the valuation, securities are classified within level 3 of the fair value hierarchy. Level 3 securities primarily include certain hybrid financial instruments and certain private equity investments not classified within level 1 or level 2.

Derivatives

Exchange-traded derivatives valued using quoted prices are classified within level 1 of the fair value hierarchy. However, few classes of derivative contracts are listed on an exchange; thus, the majority of Sony’s derivative positions are valued using internally developed models that use as their basis readily observable market parameters — i.e., parameters that are actively quoted and can be validated to external sources, including industry pricing services. Depending on the types and contractual terms of derivatives, fair value can be modeled using a series of techniques, such as the Black-Scholes option pricing model, which are consistently applied. Where derivative products have been established for some time, Sony uses models that are widely accepted in the financial services industry. These models reflect the contractual terms of the derivatives, including the period to maturity, and market-based parameters such as interest rates, volatility, and the credit rating of the counterparty. Further, many of these models do not contain a high level of subjectivity as the techniques used in the models do not require significant judgment, and inputs to the model are readily observable from actively quoted markets. Such instruments are generally classified within level 2 of the fair value hierarchy.

In determining the fair value of Sony’s interest rate swap derivatives, Sony uses the present value of expected cash flows based on market observable interest rate yield curves commensurate with the term of each instrument. For foreign currency derivatives, Sony’s approach is to use forward contract and option valuation models employing market observable inputs, such as spot currency rates, time value and option volatilities. These derivatives are classified within level 2 since Sony primarily uses observable inputs in its valuation of its derivative assets and liabilities.

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The fair value of Sony’s assets and liabilities that are measured at fair value on a recurring basis at March 31, 2017 and 2018 are as follows:

	Yen in millions
	March 31, 2017
									Presentation in the consolidated balance sheets
	Level 1		Level 2		Level 3		Total		Marketable securities		Securities investments and other		Other current assets/ liabilities		Other noncurrent assets/ liabilities
Assets:
Trading securities		611,108		310,212		—		921,320		921,320		—		—		—
Available-for-sale securities
Debt securities
Japanese national government bonds		—		1,343,401		—		1,343,401		18,483		1,324,918		—		—
Japanese local government bonds		—		60,531		—		60,531		8,518		52,013		—		—
Japanese corporate bonds		—		168,493		1,310		169,803		8,433		161,370		—		—
Foreign government bonds*1		—		27,042		—		27,042		1,007		26,035		—		—
Foreign corporate bonds*2		—		358,369		41,177		399,546		86,708		312,838		—		—
Other*3		—		—		15,192		15,192		—		15,192		—		—
Equity securities		125,306		182		—		125,488		—		125,488		—		—
Other investments*4		6,589		4,525		10,483		21,597		—		21,597		—		—
Derivative assets*5		981		26,279		—		27,260		—		—		25,409		1,851
Total assets		743,984		2,299,034		68,162		3,111,180		1,044,469		2,039,451		25,409		1,851
Liabilities:
Derivative liabilities*5		520		33,930		—		34,450		—		—		15,743		18,707
Total liabilities		520		33,930		—		34,450		—		—		15,743		18,707

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	Yen in millions
	March 31, 2018
									Presentation in the consolidated balance sheets
	Level 1		Level 2		Level 3		Total		Marketable securities		Securities investments and other		Other current assets/ liabilities		Other noncurrent assets/ liabilities
Assets:
Trading securities		712,113		335,949		—		1,048,062		1,048,062		—		—		—
Available-for-sale securities
Debt securities
Japanese national government bonds		—		1,409,610		—		1,409,610		20,473		1,389,137		—		—
Japanese local government bonds		—		67,569		—		67,569		8,548		59,021		—		—
Japanese corporate bonds		—		208,708		—		208,708		8,041		200,667		—		—
Foreign government bonds*1		—		69,539		—		69,539		—		69,539		—		—
Foreign corporate bonds*2		—		338,587		27,878		366,465		88,228		278,237		—		—
Other*3		—		15,736		83,614		99,350		—		99,350		—		—
Equity securities		126,330		293		—		126,623		—		126,623		—		—
Other investments*4		6,192		5,099		9,104		20,395		—		20,395		—		—
Derivative assets*5		2,194		37,332		—		39,526		—		—		37,003		2,523
Total assets		846,829		2,488,422		120,596		3,455,847		1,173,352		2,242,969		37,003		2,523
Liabilities:
Derivative liabilities*5		1,407		34,317		—		35,724		—		—		20,550		15,174
Total liabilities		1,407		34,317		—		35,724		—		—		20,550		15,174

*1 2,215 million yen and 2,875 million yen are included in foreign securities for which the fair value option has been elected and classified in level 2 for the fiscal years ended March 31, 2017 and 2018, respectively, and are included in the consolidated balance sheets as securities investments and other.

*2 165,236 million yen and 160,470 million yen are included in foreign securities for which the fair value option has been elected and classified in level 2 for the fiscal years ended March 31, 2017 and 2018, respectively. In the consolidated balance sheets, 32,167 million yen and 25,955 million yen are included as marketable securities and 133,069 million yen and 134,515 million yen are included as securities investment and other for the fiscal years ended March 31, 2017 and 2018, respectively.

*3 14,619 million yen and 93,971 million yen are included in foreign securities for which the fair value option has been elected and classified in level 2 and level 3 for the fiscal years ended March 31, 2017 and 2018, respectively, and are included in the consolidated balance sheets as securities investments and other.

*4 Other investments include certain hybrid financial instruments and certain private equity investments.

*5 Derivative assets and liabilities are recognized and disclosed on a gross basis.

*6 Net gains of 502 million yen and 544 million yen arising from financial instruments for which the fair value option has been elected are included in financial services revenue in the consolidated statements of income for the fiscal years ended March 31, 2017 and 2018, respectively.

Transfers into level 1 were 2,833 million yen and 3,522 million yen for the fiscal years ended March 31, 2017 and 2018, respectively, as quoted prices for certain trading securities and available-for-sale securities became available in an active market. Transfers out of level 1 were 3,103 million yen and 3,086 million yen for the fiscal years ended March 31, 2017 and 2018, respectively, as quoted prices for certain trading securities and available-for-sale securities were not available in an active market.

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The changes in fair value of level 3 assets and liabilities for the fiscal years ended March 31, 2017 and 2018 are as follows:

	Yen in millions
	Fiscal year ended March 31, 2017
	Assets
	Available-for-sale securities
	Debt securities
	Japanese corporate bonds			Foreign corporate bonds			Other			Other investments
Beginning balance		3,346			15,853			884			13,463
Total realized and unrealized gains (losses):
Included in earnings*1		—			1,091			514			328
Included in other comprehensive income (loss)*2		(20	)		(84	)		(1	)		(2,416	)
Purchases		—			35,335			14,026			247
Sales		—			—			—			—
Settlements		—			(10,021	)		(231	)		(1,139	)
Transfers into level 3*3		—			1,008			—			—
Transfers out of level 3*4		(2,016	)		(2,005	)		—			—
Ending balance		1,310			41,177			15,192			10,483
Changes in unrealized gains (losses) relating to instruments still held at reporting date:
Included in earnings*1		—			11			79			(27	)
	Yen in millions
	Fiscal year ended March 31, 2018
	Assets
	Available-for-sale securities
	Debt securities
	Japanese corporate bonds			Foreign corporate bonds			Other			Other investments
Beginning balance		1,310			41,177			15,192			10,483
Total realized and unrealized gains (losses):
Included in earnings*1		—			(307	)		(3,032	)		(65	)
Included in other comprehensive income (loss)*2		—			(84	)		1			(489	)
Purchases		—			12,604			74,736			139
Sales		—			—			—			(10	)
Settlements		—			(18,540	)		(3,283	)		(954	)
Transfers into level 3*3		—			—			—			—
Transfers out of level 3*4		(1,310	)		(6,972	)		—			—
Ending balance		—			27,878			83,614			9,104
Changes in unrealized gains (losses) relating to instruments still held at reporting date:
Included in earnings*1		—			(468	)		(2,278	)		(65	)

*1 Earning effects are included in financial services revenue in the consolidated statements of income.

*2 Unrealized gains (losses) are included in unrealized gains (losses) on securities in the consolidated statements of comprehensive income.

*3 Certain corporate bonds were transferred into level 3 because differences between the fair value determined by indicative quotes from dealers and the fair value determined by internally developed prices became significant and the observability of the inputs used decreased.

*4 Certain corporate bonds were transferred out of level 3 because observable market data became available.

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Level 3 assets include certain private equity investments, and certain domestic and foreign corporate bonds for which quoted prices are not available in a market and where there is less transparency around inputs. In determining the fair value of such assets, Sony uses third-party information such as indicative quotes from dealers without adjustment. For validating the fair values, Sony primarily uses internal models which include management judgment or estimation of assumptions that market participants would use in pricing the asset.

(2) Assets and liabilities that are measured at fair value on a nonrecurring basis

Sony also has assets and liabilities that are required to be remeasured to fair value on a nonrecurring basis when certain circumstances occur. During the fiscal years ended March 31, 2017 and 2018, such remeasurements to fair value related primarily to the following:

	During the fiscal year ended March 31, 2017
	Estimated fair value						Amounts included in earnings
	Level 1		Level 2		Level 3
Assets:
Long-lived assets impairments		—		—		72		(39,137	)
Goodwill impairments		—		—		0		(112,069	)
								(151,206	)
	During the fiscal year ended March 31, 2018
	Estimated fair value						Amounts included in earnings
	Level 1		Level 2		Level 3
Assets:
Long-lived assets impairments		—		—		19,375		(53,741	)
								(53,741	)

Long-lived assets impairments

Sony recorded an impairment loss of 30,643 million yen for the fiscal year ended March 31, 2016, included within All Other, related to long-lived assets in the battery business asset group. In the fiscal year ended March 31, 2016, due to increasingly competitive markets, Sony conducted a further strategic review of the business and evolving market trends. Following this review, Sony further reduced the corresponding estimated future cash flows of this business and the estimated ability to recover the entire carrying amount of the long-lived assets within the period applicable to the impairment determination, resulting in an impairment charge.

Sony recorded impairment losses of 59,616 million yen and 23,860 million yen for the fiscal years ended March 31, 2016 and 2017, respectively, included within the Semiconductors segment, related to long-lived assets in the camera module business asset group. Due to a decrease in the projected future demand of camera modules, Sony conducted a strategic review of the business and its market conditions. Following this review, Sony reduced the corresponding estimated future cash flows and the estimated ability to recover the entire carrying amount of the long-lived assets within the period applicable to the impairment determination, resulting in an impairment charge for the fiscal year ended March 31, 2016. Sony decided to halt all development and production of high-functionality camera modules for external sales during the fiscal year ended March 31, 2017.

Sony recorded an impairment loss of 31,341 million yen for the fiscal year ended March 31, 2018, included within the MC segment, related to long-lived assets in the smartphone business asset group. Due to smartphone sales results and changes in the business environment since January 2018, Sony conducted a strategic review of its future profitability forecast for the smartphone business. Following this review, Sony reduced the corresponding estimated future cash flows of this business and the estimated ability to recover the entire carrying amount of the long-lived assets within the period applicable to the impairment determination, resulting in an impairment charge for the fiscal year ended March 31, 2018.

These measurements are classified as level 3 because significant unobservable inputs, such as the condition of the assets or projections of future cash flows, the timing of such cash flows and the discount rate reflecting the risk inherent in future cash flows, were considered in the fair value measurements. For the fiscal year ended March 31, 2016, a discount rate of 10% and projected revenue growth rates ranging from zero to 14% were used

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in the fair value measurements related to the long-lived assets for the battery business and a discount rate of 10% and projected revenue growth rates ranging from zero to 108% were used in the fair value measurements related to the long-lived assets for the camera module business. The high end of the camera module revenue growth rate reflects projected revenue from the introduction of new products in the near term. For the fiscal year ended March 31, 2017, a discount rate of 10% and projected declining revenue rates ranging from (1)% to 8% were used in the fair value measurements related to the long-lived assets for the camera module business. For the fiscal year ended March 31, 2018, a discount rate of 8.5% and projected revenue growth rates ranging from (8)% to 6% were used in the fair value measurements related to the long-lived assets for the smartphone business.

Goodwill impairments

Sony recorded an impairment loss of 112,069 million yen during the fiscal year ended March 31, 2017 against the goodwill of the Production & Distribution reporting unit in the Pictures segment. Refer to Note 9. Sony’s determination of the estimated fair value of the reporting unit was based on the present value of expected future cash flows including a terminal value which is based on an exit price using an earnings multiple applied to the final year of the forecasted earnings, and which also takes into consideration a control premium. These measurements are classified as level 3 because significant unobservable inputs, such as the projections of future cash flows, the timing of such cash flows, the earnings multiple, the growth rates beyond the forecast and mid-range plan periods, and the discount rate reflecting the risk inherent in future cash flows, were considered in the fair value measurements. An earnings multiple of 9.0x, growth rates beyond the forecast and mid-range plan periods ranging from 3.0% to 4.5% and a discount rate of 9.5% were used in the fair value measurement.

(3) Financial instruments

The estimated fair values by fair value hierarchy level of certain financial instruments that are not reported at fair value are summarized as follows:

	Yen in millions
	March 31, 2017
	Estimated fair value								Carrying amount
	Level 1		Level 2		Level 3		Total		Total
Assets:
Housing loans in the banking business		—		1,603,784		—		1,603,784		1,449,790
Total assets		—		1,603,784		—		1,603,784		1,449,790
Liabilities:
Long-term debt including the current portion		—		745,599		—		745,599		734,886
Investment contracts included in policyholders’ account in the life insurance business		—		710,191		—		710,191		686,182
Total liabilities		—		1,455,790		—		1,455,790		1,421,068

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	Yen in millions
	March 31, 2018
	Estimated fair value								Carrying amount
	Level 1		Level 2		Level 3		Total		Total
Assets:
Housing loans in the banking business		—		1,686,842		—		1,686,842		1,522,415
Total assets		—		1,686,842		—		1,686,842		1,522,415
Liabilities:
Long-term debt including the current portion		—		877,576		—		877,576		848,973
Investment contracts included in policyholders’ account in the life insurance business		—		766,558		—		766,558		738,404
Total liabilities		—		1,644,134		—		1,644,134		1,587,377

The summary excludes cash and cash equivalents, call loans, time deposits, notes and accounts receivable, trade, call money, short-term borrowings, notes and accounts payable, trade and deposits from customers in the banking business because the carrying values of these financial instruments approximated their fair values due to their short-term nature. The summary also excludes held-to-maturity securities disclosed in Note 7.

Cash and cash equivalents, call loans and call money are classified in level 1. Time deposits, short-term borrowings, deposits from customers in the banking business are classified in level 2. Held-to-maturity securities, included in marketable securities and securities investments and other in the consolidated balance sheets, primarily include debt securities with quoted prices that are traded less frequently than exchange-traded instruments, such as the majority of government bonds and corporate bonds and are substantially all classified in level 2. The fair values of housing loans in the banking business, included in securities investments and other in the consolidated balance sheets, were estimated based on the discounted future cash flows using interest rates reflecting London Interbank Offered Rate base yield curves with certain risk premiums. The fair values of long-term debt including the current portion and investment contracts included in policyholders’ account in the life insurance business were estimated based on either the market value or the discounted future cash flows using Sony’s current incremental borrowing rates for similar liabilities.

14. Derivative instruments and hedging activities

Sony has certain financial instruments including financial assets and liabilities acquired in the normal course of business. Such financial instruments are exposed to market risk arising from the changes in foreign currency exchange rates and interest rates. In applying a consistent risk management strategy for the purpose of reducing such risk, Sony uses derivative financial instruments, which include foreign exchange forward contracts, foreign currency option contracts, and interest rate swap agreements (including interest rate and currency swap agreements). Certain other derivative financial instruments are entered into in the Financial Services segment for asset-liability management (“ALM”) purposes. These instruments are executed with creditworthy financial institutions, and virtually all foreign currency contracts are denominated in U.S. dollars, euros and other currencies of major countries. These derivatives generally mature or expire within six months after the balance sheet date. Other than derivatives utilized in the Financial Services segment for ALM, Sony does not use derivative financial instruments for trading or speculative purposes. These derivative transactions utilized for ALM in the Financial Services segment are executed within certain limits in accordance with an internal risk management policy.

Derivative financial instruments held by Sony are classified and accounted for as described below.

Fair value hedges

Both the derivatives designated as fair value hedges and the hedged items are reflected at fair value in the consolidated balance sheets. Changes in the fair value of the derivatives designated as fair value hedges, as well as offsetting changes in the carrying value of the underlying hedged items, are recognized in income. For the

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fiscal years ended March 31, 2016, 2017 and 2018, these fair value hedges were fully effective. In addition, there were no amounts excluded from the assessment of hedge effectiveness of fair value hedges.

Cash flow hedges

Changes in the fair value of derivatives designated as cash flow hedges are initially recorded in other comprehensive income (“OCI”) and reclassified into earnings when the hedged transaction affects earnings. For the fiscal year ended March 31, 2016, the ineffective portions of the hedging relationships were not significant. For the fiscal year ended March 31, 2017 and 2018, these cash flow hedges were fully effective. In addition, there were no amounts excluded from the assessment of hedge effectiveness for cash flow hedges.

Derivatives not designated as hedges

Changes in the fair value of derivatives not designated as hedges are recognized in income.

A description of the purpose and classification of the derivative financial instruments held by Sony is as follows:

Foreign exchange forward contracts and foreign currency option contracts

Foreign exchange forward contracts and purchased and written foreign currency option contracts are utilized primarily to limit the exposure affected by changes in foreign currency exchange rates on cash flows generated or anticipated by Sony’s transactions and accounts receivable and payable denominated in foreign currencies. The majority of written foreign currency option contracts are a part of range forward contract arrangements and expire in the same month with the corresponding purchased foreign currency option contracts.

Sony also entered into foreign exchange forward contracts which effectively fixed the cash flows from certain foreign currency denominated payables. Accordingly, these derivatives have been designated as cash flow hedges.

Foreign exchange forward contracts and foreign currency option contracts that do not qualify as hedges are marked-to-market with changes in value recognized in other income and expenses.

Foreign exchange forward contracts, foreign currency option contracts and currency swap agreements held by certain subsidiaries in the Financial Services segment are marked-to-market with changes in value recognized in financial services revenue.

Interest rate swap agreements (including interest rate and currency swap agreements)

Interest rate swap agreements are utilized primarily to lower funding costs, to diversify sources of funding and to limit Sony’s exposure associated with underlying debt instruments and available-for-sale debt securities resulting from adverse fluctuations in interest rates, foreign currency exchange rates and changes in fair values.

Interest rate swap agreements entered into in the Financial Services segment are used for reducing the risk arising from the changes in the fair value of fixed rate available-for-sale debt securities. These derivatives are considered to be a hedge against changes in the fair value of available-for-sale debt securities in the Financial Services segment. Accordingly, these derivatives have been designated as fair value hedges.

Certain subsidiaries in the Financial Services segment have interest rate swap agreements as part of their ALM, which are marked-to-market with changes in value recognized in financial service revenues.

Any other interest rate swap agreements that do not qualify as hedges, which are used for reducing the risk arising from changes of variable rate debt, are marked-to-market with changes in value recognized in other income and expenses.

Other agreements

Certain subsidiaries in the Financial Services segment have equity future contracts, other currency contracts and hybrid financial instruments as part of their ALM, which are marked-to-market with changes in value recognized in financial services revenue. The hybrid financial instruments, disclosed in Note 7 as debt securities, contained embedded derivatives that are not required to be bifurcated because the entire instruments are carried at fair value.

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The estimated fair values of Sony’s outstanding derivative instruments are summarized as follows:

Derivatives designated as hedging instruments	Yen in millions
	Balance sheet location	Fair value				Balance sheet location	Fair value
		March 31					March 31
	Asset derivatives	2017		2018		Liability derivatives	2017		2018
Interest rate contracts	Prepaid expenses and other current assets		43		12	Current liabilities: Other		497		160
Interest rate contracts	Other assets: Other		95		286	Liabilities: Other		13,713		10,281
Foreign exchange contracts	Prepaid expenses and other current assets		—		48	Current liabilities: Other		31		1,535
			138		346			14,241		11,976
Derivatives not designated as hedging instruments	Yen in millions
	Balance sheet location	Fair value				Balance sheet location	Fair value
		March 31					March 31
	Asset derivatives	2017		2018		Liability derivatives	2017		2018
Interest rate contracts	Prepaid expenses and other current assets		3		12	Current liabilities: Other		221		299
Interest rate contracts	Other assets: Other		1,599		1,871	Liabilities: Other		4,374		3,612
Foreign exchange contracts	Prepaid expenses and other current assets		24,382		34,737	Current liabilities: Other		14,475		17,149
Foreign exchange contracts	Other assets: Other		157		366	Liabilities: Other		620		1,281
Equity contracts	Prepaid expenses and other current assets		981		2,194	Current liabilities: Other		519		1,407
			27,122		39,180			20,209		23,748
Total derivatives			27,260		39,526			34,450		35,724

Presented below are the effects of derivative instruments on the consolidated statements of income for the fiscal years ended March 31, 2016, 2017 and 2018.

Derivatives under fair value hedging relationships	Yen in millions
	Location of gain or (loss) recognized in income on derivative	Amount of gain or (loss) recognized in income on derivative
		Fiscal year ended March 31
		2016			2017			2018
Interest rate contracts	Financial services revenue		(8,300	)		1,967			(52	)
Foreign exchange contracts	Foreign exchange loss, net		3			(31	)		—
Total			(8,297	)		1,936			(52	)
	Yen in millions
Derivatives under cash flow hedging relationships	Location of gain or (loss) recognized in income on derivative	Fiscal year ended March 31
		2016			2017			2018
		Amount of gain or (loss) recognized in OCI on derivative
Foreign exchange contracts	—		1,914			6,715			(2,295	)
Total			1,914			6,715			(2,295	)
		Amount of gain or (loss) reclassified from accumulated OCI into income (effective portion)
Foreign exchange contracts	Foreign exchange loss, net		(8	)		—			—
Foreign exchange contracts	Cost of sales		(3,104	)		(5,583	)		1,111
Total			(3,112	)		(5,583	)		1,111

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Derivatives not designated as hedging instruments	Yen in millions
	Location of gain or (loss) recognized in income on derivative	Amount of gain or (loss) recognized in income on derivative
		Fiscal year ended March 31
		2016			2017			2018
Interest rate contracts	Financial services revenue		(5,499	)		(935	)		(1,544	)
Foreign exchange contracts	Financial services revenue		4,166			(5,365	)		2,013
Foreign exchange contracts	Foreign exchange loss, net		(14,501	)		12,339			21,370
Equity contracts	Financial services revenue		3,267			(18,597	)		(11,665	)
Total			(12,567	)		(12,558	)		10,174

The following table summarizes additional information, including notional amounts, for each type of derivative:

	Yen in millions
	March 31, 2017					March 31, 2018
	Notional amount		Fair value			Notional amount		Fair value
Foreign exchange contracts:
Foreign exchange forward contracts		1,062,933		3,011			1,105,393		7,071
Currency option contracts purchased		212		1			206		1
Currency option contracts written		214		(1	)		156		(1	)
Currency swap agreements		1,439,395		4,074			1,230,254		4,613
Other currency contracts		64,944		2,328			84,623		3,502
Interest rate contracts:
Interest rate swap agreements		415,719		(17,065	)		398,291		(12,171	)
Equity contracts:
Equity future contracts		96,016		462			106,876		787

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All derivatives are recognized as either assets or liabilities in the consolidated balance sheets on a gross basis, but certain subsidiaries have entered into master netting agreements or other similar agreements, which are mainly International Swaps and Derivatives Association (ISDA) Master Agreements. An ISDA Master Agreement is an agreement between two counterparties that may have multiple derivative contracts with each other, and such ISDA Master Agreement may provide for the net settlement of all or a specified group of these derivative contracts, through a single payment, in a single currency, in the event of a default on or affecting any one derivative contract, or a termination event affecting all or a specified group of derivative contracts. Presented below are the effects of offsetting derivative assets, derivative liabilities, financial assets and financial liabilities as of March 31, 2017 and 2018.

	Yen in millions
	As of March 31, 2017
	Gross amounts presented in the consolidated balance sheet		Gross amounts not offset in the consolidated balance sheet that are subject to master netting agreements
			Financial instruments		Cash collateral		Net amounts
Derivative assets subject to master netting agreements		11,554		6,584		277		4,693
Derivative assets not subject to master netting agreements		15,706						15,706
Total assets		27,260		6,584		277		20,399
Derivative liabilities subject to master netting agreements		33,261		6,644		18,631		7,986
Derivative liabilities not subject to master netting agreements		1,189						1,189
Repurchase, securities lending and similar arrangements		310,609		309,987		—		622
Total liabilities		345,059		316,631		18,631		9,797
	Yen in millions
	As of March 31, 2018
	Gross amounts presented in the consolidated balance sheet		Gross amounts not offset in the consolidated balance sheet that are subject to master netting agreements
			Financial instruments		Cash collateral		Net amounts
Derivative assets subject to master netting agreements		15,404		7,724		449		7,231
Derivative assets not subject to master netting agreements		24,122						24,122
Total assets		39,526		7,724		449		31,353
Derivative liabilities subject to master netting agreements		34,455		8,326		14,334		11,795
Derivative liabilities not subject to master netting agreements		1,269						1,269
Repurchase, securities lending and similar arrangements		335,586		334,246		—		1,340
Total liabilities		371,310		342,572		14,334		14,404

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15. Pension and severance plans

(1) Defined benefit and severance plans

Upon terminating employment, employees of Sony Corporation and its subsidiaries in Japan are entitled, under most circumstances, to lump-sum indemnities or pension payments as described below. Sony Corporation and certain of its subsidiaries’ pension plans utilize a point-based plan under which a point is added every year reflecting the individual employee’s performance over that year. Under the point-based plan, the amount of payment is determined based on the sum of cumulative points from past services and interest points earned on the cumulative points regardless of whether or not the employee is voluntarily retiring.

Under the plans, in general, the defined benefits cover 65% of the indemnities under existing regulations to employees. The remaining indemnities are covered by severance payments by the companies. The pension benefits are payable at the option of the retiring employee either in a lump-sum amount or monthly pension payments. Contributions to the plans are funded through several financial institutions in accordance with the applicable laws and regulations.

From April 1, 2012, Sony Corporation and substantially all of its subsidiaries in Japan have modified existing defined benefit pension plans such that life annuities will no longer accrue additional service benefits, with those participants instead accruing fixed-term annuities. The defined benefit pension plans were closed to new participants and a defined contribution plan was also introduced.

In addition, several of Sony’s foreign subsidiaries have defined benefit pension plans or severance indemnity plans, which cover substantially all of their employees. Under such plans, the related cost of benefits is currently funded or accrued. Benefits awarded under these plans are based primarily on the current rate of pay and length of service.

The components of net periodic benefit costs for the fiscal years ended March 31, 2016, 2017 and 2018 were as follows:

Japanese plans:

	Yen in millions
	Fiscal year ended March 31
	2016			2017			2018
Service cost		24,670			26,811			25,185
Interest cost		8,689			5,912			8,024
Expected return on plan assets		(20,853	)		(17,829	)		(16,440	)
Recognized actuarial loss		8,588			20,436			16,099
Amortization of prior service costs		(9,489	)		(9,490	)		(8,693	)
Net periodic benefit costs		11,605			25,840			24,175

Foreign plans:

	Yen in millions
	Fiscal year ended March 31
	2016			2017			2018
Service cost		3,504			2,958			3,181
Interest cost		12,096			10,426			10,393
Expected return on plan assets		(14,117	)		(11,000	)		(11,687	)
Amortization of net transition asset		10			9			5
Recognized actuarial loss		4,236			2,552			3,014
Amortization of prior service costs		(478	)		(463	)		(574	)
Losses on curtailments and settlements		354			43			1,058
Net periodic benefit costs		5,605			4,525			5,390

The estimated net actuarial loss and prior service cost for the defined benefit pension plans that will be amortized from accumulated other comprehensive income into net periodic benefit costs over the next fiscal year are 17,706 million yen and 8,114 million yen, respectively.

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The changes in the benefit obligation and plan assets as well as the funded status and composition of amounts recognized in the consolidated balance sheets were as follows:

	Japanese plans						Foreign plans
	Yen in millions						Yen in millions
	March 31						March 31
	2017			2018			2017			2018
Change in benefit obligation:
Benefit obligation at beginning of the fiscal year		1,034,284			1,004,676			356,875			352,442
Service cost		26,811			25,185			2,958			3,181
Interest cost		5,912			8,024			10,426			10,393
Plan participants’ contributions		—			—			490			573
Actuarial (gain) loss		(33,333	)		21,920			20,045			663
Foreign currency exchange rate changes		—			—			(23,183	)		8,858
Curtailments and settlements		—			—			(1,507	)		(5,422	)
Other		(5	)		(8	)		—			—
Benefits paid		(28,993	)		(49,223	)		(13,662	)		(14,291	)
Benefit obligation at end of the fiscal year		1,004,676			1,010,574			352,442			356,397
Change in plan assets:
Fair value of plan assets at beginning of the fiscal year		679,432			699,008			256,341			259,177
Actual return on plan assets		35,508			38,896			29,346			13,426
Foreign currency exchange rate changes		—			—			(20,004	)		6,181
Employer contribution		6,640			6,090			6,738			9,040
Plan participants’ contributions		—			—			490			573
Curtailments and settlements		—			—			(1,161	)		(5,285	)
Benefits paid		(22,572	)		(32,917	)		(12,573	)		(13,367	)
Fair value of plan assets at end of the fiscal year		699,008			711,077			259,177			269,745
Funded status at end of the fiscal year		(305,668	)		(299,497	)		(93,265	)		(86,652	)

Amounts recognized in the consolidated balance sheets consist of:

	Japanese plans						Foreign plans
	Yen in millions						Yen in millions
	March 31						March 31
	2017			2018			2017			2018
Noncurrent assets		2,753			3,426			6,251			8,396
Current liabilities		—			—			(3,114	)		(4,121	)
Noncurrent liabilities		(308,421	)		(302,923	)		(96,402	)		(90,927	)
Ending balance		(305,668	)		(299,497	)		(93,265	)		(86,652	)

Amounts recognized in accumulated other comprehensive income, excluding tax effects, consist of:

	Japanese plans						Foreign plans
	Yen in millions						Yen in millions
	March 31						March 31
	2017			2018			2017			2018
Prior service cost (credit)		(25,415	)		(16,723	)		(1,034	)		(488	)
Net actuarial loss		317,397			299,852			78,548			73,404
Obligation existing at transition		—			—			(3	)		0
Ending balance		291,982			283,129			77,511			72,916

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The accumulated benefit obligations for all defined benefit pension plans were as follows:

	Japanese plans				Foreign plans
	Yen in millions				Yen in millions
	March 31				March 31
	2017		2018		2017		2018
Accumulated benefit obligations		998,501		1,005,557		329,989		340,353

The projected benefit obligations, the accumulated benefit obligations and fair value of plan assets for pension plans with accumulated benefit obligations in excess of plan assets were as follows:

	Japanese plans				Foreign plans
	Yen in millions				Yen in millions
	March 31				March 31
	2017		2018		2017		2018
Projected benefit obligations		992,052		998,629		291,413		301,046
Accumulated benefit obligations		987,428		993,612		287,491		293,834
Fair value of plan assets		685,183		695,706		207,406		215,510

Weighted-average assumptions used to determine benefit obligations as of March 31, 2017 and 2018 were as follows:

	Japanese plans						Foreign plans
	March 31						March 31
	2017			2018			2017			2018
Discount rate		0.9	%		0.8	%		3.1	%		2.9	%
Rate of compensation increase		*			*			2.4			2.6

* Substantially all of Sony’s Japanese pension plans were point-based. Point-based plans do not incorporate a measure of compensation rate increases.

Weighted-average assumptions used to determine the net periodic benefit costs for the fiscal years ended March 31, 2016, 2017 and 2018 were as follows:

	Japanese plans									Foreign plans
	Fiscal year ended March 31									Fiscal year ended March 31
	2016			2017			2018			2016			2017			2018
Discount rate		1.0	%		0.6	%		0.9	%		3.1	%		3.2	%		3.1	%
Expected return on plan assets		3.0			2.7			2.4			4.8			4.8			4.6
Rate of compensation increase		*			*			*			2.9			2.8			2.4

* Substantially all of Sony’s Japanese pension plans were point-based. Point-based plans do not incorporate a measure of compensation rate increases.

Sony reviews these assumptions for changes in circumstances.

The weighted-average rate of compensation increase is calculated based only on the pay-related plans. The point-based plans discussed above are excluded from the calculation because payments made under the plan are not based on employee compensation.

The mortality rate assumptions are based on life expectancy and death rates for different types of participants. In the fiscal year ended March 31, 2016, Sony updated mortality rate assumptions to consider the latest mortality tables and in certain instances to utilize mortality tables based on gender.

To determine the expected long-term rate of return on pension plan assets, Sony considers the current and expected asset allocations, as well as the historical and expected long-term rates of returns on various categories of plan assets. Sony’s pension investment policy recognizes the expected growth and the variability risk associated with the long-term nature of pension liabilities, the returns and risks of diversification across asset classes, and the correlation among assets. The asset allocations are designed to maximize returns consistent with

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levels of liquidity and investment risk that are considered prudent and reasonable. While the pension investment policy gives appropriate consideration to recent market performance and historical returns, the investment assumptions utilized by Sony are designed to achieve a long-term return consistent with the long-term nature of the corresponding pension liabilities.

The investment objectives of Sony’s plan assets are designed to generate returns that will enable the plans to meet their future obligations. The precise amount for which these obligations will be settled depends on future events, including the retirement dates and life expectancy of the plans’ participants. The obligations are estimated using actuarial assumptions, based on the current economic environment and other pertinent factors. Sony’s investment strategy balances the requirement to generate returns, using potentially higher yielding assets such as equity securities, with the need to control risk in the portfolio with less volatile assets, such as fixed-income securities. Risks include, among others, inflation, volatility in equity values and changes in interest rates that could negatively impact the funding level of the plans, thereby increasing its dependence on contributions from Sony. To mitigate any potential concentration risk, thorough consideration is given to balancing the portfolio among industry sectors and geographies, taking into account interest rate sensitivity, dependence on economic growth, currency and other factors that affect investment returns. The target allocations as of March 31, 2018, are, as a result of Sony’s asset liability management, 28% of equity securities, 54% of fixed income securities and 18% of other investments for the pension plans of Sony Corporation and most of its subsidiaries in Japan, and, on a weighted average basis, 27% of equity securities, 46% of fixed income securities and 27% of other investments for the pension plans of foreign subsidiaries.

The fair values of the assets held by Japanese and foreign plans, which are classified in accordance with the fair value hierarchy described in Note 2, are as follows:

	Japanese plans
	Yen in millions
	Fair value at March 31, 2017		Fair value measurements using inputs considered as
Asset class			Level 1		Level 2		Level 3
Cash and cash equivalents		7,976		7,976		—		—
Equity:
Equity securities*1		157,012		152,852		4,160		—
Fixed income:
Government bonds*2		206,632		—		206,632		—
Corporate bonds*3		75,971		—		75,971		—
Asset-backed securities*4		1,105		—		1,105		—
Commingled funds*5		122,264		—		122,264		—
Commodity funds*6		21,098		—		21,098		—
Private equity*7		21,790		—		—		21,790
Hedge funds*8		67,235		—		—		67,235
Real estate and other*9		17,925		—		—		17,925
Total		699,008		160,828		431,230		106,950

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	Japanese plans
	Yen in millions
	Fair value at March 31, 2018		Fair value measurements using inputs considered as
Asset class			Level 1		Level 2		Level 3
Cash and cash equivalents		9,446		9,446		—		—
Equity:
Equity securities*1		138,443		134,091		4,352		—
Fixed income:
Government bonds*2		225,879		—		225,879		—
Corporate bonds*3		79,323		—		79,323		—
Asset-backed securities*4		121		—		121		—
Commingled funds*5		122,950		—		122,950		—
Commodity funds*6		21,136		—		21,136		—
Private equity*7		24,144		—		—		24,144
Hedge funds*8		70,204		—		—		70,204
Real estate and other*9		19,431		—		—		19,431
Total		711,077		143,537		453,761		113,779

*1 Includes approximately 48 percent and 52 percent of Japanese equity securities, and 52 percent and 48 percent of foreign equity securities for the fiscal years ended March 31, 2017 and 2018, respectively.

*2 Includes approximately 46 percent and 49 percent of debt securities issued by Japanese national and local governments, and 54 percent and 51 percent of debt securities issued by foreign national and local governments for the fiscal years ended March 31, 2017 and 2018, respectively.

*3 Includes debt securities issued by Japanese and foreign corporation and government related agencies.

*4 Includes primarily mortgage-backed securities.

*5 Commingled funds represent pooled institutional investments, including primarily investment trusts. They include approximately 48 percent and 51 percent of investments in equity, 51 percent and 48 percent of investments in fixed income, and 1 percent and 1 percent of investments in other for the fiscal years ended March 31, 2017 and 2018, respectively.

*6 Represents commodity futures funds.

*7 Includes multiple private equity funds of funds that primarily invest in venture, buyout, and distressed markets in the U.S. and Europe.

*8 Includes primarily funds that invest in a portfolio of a broad range of hedge funds to diversify the risks and reduce the volatilities associated with a single hedge fund.

*9 Includes primarily private real estate investment trusts.

	Foreign plans
	Yen in millions
	Fair value at March 31, 2017		Fair value measurements using inputs considered as
Asset class			Level 1		Level 2		Level 3
Cash and cash equivalents		8,091		8,091		—		—
Equity:
Equity securities*1		33,103		31,783		1,320		—
Fixed income:
Government bonds*2		65,671		—		65,671		—
Corporate bonds*3		28,296		—		21,370		6,926
Asset-backed securities		982		—		982		—
Insurance contracts*4		5,135		—		5,135		—
Commingled funds*5		81,683		—		81,683		—
Real estate and other*6		36,216		—		13,287		22,929
Total		259,177		39,874		189,448		29,855

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	Foreign plans
	Yen in millions
	Fair value at March 31, 2018		Fair value measurements using inputs considered as
Asset class			Level 1		Level 2		Level 3
Cash and cash equivalents		2,377		2,377		—		—
Equity:
Equity securities*1		30,916		29,814		1,102		—
Fixed income:
Government bonds*2		78,129		—		78,129		—
Corporate bonds*3		26,424		—		21,121		5,303
Asset-backed securities		960		—		960		—
Insurance contracts*4		18,670		—		5,941		12,729
Commingled funds*5		75,785		—		75,785		—
Real estate and other*6		36,484		—		10,508		25,976
Total		269,745		32,191		193,546		44,008

*1 Includes primarily foreign equity securities.

*2 Includes primarily foreign government debt securities.

*3 Includes primarily foreign corporate debt securities.

*4 Represents annuity contracts with or without profit sharing.

*5 Commingled funds represent pooled institutional investments including mutual funds, common trust funds, and collective investment funds. They are primarily comprised of foreign equities and fixed income investments.

*6 Includes primarily private real estate investment trusts.

Each level in the fair value hierarchy in which each plan asset is classified is determined based on inputs used to measure the fair values of the asset, and does not necessarily indicate the risks or rating of the asset.

The following is a description of the valuation techniques used to measure Japanese and foreign plan assets at fair value. The valuation techniques are applied consistently from period to period.

Equity securities are valued at the closing price reported in the active market in which the individual securities are traded. These assets are generally classified as level 1.

The fair value of fixed income securities is typically estimated using pricing models, quoted prices of securities with similar characteristics or discounted cash flows and are generally classified as level 2.

Commingled funds are typically valued using the net asset value provided by the administrator of the fund and reviewed by Sony. The net asset value is based on the value of the underlying assets owned by the fund, minus liabilities and divided by the number of shares or units outstanding. These assets are classified as level 1, level 2 or level 3 depending on availability of quoted market prices.

Commodity funds are valued using inputs that are derived principally from or corroborated by observable market data. These assets are generally classified as level 2.

Private equity and private real estate investment trust valuations require significant judgment due to the absence of quoted market prices, the inherent lack of liquidity and the long-term nature of such assets. These assets are initially valued at cost and are reviewed periodically utilizing available and relevant market data to determine if the carrying value of these assets should be adjusted. These investments are classified as level 3.

Hedge funds are valued using the net asset value as determined by the administrator or custodian of the fund. These investments are classified as level 3.

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SONY CORPORATION AND CONSOLIDATED SUBSIDIARIES

The following table sets forth a summary of changes in the fair values of Japanese and foreign plans’ level 3 assets for the fiscal years ended March 31, 2017 and 2018:

	Japanese plans
	Yen in millions
	Fair value measurement using significant unobservable inputs (Level 3)
	Private equity			Hedge funds		Real estate     and other		Total
Beginning balance at April 1, 2016		31,852			60,395		7,315		99,562
Return on assets held at end of year		425			2,817		599		3,841
Purchases, sales, and settlements, net		(10,487	)		4,023		10,011		3,547
Ending balance at March 31, 2017		21,790			67,235		17,925		106,950
Return on assets held at end of year		1,483			636		425		2,544
Purchases, sales, and settlements, net		871			2,333		1,081		4,285
Ending balance at March 31, 2018		24,144			70,204		19,431		113,779

	Foreign plans
	Yen in millions
	Fair value measurement using significant unobservable inputs (Level 3)
	Insurance contracts		Corporate bonds			Real estate and other			Total
Beginning balance at April 1, 2016		—		7,000			24,124			31,124
Return on assets held at end of year		—		—			84			84
Purchases, sales, and settlements, net		—		(44	)		(367	)		(411	)
Transfers, net		—		—			(8	)		(8	)
Other*		—		(30	)		(904	)		(934	)
Ending balance at March 31, 2017		—		6,926			22,929			29,855
Return on assets held at end of year		—		—			1,101			1,101
Purchases, sales, and settlements, net		12,651		(1,256	)		12			11,407
Transfers, net		—		—			1,181			1,181
Other*		78		(367	)		753			464
Ending balance at March 31, 2018		12,729		5,303			25,976			44,008

* Primarily consists of translation adjustments.

Sony makes contributions to its defined benefit pension plans as deemed appropriate by management after considering the fair value of plan assets, expected return on plan assets and the present value of benefit obligations. Sony expects to contribute approximately 11 billion yen to the Japanese plans and approximately 6 billion yen to the foreign plans during the fiscal year ending March 31, 2019.

The expected future benefit payments are as follows:

	Japanese plans		Foreign plans
Fiscal year ending March 31	Yen in millions		Yen in millions
2019		39,918		14,889
2020		40,328		15,039
2021		41,233		16,133
2022		42,609		16,689
2023		43,772		17,830
2024 — 2028		232,325		102,045

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(2) Defined contribution plans

Total defined contribution expenses for the fiscal years ended March 31, 2016, 2017 and 2018 were as follows:

	Yen in millions
	Fiscal year ended March 31
	2016		2017		2018
Japanese plans		3,155		3,412		3,237
Foreign plans		12,419		10,458		11,379

16. Stockholders’ equity

(1) Common stock

Changes in the number of shares of common stock issued and outstanding during the fiscal years ended March 31, 2016, 2017 and 2018 have resulted from the following:

	Number of shares
Balance at March 31, 2015		1,169,773,260
Issuance of new shares		92,000,000
Exercise of stock acquisition rights		720,500
Balance at March 31, 2016		1,262,493,760
Exercise of stock acquisition rights		1,269,900
Balance at March 31, 2017		1,263,763,660
Issuance of new shares		218,000
Exercise of stock acquisition rights		2,565,700
Conversion of convertible bonds		4,789
Balance at March 31, 2018		1,266,552,149

At March 31, 2018, 37,962,769 shares of common stock would be issued upon the conversion or exercise of all convertible bonds and stock acquisition rights outstanding.

Conversions of convertible bonds into common stock are accounted for in accordance with the provisions of the Companies Act of Japan (Kaishaho) and related regulations (collectively the “Companies Act”) by crediting approximately one-half of the conversion proceeds to the common stock account and the remainder to the additional paid-in capital account.

Sony Corporation may purchase its own shares at any time by a resolution of the Board of Directors up to the retained earnings available for dividends to shareholders, in accordance with the Companies Act. No common stock had been acquired by the resolution of the Board of Directors during the fiscal years ended March 31, 2016, 2017 and 2018.

(2) Retained earnings

The amount of statutory retained earnings of Sony Corporation available for dividends to shareholders as of March 31, 2018 was 664,989 million yen. The appropriation of retained earnings for the fiscal year ended March 31, 2018, including cash dividends for the six-month period ended March 31, 2018, has been incorporated in the consolidated financial statements. This appropriation of retained earnings was approved at the meeting of the Board of Directors of Sony Corporation held on April 27, 2018 and was then recorded in the statutory books of account, in accordance with the Companies Act.

Retained earnings include Sony’s equity in undistributed earnings of affiliated companies accounted for by the equity method in the amount of 33,694 million yen and 37,859 million yen at March 31, 2017 and 2018, respectively.

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(3) Other comprehensive income

Changes in accumulated other comprehensive income, net of tax, by component for the fiscal years ended March 31, 2016, 2017 and 2018 were as follows:

	Yen in millions
	Unrealized gains (losses) on securities			Unrealized gains (losses) on derivative instruments			Pension liability adjustment			Foreign currency translation adjustments			Total
Balance at March 31, 2015		154,153			—			(201,131	)		(338,305	)		(385,283	)
Other comprehensive income before reclassifications		45,527			1,914			(174,380	)		(83,899	)		(210,838	)
Amounts reclassified out of accumulated other comprehensive income		(43,307	)		(3,112	)		2,627			—			(43,792	)
Net other comprehensive income		2,220			(1,198	)		(171,753	)		(83,899	)		(254,630	)
Less: Other comprehensive income attributable to noncontrolling interests		15,637			—			(1,145	)		(1,087	)		13,405
Balance at March 31, 2016		140,736			(1,198	)		(371,739	)		(421,117	)		(653,318	)

	Yen in millions
	Unrealized gains (losses) on securities			Unrealized gains (losses) on derivative instruments			Pension liability adjustment			Foreign currency translation adjustments			Total
Balance at March 31, 2016		140,736			(1,198	)		(371,739	)		(421,117	)		(653,318	)
Other comprehensive income before reclassifications		(27,007	)		5,028			54,513			(17,988	)		14,546
Amounts reclassified out of accumulated other comprehensive income		(3,286	)		(3,888	)		8,719			—			1,545
Net other comprehensive income		(30,293	)		1,140			63,232			(17,988	)		16,091
Less: Other comprehensive income attributable to noncontrolling interests		(16,192	)		—			229			(2,495	)		(18,458	)
Balance at March 31, 2017		126,635			(58	)		(308,736	)		(436,610	)		(618,769	)
	Yen in millions
	Unrealized gains (losses) on securities			Unrealized gains (losses) on derivative instruments			Pension liability adjustment			Foreign currency translation adjustments			Total
Balance at March 31, 2017		126,635			(58	)		(308,736	)		(436,610	)		(618,769	)
Other comprehensive income before reclassifications		2,013			(2,295	)		1,779			(4,480	)		(2,983	)
Amounts reclassified out of accumulated other comprehensive income*1		(943	)		1,111			10,611			(1,855	)		8,924
Net other comprehensive income		1,070			(1,184	)		12,390			(6,335	)		5,941
Less: Other comprehensive income attributable to noncontrolling interests		1,514			—			98			2,306			3,918
Balance at March 31, 2018		126,191			(1,242	)		(296,444	)		(445,251	)		(616,746	)

*1 Foreign currency translation adjustments were transferred from accumulated other comprehensive income to net income as a result of a complete or substantially complete liquidation or sale of certain foreign subsidiaries and affiliates.

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Reclassifications out of accumulated other comprehensive income for the fiscal years ended March 31, 2016, 2017 and 2018 were as follows:

	Yen in millions
Comprehensive income components	Amounts reclassified from accumulated other comprehensive income									Affected line items in consolidated statements of income
	2016			2017			2018
Unrealized gains (losses) on securities		(19,598	)		(4,560	)		(646	)	Financial services revenue
		(47,087	)		(30	)		(561	)	Gain on sale of securities investments, net
		3,063			—			—		Loss on devaluation of securities investments
Total before tax		(63,622	)		(4,590	)		(1,207	)
Tax expense or (benefit)		20,315			1,304			264
Net of tax		(43,307	)		(3,286	)		(943	)
Unrealized gains (losses) on derivative instruments		(8	)		—			—		Foreign exchange loss, net
		(3,104	)		(5,583	)		1,111		Cost of sales
Total before tax		(3,112	)		(5,583	)		1,111
Tax expense or (benefit)		—			1,695			—
Net of tax		(3,112	)		(3,888	)		1,111
Pension liability adjustment		2,867			13,044			11,034		*
Tax expense or (benefit)		(240	)		(4,325	)		(423	)
Net of tax		2,627			8,719			10,611
Foreign currency translation adjustments		—			—			(1,855	)	Other operating expense, net
Tax expense or (benefit)		—			—			—
Net of tax		—			—			(1,855	)
Total amounts reclassified out of accumulated other comprehensive income, net of tax		(43,792	)		1,545			8,924

* The amortization of pension and postretirement benefit components are included in the computation of net periodic pension cost. Refer to Note 15.

(4) Equity transactions with noncontrolling interests

Net income attributable to Sony Corporation’s stockholders and transfers (to) from the noncontrolling interests for the fiscal years ended March 31, 2016, 2017 and 2018 were as follows:

	Yen in millions
	Fiscal year ended March 31
	2016			2017			2018
Net income attributable to Sony Corporation’s stockholders		147,791			73,289			490,794
Transfers (to) from the noncontrolling interests:
Decrease in additional paid-in capital for purchase of additional shares in consolidated subsidiaries		(12,776	)		(53,927	)		(74	)
Change from net income attributable to Sony Corporation’s stockholders and transfers (to) from the noncontrolling interests		135,015			19,362			490,720

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During the fiscal year ended March 31, 2017, Sony obtained full ownership of its U.S.-based music publishing subsidiary by acquiring the 50% interest in the subsidiary held by the Estate of Michael Jackson (the “Estate”). The aggregate cash consideration paid to the Estate was 750 million U.S. dollars, including 17 million U.S. dollars of distributions to which the subsidiary previously committed. The difference between cash consideration paid and the decrease in the carrying amount of the noncontrolling interests was recognized as a decrease to additional paid-in capital of 70,730 million yen.

17. Stock-based compensation plans

The stock-based compensation expense for the fiscal years ended March 31, 2016, 2017 and 2018 was 1,944 million yen, 2,737 million yen and 5,249 million yen, respectively. The total cash received from exercises under all of the stock-based compensation plans during the fiscal years ended March 31, 2016, 2017 and 2018 was 1,578 million yen, 2,730 million yen and 7,129 million yen, respectively. Sony issued new shares upon exercise of these rights.

Sony has a stock-based compensation incentive plan for selected directors, corporate executive officers and employees in the form of a stock acquisition rights plan. The stock acquisition rights generally have three year graded vesting schedules and are exercisable up to ten years from the date of grant.

The weighted-average fair value per share at the date of grant of stock acquisition rights granted during the fiscal years ended March 31, 2016, 2017 and 2018 was 1,331 yen, 1,291 yen and 2,045 yen, respectively. The fair value of stock acquisition rights granted on the date of grant and used to recognize compensation expense for the fiscal years ended March 31, 2016, 2017 and 2018 was estimated using the Black-Scholes option-pricing model with the following weighted-average assumptions:

	Fiscal year ended March 31
	2016			2017			2018
Weighted-average assumptions
Risk-free interest rate		1.07%			1.10%			1.14%
Expected lives		7.12 y	ears		6.83 y	ears		6.55 y	ears
Expected volatility*		42.07%			40.00%			38.49%
Expected dividends		0.75%			0.66%			0.40%

* Expected volatility was based on the historical volatilities of Sony Corporation’s common stock over the expected life of the stock acquisition rights.

A summary of the activities regarding the stock acquisition rights plan during the fiscal year ended March 31, 2018 is as follows:

	Fiscal year ended March 31, 2018
	Number of shares		Weighted- average exercise price		Weighted- average remaining life		Total intrinsic value
			Yen		Years		Yen in millions
Outstanding at beginning of the fiscal year		15,519,400		3,147
Granted		2,978,900		4,297
Exercised		2,565,700		2,778
Forfeited or expired		1,926,700		4,864
Outstanding at end of the fiscal year		14,005,900		3,017		6.53		25,910
Exercisable at end of the fiscal year		7,905,100		2,653		4.61		19,647

The total intrinsic value of shares exercised under the stock acquisition rights plan during the fiscal years ended March 31, 2016, 2017 and 2018 was 1,338 million yen, 1,541 million yen and 6,970 million yen, respectively.

As of March 31, 2018, there was 5,698 million yen of total unrecognized compensation expense related to nonvested stock acquisition rights. This expense is expected to be recognized over a weighted-average period of 2.01 years.

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18. Kumamoto Earthquake

In April 2016, a series of earthquakes occurred in the Kumamoto region of Japan. These earthquakes caused damage to certain fixed assets, including buildings, machinery and equipment, as well as inventories in manufacturing sites located in the Kumamoto region.

For the fiscal year ended March 31, 2017, Sony incurred incremental losses and associated expenses including repair costs of fixed assets and a loss on disposal of inventories directly related to the damage caused by the earthquakes of 16,682 million yen. These losses and expenses were primarily recorded in cost of sales in the consolidated statements of income and were offset by insurance recoveries of 10,682 million yen, as described below. In addition, Sony incurred other expenses of 9,365 million yen, which included idle facility costs at manufacturing sites. These expenses were primarily recorded in cost of sales in the consolidated statements of income.

Sony has insurance policies that cover certain damage directly caused by the earthquakes for Sony Corporation and certain of its subsidiaries, including damage at manufacturing sites. The insurance policies cover the damage and costs associated with fixed assets and inventories, as well as incremental expenses including removal and cleaning costs. These policies also provide business interruption coverage, including coverage for lost profits. For the fiscal year ended March 31, 2017, Sony recorded insurance receivables of 10,682 million yen, representing a portion of the insurance recoveries that were deemed probable of collection up to the extent of the amount of corresponding losses recognized in the same period. Of the insurance receivables recorded during the period, substantially all relate to damaged assets and inventories, and do not include amounts for business interruption or lost profits. Sony concluded that the recoveries from insurance claims are probable based on the coverage under valid policies, communications with the insurance carriers, Sony’s past claims history with the insurance carriers, and Sony’s assessment that the insurance carriers have the financial ability to pay the claims. In March 2017, 10,000 million yen was agreed to by the insurance carriers. These receivables are recorded within other receivables, whereas the remaining receivables of 682 million yen is recorded in other current assets in the consolidated balance sheets as of the fiscal year ended March 31, 2017.

Sony has underwritten 2,000 million yen in reinsurance policies for the above insurance carriers related to the policy described above. The amount was recorded in other current liabilities in the consolidated balance sheets as of the fiscal year ended March 31, 2017 and was paid to the insurance carriers in the fiscal year ended March 31, 2018.

In April 2017, the remaining insurance claims of 10,000 million yen that were mainly for business interruption coverage were agreed to by the carriers. As a result, the total amount of insurance recoveries paid to Sony in April 2017 was 20,000 million yen. 9,318 million yen, which was the difference between 20,000 million yen and 10,682 million yen as described above, was recorded in other operating revenue for the fiscal year ended March 31, 2018. The proceeds from insurance recoveries were presented as cash flows from operating activities in the consolidated statements of cash flows for the fiscal year ended March 31, 2018.

19. Restructuring charges

As part of its effort to improve the performance of the various businesses, Sony has undertaken a number of restructuring initiatives. Sony defines restructuring initiatives as activities initiated by Sony, which are designed to generate a positive impact on future profitability. These activities include exiting a business or product category, implementing a headcount reduction program, realignment of its manufacturing sites to low-cost areas, utilizing the services of third-party original equipment and design manufacturers (OEMs and ODMs), a review of its development and design structure, and the streamlining of its sales and administrative functions. The restructuring activities are generally short term in nature and are generally completed within one year of initiation.

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The changes in the accrued restructuring charges for the fiscal years ended March 31, 2016, 2017 and 2018 are as follows:

	Yen in millions
	Employee termination benefits			Non-cash write-downs and disposals, net*			Other associated costs			Total
Balance at March 31, 2015		36,721			—			14,196			50,917
Restructuring costs		27,401			1,828			7,298			36,527
Non-cash charges		—			(1,828	)		—			(1,828	)
Cash payments		(40,261	)		—			(11,232	)		(51,493	)
Adjustments		(1,330	)		—			1,473			143
Balance at March 31, 2016		22,531			—			11,735			34,266
Restructuring costs		9,854			42,717			7,142			59,713
Non-cash charges		—			(42,717	)		—			(42,717	)
Cash payments		(19,759	)		—			(8,871	)		(28,630	)
Adjustments		(992	)		—			(839	)		(1,831	)
Balance at March 31, 2017		11,634			—			9,167			20,801
Restructuring costs		18,999			2,233			1,147			22,379
Non-cash charges		—			(2,233	)		—			(2,233	)
Cash payments		(9,950	)		—			(6,352	)		(16,302	)
Adjustments		(1,197	)		—			226			(971	)
Balance at March 31, 2018		19,486			—			4,188			23,674

* Significant asset impairments excluded from restructuring charges are described in Note 13.

Total costs incurred in connection with these restructuring programs by segment for the fiscal years ended March 31, 2016, 2017 and 2018 are as follows:

	Yen in millions
	Fiscal year ended March 31, 2016
	Employee termination benefits			Other associated costs*			Total net restructuring charges			Depreciation associated with restructured assets		Total
Game & Network Services		15			120			135			—		135
Music		1,501			367			1,868			—		1,868
Pictures		1,594			7			1,601			5		1,606
Home Entertainment & Sound		1,181			26			1,207			—		1,207
Imaging Products & Solutions		78			126			204			—		204
Mobile Communications		17,259			3,669			20,928			710		21,638
Semiconductors		(11	)		(102	)		(113	)		—		(113	)
Financial Services		—			—			—			—		—
All Other and Corporate		5,784			4,913			10,697			1,017		11,714
Total		27,401			9,126			36,527			1,732		38,259

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	Yen in millions
	Fiscal year ended March 31, 2017
	Employee termination benefits		Other associated costs*			Total net restructuring charges			Depreciation associated with restructured assets		Total
Game & Network Services		225		6			231			—		231
Music		2,116		1,474			3,590			—		3,590
Pictures		2,467		—			2,467			—		2,467
Home Entertainment & Sound		68		684			752			—		752
Imaging Products & Solutions		563		77			640			—		640
Mobile Communications		516		172			688			138		826
Semiconductors		4		(13	)		(9	)		—		(9	)
Financial Services		—		—			—			—		—
All Other and Corporate		3,895		47,459			51,354			364		51,718
Total		9,854		49,859			59,713			502		60,215

	Yen in millions
	Fiscal year ended March 31, 2018
	Employee termination benefits		Other associated costs*		Total net restructuring charges		Depreciation associated with restructured assets		Total
Game & Network Services		—		—		—		—		—
Music		6,358		272		6,630		—		6,630
Pictures		2,922		—		2,922		—		2,922
Home Entertainment & Sound		846		6		852		—		852
Imaging Products & Solutions		530		94		624		—		624
Mobile Communications		2,008		18		2,026		0		2,026
Semiconductors		28		—		28		—		28
Financial Services		—		—		—		—		—
All Other and Corporate		6,307		2,990		9,297		26		9,323
Total		18,999		3,380		22,379		26		22,405

* Other associated costs includes non-cash write-downs and disposals, net

Depreciation associated with restructured assets as used in the context of the disclosures regarding restructuring activities refers to the increase in depreciation expense caused by revising the useful life and the salvage value of depreciable fixed assets under an approved restructuring plan. Any impairment of the assets is recognized immediately in the period it is identified.

Retirement programs

Sony has undergone several headcount reduction programs to further reduce operating costs primarily in an effort to improve the performance of certain segments related to the Electronics business and reduce cost at the headquarters function. Through measures including the realignment of its manufacturing sites, a review of its development and design structure, and the streamlining of its sales and administrative functions, Sony has continued to implement a company-wide (including headquarters) rationalization. Sony intends to reallocate and optimize its workforce through programs including work reassignments and outplacements. The employee termination benefits costs in the above table are included in selling, general and administrative in the consolidated statements of income.

During the fiscal year ended March 31, 2016, the restructuring plans regarding the Mobile Communication segment progressed as planned by streamlining business operations, including the closure and consolidation of manufacturing sites, and the consolidation of headquarters and administrative functions described above. This restructuring program was substantially completed before March 31, 2017.

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In an effort to optimize the organization and improve the performance of the music business, Sony has implemented a number of restructuring initiatives targeting operating effectiveness and cost reduction. These activities resulted in restructuring charges primarily consisting of headcount reductions totaling 6,630 million yen for the fiscal year ended March 31, 2018.

All Other and Corporate

As described in Note 25, Sony and Murata Manufacturing Co., Ltd. signed a binding definitive agreement on October 31, 2016 to transfer the Sony Group’s battery business to the Murata Group, which was completed on September 1, 2017. Sony classified certain assets and liabilities related to the battery business as held for sale and, as a result of the fair value valuation of these assets and liabilities, recorded impairment losses of 42,298 million yen in other operating expense, net in the consolidated statements of income for the fiscal year ended March 31, 2017.

As a result of efforts to optimize the sales and headquarters functions that indirectly support the Electronics businesses, which are described above, Sony recorded restructuring charges primarily consisting of headcount reductions totaling 7,112 million yen during the fiscal years ended March 31, 2016. There were no significant restructuring charges for the Electronics businesses during the fiscal year ended March 31, 2017 and 2018.

20. Supplemental consolidated statements of income information

(1) Other operating expense, net

Sony records transactions in other operating expense, net due to either the nature of the transaction or in consideration of factors including the relationship to Sony’s core operations.

Other operating expense, net is comprised of the following:

	Yen in millions
	March 31
	2016			2017			2018
Gain on sale of the U.S. headquarters building*1		(6,545	)		—			—
Gain on sale of Sony City Osaki*1		(4,914	)		(4,914	)		(4,914	)
Gain on sale and issuance of M3 shares*2		(2	)		(37,167	)		(18	)
(Gain) loss on purchase/sale of interests in subsidiaries and affiliates, net*3		(31,778	)		(4,259	)		(29,595	)
(Gain) loss on sale, disposal or impairment of assets, net*4		90,410			195,341			38,599
		47,171			149,001			4,072

*1 A portion of gain on sale and leaseback transactions is deferred and is amortized on a straight-line basis over the lease term.

*2 Refer to Note 5.

*3 Refer to Notes 24 and 25.

*4 Refer to Notes 9, 13, 19 and 25.

(2) Research and development costs

Research and development costs charged to cost of sales for the fiscal years ended March 31, 2016, 2017 and 2018 were 468,183 million yen, 447,456 million yen and 458,518 million yen, respectively.

(3) Advertising costs

Advertising costs included in selling, general and administrative expenses for the fiscal years ended March 31, 2016, 2017 and 2018 were 391,326 million yen, 363,815 million yen and 407,106 million yen, respectively.

(4) Shipping and handling costs

Shipping and handling costs for finished goods included in selling, general and administrative expenses for the fiscal years ended March 31, 2016, 2017 and 2018 were 50,803 million yen, 42,195 million yen and 46,252 million yen, respectively, which included the internal transportation costs of finished goods.

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21. Income taxes

Domestic and foreign components of income before income taxes and the provision for current and deferred income taxes attributable to such income are summarized as follows:

	Yen in millions
	Fiscal year ended March 31
	2016			2017		2018
Income before income taxes:
Sony Corporation and all subsidiaries in Japan		149,256			166,158		436,494
Foreign subsidiaries		155,248			85,461		262,555
		304,504			251,619		699,049
Income taxes — Current:
Sony Corporation and all subsidiaries in Japan		41,080			49,739		69,697
Foreign subsidiaries		53,498			50,521		57,988
		94,578			100,260		127,685
Income taxes — Deferred:
Sony Corporation and all subsidiaries in Japan		(1,745	)		11,478		29,640
Foreign subsidiaries		1,956			12,320		(5,555	)
		211			23,798		24,085
Total income tax expense		94,789			124,058		151,770

A reconciliation of the differences between the Japanese statutory tax rate and the effective tax rate is as follows:

	Fiscal year ended March 31
	2016			2017			2018
Statutory tax rate		33.6	%		31.7	%		31.5	%
Non-deductible expenses		1.6			2.3			0.8
Income tax credits		(2.0	)		(2.9	)		(0.6	)
Change in statutory tax rate and law		(3.3	)		0.3			(1.2	)
Change in valuation allowances		10.7			7.3			(5.2	)
Change in deferred tax liabilities on undistributed earnings of foreign subsidiaries and corporate joint ventures		(0.8	)		(1.4	)		(0.8	)
Lower tax rate applied to life and non-life insurance business in Japan		(2.3	)		(2.2	)		(0.8	)
Foreign income tax differential		(6.9	)		(3.0	)		(2.6	)
Adjustments to tax reserves		0.7			(1.1	)		(0.8	)
Effect of equity in net income of affiliated companies		0.0			0.0			0.0
Impairment of goodwill in the Pictures segment		—			15.0			—
Other		(0.2	)		3.3			1.4
Effective income tax rate		31.1	%		49.3	%		21.7	%

In March 2016, the Japanese legislature enacted tax law changes which included further lowering of the national corporate tax rate, limiting the annual use of net operating loss carryforwards to 55% of taxable income for the period ended March 31, 2018, and to 50% of taxable income for periods beginning on or after April 1, 2018. As a result, the statutory tax rate from the fiscal year ended March 31, 2017 onward will be approximately 31.5%. On December 22, 2017, the U.S. Tax Reform Act was signed into law, making significant changes to the U.S. tax rules. Changes include, but are not limited to, a corporate tax rate decrease from 35% to 21% effective for tax years beginning January 1, 2018 and the transition of U.S. international taxation from a worldwide tax

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system to a modified territorial system, with a one-time mandatory transition tax on previously deferred foreign earnings of U.S. subsidiaries.

Sony is required to record the effects of a tax law change in the period of enactment; however, shortly after the enactment of the U.S. Tax Reform Act, the U.S. Securities and Exchange Commission staff issued SAB 118, which allows a company to record a provisional amount when it does not have the necessary information available, prepared, or analyzed in reasonable detail to complete its accounting for the change in the tax law. The measurement period ends when the company has obtained, prepared and analyzed the information necessary to finalize its accounting, but cannot extend beyond one year.

Sony has calculated its best estimate of the impact of the U.S. Tax Reform Act in the March 31, 2018 income tax provision in accordance with its understanding of the U.S. Tax Reform Act and guidance available and, as a result, Sony has recorded an income tax benefit of 13,816 million yen in the fiscal year ended March 31, 2018 related to the reversal of a valuation allowance as a result of the change in future net operating loss carryforward rules in the U.S. to an unlimited life which will now allow certain deferred tax assets and deferred tax liabilities to offset. Given the valuation allowance recorded against net deferred tax assets in the U.S., the reduction in the corporate income tax rate did not have a material impact on the tax provision for the fiscal year ended March 31, 2018. In addition, given the existence of significant foreign tax credit carryforwards available, with a valuation allowance recorded against them, the mandatory transition tax on previously deferred foreign earnings also did not have a material impact on the tax provision for the fiscal year ended March 31, 2018.

The changes made by the U.S. Tax Reform Act are broad and complex. The final impact of the U.S. Tax Reform Act may differ from the above estimate, possibly materially, due to, among other things, changes in interpretations of the U.S. Tax Reform Act, any legislative action to address questions that arise because of the U.S. Tax Reform Act, any changes in accounting standards for income taxes or related interpretations in response to the U.S. Tax Reform Act or any updates or changes to estimates Sony has utilized to calculate the impact.

The significant components of deferred tax assets and liabilities are as follows:

	Yen in millions
	March 31
	2017			2018
Deferred tax assets:
Operating loss carryforwards for tax purposes		455,555			439,206
Accrued pension and severance costs		112,075			106,161
Amortization including film costs		181,243			95,069
Warranty reserves and accrued expenses		110,475			104,410
Future insurance policy benefits		30,884			33,812
Inventory		16,322			15,792
Depreciation		47,485			43,353
Tax credit carryforwards		134,427			125,327
Reserve for doubtful accounts		10,887			8,534
Impairment of investments		52,451			14,146
Deferred revenue		27,294			14,478
Other		158,420			132,800
Gross deferred tax assets		1,337,518			1,133,088
Less: Valuation allowance		(1,051,964	)		(899,835	)
Total deferred tax assets		285,554			233,253
Deferred tax liabilities:
Insurance acquisition costs		(160,308	)		(166,717	)
Future insurance policy benefits		(147,159	)		(167,058	)
Unbilled accounts receivable in the Pictures segment		(113,997	)		(63,196	)
Unrealized gains on securities		(78,643	)		(83,298	)
Intangible assets acquired through stock exchange offerings		(23,794	)		(23,949	)
Undistributed earnings of foreign subsidiaries and corporate joint ventures		(26,473	)		(14,160	)
Investment in M3		(34,775	)		(35,802	)
Other		(34,271	)		(32,164	)
Gross deferred tax liabilities		(619,420	)		(586,344	)
Net deferred tax liabilities		(333,866	)		(353,091	)

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Based on the weight of the available positive and negative evidence, for the fiscal year ended March 31, 2018, Sony continued to maintain valuation allowances against the deferred tax assets at Sony Corporation and its national tax filing group in Japan, as well as at Sony Americas Holding Inc. (“SAHI”) and its consolidated tax filing group in the U.S., Sony Mobile Communications in Sweden, Sony Europe Limited in the U.K., certain subsidiaries in Brazil, and certain subsidiaries in other tax jurisdictions.

The net changes in the total valuation allowance were decreases of 21,764 million yen, 3,894 million yen and 152,129 million yen for the fiscal years ended March 31, 2016, 2017 and 2018, respectively.

The decrease in the valuation allowances during the fiscal year ended March 31, 2016 was primarily due to the effect of foreign currency translation adjustments at SAHI and its consolidated tax filing group in the U.S. and the reversal of valuation allowances for local tax purposes for certain Japanese subsidiaries based on the weight of the available positive and negative evidence, including the strength of earnings in recent years and their forecast of continuing profits. These decreases were partially offset by an increase in the valuation allowance for accrued pension and severance costs in the national tax filing group in Japan.

The decrease in the valuation allowances during the fiscal year ended March 31, 2017 was primarily due to the use of net operating loss carryforwards for the national tax filing group in Japan.

The decrease in the valuation allowances during the fiscal year ended March 31, 2018 was primarily due to the use of net operating loss carryforwards and other deferred tax assets for both the national tax filing group in Japan and the consolidated tax filing group in the U.S. The U.S. deferred tax assets were also reduced as a result of the reduction in the tax rate under the U.S. Tax Reform Act which had a corresponding reduction of the valuation allowance on those assets. In addition, valuation allowances were reversed in several jurisdictions, including France and Canada, as a result of sustained profitability.

Following the changes made by the U.S. Tax Reform Act, Sony changed its policy on dividends from foreign subsidiaries owned by the U.S. consolidated tax group. As a result, the estimated tax on the remittance of such earnings are now included in the deferred tax provision. At March 31, 2018, 14,880 million yen of deferred income taxes have not been provided on undistributed earnings of certain foreign subsidiaries and corporate joint ventures not expected to be remitted in the foreseeable future totaling 930,018 million yen, and the gain on the book/tax basis difference in subsidiaries, including a gain of 61,544 million yen on a subsidiary’s sale of stock arising from the issuance of common stock of Sony Music Entertainment (Japan) Inc. in a public offering to third parties in November 1991. Sony does not anticipate any significant tax consequences on the possible future disposition of these investments based on its tax planning strategies.

At March 31, 2018, Sony had net operating loss carryforwards, the tax effect of which totaled 439,206 million yen, which may be available as an offset against future taxable income on tax returns to be filed in various tax jurisdictions. With the exception of 132,979 million yen with no expiration period, substantially all of the total net operating loss carryforwards expire at various dates between the fiscal years ending March 31, 2019 and 2024.

Tax credit carryforwards at March 31, 2018 amounted to 125,327 million yen. With the exception of 19,048 million yen with no expiration period, substantially all of the total available tax credit carryforwards expire at various dates between the fiscal years ending March 31, 2019 and 2028.

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A reconciliation of the beginning and ending gross amounts of unrecognized tax benefits is as follows:

	Yen in millions
	March 31
	2016			2017			2018
Balance at beginning of the fiscal year		165,434			114,126			119,529
Reductions for tax positions of prior years		(34,261	)		(558	)		(8,809	)
Additions for tax positions of prior years		6,253			13,353			4,681
Additions based on tax positions related to the current year		4,299			8,231			5,740
Settlements		(12,556	)		(8,300	)		(21,893	)
Lapse in statute of limitations		(8,229	)		(3,454	)		(3,469	)
Foreign currency translation adjustments		(6,814	)		(3,869	)		(354	)
Balance at end of the fiscal year		114,126			119,529			95,425
Total net amount of unrecognized tax benefits that, if recognized, would affect the effective tax rate		49,323			45,987			39,308

The major changes in the total gross amount of unrecognized tax benefit balances relate to transfer pricing adjustments, including as a result of the Bilateral Advance Pricing Agreements (“APAs”) and competent authority requests filed for certain subsidiaries in the G&NS, HE&S, IP&S, MC and Semiconductors segments and All Other, with respect to the intercompany cross-border transactions. The APAs include agreements between Sony and two taxing authorities under the authority of the mutual agreement procedure specified in income tax treaties. Sony reviews its estimated tax expense based on the progress made in these procedures, and the progress of transfer pricing audits generally, and makes adjustments to its estimates as necessary. In addition, the APAs are government to government negotiations, and therefore it is possible that the final outcomes of the agreements may differ from Sony’s current assessment of the more-likely-than-not outcomes of such agreements.

During the fiscal year ended March 31, 2016, Sony reversed 774 million yen of interest expense and recorded 674 million yen of penalties. At March 31, 2016, Sony had recorded liabilities of 9,261 million yen and 4,358 million yen for the payments of interest and penalties, respectively.

During the fiscal year ended March 31, 2017, Sony recorded 474 million yen of interest expense and reversed 597 million yen of penalties. At March 31, 2017, Sony had recorded liabilities of 9,735 million yen and 3,761 million yen for the payments of interest and penalties, respectively.

During the fiscal year ended March 31, 2018, Sony recorded 1,053 million yen of interest expense and 876 million yen of penalties. At March 31, 2018, Sony had recorded liabilities of 10,788 million yen and 4,637 million yen for the payments of interest and penalties, respectively.

Sony operates in multiple jurisdictions throughout the world, and its tax returns are periodically audited by Japanese and foreign taxing authorities. As a result of audit settlements, the conclusion of current examinations, the expiration of the statute of limitations in several jurisdictions and other reevaluations of Sony’s tax positions, it is expected that the amount of unrecognized tax benefits will change in the next twelve months. Accordingly, Sony believes it is reasonably possible that its existing unrecognized tax benefits may be reduced by an amount up to 2,768 million yen within the next twelve months.

Sony remains subject to examinations by Japanese taxing authorities for tax years from 2008 through 2017, and by the U.S. and other material foreign taxing authorities for tax years from 2013 through 2017.

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22. Reconciliation of the differences between basic and diluted EPS

Reconciliation of the differences between basic and diluted EPS for the fiscal years ended March 31, 2016, 2017 and 2018 is as follows:

	Yen in millions
	Fiscal year ended March 31
	2016		2017		2018
Net income attributable to Sony Corporation’s stockholders for basic and diluted EPS computation		147,791		73,289		490,794
	Thousands of shares
Weighted-average shares outstanding		1,237,802		1,262,023		1,263,895
Effect of dilutive securities:
Stock acquisition rights		2,109		2,358		4,565
Zero coupon convertible bonds		17,972		23,962		23,960
Weighted-average shares for diluted EPS computation		1,257,883		1,288,343		1,292,420
	Yen
Basic EPS		119.40		58.07		388.32
Diluted EPS		117.49		56.89		379.75

Potential shares of common stock which were excluded from the computation of diluted EPS for the fiscal years ended March 31, 2016, 2017 and 2018 were 11,357 thousand shares, 6,856 thousand shares and 2,921 thousand shares, respectively. Potential shares related to stock acquisition rights were excluded as anti-dilutive for the fiscal years ended March 31, 2016, 2017 and 2018 when the exercise price for those shares was in excess of the average market value of Sony’s common stock for those fiscal years. The zero coupon convertible bonds issued in July 2015 were included in the diluted EPS calculation under the if-converted method beginning upon issuance.

23. Variable interest entities

Sony has, from time to time, entered into various arrangements with VIEs. These arrangements include several joint ventures in the recorded music business, an equity investment in the music publishing business, the financing of film production and the outsourcing of manufacturing operations. In addition, Sony has entered into several accounts receivable sales programs that involve VIEs, which are described in Note 6. For the VIEs that are described below, it has been determined that Sony is the primary beneficiary and, accordingly, these VIEs are consolidated by Sony.

Sony’s U.S. subsidiary that is engaged in the recorded music business has entered into several joint ventures with companies involved in the production and creation of recorded music. Sony has reviewed these joint ventures and determined that they are VIEs. Based on a qualitative assessment, it was determined that Sony has the power to direct the activities that most significantly impact the VIEs’ economic performance, as well as the obligation to absorb the losses of these VIEs as Sony is responsible for providing funding to these VIEs, and in most cases absorbs all losses until the VIEs become profitable. As a result, it has been determined that Sony is the primary beneficiary. The assets of Sony are not available to settle the obligations of these VIEs. As of March 31, 2018, the total assets and liabilities for these VIEs, on an aggregate basis, were 37,540 million yen and 24,625 million yen, respectively.

VIEs in which Sony holds a significant variable interest, but is not the primary beneficiary are described as follows:

As described in Note 5, on June 29, 2012, an investor group which included a wholly-owned subsidiary of Sony Corporation completed its acquisition of EMI Music Publishing. To effect the acquisition, the investor group formed DH Publishing, L.P. (“DHP”) which acquired EMI Music Publishing. In addition, DHP entered into an agreement with Sony’s U.S.-based music publishing subsidiary in which the subsidiary provides administration services to DHP (the “Administration Agreement”). DHP was determined to be a VIE as many of

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the decision making rights for the entity do not reside within the entity’s equity interests, but rather are embedded in the Administration Agreement. Under the terms of the Administration Agreement, the largest non-Sony shareholder has approval rights over decisions regarding the activities that most significantly impact DHP, including the acquisition and retention of copyrights and the licensing of songs. These approval rights result in Sony and the largest non-Sony shareholder sharing the power to direct the activities of DHP, and as such, Sony is not the primary beneficiary of the VIE. At March 31, 2018, the only amounts recorded on Sony’s consolidated balance sheet that relate to the VIE are Sony’s net investment of 213 million U.S. dollars and a net payable balance of 3 million U.S. dollars. Sony’s maximum exposure to losses as of March 31, 2018 is the aggregate amount recorded on its balance sheet of 210 million U.S. dollars.

Sony’s subsidiary in the Pictures segment entered into a distribution agreement with and made an investment in a production company that will develop, produce and finance feature-length motion pictures and television programming. The investment is accounted for under the cost method. The production company is a VIE as many of the decision making rights for the entity reside within the equity interests held by the management of the production company which are not at risk of economic loss. Based on a qualitative assessment, it was determined that Sony is not the primary beneficiary as Sony does not have the power to direct the activities of the production company. Sony’s maximum exposure to losses as of March 31, 2018 is the amount of investment and the future funding commitments, which total 26 million U.S. dollars.

As described in Note 6, certain accounts receivable sales programs also involve VIEs. These VIEs are all special purpose entities associated with the sponsor banks. Based on a qualitative assessment, Sony is not the primary beneficiary and therefore does not consolidate these entities as Sony does not have the power to direct the activities, an obligation to absorb losses, or the right to receive the residual returns of these VIEs. Sony’s maximum exposure to losses from these VIEs is considered insignificant.

24. Acquisitions

(1) Sony Semiconductor acquisitions

On December 4, 2015, Sony Corporation and Toshiba Corporation (“Toshiba”) signed definitive agreements (the “Transfer Agreements”) to transfer to Sony Corporation and to Sony Semiconductor Manufacturing Corporation (“SCK”), a wholly-owned subsidiary of Sony, semiconductor fabrication facilities, equipment and related assets, as well as other related equipment and assets owned by Toshiba, for 19,000 million yen.

On March 31, 2016, pursuant to the Transfer Agreements, SCK acquired from Toshiba a portion of the semiconductor fabrication facilities, equipment and related assets (the “Toshiba Transferred Assets”) for 16,700 million yen. The purchase price for the Toshiba Transferred Assets is included within Other in the investing activities section of the consolidated statements of cash flows. SCK is utilizing the Toshiba Transferred Assets to establish a new technology center and further strengthen its production capacity for CMOS image sensors. The purchase price for the Toshiba Transferred Assets was allocated and recorded primarily to machinery and equipment. SCK also entered into a supply arrangement with Toshiba to manufacture and supply CMOS image sensors for a certain period following the acquisition. In connection with this acquisition, SCK also acquired related inventories from Toshiba.

As the purchase price for the Toshiba Transferred Assets was fully allocated to identifiable tangible and intangible assets and no liabilities were assumed, no goodwill was recorded as part of the acquisition. Pro forma results of operations have not been presented because the effect of the acquisition was not material.

(2) Orchard acquisition

In April 2015, Sony Music Entertainment (“SME”), a wholly owned subsidiary of Sony, increased its shareholding in The Orchard to 100% by acquiring Orchard Asset Holdings, LLC’s 49% equity interest for 22,168 million yen (185 million U.S. dollars).

Prior to the acquisition, SME’s interest in The Orchard was accounted for under the equity method of accounting. As a result of SME’s obtaining a controlling interest in The Orchard, Sony consolidated The Orchard in accordance with the accounting guidance for business combinations achieved in stages and remeasured the 51% equity interest in The Orchard that it owned prior to the acquisition at a fair value, and recognized a gain of 18,085 million yen (151 million U.S. dollars) in other operating expense, net in the consolidated statement of income.

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As a result of the acquisition, Sony recorded 36,664 million yen (307 million U.S. dollars) of goodwill and 13,806 million yen (115 million U.S. dollars) of intangible assets. The cash consideration of 19,547 million yen (164 million U.S. dollars) paid in this transaction, net of cash received, is included within Other in the investing activities section of the consolidated statements of cash flows.

Pro forma results of operations have not been presented because the effect of the acquisition was not material.

(3) TEN Sports Network acquisition

On February 28, 2017, Sony Pictures Networks India, a wholly-owned subsidiary of Sony, completed the first phase of a two-phase acquisition of the TEN Sports Network in a majority of the countries and territories where TEN Sports Network operates, including India, for total consideration of 39,106 million yen (346 million U.S. dollars), of which 37,298 million yen (330 million U.S. dollars) was paid during the fiscal year ended March 31, 2017 and the remaining 1,772 million yen (16 million U.S. dollars) was paid during the fiscal year ended March 31, 2018. On September 15, 2017, Sony Pictures Networks India completed the final phase of the acquisition for cash consideration of 2,316 million yen (21 million U.S. dollars).

As a result of the acquisition, Sony recorded 26,489 million yen (235 million U.S. dollars) of goodwill and 14,910 million yen (132 million U.S. dollars) of intangible assets. The cash consideration paid in this transaction, net of cash received, is included within Other in the investing activities section of the consolidated statements of cash flows.

Pro forma results of operations have not been presented because the effect of the acquisition was not material.

(4) Other acquisitions

During the fiscal year ended March 31, 2016, Sony completed other acquisitions for total consideration of 46,233 million yen which were paid for primarily in cash and included the February 1, 2016 acquisition of Altair for total consideration of 25,565 million yen. Altair develops and sells products focused on LTE (Long Term Evolution) technologies. There was no material contingent consideration subject to future change. The cash consideration of 22,657 million yen paid in the Altair transaction is included within Other in the investing activities section of the consolidated statements of cash flows. As a result of these acquisitions, Sony recorded 36,128 million yen of goodwill and 14,983 million yen of intangible assets, of which 17,879 million yen of goodwill and 6,600 million yen of intangible assets related to the Altair transaction.

During the fiscal year ended March 31, 2017, Sony completed other acquisitions for total consideration of 12,409 million yen which were paid for primarily in cash and there was no material contingent consideration subject to future change. As a result of these acquisitions, Sony recorded 12,384 million yen of goodwill and 7,073 million yen of intangible assets.

During the fiscal year ended March 31, 2018, Sony completed other acquisitions for total consideration of 27,459 million yen which were paid for primarily in cash and there was no material contingent consideration subject to future change. As a result of these acquisitions, Sony recorded 20,013 million yen of goodwill and 4,980 million yen of intangible assets.

No significant amounts have been allocated to in-process research and development and all of the entities described above have been consolidated into Sony’s results of operations since their respective acquisition dates. Pro forma results of operations have not been presented because the effects of other acquisitions, individually and in aggregate, were not material.

25. Divestitures

(1) Sale of the logistics business

On April 1, 2015, in connection with the formation of a logistics joint venture, Sony sold a part of its logistics business in Japan, Thailand, and Malaysia within Corporate to MITSUI-SOKO HOLDINGS Co., Ltd. for a sales price of 19,211 million yen. As a result of the sale, Sony recognized a gain of 12,284 million yen in other operating expense, net in the consolidated statement of income.

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(2) Battery business

On October 31, 2016, Sony and Murata Manufacturing Co., Ltd. signed a binding definitive agreement to transfer the Sony Group’s battery business to the Murata Group which was completed on September 1, 2017. Sony classified certain assets and liabilities related to the battery business as held for sale and, as a result of the fair value valuation of these assets and liabilities, recorded impairment losses of 42,298 million yen in other operating expense, net in the consolidated statements of income for the fiscal year ended March 31, 2017.

(3) Sale of equity interest in Sony Electronics Huanan Co., Ltd.

On April 1, 2017, Sony transferred all of the equity interest in Sony Electronics Huanan Co., Ltd. (“SEH”), a wholly-owned subsidiary in the Semiconductors segment that manufactures camera modules, to Shen Zhen O-Film Tech Co., Ltd. The consideration for the transfer is approximately 234 million U.S. dollars, including the assumption of SEH’s debt and the sales price of approximately 95 million U.S. dollars. As the result of the transfer, Sony recognized a gain on transfer totaling 28,262 million yen in other operating expense, net in the consolidated statement of income for the fiscal year ended March 31, 2018.

26. Collaborative arrangements

Sony’s collaborative arrangements primarily relate to arrangements entered into, through subsidiaries in the Pictures segment, with one or more active participants to jointly finance, produce and/or distribute motion pictures or television programming under which both the subsidiaries and the other active participants share in the risks and rewards of ownership. These arrangements are referred to as co-production and distribution arrangements.

Sony typically records an asset for only the portion of the motion pictures or television programming it owns and finances. Sony and the other participants typically distribute the product in different media or markets. Revenues earned and expenses incurred for the media or markets in which Sony distributes the product are typically recorded on a gross basis. Sony typically does not record revenues earned and expenses incurred when the other participants distribute the product. Sony and the other participants typically share in the profits from the distribution of the product in all media or markets. For motion pictures, if Sony is a net receiver of (1) Sony’s share of the profits from the media or markets distributed by the other participants less (2) the other participants’ share of the profits from the media or markets distributed by Sony then the net amount is recorded as net sales. If Sony is a net payer then the net amount is recorded in cost of sales. For television programming, Sony records its share of the profits from the media or markets distributed by the other participants as sales, and the other participants’ share of the profits from the media or markets distributed by Sony as cost of sales.

For the fiscal years ended March 31, 2016, 2017 and 2018, 30,888 million yen, 44,124 million yen and 49,547 million yen, respectively, were recorded as net sales for amounts due from the other participants and 38,303 million yen, 29,594 million yen and 24,280 million yen, respectively, were recorded as cost of sales for amounts owed to the other participants in these collaborative arrangements.

27. Commitments, contingent liabilities and other

(1) Loan commitments

Subsidiaries in the Financial Services segment have entered into loan agreements with their customers in accordance with the condition of the contracts. As of March 31, 2018, the total unused portion of the lines of credit extended under these contracts was 31,245 million yen. The aggregate amounts of future year-by-year payments for these loan commitments cannot be determined.

(2) Purchase commitments and other

Purchase commitments and other outstanding as of March 31, 2018 amounted to 367,991 million yen. The major components of these commitments are as follows:

Certain subsidiaries in the Pictures segment have entered into agreements with creative talent for the development and production of motion pictures and television programming as well as agreements with third parties to acquire completed motion pictures, or certain rights therein, and to acquire the rights to broadcast certain live action sporting events. These agreements cover various periods mainly within three years. As of March 31, 2018, these subsidiaries were committed to make payments under such contracts of 118,914 million yen.

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Certain subsidiaries in the Music segment have entered into long-term contracts with recording artists, songwriters and companies for the future production, distribution and/or licensing of music product. These contracts cover various periods mainly within five years. As of March 31, 2018, these subsidiaries were committed to make payments of 73,259 million yen under such long-term contracts.

A subsidiary in the Game & Network Services segment has entered into long-term contracts for programming content. These contracts cover various periods mainly within two years. As of March 31, 2018, this subsidiary was committed to make payments of 26,227 million yen under such long-term contracts.

Sony has entered into long-term sponsorship contracts related to advertising and promotional rights. These contracts cover various periods mainly within two years. As of March 31, 2018, Sony has committed to make payments of 6,379 million yen under such long-term contracts.

The schedule of the aggregate amounts of year-by-year payment of purchase commitments during the next five fiscal years and thereafter is as follows:

Fiscal year ending March 31	Yen in millions
2019		211,713
2020		85,755
2021		25,249
2022		17,212
2023		12,014
Later fiscal years		16,048
Total		367,991

(3) Litigation

Beginning in 2009, the U.S. Department of Justice (“DOJ”), the European Commission and certain other governmental agencies outside the United States have conducted investigations relating to competition in the optical disk drives market. Sony Corporation and/or certain of its subsidiaries have been subject to these investigations. Sony understands that the investigations of several governmental agencies, including the DOJ, have ended, and the only remaining investigation has reached a settlement, which is subject to a final ruling from the relevant agency. However, proceedings initiated by the European Commission as a result of its investigation continue. In October 2015, the European Commission adopted a decision in which it fined Sony Corporation and certain of its subsidiaries 31 million euros; however, Sony filed an appeal against the decision with the European Union’s General Court. In addition, a number of direct and indirect purchaser lawsuits, including class actions, have been filed in certain jurisdictions in which the plaintiffs allege that Sony Corporation and certain of its subsidiaries violated antitrust laws and seek recovery of damages and other remedies. Certain of these lawsuits have been settled, including the class actions brought by the direct and indirect purchasers in the United States; however, certain other lawsuits continue. Based on the stage of the pending proceedings, it is not possible to estimate the amount of losses or range of possible losses, if any, that might ultimately result from adverse judgments, settlements or other resolution of all of these matters.

Since 2011, in relation to the secondary batteries business that was operated by Sony and certain of its subsidiaries, a number of direct and indirect purchaser lawsuits, including class actions, have been filed in certain jurisdictions in which the plaintiffs allege that Sony Corporation and certain of its subsidiaries violated antitrust laws and seek recovery of damages and other remedies. Certain of these lawsuits have been settled, including the class actions brought by the direct and indirect purchasers in the United States; however, certain other lawsuits are still pending. Based on the stage of the pending proceedings, it is not possible to estimate the amount of losses or range of possible losses, if any, that might ultimately result from adverse judgments, settlements or other resolution of all of these matters.

In addition, Sony Corporation and certain of its subsidiaries are defendants or otherwise involved in other pending legal and regulatory proceedings. However, based upon the information currently available, Sony believes that the outcome from such legal and regulatory proceedings would not have a material impact on Sony’s results of operations and financial position.

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(4) Guarantees

Sony has issued guarantees that contingently require payments to guaranteed parties if certain specified events or conditions occur. The maximum potential amount of future payments under these guarantees as of March 31, 2018 amounted to 2,642 million yen.

In addition to the above, Sony also issues contractual product warranties under which it generally guarantees the performance of products delivered and services rendered for a certain period or term. The changes in the product warranty liability for the fiscal years ended March 31, 2016, 2017 and 2018 are as follows:

	Yen in millions
	Fiscal year ended March 31
	2016			2017			2018
Balance at beginning of the fiscal year		75,129			66,943			60,798
Additional liabilities for warranties		83,227			53,502			34,557
Settlements (in cash or in kind)		(81,462	)		(49,532	)		(32,549	)
Changes in estimate for pre-existing warranty reserve		(6,440	)		(7,927	)		(16,888	)
Translation adjustment		(3,511	)		(2,188	)		2,234
Balance at end of the fiscal year		66,943			60,798			48,152

28. Business segment information

The reportable segments presented below are the segments of Sony for which separate financial information is available and for which operating profit or loss amounts are evaluated regularly by the chief operating decision maker (“CODM”) in deciding how to allocate resources and in assessing performance. The CODM does not evaluate segments using discrete asset information. Sony’s CODM is its Chief Executive Officer and President.

Sony realigned its business segments from the first quarter of the fiscal year ended March 31, 2018. As a result of this realignment, the operation of the former Components segment is now included in All Other. In connection with this realignment, the sales and operating revenue and operating income (loss) of each segment for the comparable period have been reclassified to conform to the current presentation.

The G&NS segment includes network services businesses, the manufacture and sales of home gaming products and production and sales of software. The Music segment includes Recorded Music, Music Publishing and Visual Media and Platform businesses. The Pictures segment includes Motion Pictures, Television Productions and Media Networks businesses. The HE&S segment includes Televisions as well as Audio and Video businesses. The IP&S segment includes the Still and Video Cameras business. The MC segment includes the manufacture and sales of mobile phones and an internet-related service business. The Semiconductors segment includes the image sensors business. The Financial Services segment primarily represents individual life insurance and non-life insurance businesses in the Japanese market and the banking business in Japan. All Other consists of various operating activities, including the overseas disc manufacturing, recording media and battery businesses. Sony’s products and services are generally unique to a single operating segment.

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Segment sales and operating revenue:

	Yen in millions
	Fiscal year ended March 31
	2016			2017			2018
Sales and operating revenue:
Game & Network Services —
Customers		1,479,775			1,581,568			1,848,298
Intersegment		72,118			68,231			95,514
Total		1,551,893			1,649,799			1,943,812
Music —
Customers		602,564			630,767			784,792
Intersegment		16,675			16,891			15,203
Total		619,239			647,658			799,995
Pictures —
Customers		935,827			901,230			1,010,173
Intersegment		2,315			1,899			894
Total		938,142			903,129			1,011,067
Home Entertainment & Sound —
Customers		1,155,085			1,034,215			1,221,734
Intersegment		3,957			4,789			999
Total		1,159,042			1,039,004			1,222,733
Imaging Products & Solutions —
Customers		677,231			571,499			647,163
Intersegment		6,724			8,134			8,729
Total		683,955			579,633			655,892
Mobile Communications —
Customers		1,121,925			752,688			713,916
Intersegment		5,548			6,457			9,826
Total		1,127,473			759,145			723,742
Semiconductors —
Customers		599,430			659,779			726,892
Intersegment		139,629			113,344			123,118
Total		739,059			773,123			850,010
Financial Services —
Customers		1,066,319			1,080,284			1,221,235
Intersegment		6,750			7,220			7,142
Total		1,073,069			1,087,504			1,228,377
All Other —
Customers		435,668			375,116			351,527
Intersegment		104,526			75,334			55,647
Total		540,194			450,450			407,174
Corporate and elimination		(326,354	)		(286,195	)		(298,820	)
Consolidated total		8,105,712			7,603,250			8,543,982

G&NS intersegment amounts primarily consist of transactions with All Other. Semiconductors intersegment amounts primarily consist of transactions with the MC segment, the G&NS segment and the IP&S segment. All Other intersegment amounts primarily consist of transactions with the Pictures segment, the Music segment and the G&NS segment. Corporate and elimination includes certain brand and patent royalty income.

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Segment profit or loss:

	Yen in millions
	Fiscal year ended March 31
	2016			2017			2018
Operating income (loss):
Game & Network Services		88,668			135,553			177,478
Music		86,509			75,798			127,786
Pictures		38,507			(80,521	)		41,110
Home Entertainment & Sound		50,558			58,504			85,841
Imaging Products & Solutions		69,320			47,257			74,924
Mobile Communications		(61,435	)		10,164			(27,636	)
Semiconductors		14,500			(7,811	)		164,023
Financial Services		156,543			166,424			178,947
All Other		(41,252	)		(29,585	)		(23,530	)
Total		401,918			375,783			798,943
Corporate and elimination		(107,721	)		(87,081	)		(64,083	)
Consolidated operating income		294,197			288,702			734,860
Other income		66,849			14,418			23,728
Other expenses		(56,542	)		(51,501	)		(59,539	)
Consolidated income before income taxes		304,504			251,619			699,049

Operating income (loss) is sales and operating revenue less costs and expenses, and includes equity in net income (loss) of affiliated companies.

Corporate and elimination includes headquarters restructuring costs and certain other corporate expenses, including the amortization of certain intellectual property assets such as the cross-licensing of intangible assets acquired from Ericsson at the time of the Sony Mobile Communications acquisition, which are not allocated to segments.

Pursuant to a separation of Sony’s businesses into distinct subsidiaries and a realignment of corporate functions, changes have been made to the method of calculating the amount of pension and severance-related expenses allocated to Sony’s headquarters and each business segment. As a result of these changes, an increase in corporate costs totaling 7.5 billion yen is included in Corporate and elimination for the fiscal year ended March 31, 2018. Conversely, a decrease in expenses totaling the same amount is included in each business segment, mainly in the Semiconductors (3.2 billion yen) and IP&S (2.0 billion yen) segments. These changes have no impact on consolidated operating income.

F-76

SONY CORPORATION AND CONSOLIDATED SUBSIDIARIES

Other significant items:

	Yen in millions
	Fiscal year ended March 31
	2016			2017			2018
Equity in net income (loss) of affiliated companies:
Game & Network Services		—			—			—
Music		3,801			5,435			4,483
Pictures		(981	)		(35	)		(129	)
Home Entertainment & Sound		—			—			—
Imaging Products & Solutions		—			—			—
Mobile Communications		(186	)		(79	)		(102	)
Semiconductors		—			—			—
Financial Services		(645	)		(3,601	)		(61	)
All Other		249			1,843			4,378
Consolidated total		2,238			3,563			8,569
Depreciation and amortization:
Game & Network Services		20,798			25,486			29,091
Music		17,795			16,124			18,230
Pictures		22,375			20,487			24,458
Home Entertainment & Sound		21,781			19,830			21,136
Imaging Products & Solutions		27,612			25,442			23,928
Mobile Communications		24,186			19,794			19,215
Semiconductors		100,964			102,328			99,258
Financial Services, including deferred insurance acquisition costs		102,270			47,056			79,843
All Other		17,767			7,407			5,910
Total		355,548			283,954			321,069
Corporate		41,543			43,094			40,375
Consolidated total		397,091			327,048			361,444

F-77

SONY CORPORATION AND CONSOLIDATED SUBSIDIARIES

The following table includes a breakdown of sales and operating revenue to external customers by product category for certain segments. Sony management views each segment as a single operating segment.

	Yen in millions
	Fiscal year ended March 31
	2016		2017		2018
Sales and operating revenue:
Game & Network Services
Network		529,318		714,924		1,033,192
Hardware and Others		950,457		866,644		815,106
Total		1,479,775		1,581,568		1,848,298
Music
Recorded Music		412,718		388,948		446,960
Music Publishing		71,258		66,541		74,360
Visual Media and Platform		118,588		175,278		263,472
Total		602,564		630,767		784,792
Pictures
Motion Pictures		447,355		409,363		448,945
Television Productions		270,115		271,886		289,024
Media Networks		218,357		219,981		272,204
Total		935,827		901,230		1,010,173
Home Entertainment & Sound
Televisions		797,764		720,557		861,763
Audio and Video		354,946		311,771		357,194
Other		2,375		1,887		2,777
Total		1,155,085		1,034,215		1,221,734
Imaging Products & Solutions
Still and Video Cameras		428,777		351,834		415,318
Other		248,454		219,665		231,845
Total		677,231		571,499		647,163
Mobile Communications		1,121,925		752,688		713,916
Semiconductors		599,430		659,779		726,892
Financial Services		1,066,319		1,080,284		1,221,235
All Other		435,668		375,116		351,527
Corporate		31,888		16,104		18,252
Consolidated total		8,105,712		7,603,250		8,543,982

In the G&NS segment, Network includes network services relating to game, video and music content provided by Sony Interactive Entertainment; Hardware and Others includes home and portable game consoles, packaged software and peripheral devices. In the Music segment, Recorded Music includes the distribution of physical and digital recorded music and revenue derived from artists’ live performances; Music Publishing includes the management and licensing of the words and music of songs; Visual Media and Platform includes the production and distribution of animation titles, including game applications based on the animation titles, and various service offerings for music and visual products. In the Pictures segment, Motion Pictures includes the worldwide production, acquisition and distribution of motion pictures and direct-to-video content; Television Productions includes the production, acquisition and distribution of television programming; Media Networks includes the operation of television and digital networks worldwide. In the HE&S segment, Televisions includes LCD and OLED televisions; Audio and Video includes Blu-ray disc players and recorders, home audio, headphones and memory-based portable audio devices. In the IP&S segment, Still and Video Cameras includes interchangeable lens cameras, compact digital cameras, consumer video cameras and video cameras for broadcast; Other includes display products such as projectors and medical equipment.

F-78

SONY CORPORATION AND CONSOLIDATED SUBSIDIARIES

Geographic Information:

Sales and operating revenue attributed to countries and areas based on location of external customers for the fiscal years ended March 31, 2016, 2017 and 2018 and property, plant and equipment, net as of March 31, 2017 and 2018 are as follows:

	Yen in millions
	Fiscal year ended March 31
	2016		2017		2018
Sales and operating revenue:
Japan		2,317,312		2,392,790		2,625,619
United States		1,733,759		1,673,768		1,835,705
Europe		1,881,329		1,634,683		1,841,457
China		540,497		557,995		674,718
Asia-Pacific		959,171		866,712		1,024,179
Other Areas		673,644		477,302		542,304
Total		8,105,712		7,603,250		8,543,982

	Yen in millions
	March 31
	2017		2018
Property, plant and equipment, net:
Japan		580,453		563,593
United States		101,167		97,979
Europe		24,273		23,302
China		13,466		11,232
Asia-Pacific		34,575		36,738
Other Areas		4,265		6,626
Total		758,199		739,470

Major countries and areas in each geographic segment excluding Japan, United States and China are as follows:

(1) Europe:	United Kingdom, France, Germany, Russia, Spain and Sweden
(2) Asia-Pacific:	India, South Korea, Oceania, Thailand and Malaysia
(3) Other Areas:	The Middle East/Africa, Brazil, Mexico and Canada

There are no individually material countries with respect to sales and operating revenue or property, plant and equipment, net included in Europe, Asia-Pacific and Other Areas.

Transfers between reportable business segments or geographic areas are made at individually negotiated prices that are intended to reflect a market-based transfer price.

There were no sales and operating revenue with any single major external customer for the fiscal years ended March 31, 2016, 2017 and 2018.

29. Subsequent events

(1) Public listing of Spotify

On April 3, 2018, Spotify Technology S.A. (“Spotify”) was publicly listed for trading on the New York Stock Exchange. Sony owned 5.707% of Spotify’s shares (5.082% on a fully diluted basis) at the time of the public listing. Due to the public listing and the subsequent sale of a portion of such shares owned by Sony, Sony expects to record an unrealized valuation gain for the shares Sony continues to hold after the listing and a realized gain for the shares sold, net of the estimated amount to be shared with its artists and distributed labels. The sum of the unrealized valuation gain (net) and the gain on the sale of shares (net) to be recorded for the fiscal year ending March 31, 2019 is expected to be approximately 100 billion yen in total.

F-79

SONY CORPORATION AND CONSOLIDATED SUBSIDIARIES

(2) Acquisition of equity interest in EMI

On May 22, 2018, Sony Corporation of America (“SCA”), a wholly-owned subsidiary of Sony Corporation, and Nile Acquisition Holding Company Ltd., the entity through which a consortium led by Mubadala Investment Company owns an approximately 60% equity interest in DH Publishing, L.P. (“EMI”), which owns and manages EMI Music Publishing, signed a legally binding memorandum of understanding for the sale of such equity interest in EMI to SCA. The closing of the transaction is subject to certain closing conditions, including regulatory approvals. Sony currently owns an approximately 40% equity interest in EMI jointly through a majority-owned subsidiary of Sony Corporation. As a result of this transaction, Sony will indirectly own approximately 90% of the equity interest in EMI and it will become a consolidated subsidiary of Sony.

F-80

SCHEDULE II

VALUATION AND QUALIFYING ACCOUNTS

SONY CORPORATION AND CONSOLIDATED SUBSIDIARIES

	Yen in millions
	Balance at beginning of period		Additions charged to costs and expenses		Deductions (Note 1)			Other (Note 2)			Balance at end of period
Fiscal year ended March 31, 2016:
Allowance for doubtful accounts and sales returns		86,598		56,687		(66,443	)		(4,059	)		72,783
Fiscal year ended March 31, 2017:
Allowance for doubtful accounts and sales returns		72,783		33,667		(50,858	)		(2,442	)		53,150
Fiscal year ended March 31, 2018:
Allowance for doubtful accounts and sales returns		53,150		45,515		(51,302	)		1,300			48,663
Notes: 1.  Reversal including amounts written off. 2.  Translation adjustments.
	Balance at beginning of period		Additions		Deductions			Other (Note 1)			Balance at end of period
Fiscal year ended March 31, 2016:
Valuation allowance — Deferred tax assets		1,077,622		154,171		(116,277	)		(59,658	)		1,055,858
Fiscal year ended March 31, 2017:
Valuation allowance — Deferred tax assets		1,055,858		149,697		(154,210	)		619			1,051,964
Fiscal year ended March 31, 2018:
Valuation allowance — Deferred tax assets		1,051,964		70,797		(123,597	)		(99,329	)		899,835

Note:

1. Translation adjustments and the effect of change in statutory tax rate.

F-81

EX-1.3

Exhibit 1.3

(TRANSLATION)

CHARTER OF THE BOARD OF DIRECTORS

SONY CORPORATION

(TRANSLATION)

CHARTER OF THE BOARD OF DIRECTORS

OF

SONY CORPORATION

Article 1.    Purpose of Charter

The purpose of this Charter of the Board of Directors of Sony Corporation (hereinafter referred to as the “Corporation”) is to set forth the basic governance principles of the Board of Directors of the Corporation (hereinafter referred to as the “Board of Directors”) and its committees, subject to applicable law, regulation and the Articles of Incorporation. The Board of Directors and such committees shall follow this Charter, as well as applicable law, regulation and the Articles of Incorporation, while adhering to high ethical standards.

Article 2.    Purpose and Duties of Board of Directors

(1) The purpose of the Board of Directors shall be to enhance the corporate value of Sony Group.

(2) The Board of Directors shall perform the following duties in furtherance of the purpose set forth in the preceding paragraph:

(a) Determine the fundamental management policies of the Sony Group and other matters to be approved by the Board of Directors pursuant to applicable law, regulation, the Articles of Incorporation and this Charter.

(b) Oversee the performance of the duties of Directors and Corporate Executive Officers and the performance of Sony Group’s business operations.

Article 3.    Constitution of Board of Directors

The Board of Directors shall consist of not fewer than ten (10) Directors and not more than twenty (20) Directors.

Article 4.    Director Qualifications

(1) All Directors shall satisfy all of the following qualifications:

(a) Shall not be a director, a statutory auditor, a corporate executive officer, a general manager or other employees of any company in competition with Sony Group in any of Sony Group’s principal businesses (hereinafter referred to as “Competing Company”) or own three percent (3%) or more of the shares of any Competing Company.

(b) Shall not be or have been a representative partner or partner of any independent auditor of Sony Group during the past three (3) years before being nominated as a Director.

(c) Shall not have any connection with any matter that may cause a material conflict of interest in performing the duties of a Director.

(2) Directors who are Corporate Executive Officers shall also satisfy the following qualification:

Shall, in their roles as Corporate Executive Officers, be those responsible for the overall management of Sony Group or for important and extensive headquarters functions of Sony Group.

(3) Directors who will be deemed “Outside Directors” by the Corporation shall also satisfy all of the following qualifications as well as those for “Outside Director” as provided in the Companies Act of Japan:

(a) Shall not have received directly from Sony Group, during any consecutive twelve-month (12 month) period within the last three (3) years, more than an amount equivalent to one hundred twenty thousand United States dollars (US$120,000), other than director and committee fees and pension or other forms of deferred compensation for prior service (provided such compensation is not contingent in any way on continued service).

(b) Shall not be an executive director, a corporate executive officer, a general manager or other employees of any company whose aggregate amount of transactions with Sony Group, in any

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of the last three (3) fiscal years, exceeds the greater of an amount equivalent to one million United States dollars (US$1,000,000), or two percent (2%) of the annual consolidated sales of such company.

Article 5.    Re-election of Outside Directors

Each Outside Director may, by resolution of the Nominating Committee, be nominated as a Director candidate for re-election five (5) times, and thereafter by resolution of the Nominating Committee and by consent of all of the Directors; provided, however, that in no event may any Outside Director be re-elected more than eight (8) times.

Article 6.    Chairman of the Board and Vice Chairmen of the Board

(1) The Chairman of the Board of Directors (hereinafter referred to as the “Chairman of the Board”) shall be appointed by a resolution of the Board of Directors from among the Directors who are not Representative Corporate Executive Officers.

(2) The Chairman of the Board shall convene meetings of the Board of Directors, determine the agenda of such meetings, and perform such acts as provided in this Charter.

(3) When the Chairman of the Board is unable to act, another Director, who shall be designated in accordance with an order of priority previously determined by a resolution of the Board of Directors, shall act as the Chairman of the Board.

(4) The Board of Directors may appoint one (1) or more vice chairmen of the Board of Directors (hereinafter referred to as the “Vice Chairmen of the Board”) from among the Directors who are not Representative Corporate Executive Officers. Vice Chairmen of the Board shall assist the Chairman of the Board.

(5) The Chairman of the Board and Vice Chairmen of the Board may attend meetings of the committees set out in Article 14, Paragraph 1 (hereinafter each referred to as a “Committee” and collectively as the “Committees”) as an observer. The Chairman of the Board and Vice Chairmen of the Board shall not have a right to vote at such Committees, unless they are members thereof.

(6) The Chairman of the Board and Vice Chairmen of the Board may invite any person, as deemed necessary, to attend meetings of the Board of Directors and to report or express his or her opinion.

Article 7.    Meetings of Board of Directors

(1) Meetings of the Board of Directors shall be held at least once every three (3) months and at least six (6) times per year and additionally when necessary.

(2) The Board of Directors shall set its annual meeting schedule, activity plan and budget plan.

Article 8.    Convocation of Meetings of Board of Directors

(1) Meetings of the Board of Directors, as provided in Article 6, Paragraph 2, shall, as a general rule, be convened by the Chairman of the Board.

(2) If a Committee deems it necessary by adopting a resolution of such Committee to convene a meeting of the Board of Directors, the Chairman of the Committee shall request the Chairman of the Board to convene a meeting of the Board of Directors pursuant to Paragraph 4 of this Article, and the Chairman of the Board shall convene a meeting of the Board of Directors. The Chairman of the Committee may convene a meeting of the Board of Directors in accordance with Paragraph 3 of this Article if the Chairman of the Board does not convene the meeting despite such request; provided, however, that such convocation shall be made with the agenda to be submitted to the meeting of the Board of Directors.

(3) To convene a meeting of the Board of Directors, the Chairman of the Board shall send a notice of the meeting setting out the date and location of the meeting (with an agenda and back-up materials, as appropriate, at his/her discretion) to each Director at least five (5) days prior to the date set for the meeting. In the case of urgency, such notice period may be shortened. Meetings may be convened without following these convocation procedures with the consent of all Directors.

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(4) If a Director (other than the Chairman of the Board) and/or a Corporate Executive Officer wishes to convene a meeting of the Board of Directors, such Director or Corporate Executive Officer must submit an agenda (with back-up materials, as appropriate) to the Chairman of the Board and request the Chairman of the Board to convene a meeting of the Board of Directors.

(5) In the event a request for a meeting referred to in the preceding paragraph is made, and if, within five (5) days of such request, a notice of convocation of a meeting within two (2) weeks of the date of the request is not issued, the Director or Corporate Executive Officer who made the request may convene a meeting of the Board of Directors in accordance with Paragraph 3 of this Article.

Article 9.    Agenda of the Board of Directors

(1) Unless otherwise provided by law, regulation or the Articles of Incorporation, the agenda of the Board of Directors shall be determined by the Chairman of the Board, in accordance with proposals made by Directors and Corporate Executive Officers, or upon his/her own decision as the Chairman of the Board.

(2) The Director or Corporate Executive Officer who made a proposal under the preceding paragraph to the Chairman of the Board may request the Chairman of the Board to withdraw such submission.

Article 10.    Quorum and Resolutions of Board of Directors

(1) A quorum of a meeting of the Board of Directors shall be a majority of all Directors who may participate in a resolution, and a resolution of the Board of Directors shall be decided by a majority of the Directors present.

(2) No Director who has a conflict of interest with respect to an agenda item shall participate in any consideration or decision of such agenda item.

(3) Notwithstanding Paragraph 1 of this Article, in the event a Director makes a proposal of a matter to be resolved by the Board of Directors and then all of the Directors who may participate in the decision of such proposal unanimously consent to such proposal in writing or electronically, the Board of Directors shall be deemed to have approved such proposal.

Article 11.    Matters to be Decided by Board of Directors

(1) The matters requiring decision by the Board of Directors are those set forth in Appendix 1 of this Charter and such other matters as provided by law, regulation or the Articles of Incorporation.

(2) Determination of matters not included in the preceding paragraph shall be delegated to Corporate Executive Officers, subject to a resolution of the Board of Directors.

Article 12.    Matters to be reported to Board of Directors

(1) Matters to be reported to the Board of Directors are those set forth in Appendix 2 of this Charter and such other matters as provided by law, regulation or the Articles of Incorporation.

(2) Notwithstanding Paragraph 1 of this Article, in the event a Corporate Executive Officer or a Director provides to all Directors the required report in writing or electronically, a formal report at the Board of Directors meeting may be omitted, provided, however, that in no event, may a report required under Article 20, Paragraph 4, be omitted in this manner.

Article 13.    Minutes of Board of Directors

(1) With respect to proceedings at meetings of the Board of Directors, minutes shall be prepared in writing or electronically and kept at the head office of the Corporation for at least ten (10) years from the date of the meeting.

(2) A summary of all proceedings at meetings of the Board of Directors, the results of such proceedings, and any other matters as provided by law or regulation shall be recorded in the minutes, and the Directors present shall affix their names and seals thereon or put their electronic signatures thereon. Notwithstanding the above, for the minutes that record matters deemed to have been approved by the Board of Directors pursuant to Article 10, Paragraph 3 and the minutes that record matters omitted to

4

be reported to the Board of Directors pursuant to Article 12, Paragraph 2, the minutes shall be prepared in writing or electronically, but no Directors are required to affix their names and seals thereon or put their electronic signatures thereon.

(3) Unless otherwise provided by law or regulation, in the event any person wishes to examine or copy the minutes of the Board of Directors, the Chairman of the Board or a Vice Chairman of the Board may decide whether or not to approve such request, except that Directors need no such approval. The Chairman of the Board and the Vice Chairman of the Board may delegate such approval authority to the head of the administrative office of the Board of Directors.

Article 14.    Committees

(1) The Corporation has a Nominating Committee, Audit Committee and Compensation Committee. The matters related to each Committee, unless otherwise provided in this Charter, shall be set forth in the Charter of each Committee as determined by the Board of Directors (hereinafter referred to as the “Charter of the Committee”).

(2) The Board of Directors shall appoint and remove members of each Committee and a Chairman of each Committee, pursuant to law, regulation, the Articles of Incorporation and this Charter.

(3) Any Director may examine and make copies of minutes of a Committee meeting.

(4) Unless otherwise provided by law or regulation, in the event any person wishes to examine or copy the minutes of a Committee, the Chairman of such Committee may decide whether or not to give its approval to such request, except that Directors need no such approval. The Chairman of each Committee may delegate such approval authority to the head of the administrative office of such Committee.

Article 15.    Constitution of Nominating Committee

The Nominating Committee shall consist of at least three (3) Directors, the majority of whom shall be Outside Directors. At least one (1) Director of the Nominating Committee shall be a Corporate Executive Officer. In determining whether to appoint or remove a Nominating Committee Member, continuity of the Nominating Committee shall be duly taken into account.

Article 16.    Constitution of Audit Committee

(1) The Audit Committee shall consist of at least three (3) Directors, the majority of whom shall be Outside Directors, and subject also to Paragraph 2, below. In determining whether to appoint or remove an Audit Committee Member, continuity of the Audit Committee shall be duly taken into account.

(2) Each member of the Audit Committee (hereinafter referred to as an “Audit Committee Member”) shall satisfy all of the following qualifications:

(a) Shall not be a director engaged in the business operation, a corporate executive officer, an accounting counselor, a general manager or other employees of the Corporation or its subsidiaries.

(b) Shall meet the independence requirements or such other equivalent requirements of the U.S. securities laws and regulations as may from time to time be applicable to the Corporation.

Moreover, at least one (1) Audit Committee Member shall meet the audit committee financial expert requirements or such other equivalent requirements of the U.S. securities laws and regulations as may from time to time be applicable to the Corporation. The Board of Directors shall make a determination on whether or not such Audit Committee Members meet these requirements.

(3) No Audit Committee Member shall become, as a general rule, a member of the Nominating Committee or the Compensation Committee.

Article 17.    Constitution of Compensation Committee

The Compensation Committee shall consist of at least three (3) Directors, the majority of whom shall be Outside Directors, and a Director who is a CEO (Chief Executive Officer), a COO (Chief Operating Officer) or CFO

5

(Chief Financial Officer) or at any equivalent position shall not be a member of the Compensation Committee (hereinafter referred to as a “Compensation Committee Member”). In determining whether to appoint or remove a Compensation Committee Member, continuity of the Compensation Committee shall be duly taken into account.

Article 18.    Chairmen of Committees

(1) A Chairman of each Committee shall be appointed from among the members of such Committee by a resolution of the Board of Directors and shall be an Outside Director.

(2) The Chairman of each Committee shall convene meetings of the Committee, set the agenda of the Committee, and perform the acts provided in this Charter or the Charter of the Committee.

(3) When a Chairman of a Committee is unable to act, another Director of such Committee shall act as Chairman of the Committee, upon an order of priority previously determined by a resolution of the Board of Directors.

Article 19.    Optional Committees

The Board of Directors may, in addition to the Nominating Committee, Compensation Committee and Audit Committee, establish committees consisting of all or some of the Directors and Senior Executives.

Article 20.    Senior Executives including Corporate Executive Officers

(1) The Board of Directors shall appoint Corporate Executive Officers and other executives appointed by the Board of Directors that assume important roles in the management of Sony Group (Corporate Executive Officers and such executives appointed by the Board of Directors, hereinafter collectively referred to as the “Senior Executives”); it shall additionally appoint one or more Representative Corporate Executive Officers from among the Corporate Executive Officers.

(2) The Board of Directors may remove Senior Executives and Representative Corporate Executive Officers from such positions at any time.

(3) The Board of Directors shall determine the relationship among Senior Executives, including but not limited to the assignment of their duties and the supervising and directing relationships among them.

(4) Each Corporate Executive Officer (by himself/herself or through proxy who is another Corporate Executive Officer) shall report to the Board of Directors the status of the performance of their duties at least once each three (3) months directly or through other Corporate Executive Officers.

(5) The Board of Directors may require Senior Executives to attend meetings of the Board of Directors and to address such matters as may be requested by the Board of Directors.

Article 21.    Administrative Office

(1) The Board of Directors shall have an administrative office to administer the business of the Board of Directors.

(2) Administrative offices of the Nominating Committee, Compensation Committee and Audit Committee shall be established in the administrative office of the Board of Directors.

Article 22.    Expenses

The Board of Directors shall charge the Corporation for necessary expenses incurred in accordance with the activity plan and budget plan provided in Article 7, Paragraph 2, including fees for outside consultants, outside attorneys and other experts retained by the Board of Directors as it deems necessary to perform its duties.

Article 23.    Modification or Abolition

The modification or abolition of this Charter is subject to a resolution of the Board of Directors.

6

ADDENDUM

This Charter shall come into force on June 20, 2003.

Amended:	June 22, 2004
	(*Amendment to Appendix 1 to be effective on July 1, 2004)
	June 22, 2005
	October 26, 2005
	June 22, 2006
	June 20, 2008
	June 18, 2010
	June 23, 2015
	April 27, 2018
	June 19, 2018

7

Appendix 1: Matters to be decided by Board of Directors

1. General meetings of shareholders

Convocation of a general meeting of shareholders and the contents of the agenda to be submitted to the meeting (excluding the agenda items regarding the appointment and removal of Directors and the appointment, removal and non-reappointment of independent auditors, as such matters are determined by the Nominating Committee and Audit Committee, respectively)

2. Shares and reorganization of the Corporation

2.1 Listing of shares on stock exchanges and delisting of such shares

2.2 Transfer or assignment of all or a substantial part of the business, lease of all the business, and delegation of authority to management, of the Corporation; entering into, terminating, and amending agreements with any other companies regarding the distribution of all profits and losses of the Corporation, or a takeover of all of the business of another company by the Corporation (excluding simplified takeovers as defined under the Companies Act)

2.3 Content of proposals to be presented to a general meetings of shareholders for a share exchange, share transfer, corporate split, merger or any other reorganization of the Corporation (excluding simplified share exchanges, corporate splits and mergers as defined under the Companies Act)

2.4 Issuance of shares or stock acquisition rights or sale of repurchased shares constituting not less than 5% of the total issued shares

2.5 Issuance of shares or stock acquisition rights or sale of repurchased shares at an especially favorable price or condition

2.6 Purchase by the Corporation of its own shares

3. Settlement of accounts, financial statements and dividends

3.1 Approval of non-consolidated financial statements and appended schedules and consolidated financial statements

3.2 Approval of business reports and appended schedules filed under the Companies Act

3.3 Dividends and interim dividends and, if paid, the amount and date of payment

4. Board of Directors, Committees and Directors

4.1 Adoption, abolition and modification of the Charters of the Board of Directors, Nominating Committee, Audit Committee, Compensation Committee or any other committee established by the Board

4.2 Chairman of the Board and any Vice Chairmen of the Board; Order of substitution for the Chairman of the Board

4.3 Appointment and removal of members of each Committee

4.4 Appointment of a Chairman of each Committee; Order of substitution for the Chairmen of Committees

4.5 Any reduction in liability of Directors to the Corporation pursuant to the Articles of Incorporation

4.6 Contents of limitation of liability agreements with Directors who do not execute the operation of the Corporation

4.7 Approval of transactions that may result in a Director engaging in competitive transactions or transactions entered into by a Director that may result in a conflict of interests between the Corporation and such Director

8

4.8 Approval of a Director’s assumption of a role as a director, corporate executive officer, statutory auditor, employee or any position in any entity that may result in the Director engaging in competitive transactions or transactions that may result in a conflict of interests between the Corporation and such Director

4.9 Matters to be reported to the Board of Directors from Committees, Senior Executives and employees

4.10 Judgement whether or not an Audit Committee Member is an “Audit Committee Financial Expert”

4.11 Matters necessary for the Audit Committee to execute its duties including:

4.11.1 Matters regarding Directors and/or employees of the Corporation who support the execution of duties by the Audit Committee (the “Audit Committee Supporting Personnel”)

4.11.2 Matters regarding independence of the Audit Committee Supporting Personnel from Corporate Executive Officers and matters to assure that the Audit Committee’s instructions to the Audit Committee Supporting Personnel are carried out

4.11.3 System of reporting to the Audit Committee of the Corporation by Directors (excluding a Director who is an Audit Committee Member), Corporate Executive Officers and employees of the Corporation, and system of reporting to the Audit Committee of the Corporation by Directors, Accounting Advisors, Statutory Auditors, Corporate Executive Officers, Members who execute the business, any personnel who execute their duties under Article 598, Paragraph 1 of the Companies Act of Japan, equivalents thereof, employees or certain personnel who received a report from the above, of Sony Group companies

4.11.4 System to ensure any personnel who make the report referred to in the preceding item would not be treated unfavorably due to their report

4.11.5 Matters regarding the procedures for prepayment or reimbursement of expenses resulting from the execution of duties by the Audit Committee Members and the policy for treatment of any expenses or liabilities resulting from the execution of their duties

4.11.6 Other systems to ensure effective oversight by the Audit Committee

4.12 Adoption, modification or abolition of administrative regulations concerning the Directors

4.13 Matters regarding the independence of the manager of the administrative office of the Board of Directors from Corporate Executive Officers

4.14 Contents of directors’ and officers’ liability insurance and amendments thereof

5. Senior Executives including Corporate Executive Officers

5.1 Appointment and removal of Senior Executives, including Corporate Executive Officers

5.2 Appointment and removal of Representative Corporate Executive Officers

5.3 Matters regarding the relationship among Senior Executives, including Corporate Executive Officers, including but not limited to their duties and the supervising and directing relationship among them

5.3.1 Assignment of the duties and powers of Senior Executives, including Corporate Executive Officers

5.3.2 Relationship among Senior Executives, including Corporate Executive Officers

5.3.3 Establishment of the Group Executive Committee, its members and function, and matters that must be discussed at the committee

9

5.4 Approval of transactions that may result in a Corporate Executive Officer’ engaging in competitive transactions or transactions entered into by a Corporate Executive Officer that result in a conflict of interests between the Corporation and such Corporate Executive Officer

5.5 Assumption by a Corporate Executive Officer of a role as a director, corporate executive officer, statutory auditor, employee or any other position in any entity that may result in the Corporate Executive Officer engaging in competitive transactions or transactions that may result in a conflict of interests between the Corporation and such Corporate Executive Officer

5.6 Any reduction in liability of Corporate Executive Officers to the Corporation pursuant to the Articles of Incorporation

5.7 Adoption, modification or abolishment of administrative regulations concerning the officers of Sony Corporation

6. Fundamental management policies of Sony Group

6.1 Structure of internal governance of Sony Group

6.1.1 Approval of fundamental matters related to the internal corporate governance of Sony Group and the Corporation

6.1.1.1 Sony Group Code of Conduct

6.1.1.2 Matters related to improvement of governance-related structures of Sony Group and the Corporation

6.1.1.3 Systems to ensure Corporate Executive Officers’ compliance with law, regulation and Articles of Incorporation and systems to ensure the adequacy of the business of Sony Group

6.1.1.3.1 System to ensure the execution of duties by Corporate Executive Officers and employees of the Corporation and Directors, Corporate Executive Officers and employees of Sony Group companies (“Sony Group Personnel”) in compliance with laws, regulations and the Articles of Incorporation

6.1.1.3.2 System to ensure efficient execution of duties by Corporate Executive Officers of the Corporation and Sony Group Personnel

6.1.1.3.3 Systems regarding rules and other structures of risk management of the Corporation and Sony Group companies

6.1.1.3.4 System of reporting to the Corporation regarding matters related to the execution of duties by the Sony Group Personnel

6.1.1.3.5 System regarding the retention/management of information relating to execution of duties by Corporate Executive Officers of the Corporation

6.1.1.4 Global Policy on Insider Trading Prevention and Regulations for Prevention of Insider Trading

6.1.1.5 Any other matters related to the fundamentals of internal corporate governance

6.2. Approval of mid-term plan (consolidated/segments)

6.2.1 Mid/long-term management policies

6.2.2 Mid/long-term material commitments

10

6.3 Approval of annual business plan (consolidated/segments)

6.3.1 Annual management policies and prioritized measures (consolidated/segments)

6.3.2 Key performance indicators (KPI)

6.3.2.1 Sales, profits and cash flow

6.3.2.2 Capital expenditures, investments, cost and inventories

6.4 Approval of substantial changes to the annual business plan

6.5 Approval of material matters, including transfers or takeovers of material assets and loans or credit enhancement of large amounts (the materiality threshold for approval shall be separately determined by the Board of Directors)

6.6 Other fundamental management policies of Sony Group (including fundamental management policies of the Corporation)

7. Others

7.1 Person(s) to represent the Corporation in the event of litigation between the Corporation and the Director who is an Audit Committee Member

7.2 Content of remedial measures or any other actions by the Board of Directors regarding matters reported to the Board of Directors by Committees, Senior Executives or any other employees that require such remedial measures or any other actions by the Board of Directors

7.3 Any other matters required to be approved by the Board of Directors by applicable laws, regulations including those of securities exchanges or the Articles of Incorporation

11

Appendix 2: Matters to be Reported to Board of Directors

The following matters require prior reporting to the Board of Directors, to the extent possible (not including matters which are required to be reported to Committees under the Charter of each Committee listed in Article 14, Paragraph 1 of this Charter.)

1. Matters regarding the performance of duties of Senior Executives

1.1 Report of consolidated results

1.1.1 Quarterly results and annual forecasts

1.1.2 Material discrepancies between planned and actual performance

1.2 Matters that materially affect the Sony Group

1.2.1 Matters that may materially injure Sony brand

1.2.2 Matters that may materially affect the interests of shareholders and other stakeholders

1.2.3 Matters related to investigations and litigation regarding material violations of antitrust laws, securities laws and other laws

1.2.4 Establishment and amendment of the material management structure of Sony Group

1.2.5 Material amendments to accounting policies and principles of the Sony Group

1.2.6 Any other matters that may materially affect the Sony Group

1.3 Material matters, including transfers or takeovers of material assets and loans or credit enhancement of large amounts, except for the matters to be decided by the Board of Directors (The materiality threshold for report shall be separately determined by the Board of Directors. This report does not require prior reporting.)

2. IR and Disclosure

2.1 Release of results and forecasts

2.2 Contents of Japanese annual report (Yukashoken Houkokusho) and quarterly report (Shihanki Houkokusho) under the Financial Instruments and Exchange Act of Japan, Form 20-F filing with the U.S. Securities and Exchange Commission, and any other equivalent material disclosure of company information

3. Matters to be reported by the Nominating Committee

3.1 Content of the deliberations of the Nominating Committee and the results thereof

3.2 Draft list of Director candidates to be submitted to the General Meeting of Shareholders (before the Nominating Committee’s determination of the Director candidates)

4. Matters to be reported by the Compensation Committee

4.1 Content of the deliberations of the Compensation Committee and the results thereof

5. Matters to be reported by the Audit Committee and Audit Committee Members

5.1 Content of the deliberations of the Audit Committee and the results thereof

5.2 If defects, as defined in Article 416, Paragraph 1-1 of the Companies Act, arise regarding matters necessary for the Audit Committee to perform its duties, subject to the Companies Act, the content of such defects

5.3 Any violation or suspected violation of any applicable law, regulation or the Articles of Incorporation by a Director or Corporate Executive Officer

12

6. Other matters required to be reported to the Board of Directors by applicable law or regulation

7. Other matters that Directors or Senior Executives deem necessary to report to the Board of Directors

Materials to be submitted to Directors

1. Minutes of the Nominating Committee

2. Minutes of the Audit Committee

3. Minutes of the Compensation Committee

4. Monthly consolidated financial results

5. Other materials requested by the Directors

13

EX-12.1

Exhibit 12.1

Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Kenichiro Yoshida, President and Chief Executive Officer, certify that:

1. I have reviewed this annual report on Form 20-F of Sony Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the company as of, and for, the periods presented in this report;

4. The company’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the company and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the company’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the company’s internal control over financial reporting that occurred during the period covered by the annual report that has materially affected, or is reasonably likely to materially affect, the company’s internal control over financial reporting; and

5. The company’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the company’s auditors and the audit committee of the company’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the company’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the company’s internal control over financial reporting.

	/s/ KENICHIRO YOSHIDA
Date: June 19, 2018	Kenichiro Yoshida President and Chief Executive Officer

EX-12.2

Exhibit 12.2

Certification Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

I, Hiroki Totoki, Senior Executive Vice President and Chief Financial Officer, certify that:

1. I have reviewed this annual report on Form 20-F of Sony Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the company as of, and for, the periods presented in this report;

4. The company’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the company and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the company’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the company’s internal control over financial reporting that occurred during the period covered by the annual report that has materially affected, or is reasonably likely to materially affect, the company’s internal control over financial reporting; and

5. The company’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the company’s auditors and the audit committee of the company’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the company’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the company’s internal control over financial reporting.

	/s/ HIROKI TOTOKI
Date: June 19, 2018	Hiroki Totoki Senior Executive Vice President and Chief Financial Officer

EX-13.1

Exhibit 13.1

Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (subsections (a) and (b) of Section 1350, Chapter 63 of Title 18, United States Code), each of the undersigned officers of Sony Corporation (the “Company”), does hereby certify, to such officer’s knowledge, that:

The Annual Report on Form 20-F for the fiscal year ended March 31, 2018 (the “Form 20-F”) of the Company fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 and information contained in the Form 20-F fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ KENICHIRO YOSHIDA

Kenichiro Yoshida

President and Chief Executive Officer

/s/ HIROKI TOTOKI

Hiroki Totoki

Senior Executive Vice President and Chief Financial Officer

Date: June 19, 2018

EX-15.1

Exhibit 15.1

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We hereby consent to the incorporation by reference in the Registration Statements on Form S-8 (Nos. 333-155448, 333-163616, 333-170714, 333-178115, 333-185261, 333-192436, 333-200414, 333-208113, 333-214758, 333-219266, 333-221693 and 333-223219) of Sony Corporation of our reportdated May 21, 2018, except for Note 29 (2), as to which the date is June 19, 2018, relating to the financial statements, financial statement schedule and the effectiveness of internal control over financial reporting, which appears in this Annual Report on Form 20-F.

/s/ PricewaterhouseCoopers Aarata LLC

Tokyo, Japan

June 19, 2018

XML

Document and Entity Information	12 Months Ended
	Mar. 31, 2018 shares
Document And Entity Information [Abstract]
Document Type	20-F
Amendment Flag	false
Document Period End Date	Mar. 31, 2018
Document Fiscal Year Focus	2018
Document Fiscal Period Focus	FY
Trading Symbol	SNE
Entity Registrant Name	SONY CORP
Entity Central Index Key	0000313838
Current Fiscal Year End Date	--03-31
Entity Well-known Seasoned Issuer	Yes
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding	1,265,425,048

XML

Consolidated Balance Sheets - JPY (¥) ¥ in Millions	Mar. 31, 2018	Mar. 31, 2017
Current assets:
Cash and cash equivalents	¥ 1,586,329	¥ 960,142
Marketable securities	1,176,601	1,051,441
Notes and accounts receivable, trade	1,061,442	1,006,961
Allowance for doubtful accounts and sales returns	(48,663)	(53,150)
Inventories	692,937	640,835
Other receivables	190,706	223,632
Prepaid expenses and other current assets	516,744	525,861
Total current assets	5,176,096	4,355,722
Film costs	327,645	336,928
Investments and advances:
Affiliated companies	157,389	149,371
Securities investments and other	10,598,669	9,962,422
Long-term Investments, Total	10,756,058	10,111,793
Property, plant and equipment:
Land	84,358	117,293
Buildings	655,434	666,381
Machinery and equipment	1,798,722	1,842,852
Construction in progress	38,295	28,779
Property, Plant and Equipment, Gross, Total	2,576,809	2,655,305
Less - Accumulated depreciation	1,837,339	1,897,106
Property, plant and equipment, net	739,470	758,199
Other assets:
Intangibles, net	527,168	584,185
Goodwill	530,492	522,538
Deferred insurance acquisition costs	586,670	568,837
Deferred income taxes	96,772	98,958
Other	325,167	323,396
Other noncurrent assets	2,066,269	2,097,914
Total assets	19,065,538	17,660,556
Current liabilities:
Short-term borrowings	496,093	464,655
Current portion of long-term debt	225,522	53,424
Notes and accounts payable, trade	468,550	539,900
Accounts payable, other and accrued expenses	1,514,433	1,394,758
Accrued income and other taxes	145,905	106,037
Deposits from customers in the banking business	2,159,246	2,071,091
Other	610,792	591,874
Total current liabilities	5,620,541	5,221,739
Long-term debt	623,451	681,462
Accrued pension and severance costs	394,504	396,715
Deferred income taxes	449,863	432,824
Future insurance policy benefits and other	5,221,772	4,834,492
Policyholders' account in the life insurance business	2,820,702	2,631,073
Other	278,338	314,771
Total liabilities	15,409,171	14,513,076
Redeemable noncontrolling interest	9,210	12,058
Commitments and contingent liabilities
Sony Corporation's stockholders' equity:
Common stock, no par value - 2017 - Shares authorized: 3,600,000,000; shares issued: 1,263,763,660 2018 - Shares authorized: 3,600,000,000; shares issued: 1,266,552,149	865,678	860,645
Additional paid-in capital	1,282,577	1,275,337
Retained earnings	1,440,387	984,368
Accumulated other comprehensive income -
Unrealized gains on securities, net	126,191	126,635
Unrealized losses on derivative instruments, net	(1,242)	(58)
Pension liability adjustment	(296,444)	(308,736)
Foreign currency translation adjustments	(445,251)	(436,610)
Accumulated Other Comprehensive Income (Loss), Net of Tax, Total	(616,746)	(618,769)
Treasury stock, at cost Common stock 2017 - 1,073,222 shares 2018 - 1,127,101 shares	(4,530)	(4,335)
Stockholders' Equity Attributable to Parent, Total	2,967,366	2,497,246
Non controlling interests	679,791	638,176
Total equity	3,647,157	3,135,422
Total liabilities and equity	¥ 19,065,538	¥ 17,660,556

XML

Consolidated Balance Sheets (Parenthetical) - ¥ / shares	Mar. 31, 2018	Mar. 31, 2017
Statement of Financial Position [Abstract]
Common stock, par value
Common stock, shares authorized	3,600,000,000	3,600,000,000
Common stock, shares issued	1,266,552,149	1,263,763,660
Treasury stock, common stock shares	1,127,101	1,073,222

XML

Consolidated Statements of Income - JPY (¥) ¥ in Millions	12 Months Ended
	Mar. 31, 2018	Mar. 31, 2017	Mar. 31, 2016
Sales and operating revenue:
Net sales	¥ 7,231,613	¥ 6,443,328	¥ 6,949,357
Financial services revenue	1,221,235	1,080,284	1,066,319
Other operating revenue	91,134	79,638	90,036
Sales and operating revenue, Total	8,543,982	7,603,250	8,105,712
Costs and expenses:
Cost of sales	5,188,259	4,753,010	5,166,894
Selling, general and administrative	1,583,197	1,505,956	1,691,930
Financial services expenses	1,042,163	910,144	907,758
Other operating expense, net	4,072	149,001	47,171
Costs and Expenses, Total	7,817,691	7,318,111	7,813,753
Equity in net income of affiliated companies	8,569	3,563	2,238
Operating income	734,860	288,702	294,197
Other income:
Interest and dividends	19,784	11,459	12,455
Gain on sale of securities investments, net	1,517	225	52,068
Other	2,427	2,734	2,326
Other income, Total	23,728	14,418	66,849
Other expenses:
Interest	13,566	14,544	25,286
Loss on devaluation of securities investments	4,955	7,629	3,309
Foreign exchange loss, net	30,634	22,181	20,565
Other	10,384	7,147	7,382
Other expenses, Total	59,539	51,501	56,542
Income before income taxes	699,049	251,619	304,504
Income taxes:
Current	127,685	100,260	94,578
Deferred	24,085	23,798	211
Income tax expense, Total	151,770	124,058	94,789
Net income	547,279	127,561	209,715
Less - Net income attributable to noncontrolling interests	56,485	54,272	61,924
Net income attributable to Sony Corporation's stockholders	¥ 490,794	¥ 73,289	¥ 147,791
Net income attributable to Sony Corporation's stockholders
- Basic	¥ 388.32	¥ 58.07	¥ 119.40
- Diluted	379.75	56.89	117.49
Cash dividends	¥ 27.50	¥ 20.00	¥ 20.00

XML

Consolidated Statements of Comprehensive Income - JPY (¥) ¥ in Millions	12 Months Ended
	Mar. 31, 2018	Mar. 31, 2017	Mar. 31, 2016
Statement of Comprehensive Income [Abstract]
Net income	¥ 547,279	¥ 127,561	¥ 209,715
Other comprehensive income, net of tax -
Unrealized gains (losses) on securities	1,070	(30,293)	2,220
Unrealized gains (losses) on derivative instruments	(1,184)	1,140	(1,198)
Pension liability adjustment	12,390	63,232	(171,753)
Foreign currency translation adjustments	(6,335)	(17,988)	(83,899)
Total comprehensive income (loss)	553,220	143,652	(44,915)
Less - Comprehensive income attributable to noncontrolling interests	60,403	35,814	75,329
Comprehensive income (loss) attributable to Sony Corporation's stockholders	¥ 492,817	¥ 107,838	¥ (120,244)

XML

Consolidated Statements of Cash Flows - JPY (¥) ¥ in Millions	12 Months Ended
	Mar. 31, 2018	Mar. 31, 2017	Mar. 31, 2016
Cash flows from operating activities:
Net income	¥ 547,279	¥ 127,561	¥ 209,715
Adjustments to reconcile net income to net cash provided by operating activities -
Depreciation and amortization, including amortization of deferred insurance acquisition costs	361,444	327,048	397,091
Amortization of film costs	359,274	297,505	299,587
Accrual for pension and severance costs, less payments	4,113	9,297	(6,383)
Other operating expense, net	4,072	149,001	47,171
(Gain) loss on sale or devaluation of securities investments, net	3,438	7,404	(48,857)
(Gain) loss on revaluation of marketable securities held in the financial services business for trading purposes, net	(47,339)	(55,789)	44,821
Loss on revaluation or impairment of securities investments held in the financial services business, net	220	47	2,653
Deferred income taxes	24,085	23,798	211
Equity in net (income) loss of affiliated companies, net of dividends	(2,956)	4,409	5,045
Changes in assets and liabilities:
Increase in notes and accounts receivable, trade	(80,004)	(37,529)	(5,828)
(Increase) decrease in inventories	(51,508)	11,199	(57,804)
Increase in film costs	(362,496)	(331,179)	(318,391)
Decrease in notes and accounts payable, trade	(87,939)	(1,386)	(49,525)
Increase (decrease) in accrued income and other taxes	29,181	26,701	(23,607)
Increase in future insurance policy benefits and other	495,419	433,803	403,392
Increase in deferred insurance acquisition costs	(86,779)	(93,234)	(83,774)
Increase in marketable securities held in the financial services business for trading purposes	(89,797)	(81,456)	(107,433)
(Increase) decrease in other current assets	3,776	(21,402)	21,299
Increase (decrease) in other current liabilities	151,805	79,114	(25,751)
Other	79,684	(65,650)	45,457
Net cash provided by operating activities	1,254,972	809,262	749,089
Cash flows from investing activities:
Payments for purchases of fixed assets	(262,989)	(333,509)	(375,411)
Proceeds from sales of fixed assets	60,599	13,098	26,472
Proceeds from sales of businesses	44,624	3,262	17,790
Other	(11,175)	7,695	(72,938)
Net cash used in investing activities	(822,197)	(1,253,973)	(1,030,403)
Cash flows from financing activities:
Proceeds from issuance of long-term debt	125,092	254,695	19,076
Payments of long-term debt	(44,561)	(261,299)	(270,669)
Increase in short-term borrowings, net	35,145	317,827	92,153
Increase in deposits from customers in the financial services business, net	169,479	277,152	165,169
Proceeds from issuance of convertible bonds			120,000
Proceeds from issuance of new shares of common stock			301,708
Dividends paid	(28,490)	(25,301)	(12,751)
Payment for purchase of Sony/ATV shares from noncontrolling interests		(76,565)
Other	(10,209)	(34,207)	(34,564)
Net cash provided by financing activities	246,456	452,302	380,122
Effect of exchange rate changes on cash and cash equivalents	(53,044)	(31,061)	(64,609)
Net increase (decrease) in cash and cash equivalents	626,187	(23,470)	34,199
Cash and cash equivalents at beginning of the fiscal year	960,142	983,612	949,413
Cash and cash equivalents at end of the fiscal year	1,586,329	960,142	983,612
Cash paid during the fiscal year for -
Income taxes	101,092	106,054	138,770
Interest	12,169	13,877	26,166
Non-cash investing and financing activities -
Obtaining assets by entering into capital leases	21,762	8,457	14,759
Financial Services
Cash flows from investing activities:
Payments for investments and advances	(963,210)	(1,233,290)	(1,221,093)
Proceeds from sales or return of investments and collections of advances	317,159	289,901	534,072
Other than financial service business
Cash flows from investing activities:
Payments for investments and advances	(13,801)	(17,208)	(20,830)
Proceeds from sales or return of investments and collections of advances	¥ 6,596	¥ 16,078	¥ 81,535

XML

Consolidated Statements of Changes in Stockholders' Equity - JPY (¥) ¥ in Millions	Total	Common stock	Additional paid-in capital	Retained earnings	Accumulated other comprehensive income	Treasury stock, at cost	Sony Corporation's stockholders' equity	Noncontrolling interests
Beginning Balance at Mar. 31, 2015	¥ 2,928,469	¥ 707,038	¥ 1,185,777	¥ 813,765	¥ (385,283)	¥ (4,220)	¥ 2,317,077	¥ 611,392
Issuance of new shares	301,708	150,854	150,854				301,708
Exercise of stock acquisition rights	1,950	975	975				1,950
Stock-based compensation	1,516		1,516				1,516
Comprehensive income:
Net income	209,715			147,791			147,791	61,924
Other comprehensive income, net of tax -
Unrealized gains (losses) on securities	2,220				(13,417)		(13,417)	15,637
Unrealized gains (losses) on derivative instruments	(1,198)				(1,198)		(1,198)
Pension liability adjustment	(171,753)				(170,608)		(170,608)	(1,145)
Foreign currency translation adjustments	(83,899)				(82,812)		(82,812)	(1,087)
Total comprehensive income (loss)	(44,915)						(120,244)	75,329
Stock issue costs, net of tax	(1,478)		(1,478)				(1,478)
Dividends declared	(46,093)			(25,225)			(25,225)	(20,868)
Purchase of treasury stock	(110)					(110)	(110)
Reissuance of treasury stock	59		(12)			71	59
Transactions with noncontrolling interests shareholders and other	(16,696)		(11,913)				(11,913)	(4,783)
Ending Balance at Mar. 31, 2016	3,124,410	858,867	1,325,719	936,331	(653,318)	(4,259)	2,463,340	661,070
Exercise of stock acquisition rights	3,556	1,778	1,778				3,556
Stock-based compensation	1,601		1,601				1,601
Comprehensive income:
Net income	127,561			73,289			73,289	54,272
Other comprehensive income, net of tax -
Unrealized gains (losses) on securities	(30,293)				(14,101)		(14,101)	(16,192)
Unrealized gains (losses) on derivative instruments	1,140				1,140		1,140
Pension liability adjustment	63,232				63,003		63,003	229
Foreign currency translation adjustments	(17,988)				(15,493)		(15,493)	(2,495)
Total comprehensive income (loss)	143,652						107,838	35,814
Stock issue costs, net of tax	(30)		(30)				(30)
Dividends declared	(42,320)			(25,252)			(25,252)	(17,068)
Purchase of treasury stock	(114)					(114)	(114)
Reissuance of treasury stock	28		(10)			38	28
Transactions with noncontrolling interests shareholders and other	(95,361)		(53,721)				(53,721)	(41,640)
Ending Balance at Mar. 31, 2017	3,135,422	860,645	1,275,337	984,368	(618,769)	(4,335)	2,497,246	638,176
Issuance of new shares	976	488	488				976
Exercise of stock acquisition rights	9,065	4,533	4,532				9,065
Conversion of convertible bonds	24	12	12				24
Stock-based compensation	3,160		3,160				3,160
Comprehensive income:
Net income	547,279			490,794			490,794	56,485
Other comprehensive income, net of tax -
Unrealized gains (losses) on securities	1,070				(444)		(444)	1,514
Unrealized gains (losses) on derivative instruments	(1,184)				(1,184)		(1,184)
Pension liability adjustment	12,390				12,292		12,292	98
Foreign currency translation adjustments	(6,335)				(8,641)		(8,641)	2,306
Total comprehensive income (loss)	553,220						492,817	60,403
Stock issue costs, net of tax	(879)		(879)				(879)
Dividends declared	(49,136)			(34,775)			(34,775)	(14,361)
Purchase of treasury stock	(199)					(199)	(199)
Reissuance of treasury stock	4		0			4	4
Transactions with noncontrolling interests shareholders and other	(4,500)		(73)				(73)	(4,427)
Ending Balance at Mar. 31, 2018	¥ 3,647,157	¥ 865,678	¥ 1,282,577	¥ 1,440,387	¥ (616,746)	¥ (4,530)	¥ 2,967,366	¥ 679,791

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Nature of operations

12 Months Ended

Mar. 31, 2018

Accounting Policies [Abstract]

Nature of operations

1. Nature of operations

Sony Corporation and its consolidated subsidiaries (hereinafter collectively referred to as “Sony”) are engaged in the development, design, production, manufacture, offer and sale of various kinds of electronic equipment, instruments and devices for consumer, professional and industrial markets such as network services, game hardware and software, televisions, audio and video recorders and players, still and video cameras, mobile phones, and semiconductors. Sony’s primary manufacturing facilities are located in Asia including Japan. Sony also utilizes third-party contract manufacturers for certain products. Sony’s products and services are marketed throughout the world by sales subsidiaries and unaffiliated distributors as well as direct sales and offers via the internet. Sony is engaged in the development, production, manufacture, and distribution of recorded music and the management and licensing of the words and music of songs as well as production and distribution of animation titles, including game applications based on the animation titles. Sony is also engaged in the production, acquisition and distribution of motion pictures and television programming and the operation of television and digital networks. Further, Sony is also engaged in various financial services businesses, including life and non-life insurance operations through its Japanese insurance subsidiaries and banking operations through a Japanese internet-based banking subsidiary.

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Summary of significant accounting policies

12 Months Ended

Mar. 31, 2018

Accounting Policies [Abstract]

Summary of significant accounting policies

2. Summary of significant accounting policies

The accompanying consolidated financial statements are presented in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Certain adjustments and reclassifications have been incorporated in the accompanying consolidated financial statements to conform with U.S. GAAP. These adjustments were not recorded in the statutory books and records as Sony Corporation and its subsidiaries in Japan maintain their records and prepare their statutory financial statements in accordance with accounting principles generally accepted in Japan, while its foreign subsidiaries maintain their records and prepare their financial statements in conformity with accounting principles generally accepted in the countries of their domicile.

(1) Significant accounting policies

Basis of consolidation and accounting for investments in affiliated companies -

The consolidated financial statements include the accounts of Sony Corporation and its majority-owned subsidiary companies, general partnerships and other entities in which Sony has a controlling interest, and variable interest entities for which Sony is the primary beneficiary. All intercompany transactions and accounts are eliminated. Investments in business entities in which Sony does not have control, but has the ability to exercise significant influence over operating and financial policies, generally through 20-50% ownership, are accounted for under the equity method. In addition, investments in general partnerships in which Sony does not have a controlling interest and limited partnerships are also accounted for under the equity method if more than minor influence over the operation of the investee exists (generally through more than 3-5% ownership). When the interest in the partnership is so minor that Sony has no significant influence over the operation of the investee, the cost method is used. Under the equity method, investments are stated at cost plus/minus Sony’s portion of equity in undistributed earnings or losses. Sony’s equity in current earnings or losses of such entities is reported net of income taxes and is included in operating income (loss) after the elimination of unrealized intercompany profits. If the value of an investment has declined and is judged to be other-than-temporary, the investment is written down to its estimated fair value.

On occasion, a consolidated subsidiary or an affiliated company accounted for by the equity method may issue its shares to third parties in either a public or private offering or upon conversion of convertible debt to common stock at amounts per share in excess of or less than Sony’s average per share carrying value. With respect to such transactions, the resulting gains or losses arising from the change in ownership interest are recorded in earnings within the fiscal year in which the change in interest transactions occur.

Gains or losses that result from a loss of a controlling financial interest in a subsidiary are recorded in earnings along with fair value remeasurement gains or losses on any retained investment in the entity, while a change in interest of a consolidated subsidiary that does not result in a change in control is accounted for as a capital transaction and no gains or losses are recorded in earnings.

The excess of the cost over the underlying net equity of investments in consolidated subsidiaries and affiliated companies accounted for on an equity basis is allocated to identifiable tangible and intangible assets and liabilities based on fair values at the date of acquisition. The unassigned residual value of the excess of the cost over Sony’s underlying net equity is recognized as goodwill as a component of the investment balance.

Use of estimates -

The preparation of the consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The most significant estimates include those used in determining the valuation of investment securities, valuation of inventories, fair values of long-lived assets, fair values of goodwill and other intangible assets, fair values of assets and liabilities assumed in business combinations, product warranty liability, pension and severance plans, valuation of deferred tax assets, uncertain tax positions, film costs, and insurance related liabilities. Actual results could significantly differ from those estimates.

Translation of foreign currencies -

All asset and liability accounts of foreign subsidiaries and affiliates are translated into Japanese yen at appropriate fiscal year end exchange rates and all income and expense accounts are translated at exchange rates that approximate those rates prevailing at the time of the transactions. The resulting translation adjustments are accumulated as a component of accumulated other comprehensive income. Upon remeasurement of a previously held equity interest in accordance with the accounting guidance for business combinations achieved in stages, accumulated translation adjustments, if any, are included in earnings.

Receivables and payables denominated in foreign currencies are translated at appropriate fiscal year end exchange rates and the resulting translation gains or losses are recognized into income.

Cash and cash equivalents -

Cash and cash equivalents include all highly liquid investments, with original maturities of three months or less, that are readily convertible to known amounts of cash and are so near maturity that they present insignificant risk of changes in value because of changes in interest rates.

Marketable debt and equity securities -

Debt and equity securities designated as available-for-sale, whose fair values are readily determinable, are carried at fair value with unrealized gains or losses included as a component of accumulated other comprehensive income, net of applicable taxes. Debt and equity securities classified as trading securities are carried at fair value with unrealized gains or losses included in income. Debt securities that are expected to be held-to-maturity are carried at amortized cost. Individual securities classified as either available-for-sale or held-to-maturity are reduced to fair value by a charge to income when an other-than-temporary impairment is recognized. Realized gains and losses are determined on the average cost method and are reflected in income.

Sony regularly evaluates its investment portfolio to identify other-than-temporary impairments of individual securities. Factors that are considered by Sony in determining whether an other-than-temporary decline in value has occurred include: the length of time and extent to which the market value of the security has been less than its original cost, the financial condition, operating results, business plans and estimated future cash flows of the issuer of the security, other specific factors affecting the market value, deterioration of the credit condition of the issuer, sovereign risk, and whether or not Sony is able to retain the investment for a period of time sufficient to allow for the anticipated recovery in market value.

In evaluating the factors for available-for-sale securities whose fair values are readily determinable, Sony presumes a decline in value to be other-than-temporary if the fair value of the security is 20 percent or more below its original cost for an extended period of time (generally for a period of up to six months). This criterion is employed as a threshold to identify securities which may have a decline in value that is other-than-temporary. The presumption of an other-than-temporary impairment in such cases may be overcome if there is evidence to support that the decline is temporary in nature due to the existence of other factors which overcome the duration or magnitude of the decline. On the other hand, there may be cases where impairment losses are recognized when the decline in the fair value of the security is not more than 20 percent or such decline has not existed for an extended period of time, as a result of considering specific factors which may indicate that the decline in the fair value is other-than-temporary.

When an other-than-temporary impairment of a held-to-maturity debt security has occurred, the amount of the other-than-temporary impairment recognized in income depends on whether Sony intends to sell the security or more likely than not will be required to sell the security before recovery of its amortized cost. If the debt security meets either of these two criteria, the other-than-temporary impairment is recognized in income, measured as the entire difference between the security’s amortized cost and its fair value at the impairment measurement date. For other-than-temporary impairments of debt securities that do not meet these two criteria, the net amount recognized in income is a credit loss equal to the difference between the amortized cost of the debt security and its net present value calculated by discounting Sony’s best estimate of projected future cash flows at the effective interest rate implicit in the debt security prior to impairment. Any difference between the fair value and the net present value of the debt security at the impairment measurement date is recorded in accumulated other comprehensive income. Unrealized gains or losses on securities for which an other-than-temporary impairment has been recognized in income are presented as a separate component of accumulated other comprehensive income.

Equity securities in non-public companies -

Equity securities in non-public companies are primarily carried at cost if fair value is not readily determinable. If the value of a non-public equity investment is estimated to have declined and such decline is judged to be other-than-temporary, Sony recognizes the impairment of the investment and the carrying value is reduced to its fair value. Determination of impairment is based on the consideration of several factors, including operating results, business plans and estimated future cash flows. Fair value is determined through the use of various methodologies such as discounted cash flows, valuation of recent financings and comparable valuations of similar companies.

Allowance for doubtful accounts -

Sony maintains an allowance for doubtful accounts to reserve for potentially uncollectible receivables. Sony reviews accounts receivable by amounts due from customers which are past due to identify specific customers with known disputes or collectability issues. In determining the amount of the reserve, Sony makes judgments about the creditworthiness of customers based on past collection experience and ongoing credit risk evaluations.

Inventories -

Inventories in the Game & Network Services (“G&NS”), Music, Home Entertainment & Sound (“HE&S”), Imaging Products & Solutions (“IP&S”), Mobile Communications (“MC”) and Semiconductors segments as well as non-film inventories for the Pictures segment are valued at cost, not in excess of the net realizable value – i.e., estimated selling price in the ordinary course of business less predictable costs of completion and disposal, cost being determined on the “average cost” basis, except for the cost of finished products carried by certain subsidiary companies which is determined on the “first-in, first-out” basis.

Other receivables -

Other receivables include receivables which relate to arrangements with certain component manufacturers whereby Sony procures goods, including product components, for these component manufacturers and is reimbursed for the related purchases. No revenue or profit is recognized on these transfers. Sony will repurchase the inventory at a later date from the component manufacturers as either finished goods inventory or as partially assembled product.

Film costs -

Film costs include direct production costs, production overhead and acquisition costs for both motion picture and television productions and are stated at the lower of unamortized cost or estimated fair value and classified as noncurrent assets. Film costs are amortized, and the estimated liabilities for residuals and participations are accrued using an individual-film-forecast method based on the ratio of current period actual revenues to the estimated remaining total revenues. Film costs also include broadcasting rights, which are recognized when the license period begins and the program is available for use, and consist of acquired programming to be aired on Sony’s worldwide channel network. Broadcasting rights are stated at the lower of unamortized cost or net realizable value, classified as either current or noncurrent assets based on timing of expected use. Broadcasting rights are amortized based on estimated usage or on a straight-line basis over the useful life, as appropriate, although broadcasting rights licensed under multi-year live-event sports programming agreements are generally amortized based on the ratio of the current period’s actual advertising revenue and an allocation of subscription fee revenue to the estimated total remaining attributable revenues. Estimates used in calculating the fair value of film costs and the net realizable value of broadcasting rights are based upon assumptions about future demand and market conditions and are reviewed on a periodic basis.

Property, plant and equipment and depreciation -

Property, plant and equipment are stated at cost. Depreciation is computed using the straight-line method. Useful lives for depreciation range from two to 50 years for buildings and from two to 10 years for machinery and equipment. Significant renewals and additions are capitalized at cost. Maintenance and repairs, and minor renewals and betterments are charged to income as incurred.

Goodwill and other intangible assets -

Goodwill and indefinite lived intangible assets are tested annually for impairment during the fourth quarter of the fiscal year and between annual tests if an event occurs or circumstances change that would more likely than not reduce the fair value below its carrying amount. Such an event or change in circumstances would include unfavorable variances from established business plans, significant changes in forecasted results or volatility inherent to external markets and industries, which are periodically reviewed by Sony’s management.

In the fiscal year ended March 31, 2018, Sony elected not to perform an optional qualitative assessment of goodwill and instead proceeded directly to a quantitative impairment test by comparing the fair value of a reporting unit with its carrying amount. Reporting units are Sony’s operating segments or one level below the operating segments. If the fair value of a reporting unit exceeds its carrying amount, goodwill of the reporting unit is not considered impaired. If the carrying amount of a reporting unit exceeds its fair value, an impairment loss is recognized in an amount equal to that excess, not to exceed the total amount of goodwill allocated to the reporting unit. Indefinite lived intangible assets are tested for impairment by comparing the fair value of the intangible asset with its carrying value, and if the carrying value of the intangible asset exceeds its fair value, an impairment loss is recognized in an amount equal to that excess.

The fair value of a reporting unit or indefinite lived intangible asset is generally determined using a discounted cash flow analysis. This approach uses significant estimates and assumptions, including projected future cash flows, the timing of such cash flows, discount rates reflecting the risk inherent in future cash flows, perpetual growth rates, earnings multiples, the determination of appropriate comparable entities and the determination of whether a premium or discount should be applied to comparables. Consideration is also given to Sony’s market capitalization in relation to the sum of the calculated fair values of the reporting units, including reporting units with no goodwill, and taking into account corporate level assets and liabilities not assigned to individual reporting units as well as a reasonable control premium.

The assumptions used for projected future cash flows and the timing of such cash flows are based on the forecast and mid-range plan (“MRP”) of each reporting unit and take into account such factors as historical experience, market and industry information, and current and forecasted economic conditions. Perpetual growth rates are utilized to determine a terminal cash flow value and are generally set after the three-year forecasted period for the MRP. Certain reporting units, such as those in the Pictures segment, utilize longer forecast periods and base the terminal value on an exit price using an earnings multiple applied to the final year of the forecasted earnings, which also takes into consideration a control premium. Discount rates are derived from the weighted average cost of capital of market participants in similar businesses.

When a business within a reporting unit is disposed of, goodwill is allocated to the disposed business using the relative fair value method.

Intangible assets with finite useful lives mainly consist of patent rights, know-how, license agreements, customer relationships, trademarks, software to be sold, leased or otherwise marketed, internal-use software, music catalogs, artist contracts, and television carriage contracts (broadcasting agreements). Patent rights, know-how, license agreements, trademarks, software to be sold, leased or otherwise marketed, and internal-use software are generally amortized on a straight-line basis over three to 10 years. Customer relationships, music catalogs, artist contracts and television carriage contracts (broadcasting agreements) are amortized on a straight-line basis, generally, over 10 to 40 years.

Capitalized software -

The costs related to establishing the technological feasibility of software to be sold, leased or otherwise marketed are expensed as incurred as a part of research and development in cost of sales. Costs that are incurred to produce the finished product after technological feasibility is established are capitalized and amortized to cost of sales over the estimated economic life, which is generally three years. The technological feasibility of game software is established when the product master is completed. Consideration to capitalize game software development costs before this point is limited to the development costs of games for which technological feasibility can be proven at an earlier stage. At each balance sheet date, Sony performs reviews to ensure that unamortized capitalized software costs remain recoverable from future profits of the related software products.

The costs incurred for internal-use software during the application development stage are capitalized and amortized, mainly to selling, general and administrative expenses, on a straight-line basis over the estimated useful life. Costs related to the preliminary project stage and post implementation activities are expensed as incurred.

Deferred insurance acquisition costs -

Costs that vary with and are directly related to acquiring new insurance policies are deferred as long as they are recoverable. The deferred insurance acquisition costs include such items as commissions, medical examination costs and inspection report fees, and are subject to recoverability testing at least annually to ensure that the capitalized amounts do not exceed the present value of anticipated gross profits or premiums less benefits and maintenance expenses, as applicable. The deferred insurance acquisition costs for traditional life insurance contracts are amortized over the premium-paying period of the related insurance policies using assumptions consistent with those used in computing policy reserves. The deferred insurance acquisition costs for non-traditional life insurance contracts are amortized over the expected life in proportion to the estimated gross profits.

Product warranty -

Sony provides for the estimated cost of product warranties at the time revenue is recognized. The product warranty is calculated based upon product sales, estimated probability of failure and estimated cost per claim. The variables used in the calculation of the provision are reviewed on a periodic basis.

Certain subsidiaries in the G&NS, HE&S, IP&S, and MC segments offer extended warranty programs. The consideration received for extended warranty service is deferred and recognized as revenue on a straight-line basis over the term of the extended warranty.

Future insurance policy benefits -

Liabilities for future insurance policy benefits are primarily comprised of the present value of estimated future payments to policyholders. These liabilities are computed by the net level premium method based upon the assumptions as to future investment yield, morbidity, mortality, withdrawals and other factors. These assumptions are reviewed on a periodic basis. Liabilities for future insurance policy benefits also include liabilities for guaranteed benefits related to certain non-traditional life and annuity contracts.

Policyholders’ account in the life insurance business -

Liabilities for policyholders’ account in the life insurance business represent the contract value that has accrued to the benefit of the policyholders as of the balance sheet date. This liability is generally equal to the accumulated account deposits, plus interest credited, less policyholder withdrawals and other charges assessed against the account balances.

Impairment of long-lived assets -

Sony reviews the recoverability of the carrying value of its long-lived assets held and used, other than goodwill and intangible assets with indefinite lives, and assets to be disposed of, whenever events or changes in circumstances indicate that the individual carrying amount of an asset or asset group may not be recoverable. Long-lived assets to be held and used are reviewed for impairment by comparing the carrying value of the asset or asset group with their estimated undiscounted future cash flows. If the cash flows are determined to be less than the carrying value of the asset or asset group, an impairment loss would be recognized during the period for the amount by which the carrying value of the asset or asset group exceeds estimated fair value. Long-lived assets that are to be disposed of other than by sale are considered held and used until they are disposed of. Long-lived assets that are to be disposed of by sale are reported at the lower of their carrying value or fair value less cost to sell and are not depreciated. Fair value is determined using the present value of estimated net cash flows or comparable market values. This approach uses significant estimates and assumptions including projected future cash flows, the timing of such cash flows, discount rates reflecting the risk inherent in future cash flows, perpetual growth rates applied to determine terminal values, determination of appropriate market comparables and the determination of whether a premium or discount should be applied to comparables.

Fair value measurement -

Sony measures fair value as an exit price, or the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants as of the measurement date. Sony has elected the fair value option in the banking business for certain foreign securities. The election was made to mitigate accounting mismatches related to fluctuations of foreign exchange rates by allowing the gains and losses on the translation of these securities to be included in current earnings.

The accounting guidance for fair value measurements specifies a hierarchy of inputs to valuation techniques based on the extent to which inputs used in measuring fair value are observable in the market. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect Sony’s assumptions about the assumptions that market participants would use in pricing the asset or liability. Observable market data is used if such data is available without undue cost and effort. Each fair value measurement is reported in one of three levels which is determined by the lowest level input that is significant to the fair value measurement in its entirety.

These levels are:

Level 1	—	Inputs are unadjusted quoted prices for identical assets and liabilities in active markets.
Level 2	—	Inputs are based on observable inputs other than level 1 prices, such as quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active and model-derived valuations, in which all significant inputs are observable in active markets.
Level 3	—	One or more significant inputs are unobservable.

When available, Sony uses unadjusted quoted market prices in active markets to measure fair value and classifies such items within level 1. If quoted market prices are not available, fair value is based upon internally developed valuation techniques that use, where possible, current market-based or independently sourced market parameters, such as interest rates, currency rates and option volatilities. Items valued using internally generated models are classified according to the lowest level input that is significant to the valuation. For certain financial assets and liabilities, Sony determines fair value using third-party information such as indicative quotes from dealers and quantitative input from investment advisors following Sony’s established valuation procedures including validation against internally developed prices. Additionally, Sony considers both counterparty credit risk and Sony’s own creditworthiness in determining fair value. Sony attempts to mitigate credit risk to third parties by entering into netting agreements and actively monitoring the creditworthiness of counterparties and its exposure to credit risk through the use of credit limits and by selecting major international banks and financial institutions as counterparties.

Transfers between levels are deemed to have occurred at the beginning of the interim period in which the transfers occur.

Derivative financial instruments -

All derivatives are recognized as either assets or liabilities in the consolidated balance sheets at fair value on a gross basis. Changes in the fair value of derivative financial instruments are either recognized periodically in income or stockholders’ equity (as a component of accumulated other comprehensive income), depending on whether the derivative financial instrument qualifies as a hedge and the derivative is being used to hedge changes in fair value or cash flows.

The accounting guidance for hybrid financial instruments permits an entity to elect fair value remeasurement for any hybrid financial instrument if the hybrid instrument contains an embedded derivative that would otherwise be required to be bifurcated and accounted for separately under accounting guidance for derivative instruments and hedging activities. The election to measure the hybrid instrument at fair value is made on an instrument-by-instrument basis and is irreversible. Certain subsidiaries in the Financial Services segment had hybrid financial instruments, disclosed in Note 7 as debt securities, that contain embedded derivatives where the entire instrument was carried at fair value.

In accordance with accounting guidance for derivative instruments and hedging activities, various derivative financial instruments held by Sony are classified and accounted for as described below.

Fair value hedges

Changes in the fair value of derivatives designated and effective as fair value hedges for recognized assets or liabilities or unrecognized firm commitments are recognized in earnings as offsets to changes in the fair value of the related hedged assets or liabilities.

Cash flow hedges

Changes in the fair value of derivatives designated and effective as cash flow hedges for forecasted transactions or exposures associated with recognized assets or liabilities are initially recorded in other comprehensive income and reclassified into earnings when the hedged transaction affects earnings. Changes in the fair value of the ineffective portion are recognized immediately in earnings.

Derivatives not designated as hedges

Changes in the fair value of derivatives that are not designated as hedges are recognized immediately in earnings.

Assessment of hedges

When applying hedge accounting, Sony formally documents all hedging relationships between the derivatives designated as hedges and the hedged items, as well as its risk management objectives and strategies for undertaking various hedging activities. Sony links all hedges that are designated as fair value or cash flow hedges to specific assets or liabilities on the consolidated balance sheets or to the specific forecasted transactions. Sony also assesses, both at the inception of the hedge and on an on-going basis, whether the derivatives that are designated as hedges are highly effective in offsetting changes in fair value or cash flows of hedged items. When it is determined that a derivative is not highly effective as a hedge, Sony discontinues hedge accounting. Hedge ineffectiveness, if any, is included immediately in earnings.

Stock-based compensation -

Sony accounts for stock-based compensation using the fair value based method, measured on the date of grant using the Black-Scholes option-pricing model. The expense is mainly included in selling, general and administrative expenses. Stock-based compensation is recognized, net of an estimated forfeiture rate, over the requisite service period using the accelerated method of amortization for grants with graded vesting. The estimated forfeiture rate is based on Sony’s historical experience in the stock acquisition rights plans where the majority of the vesting terms have been satisfied.

Revenue recognition -

Revenues from sales in the G&NS, Music, HE&S, IP&S, MC and Semiconductors segments are recognized when persuasive evidence of an arrangement exists, delivery has occurred or services have been rendered, the sales price is fixed or determinable, and collectability is reasonably assured. Delivery is considered to have occurred when the customer has taken title to the product and the risks and rewards of ownership have been substantively transferred. If the sales contract contains a customer acceptance provision, then sales are recognized after customer acceptance occurs or the acceptance provisions lapse. Revenues are recognized net of anticipated returns and sales incentives. Revenues from prepaid subscription fees, such as within the G&NS segment, are recognized ratably over the subscription term.

Revenue arrangements with customers may include multiple elements, including any combination of products, services and software. An example includes sales of electronics products with rights to receive promotional goods. For Sony’s multiple element arrangements where at least one of the elements is not subject to existing software or film revenue recognition guidance, elements are separated into more than one unit of accounting when the delivered element(s) have value to the customer on a standalone basis, and delivery of the undelivered element(s) is probable and substantially in the control of Sony. Revenue is then allocated to each unit of accounting based on the relative selling price of each unit of accounting based first on vendor-specific objective evidence of selling price (“VSOE”) if it exists, based next on third-party evidence of selling price (“TPE”) if VSOE does not exist, and, finally, if both VSOE and TPE do not exist, based on estimated selling prices (“ESP”). VSOE is limited to either the price charged for an element when it is sold separately or, for an element not yet being sold separately, the price established by management having the relevant authority; it must be probable that the price, once established, will not change before the separate introduction of the element into the market place. TPE is the price of Sony’s or any competitor’s largely interchangeable products or services in standalone sales to similarly situated customers. ESP is the price at which Sony would transact if the element were sold by Sony regularly on a standalone basis. When determining ESP, Sony considers all relevant inputs, including sales, cost and margin analysis of the product, targeted rate of return of the product, competitors’ and Sony’s pricing practices and customer perspectives.

Certain software products published by Sony provide limited online features at no additional cost to the customer. Generally, such features are considered to be incidental to the overall software product and an inconsequential deliverable. Accordingly, revenue related to software products containing these limited online features is not deferred.

Revenues from sales in the Pictures segment are recognized when persuasive evidence of an arrangement exists, the sales price is fixed or determinable and collectability is reasonably assured. Revenues from the theatrical exhibition of motion pictures are recognized as the customer exhibits the film. Revenues from the licensing of motion picture and television programming for pay and free television exhibition and other markets are recognized when the product is available for exploitation by the licensee and when any restrictions regarding the use of the product lapse. For home entertainment distribution, revenues from the sale of DVDs and Blu-ray Disc^TM, net of anticipated returns and sales incentives, are recognized when delivery has occurred and the product is available for sale to the public, and revenues from electronic sell-through and video-on-demand are recognized when the product is made available for viewing via digital distribution platforms. Certain motion picture and television program licensing arrangements involve an allocation to multiple elements, for example a fee for multiple territories and availability dates, that is based on relative fair value using management’s best estimate. Revenues from the sale of broadcast advertising are recognized when the advertisement is aired. Revenues from subscription fees received by television networks are recognized when the service is provided.

Traditional life insurance policies that the life insurance subsidiary underwrites, most of which are categorized as long-duration contracts, mainly consist of whole life, term life and accident and health insurance contracts. Premiums from these policies are reported as revenue when due from policyholders.

Amounts received as payment for non-traditional contracts such as interest sensitive whole life contracts, individual annuity contracts and other contracts without life contingencies are recognized in policyholders’ account in the life insurance business. Revenues from these contracts are comprised of fees earned for administrative and contract-holder services, which are recognized over the period of the contracts, and included in financial services revenue.

Property and casualty insurance policies that the non-life insurance subsidiary underwrites are primarily automotive insurance contracts which are categorized as short-duration contracts. Premiums from these policies are reported as revenue over the period of the contract in proportion to the amount of insurance protection provided.

Revenue is recognized net of any taxes collected from customers and subsequently remitted to governmental authorities.

Consideration given to a customer or a reseller -

Sales incentives or other cash consideration given to a customer or a reseller, including payments for buydowns, slotting fees and cooperative advertising programs, are accounted for as a reduction of revenue unless Sony receives an identifiable benefit (goods or services) in exchange for the consideration, the fair value of the benefit is reasonably estimated and documentation from the reseller is received to support the amounts paid to the reseller. Payments meeting these criteria are recorded as selling, general and administrative expenses. For the fiscal years ended March 31, 2016, 2017 and 2018, consideration given to a reseller, primarily for free promotional shipping and cooperative advertising programs included in selling, general and administrative expenses, totaled 13,178 million yen, 12,046 million yen and 12,319 million yen, respectively.

Cost of sales -

Costs classified as cost of sales relate to the producing and manufacturing of products and include items such as material cost, subcontractor cost, depreciation of fixed assets, amortization of intangible assets, personnel expenses, research and development costs, and amortization of film costs related to motion picture and television productions.

Research and development costs -

Research and development costs, included in cost of sales, include items such as salaries, personnel expenses and other direct and indirect expenses associated with research and product development. Research and development costs are expensed as incurred.

Selling, general and administrative -

Costs classified as selling expenses relate to promoting and selling products and include items such as advertising, promotion, shipping and warranty expenses. General and administrative expenses include operating items such as officers’ salaries, personnel expenses, depreciation of fixed assets, office rental for sales, marketing and administrative divisions, a provision for doubtful accounts and amortization of intangible assets.

Financial services expenses -

Financial services expenses include a provision for policy reserves and amortization of deferred insurance acquisition costs, and all other operating costs, such as personnel expenses, depreciation of fixed assets, and office rental of subsidiaries, in the Financial Services segment.

Advertising costs -

Advertising costs are expensed when the advertisement or commercial appears in the selected media.

Shipping and handling costs -

The majority of shipping and handling, warehousing and internal transfer costs for finished goods are included in selling, general and administrative expenses. An exception to this is in the Pictures segment where such costs are charged to cost of sales as they are an integral part of producing and distributing motion pictures and television programming. All other costs related to Sony’s distribution network are included in cost of sales, including inbound freight charges, purchasing and receiving costs, inspection costs and warehousing costs for raw materials and in-process inventory. Amounts paid by customers for shipping and handling costs are included in net sales.

Income taxes -

The provision for income taxes is computed based on the pretax income included in the consolidated statements of income, and the tax liability attributed to undistributed earnings of subsidiaries and affiliated companies accounted for by the equity method expected to be remitted in the foreseeable future. The asset and liability approach is used to recognize deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the carrying amounts and the tax bases of assets and liabilities.

Carrying amounts of deferred tax assets require a reduction by a valuation allowance if, based on the available evidence, it is more likely than not that such assets will not be realized. Accordingly, the need to establish valuation allowances for deferred tax assets is assessed periodically with appropriate consideration given to all positive and negative evidence related to the realization of the deferred tax assets. Management’s judgments related to this assessment consider, among other matters, the nature, frequency and severity of current and cumulative losses on an individual tax jurisdiction basis, forecasts of future profitability after consideration of uncertain tax positions, excess of appreciated asset value over the tax basis of net assets, the duration of statutory carryforward periods, the past utilization of net operating loss carryforwards prior to expiration, as well as prudent and feasible tax planning strategies which would be employed by Sony to prevent net operating loss and tax credit carryforwards from expiring unutilized.

Sony records assets and liabilities for unrecognized tax benefits resulting from uncertain tax positions taken or expected to be taken in a tax return. Sony continues to recognize interest and penalties, if any, with respect to income taxes, including unrecognized tax benefits, as interest expense and as income tax expense, respectively, in the consolidated statements of income. The amount of income taxes Sony pays is subject to ongoing audits by various taxing authorities, which may result in proposed assessments. In addition, several significant items related to intercompany transfer pricing are currently the subject of negotiations between taxing authorities in different jurisdictions as a result of pending advance pricing agreement applications and competent authority requests. Sony’s estimate for the potential outcome for any uncertain tax issues is judgmental and requires significant estimates. Sony assesses its income tax positions and records tax benefits for all years subject to examinations based upon the evaluation of the facts, circumstances and information available at that reporting date. For those tax positions for which it is more likely than not that a tax benefit will be sustained, Sony records the amount that has a greater than 50% likelihood of being realized upon settlement with a taxing authority that has full knowledge of all relevant information. If Sony does not believe that it is more likely than not that a tax benefit will be sustained, no tax benefit is recognized. However, Sony’s future results may include favorable or unfavorable adjustments to Sony’s estimated tax liabilities due to closure of income tax examinations, the outcome of negotiations between taxing authorities in different jurisdictions, new regulatory or judicial pronouncements or other relevant events. As a result, the amount of unrecognized tax benefits, and the effective tax rate, may fluctuate significantly.

The impact of the U.S. Tax Cuts and Jobs Act of 2017 (the “U.S. Tax Reform Act”) has been recorded on a provisional basis as defined in Staff Accounting Bulletin No. 118 (“SAB 118”) and additional guidance is to be issued by the U.S. Department of the Treasury on several provisions including the computation of the transition tax on historic foreign earnings. Additional guidance issued during the fiscal year ending March 31, 2019 could impact the information required for, and the calculation of, the transition tax charge. Further analysis performed and conclusions reached as part of the tax return filing process and the issuance of additional guidance related to the U.S. Tax Reform Act could affect the provisional amount recorded. Sony expects to complete its analysis of the impact of the U.S. Tax Reform Act no later than December 22, 2018.

Net income (loss) attributable to Sony Corporation’s stockholders per share (“EPS”) -

Basic EPS is computed based on the weighted-average number of shares of common stock outstanding during each period. The computation of diluted EPS reflects the maximum possible dilution from conversion, exercise, or contingent issuance of securities. All potentially dilutive securities are excluded from the calculation in a situation where there is a net loss attributable to Sony Corporation’s stockholders.

(2) Recently adopted accounting pronouncements

Simplifying the test for goodwill impairment -

In January 2017, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2017-04 to simplify the accounting for goodwill impairment. This ASU eliminates the second step from the goodwill impairment test. Instead, an entity should perform its annual or interim goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount and recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value, not to exceed the total amount of goodwill allocated to the reporting unit. Sony has early adopted this ASU in the fiscal year ended March 31, 2018. The adoption of this ASU did not have a material impact on Sony’s results of operations and financial position.

(3) Recent accounting pronouncements not yet adopted

Revenue from contracts with customers -

In May 2014, the FASB issued ASU 2014-09 addressing revenue recognition which will supersede the current revenue recognition requirements, including most industry-specific guidance. The guidance requires an entity to recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services.

This guidance will be effective from the first quarter of Sony’s fiscal year beginning April 1, 2018. The guidance permits two methods of adoption: retrospectively to each prior period presented (“full retrospective method”), or retrospectively with the cumulative effect of initially applying the guidance recognized at the date of initial application (“modified retrospective method”). Sony will adopt this guidance using the modified retrospective method.

Sony has substantially completed its assessment of the impact of adopting this new guidance and does not expect that the adoption will have a material impact on Sony’s results of operations and financial position. Although Sony does not expect the impact of adopting the guidance to be material, there are several areas where Sony’s revenue recognition is expected to change as compared with historical U.S. GAAP. The more significant of these areas are as follows:

In the Pictures segment, (1) licensing revenue associated with certain renewals or extensions of existing agreements for motion pictures and television programming will be recognized at a later point in time, which is when the licensee can use and benefit from the content, instead of when the agreement is renewed or extended, and (2) licensing revenue associated with minimum guarantees for symbolic intellectual property (e.g., brands, trademarks and logos) will be recognized over the license term instead of at the inception of the license term.

In the MC segment, incremental costs of obtaining contracts for internet-related service business will be recognized as assets and amortized to expense over the contract period.

In addition, the ASU will change the presentation of certain items in the consolidated financial statements, such as sales returns, with no impact to the timing of the recognition of revenue or expense.

Recognition and measurement of financial assets and financial liabilities -

In January 2016, the FASB issued ASU 2016-01 amending various aspects of the recognition, measurement, presentation, and disclosure requirements for financial instruments. The changes mainly relate to the requirement to measure equity investments in unconsolidated subsidiaries, other than those accounted for under the equity method of accounting, at fair value with changes in fair value recognized in earnings. However, this ASU permits entities to elect to measure equity investments that do not have readily determinable fair values at cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer. This ASU will be effective for Sony as of April 1, 2018. As a result of the adoption of this ASU, Sony will reclassify the unrealized gains and losses, net of tax, on equity securities previously classified as available-for-sale, from accumulated other comprehensive income to retained earnings. Sony anticipates that the adoption of this ASU will increase the volatility of Sony’s other income (expenses), net, resulting from the remeasurement of Sony’s equity investments.

Leases -

In February 2016, the FASB issued ASU 2016-02, which amends current leasing guidance. The ASU requires substantially all leases to be recognized on the balance sheet. This ASU will be effective for Sony as of the fiscal year beginning April 1, 2019, and early adoption is permitted. The impact of this ASU on Sony’s results of operations and financial position is being evaluated.

Measurement of credit losses on financial instruments -

In June 2016, the FASB issued ASU 2016-13, which amends the accounting guidance for credit losses on financial instruments. The ASU requires the consideration of all available relevant information when estimating expected credit losses, including past events, current conditions and forecasts and their implications for expected credit losses. This ASU will be effective for Sony as of the fiscal year beginning April 1, 2020, with early adoption permitted for the first quarter of the fiscal year beginning April 1, 2019. The impact of this ASU on Sony’s results of operations and financial position is being evaluated.

Classification of certain cash receipts and cash payments -

In August 2016, the FASB issued ASU 2016-15, which clarifies the classification of certain cash receipts and cash payments in the statement of cash flows. This guidance is effective from the first quarter of Sony’s fiscal year beginning April 1, 2018. Sony does not expect the impact on its consolidated financial statements to be material.

Intra-entity transfers of assets other than inventory -

In October 2016, the FASB issued ASU 2016-16, which amends the accounting for income taxes. This update requires recognition of the income tax consequences of an intra-entity transfer of assets other than inventory when the transfer occurs. Under current U.S. GAAP, recognition of the income tax consequences for asset transfers other than inventory cannot be recognized until the asset is sold to a third party. This ASU is required to be applied on a modified retrospective basis through a cumulative-effect adjustment to retained earnings as of the beginning of the period of adoption. This ASU will be effective for Sony as of the fiscal year beginning April 1, 2018. The adoption of this ASU is not expected to have a material impact on Sony’s results of operations and financial position.

Restricted cash -

In November 2016, the FASB issued ASU 2016-18, which requires that restricted cash and restricted cash equivalents be included with cash and cash equivalents in the statement of cash flows. This guidance also requires entities to disclose how the statement of cash flows that includes restricted cash and restricted cash equivalents with cash and cash equivalents reconciles to the balance sheet. The guidance is effective from the first quarter of Sony’s fiscal year beginning April 1, 2018. Sony does not expect the impact on its consolidated financial statements to be material.

Clarifying the definition of a business -

In January 2017, the FASB issued ASU 2017-01 which clarifies the definition of a business. The ASU requires an entity first to determine whether substantially all of the fair value of a set of assets acquired is concentrated in either a single identifiable asset or a group of similar identifiable assets. If this criterion is met, the acquired set of assets is not deemed to be a business. If the criterion is not met, the entity then must evaluate whether the set of assets meets the requirement to be deemed a business. To be considered a business, the acquired set of assets would have to include an input and a substantive process that together significantly contribute to the ability to create outputs. This ASU is effective for Sony as of the fiscal year beginning April 1, 2018. The adoption of this ASU is not expected to have a material impact on Sony’s results of operations and financial position.

Presentation of net periodic pension and postretirement benefit costs -

In March 2017, the FASB issued ASU 2017-07, which requires separate presentation of service costs and other components of net benefit costs. The service costs will only be presented with other employee compensation costs in operating income or capitalized, while the other components of net benefit costs will be presented outside of operating income, and will not be eligible for capitalization. This ASU will be effective for Sony as of the fiscal year beginning April 1, 2018. This ASU is required to be applied on a retrospective basis for the presentation of service costs and other components of net benefit costs, and on a prospective basis for the capitalization of only the service costs component of net benefit costs. The adoption of this ASU is not expected to have a material impact on Sony’s results of operations and financial position.

Premium amortization on purchased callable debt securities -

In March 2017, the FASB issued ASU 2017-08, which requires certain premiums on callable debt securities to be amortized to the earliest call date. The amortization period for callable debt securities purchased at a discount will not be affected. This ASU will be effective for Sony as of April 1, 2019. The impact of this ASU on Sony’s results of operations and financial position is being evaluated.

Targeted improvements to accounting for hedging activities -

In August 2017, the FASB issued ASU 2017-12, which made targeted improvements to the accounting for hedging activities. The amendments in this update simplify certain aspects of hedge accounting for both non-financial and financial risks and better align the recognition and measurement of hedge results with an entity’s risk management activities. This ASU also amends certain presentation and disclosure requirements for hedging activities and changes how an entity assesses hedge effectiveness. This ASU will be effective for Sony as of the fiscal year beginning April 1, 2019. The impact of this ASU on Sony’s results of operations and financial position is being evaluated.

(4) Reclassifications

Certain reclassifications of the financial statements and accompanying footnotes for the fiscal years ended March 31, 2016 and 2017 have been made to conform to the presentation for the fiscal year ended March 31, 2018.

(5) Out-of-period adjustments

For the fiscal year ended March 31, 2016, Sony recorded an out-of-period adjustment to correct an error in the amount of accruals for certain sales incentives being recorded at a subsidiary. The error began in the fiscal year ended March 31, 2009 and continued until it was identified by Sony during the fiscal year ended March 31, 2016. The adjustment, which related to the HE&S segment, impacted net sales and increased income before income taxes in the consolidated statements of income by 8,447 million yen for the fiscal year ended March 31, 2016. Sony determined that the adjustment was not material to the consolidated financial statements for the fiscal year ended March 31, 2016 or any prior periods.

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Inventories

12 Months Ended

Mar. 31, 2018

Inventory Disclosure [Abstract]

Inventories

3. Inventories

Inventories are comprised of the following:

	Yen in millions
	March 31
	2017		2018
Finished products		399,850		422,461
Work in process		140,718		153,257
Raw materials, purchased components and supplies		100,267		117,219
Inventories		640,835		692,937

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Film costs

12 Months Ended

Mar. 31, 2018

Other Industries [Abstract]

Film costs

4. Film costs

Film costs are comprised of the following:

	Yen in millions
	March 31
	2017			2018
Motion picture productions:
Released		80,539			81,755
Completed and not released		5,608			1,728
In production and development		94,197			78,868
Television productions:
Released		120,693			127,790
In production and development		7,707			1,174
Broadcasting rights		65,725			72,125
Less: current portion of broadcasting rights included in inventories		(37,541	)		(35,795	)
Film costs		336,928			327,645

Sony estimates that approximately 91% of the unamortized film costs of released motion picture and television productions at March 31, 2018 will be amortized within the next three years. Approximately 123 billion yen of completed film costs are expected to be amortized during the next twelve months. Approximately 158 billion yen of accrued participation liabilities included in accounts payable, other and accrued expenses are expected to be paid during the next twelve months.

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Investments in affiliated companies

12 Months Ended

Mar. 31, 2018

Equity Method Investments and Joint Ventures [Abstract]

Investments in affiliated companies

5. Investments in affiliated companies

The summarized combined financial information that is based on information provided by the equity investees including information for significant equity affiliates and the reconciliation of such information to the consolidated financial statements is shown below:

Balance Sheets

	Yen in millions
	March 31
	2017			2018
Current assets		361,492			404,658
Noncurrent assets		834,765			868,455
Current liabilities		248,450			273,067
Noncurrent liabilities and noncontrolling interests		761,546			768,007
Percentage of ownership in equity investees		20%-50	%		20%-50	%

Statements of Income

	Yen in millions
	Fiscal year ended March 31
	2016			2017			2018
Net revenues		358,256			387,229			468,933
Operating income		32,884			37,800			56,729
Net income attributable to controlling interests		8,388			11,529			27,301
Percentage of ownership in equity investees		20%-50	%		20%-50	%		20%-50	%

On June 29, 2012, an investor group which included a wholly-owned subsidiary of Sony Corporation completed its acquisition of EMI Music Publishing. To effect the acquisition, the investor group formed DH Publishing, L.P. (“DHP”), which acquired EMI Music Publishing for total consideration of 2.2 billion U.S. dollars. Sony invested 320 million U.S. dollars in DHP, through Nile Acquisition LLC, for a 39.8% equity interest. Nile Acquisition LLC is a joint venture with the third-party investor of Sony’s U.S.- based music publishing subsidiary in which Sony holds a 74.9% ownership interest. Sony accounts for its interest in DHP under the equity method. In addition, DHP entered into an agreement with Sony’s U.S.-based music publishing subsidiary in which the subsidiary provides administration services to DHP. DHP was determined to be a variable interest entity (“VIE”) as described in Note 23.

On January 30, 2017, Sony sold 17,302,700 shares of its 127,381,600 shares in its affiliated company M3, Inc. (“M3”) to a third party for cash consideration of 51,968 million yen, which is included within other in the investing activities section of the consolidated statements of cash flows. In connection with the sale, Sony’s share ownership decreased from 39.35% to 34.0% of the issued and outstanding shares of M3 and Sony recorded a gain of 37,167 million yen in other operating expense, net in the consolidated statements of income for the fiscal year ended March 31, 2017. Sony continues to account for its remaining interest in M3 under the equity method. Sony remains a major shareholder of M3 and will continue to pursue opportunities to collaborate with M3 in certain business areas, including medical.

The carrying value of Sony’s investment in M3 exceeded its proportionate share in the underlying net assets of M3 by 98,938 million yen at March 31, 2018. The excess is substantially attributable to the remeasurement to fair value of the remaining shares of M3, and allocated to identifiable tangible and intangible assets. The intangible assets relate primarily to M3’s medical web-portal. The unassigned residual value of the excess is recognized as goodwill as a component of the investment balance. The amounts allocated to intangible assets are amortized net of the related tax effects to equity in net income (loss) of affiliated companies over their respective estimated useful lives, principally 10 years, using the straight-line method.

With the exception of M3 as described above, there was no significant difference between Sony’s proportionate share in the underlying net assets of the investees and the carrying value of investments in affiliated companies at March 31, 2017 and 2018.

Several affiliated companies are listed on the Tokyo Stock Exchange and Sony’s investments in these companies have an aggregate carrying value and fair value of 99,944 million yen and 533,932 million yen, respectively, as of March 31, 2018.

The number of affiliated companies accounted for under the equity method as of March 31, 2017 and 2018 were 109 and 107, respectively.

Account balances and transactions with affiliated companies accounted for under the equity method are presented below. There are no other material transactions or account balances with any other related parties.

	Yen in millions
	March 31
	2017		2018
Accounts receivable, trade		10,873		15,516
Accounts payable, trade		2,525		2,568
Short-term borrowings		20,650		22,849
Capital lease obligations		10,105		13,294

	Yen in millions
	Fiscal year ended March 31
	2016		2017		2018
Sales		33,569		31,238		45,415
Purchases		2,259		1,966		3,180
Lease payments		32,291		16,492		7,749

Sony entered into sale and leaseback transactions regarding certain machinery and equipment with SFI Leasing Company, Limited (“SFIL”), a leasing company in Japan, in the fiscal years ended March 31, 2016, 2017 and 2018. SFIL is accounted for under the equity method and is 34% owned by Sony. For the transactions with SFIL, refer to Note8.

MITSUI-SOKO Supply Chain Solutions, Inc. is accounted for under the equity method and is 34% owned by Sony as a result of the sale of the logistics business on April 1, 2015. As of the fiscal years ended March 31, 2017 and 2018, account balances with MITSUI-SOKO Supply Chain Solutions, Inc. and its subsidiaries were 4,922 million yen and 3,662 million yen, respectively, which are mainly included in accrued expenses. For the fiscal years ended March 31, 2017 and 2018, transactions were 13,752 million yen and 9,123 million yen, respectively, which are mainly included in general and administrative expenses. Refer to Note 25.

Dividends from affiliated companies accounted for under the equity method for the fiscal years ended March 31, 2016, 2017 and 2018 were 7,282 million yen, 7,970 million yen and 5,613 million yen, respectively.

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Transfer of financial assets

12 Months Ended

Mar. 31, 2018

Transfers and Servicing [Abstract]

Transfer of financial assets

6. Transfer of financial assets

Sony has established several accounts receivable sales programs mainly within the HE&S, IP&S and MC segments. Through these programs, Sony can sell receivables to a commercial bank or a special purpose entity associated with a sponsor bank. Total receivables sold during the fiscal years ended March 31, 2016, 2017 and 2018 were 53,267 million yen, 73,185 million yen and 84,718 million yen, respectively. These transactions are accounted for as sales in accordance with the accounting guidance for transfers of financial assets, because Sony has relinquished control of the receivables. Sony includes the sales proceeds from these receivables as cash flows within operating activities in the consolidated statement of cash flows because the receivables are the result of operating activities and are short term in nature. Gains and losses from these transactions were insignificant. Although Sony continues servicing the receivables subsequent to being sold or contributed, no servicing assets or liabilities are recorded as the costs of collection of the sold receivables and the income from servicing such receivables are insignificant.

Certain of the accounts receivable sales programs above also involve VIEs. Refer to Note 23.

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Marketable securities and securities investments

12 Months Ended

Mar. 31, 2018

Investments, Debt and Equity Securities [Abstract]

Marketable securities and securities investments

7. Marketable securities and securities investments

Marketable securities and securities investments, primarily included in the Financial Services segment, are comprised of debt and equity securities for which the aggregate cost, gross unrealized gains and losses and fair value pertaining to available-for-sale securities and held-to-maturity securities are as follows:

	Yen in millions
	March 31, 2017									March 31, 2018
	Cost		Gross unrealized gains		Gross unrealized losses			Fair value		Cost		Gross unrealized gains		Gross unrealized losses			Fair value
Available-for-sale:
Debt securities:
Japanese national government bonds		1,161,493		182,836		(928	)		1,343,401		1,227,139		182,830		(359	)		1,409,610
Japanese local government bonds		60,450		144		(63	)		60,531		67,574		107		(112	)		67,569
Japanese corporate bonds		163,785		7,864		(1,846	)		169,803		199,880		9,844		(1,016	)		208,708
Foreign government bonds		27,601		359		(918	)		27,042		72,204		622		(3,287	)		69,539
Foreign corporate bonds		396,097		4,168		(719	)		399,546		365,457		1,649		(641	)		366,465
Other		15,192		—		(0	)		15,192		99,349		1		(0	)		99,350
		1,824,618		195,371		(4,474	)		2,015,515		2,031,603		195,053		(5,415	)		2,221,241
Equity securities		55,928		69,937		(377	)		125,488		55,676		71,723		(776	)		126,623
Held-to-maturity securities:
Japanese national government bonds		5,661,191		1,520,904		(30,553	)		7,151,542		5,892,868		1,635,036		(20,890	)		7,507,014
Japanese local government bonds		4,101		449		—			4,550		3,850		413		—			4,263
Japanese corporate bonds		230,011		12,346		(22,071	)		220,286		345,818		16,912		(17,390	)		345,340
Foreign government bonds		253,019		5,269		(22,868	)		235,420		300,220		8,310		(18,570	)		289,960
Foreign corporate bonds		198		18		—			216		198		13		—			211
		6,148,520		1,538,986		(75,492	)		7,612,014		6,542,954		1,660,684		(56,850	)		8,146,788
Total		8,029,066		1,804,294		(80,343	)		9,753,017		8,630,233		1,927,460		(63,041	)		10,494,652

The following table presents the cost and fair value of debt securities classified as available-for-sale securities and held-to-maturity securities by contractual maturity:

	Yen in millions
	March 31, 2018
	Available-for-sale securities				Held-to-maturity securities
	Cost		Fair value		Cost		Fair value
Due in one year or less		125,037		125,290		3,249		3,269
Due after one year through five years		421,676		422,987		27,805		29,417
Due after five years through ten years		542,642		626,888		334,206		382,175
Due after ten years		942,248		1,046,076		6,177,694		7,731,927
Total		2,031,603		2,221,241		6,542,954		8,146,788

Proceeds from sales of available-for-sale securities were 315,043 million yen, 75,319 million yen and 39,982 million yen for the fiscal years ended March 31, 2016, 2017 and 2018, respectively. On these sales, gross realized gains were 67,205 million yen, 2,297 million yen and 1,257 million yen and gross realized losses were 186 million yen, 37 million yen and 2 million yen, respectively, for the fiscal years ended March 31, 2016, 2017 and 2018. Included in the gross realized gains of available-for-sale securities is 46,757 million yen from the sale of Olympus shares in the fiscal year ended March 31, 2016.

Marketable securities classified as trading securities, which consist of debt and equity securities held primarily in the Financial Services segment, totaled 921,320 million yen and 1,048,062 million yen as of March 31, 2017 and 2018, respectively. Sony recorded net unrealized losses of 45,841 million yen, net unrealized gains of 56,593 million yen, and net unrealized gains of 48,047 million yen for the fiscal years ended March 31 2016, 2017 and 2018, respectively. Changes in the fair value of trading securities are primarily recognized in financial services revenue in the consolidated statements of income.

In the ordinary course of business, Sony maintains long-term investment securities, included in securities investments and other, issued by a number of non-public companies. The aggregate carrying amounts of the investments in non-public companies as of March 31, 2017 and 2018 totaled 61,323 million yen and 52,361 million yen, respectively. Non-public equity investments are primarily valued at cost as fair value is not readily determinable.

The following tables present the gross unrealized losses on, and fair value of, Sony’s investment securities with unrealized losses, aggregated by investment category and the length of time that individual investment securities have been in a continuous unrealized loss position, at March 31, 2017 and 2018.

	Yen in millions
	March 31, 2017
	Less than 12 months					12 months or more					Total
	Fair value		Unrealized losses			Fair value		Unrealized losses			Fair value		Unrealized losses
Available-for-sale:
Debt securities:
Japanese national government bonds		52,825		(909	)		2,018		(19	)		54,843		(928	)
Japanese local government bonds		3,793		(6	)		14,270		(57	)		18,063		(63	)
Japanese corporate bonds		53,302		(1,761	)		20,489		(85	)		73,791		(1,846	)
Foreign government bonds		10,258		(577	)		7,792		(341	)		18,050		(918	)
Foreign corporate bonds		27,944		(143	)		24,662		(576	)		52,606		(719	)
		148,122		(3,396	)		69,231		(1,078	)		217,353		(4,474	)
Equity securities		11,878		(370	)		9		(7	)		11,887		(377	)
Held-to-maturity securities:
Japanese national government bonds		277,328		(30,553	)		—		—			277,328		(30,553	)
Japanese local government bonds		—		—			—		—			—		—
Japanese corporate bonds		146,004		(22,071	)		—		—			146,004		(22,071	)
Foreign government bonds		196,740		(22,868	)		—		—			196,740		(22,868	)
Foreign corporate bonds		—		—			—		—			—		—
		620,072		(75,492	)		—		—			620,072		(75,492	)
Total		780,072		(79,258	)		69,240		(1,085	)		849,312		(80,343	)

	Yen in millions
	March 31, 2018
	Less than 12 months					12 months or more					Total
	Fair value		Unrealized losses			Fair value		Unrealized losses			Fair value		Unrealized losses
Available-for-sale:
Debt securities:
Japanese national government bonds		10,118		(11	)		32,836		(348	)		42,954		(359	)
Japanese local government bonds		9,324		(11	)		14,729		(101	)		24,053		(112	)
Japanese corporate bonds		11,046		(10	)		64,119		(1,006	)		75,165		(1,016	)
Foreign government bonds		40,156		(2,281	)		7,752		(1,006	)		47,908		(3,287	)
Foreign corporate bonds		34,840		(69	)		21,191		(572	)		56,031		(641	)
Other		1,840		(0	)		315		(0	)		2,155		(0	)
		107,324		(2,382	)		140,942		(3,033	)		248,266		(5,415	)
Equity securities		13,859		(776	)		15		(0	)		13,874		(776	)
Held-to-maturity securities:
Japanese national government bonds		—		—			304,564		(20,890	)		304,564		(20,890	)
Japanese local government bonds		—		—			—		—			—		—
Japanese corporate bonds		—		—			174,815		(17,390	)		174,815		(17,390	)
Foreign government bonds		20,448		(704	)		134,230		(17,866	)		154,678		(18,570	)
Foreign corporate bonds		—		—			—		—			—		—
		20,448		(704	)		613,609		(56,146	)		634,057		(56,850	)
Total		141,631		(3,862	)		754,566		(59,179	)		896,197		(63,041	)

For the fiscal years ended March 31, 2016, 2017 and 2018, total realized impairment losses were 3,566 million yen, 7,566 million yen and 5,175 million yen, respectively.

At March 31, 2018, Sony determined that the decline in value for securities with unrealized losses shown in the above table is not other-than-temporary in nature.

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Leases

12 Months Ended

Mar. 31, 2018

Leases [Abstract]

Leases

8. Leases

Sony leases certain communication and commercial equipment, plant, office space, warehouses, employees’ residential facilities and other assets. Certain of these leases have renewal and purchase options. Sony has also entered into capital lease arrangements with third parties to finance certain of its motion picture productions, as well as sale and leaseback transactions for office buildings, machinery and equipment.

(1) Capital leases

Leased assets under capital leases are comprised of the following:

	Yen in millions
	March 31
Class of property	2017			2018
Machinery, equipment and others		66,722			82,260
Film costs		4,943			4,007
Accumulated amortization		(53,330	)		(58,861	)
		18,335			27,406

The following is a schedule by fiscal year of the future minimum lease payments under capital leases together with the present value of the net minimum lease payments as of March 31, 2018:

Fiscal year ending March 31	Yen in millions
2019		12,326
2020		15,101
2021		8,787
2022		4,773
2023		3,573
Later fiscal years		12,424
Total minimum lease payments		56,984
Less — Amount representing interest		7,150
Present value of net minimum lease payments		49,834
Less — Current obligations		11,432
Long-term capital lease obligations		38,402

(2) Operating leases

The minimum rental payments required under operating leases that have initial or remaining noncancelable lease terms in excess of one year at March 31, 2018 are as follows:

Fiscal year ending March 31	Yen in millions
2019		57,810
2020		64,380
2021		38,495
2022		24,993
2023		20,280
Later fiscal years		81,305
Total minimum future rentals		287,263

Rental expenses under operating leases for the fiscal years ended March 31, 2016, 2017 and 2018 were 94,000 million yen, 77,976 million yen and 77,950 million yen, respectively. Sublease rentals received under operating leases for the fiscal years ended March 31, 2016, 2017 and 2018 were 1,138 million yen, 1,157 million yen and 1,325 million yen, respectively. The total minimum rentals to be received in the future under noncancelable subleases for operating leases as of March 31, 2018 were 2,792 million yen.

(3) Sale and leaseback transactions

Sale and leaseback transactions with SFIL -

Sony entered into sale and leaseback transactions regarding certain machinery and equipment with SFIL. In the fiscal years ended March 31, 2016, 2017 and 2018, transactions with total proceeds of 1,856 million yen, 2,679 million yen and 2,538 million yen, respectively and terms which averaged two years, have been accounted for as financings and are included within proceeds from issuance of long-term debt in the financing activities section of the consolidated statements of cash flows.

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Goodwill and other intangible assets

12 Months Ended

Mar. 31, 2018

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and other intangible assets

9. Goodwill and other intangible assets

Intangible assets other than goodwill acquired during the fiscal year ended March 31, 2018 totaled 110,788 million yen, of which 110,781 million yen is subject to amortization, and are comprised of the following:

	Intangible assets acquired during the fiscal year		Weighted-average amortization period
	Yen in millions		Years
Patent rights, know-how and license agreements		16,003		4
Software to be sold, leased or otherwise marketed		16,066		3
Internal-use software		69,205		5
Other		9,507		7

In the fiscal year ended March 31, 2018, additions to internal-use software primarily related to the capitalization of new software across several business platforms.

Intangible assets subject to amortization are comprised of the following:

	Yen in millions
	March 31, 2017					March 31, 2018
	Gross carrying amount		Accumulated amortization			Gross carrying amount		Accumulated amortization
Patent rights, know-how and license agreements		317,337		(251,401	)		175,980		(142,724	)
Customer relationships		37,289		(15,585	)		18,881		(7,615	)
Trademarks		31,630		(15,554	)		16,310		(8,451	)
Software to be sold, leased or otherwise marketed		117,897		(86,661	)		123,269		(92,457	)
Internal-use software		473,750		(310,408	)		494,649		(315,516	)
Music catalogs		218,321		(95,367	)		207,789		(94,210	)
Artist contracts		31,393		(29,001	)		28,534		(27,650	)
Television carriage contracts (broadcasting agreements)		74,780		(21,986	)		74,258		(25,884	)
Other		62,212		(46,624	)		58,543		(47,586	)
Total		1,364,609		(872,587	)		1,198,213		(762,093	)

The aggregate amortization expense for intangible assets for the fiscal years ended March 31, 2016, 2017 and 2018 was 125,616 million yen, 121,634 million yen and 123,450 million yen, respectively. The estimated aggregate amortization expense for intangible assets for the next five fiscal years is as follows:

Fiscal year ending March 31	Yen in millions
2019		89,924
2020		73,516
2021		56,485
2022		39,050
2023		27,982

Total carrying amount of intangible assets having an indefinite life are comprised of the following:

	Yen in millions
	March 31
	2017		2018
Trademarks		70,220		68,922
Distribution agreements		18,834		18,834
Other		3,109		3,292
Total		92,163		91,048

The changes in the carrying amount of goodwill by segment for the fiscal years ended March 31, 2017 and 2018 are as follows:

	Yen in millions
	G&NS			Music			Pictures			HE&S			IP&S			MC			Semiconductors			Financial Services			All Other			Total
Balance, March 31, 2016:
Goodwill — gross		152,293			162,078			221,517			5,320			8,637			179,331			49,621			3,020			31,536			813,353
Accumulated impairments		—			(306	)		—			(5,320	)		(300	)		(176,045	)		—			(706	)		(24,386	)		(207,063	)
Goodwill		152,293			161,772			221,517			—			8,337			3,286			49,621			2,314			7,150			606,290
Increase (decrease) due to:
Acquisitions*1		—			7,689			29,363			—			—			—			—			61			—			37,113
Sales and dispositions		—			—			(60	)		—			—			—			—			—			—			(60	)
Impairments		—			—			(112,069	)		—			—			—			—			—			—			(112,069	)
Translation adjustments		(355	)		(3,351	)		(598	)		—			(186	)		—			(77	)		—			(11	)		(4,578	)
Other		—			—			—			—			—			—			(1,475	)		—			(2,683	)		(4,158	)
Balance, March 31, 2017:
Goodwill — gross		151,938			166,416			246,085			5,320			8,451			179,331			48,069			3,081			28,842			837,533
Accumulated impairments		—			(306	)		(107,932	)		(5,320	)		(300	)		(176,045	)		—			(706	)		(24,386	)		(314,995	)
Goodwill		151,938			166,110			138,153			—			8,151			3,286			48,069			2,375			4,456			522,538
Increase (decrease) due to:
Acquisitions		—			2,877			12,842			—			1,204			—			—			4,850			—			21,773
Sales and dispositions		—			(121	)		—			—			—			—			—			—			—			(121	)
Impairments		—			—			—			—			—			—			—			—			—			—
Translation adjustments		(1,332	)		(3,472	)		(6,583	)		—			162			—			(1,072	)		—			(85	)		(12,382	)
Other		—			—			—			—			—			—			(1,204	)		—			(112	)		(1,316	)
Balance, March 31, 2018:
Goodwill — gross		150,606			165,700			246,620			5,320			9,817			179,331			45,793			7,931			27,912			839,030
Accumulated impairments		—			(306	)		(102,208	)		(5,320	)		(300	)		(176,045	)		—			(706	)		(23,653	)		(308,538	)
Goodwill		150,606			165,394			144,412			—			9,517			3,286			45,793			7,225			4,259			530,492

Sony realigned its business segments from the first quarter of the fiscal year ended March 31, 2018. As a result of this realignment, the operation of the former Components segment is now included in All Other. In connection with this realignment, the carrying amounts of associated goodwill for the former Components segment have been reclassified into All Other for the fiscal years ended March 31, 2016 and 2017. Refer to Note 28.

*1 Acquisitions for the fiscal year ended March 31, 2017 relate mainly to the TEN Sports Network acquisition in the Pictures segment. Refer to Note 24.

Impairment of goodwill in the Pictures segment -

During the fiscal year ended March 31, 2017, Sony made a downward revision in the future profitability projection for the Motion Pictures business within the Pictures segment primarily due to a lowering of previous expectations regarding the home entertainment business, mainly driven by an acceleration of market decline. The future profitability projection for the Motion Pictures business also reflected a reduction in underlying profitability projections of film performance largely mitigated by measures identified to improve the profitability of the Motion Pictures business.

Sony assessed the aforementioned events and circumstances and determined that it was more likely than not that the fair value of the Production & Distribution reporting unit (which includes the Motion Pictures and the Television Productions businesses) was less than its carrying value. Accordingly, Sony conducted the goodwill impairment tests using this new profitability projection and recalculated the implied fair value of the goodwill of the reporting unit. As a result of this recalculation, the carrying value of the goodwill was determined to be zero.

Consequently, the entire amount of the goodwill in the Production & Distribution reporting unit, 112,069 million yen, was impaired, in the fiscal year ended March 31, 2017. The impairment loss was included in other operating expense, net in the consolidated statements of income, and was recorded entirely within the Pictures segment.

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Insurance-related accounts

12 Months Ended

Mar. 31, 2018

Insurance [Abstract]

Insurance-related accounts

10. Insurance-related accounts

Sony’s Financial Services segment subsidiaries in Japan maintain their accounting records as described in Note 2 in accordance with the accounting principles and practices generally accepted in Japan, which vary in some respects from U.S. GAAP.

Those differences are mainly that insurance acquisition costs for life and non-life insurance contracts are charged to income when incurred in Japan whereas in the U.S. those costs are deferred and amortized generally over the premium-paying period of the related insurance policies, and that future policy benefits for life insurance contracts calculated locally under the authorization of the supervisory administrative agencies are comprehensively adjusted using the net level premium method with certain adjustments of actuarial assumptions for U.S. GAAP purposes. For the purpose of preparing the consolidated financial statements, appropriate adjustments have been made to reflect the accounting for these items in accordance with U.S. GAAP.

The combined amounts of statutory net equity of the insurance subsidiaries, which is not measured in accordance with U.S. GAAP, as of March 31, 2017 and 2018 were 502,999 million yen and 525,976 million yen, respectively.

(1) Insurance policies

Life insurance policies that a subsidiary in the Financial Services segment underwrites, most of which are categorized as long-duration contracts, mainly consist of whole life, term life and accident and health insurance contracts. The life insurance revenues for the fiscal years ended March 31, 2016, 2017 and 2018 were 803,549 million yen, 754,242 million yen and 857,766 million yen, respectively. Property and casualty insurance policies that a subsidiary in the Financial Services segment underwrites are primarily automotive insurance contracts, which are categorized as short-duration contracts. The non-life insurance revenues for the fiscal years ended March 31, 2016, 2017 and 2018 were 93,928 million yen, 97,581 million yen and 105,497 million yen, respectively.

(2) Deferred insurance acquisition costs

Amortization of deferred insurance acquisition costs charged to income for the fiscal years ended March 31, 2016, 2017 and 2018 amounted to 92,203 million yen, 36,130 million yen and 68,137 million yen, respectively.

(3) Future insurance policy benefits

Liabilities for future policy benefits, which mainly relate to individual life insurance policies, are established in amounts adequate to meet the estimated future obligations of policies in force. These liabilities, which require significant management judgment and estimates, are computed by the net level premium method based upon the assumptions as to future investment yield, morbidity, mortality, withdrawals and other factors. Future policy benefits are computed using interest rates ranging from 1.0% to 4.5% and are based on factors such as market conditions and expected investment returns. Morbidity, mortality and withdrawal assumptions for all policies are based on either the subsidiary’s own experience or various actuarial tables. Generally these assumptions are locked-in throughout the life of the contract upon the issuance of new insurance, although significant changes in experience or assumptions may require Sony to provide for expected future losses. At March 31, 2017 and 2018, future insurance policy benefits amounted to 4,823,687 million yen and 5,211,421 million yen, respectively.

(4) Policyholders’ account in the life insurance business

Policyholders’ account in the life insurance business represents an accumulation of account deposits plus credited interest less withdrawals, expenses and mortality charges. Policyholders’ account includes universal life insurance and investment contracts. Universal life insurance includes interest sensitive whole life contracts and variable contracts. The credited rates associated with interest sensitive whole life contracts range from 1.8% to 2.0%. For variable contracts, policy values are expressed in terms of investment units. Each unit is linked to an asset portfolio. The value of a unit increases or decreases based on the value of the linked asset portfolio. Investment contracts mainly include single payment endowment contracts, single payment educational endowment contracts, individual variable annuities and policies after the start of annuity payments. The credited rates associated with investment contracts, except for individual variable annuities, range from 0.01% to 6.3%. For individual variable annuities, policy values are expressed in terms of investment units. Each unit is linked to an asset portfolio. The value of a unit increases or decreases based on the value of the linked asset portfolio.

Policyholders’ account in the life insurance business is comprised of the following:

	Yen in millions
	March 31
	2017		2018
Universal life insurance		1,809,142		1,951,906
Investment contracts		686,182		738,404
Other		135,749		130,392
Total		2,631,073		2,820,702

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Short-term borrowings and long-term debt

12 Months Ended

Mar. 31, 2018

Debt Disclosure [Abstract]

Short-term borrowings and long-term debt

11. Short-term borrowings and long-term debt

Short-term borrowings are comprised of the following:

	Yen in millions
	March 31
	2017		2018
Unsecured loans:
with a weighted-average interest rate of 7.29%		64,046
with a weighted-average interest rate of 3.95%				64,480
Secured loans:
with a weighted-average interest rate of 0.00%		20,000
with a weighted-average interest rate of 0.12%				27
Repurchase agreement:
with a weighted-average interest rate of 0.01%		310,609
with a weighted-average interest rate of 0.18%				335,586
Secured call money:
with a weighted-average interest rate of (0.08)%		70,000
with a weighted-average interest rate of (0.07)%				96,000
		464,655		496,093

At March 31, 2018, a certain subsidiary in the Financial Services segment pledged securities investments with a book value of 267,538 million yen as collateral for 335,586 million yen of short-term repurchase agreements. The repurchase agreement provides for net settlement upon a termination event.

At March 31, 2018, a certain subsidiary in the Financial Services segment pledged marketable securities and securities investments with a book value of 119,213 million yen as collateral for 96,000 million yen of secured call money.

In addition, certain subsidiaries in the Financial Services segment pledged marketable securities and securities investments with an aggregate book value of 9,618 million yen as collateral for cash settlements, variation margins of futures markets and certain other purposes.

Long-term debt is comprised of the following:

	Yen in millions
	March 31
	2017		2018
Unsecured loans, representing obligations principally to banks:
Due 2017 to 2024, with interest rates ranging from 0.24% to 5.10% per annum		63,248
Due 2018 to 2024, with interest rates ranging from 0.01% to 5.10% per annum				49,454
Unsecured 0.43% bonds, due 2018		10,000
Unsecured 0.86% bonds, due 2018		150,000		150,000
Unsecured 2.00% bonds, due 2018		16,300		16,300
Unsecured 0.05% bonds, due 2019		69,793		69,879
Unsecured 2.07% bonds, due 2019		50,000		50,000
Unsecured 0.23% bonds, due 2021		89,670		89,744
Unsecured 0.11% bonds, due 2022				10,000
Unsecured 1.41% bonds, due 2022		10,000		10,000
Unsecured 0.28% bonds, due 2023		15,000		15,000
Unsecured 0.22% bonds, due 2025				10,000
Unsecured 0.42% bonds, due 2026		24,887		24,899
Unsecured zero coupon convertible bonds, due 2022		120,000		119,976
Secured 0.00% loans, due 2019 to 2020		70,000
Secured 0.00% loans, due 2019 to 2022				170,002
Capital lease obligations and other:
Due 2017 to 2027, with interest rates ranging from 0.36% to 8.90% per annum		34,224
Due 2018 to 2047, with interest rates ranging from 0.36% to 11.88% per annum				52,929
Guarantee deposits received		11,764		10,790
		734,886		848,973
Less — Portion due within one year		53,424		225,522
		681,462		623,451

At March 31, 2018, a certain subsidiary in the Financial Services segment pledged marketable securities and securities investments with a book value of 38,375 million yen and housing loans with a book value of 306,589 million yen as collateral for a 170,000 million yen long-term secured loan.

In March 2012, Sony executed a 1,365 million U.S. dollar unsecured bank loan with a group of lenders having six to ten year maturity terms in connection with Sony’s acquisition of Ericsson’s 50% equity interest in Sony Ericsson. This bank loan utilizes the Japan Bank for International Cooperation Facility, which was established to facilitate overseas mergers and acquisitions by Japanese companies as a countermeasure against yen appreciation. The terms of this U.S. dollar loan require accelerated repayment of the entire outstanding balance if Sony Corporation or its wholly-owned subsidiaries discontinue the business of mobile devices featuring telephone functionality. In March 2016, Sony repaid 682 million U.S. dollars of the 1,365 million U.S. dollars. In September 2016, Sony repaid the remaining 683 million U.S. dollars.

On July 21, 2015, Sony issued 120,000 million yen of 130% callable unsecured zero coupon convertible bonds with stock acquisition rights due 2022 (the “Zero Coupon Convertible Bonds”). The bondholders are entitled to stock acquisition rights effective from September 1, 2015 to September 28, 2022. The initial conversion price is 5,008 yen per common share. In addition to the standard anti-dilution provisions, the conversion price is reduced for a certain period before an early redemption triggered upon the occurrence of certain corporate events including a merger, corporate split and delisting event. The reduced amount of the conversion price will be determined by a formula that is based on the effective date of the reduction and Sony’s common stock price. The reduced conversion price ranges from 3,526.5 yen to 5,008.0 yen per common share. The conversion price is also adjusted for dividends in excess of 25 yen per common share per fiscal year. Sony has the option to redeem all of the Zero Coupon Convertible Bonds outstanding at 100% of the principal amount after July 21, 2020, if the closing sales price per share of Sony’s common stock on the Tokyo Stock Exchange is 130% or more of the conversion price of the Zero Coupon Convertible Bonds for 20 consecutive trading days. Sony was not required to bifurcate any of the embedded features contained in the Zero Coupon Convertible Bonds for accounting purposes. There are no significant adverse debt covenants under the Zero Coupon Convertible Bonds.

In September 2016, Sony issued unsecured straight bonds in the aggregate principal amount of 200,000 million yen. The proceeds from the issuance of the bonds have been applied to the repayment of borrowings and debt.

There are no significant adverse debt covenants or cross-default provisions related to the other short-term borrowings and long-term debt.

Aggregate amounts of annual maturities of long-term debt are as follows:

Fiscal year ending March 31	Yen in millions
2019		225,522
2020		155,490
2021		58,620
2022		204,428
2023		16,437
Later fiscal years		188,476
Total		848,973

At March 31, 2018, Sony had unused committed lines of credit amounting to 459,860 million yen and can generally borrow up to 180 days from the banks with whom Sony has committed line contracts. Furthermore, at March 31, 2018, Sony has commercial paper programs totaling 818,720 million yen. Sony can issue commercial paper for a period generally not in excess of 270 days up to the size of the programs.

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Housing loans and deposits from customers in the banking business

12 Months Ended

Mar. 31, 2018

Banking and Thrift [Abstract]

Housing loans and deposits from customers in the banking business

12. Housing loans and deposits from customers in the banking business

(1) Housing loans in the banking business

Sony acquires and holds certain financial receivables in the normal course of business. The majority of financing receivables held by Sony consists of housing loans in the banking business and no other significant financial receivables exist.

A subsidiary in the banking business monitors the credit quality of housing loans based on the classification set by the financial conditions and the past due status of individual obligors. Past due status is monitored on a daily basis and the aforementioned classification is reviewed on a quarterly basis.

The allowance for the credit losses is established based on the aforementioned classifications and the evaluation of collateral. The amount of housing loans in the banking business and the corresponding allowance for credit losses as of March 31, 2017 were 1,449,790 million yen and 866 million yen, respectively, and as of March 31, 2018 were 1,522,415 million yen and 717 million yen, respectively. During the fiscal years ended March 31, 2017 and 2018, charge-offs on housing loans in the banking business and changes in the allowance for credit losses were not significant.

The balance of housing loans placed on nonaccrual status or past due status were not significant as of March 31, 2017 and 2018.

(2) Deposits from customers in the banking business

All deposits from customers in the banking business within the Financial Services segment are interest bearing deposits. At March 31, 2017 and 2018, the balances of time deposits issued in amounts of 10 million yen or more were 275,638 million yen and 279,943 million yen, respectively. These amounts have been classified as current liabilities mainly due to the ability of the customers to make withdrawals prior to maturity.

At March 31, 2018, aggregate amounts of annual maturities of time deposits with a remaining term of more than one year are as follows:

Fiscal year ending March 31	Yen in millions
2020		39,058
2021		19,395
2022		9,120
2023		11,295
2024		9,736
Later fiscal years		19,203
Total		107,807

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Fair value measurements

12 Months Ended

Mar. 31, 2018

Fair Value Disclosures [Abstract]

Fair value measurements

13. Fair value measurements

As discussed in Note 2, assets and liabilities subject to the accounting guidance for fair value measurements held by Sony are classified and accounted for as described below.

(1) Assets and liabilities that are measured at fair value on a recurring basis

The following section describes the valuation techniques used by Sony to measure different financial instruments at fair value, including an indication of the level in the fair value hierarchy in which each instrument is generally classified.

Trading securities, available-for-sale securities and other investments

Where quoted prices are available in an active market, securities are classified in level 1 of the fair value hierarchy. Level 1 securities include exchange-traded equities. If quoted market prices are not available for the specific security or the market is inactive, then fair values are estimated by using pricing models, quoted prices of securities with similar characteristics or discounted cash flows and mainly classified in level 2 of the hierarchy. Level 2 securities include debt securities with quoted prices that are traded less frequently than exchange-traded instruments, such as the majority of government bonds and corporate bonds. In certain cases where there is limited activity or less transparency around inputs to the valuation, securities are classified within level 3 of the fair value hierarchy. Level 3 securities primarily include certain hybrid financial instruments and certain private equity investments not classified within level 1 or level 2.

Derivatives

Exchange-traded derivatives valued using quoted prices are classified within level 1 of the fair value hierarchy. However, few classes of derivative contracts are listed on an exchange; thus, the majority of Sony’s derivative positions are valued using internally developed models that use as their basis readily observable market parameters — i.e., parameters that are actively quoted and can be validated to external sources, including industry pricing services. Depending on the types and contractual terms of derivatives, fair value can be modeled using a series of techniques, such as the Black-Scholes option pricing model, which are consistently applied. Where derivative products have been established for some time, Sony uses models that are widely accepted in the financial services industry. These models reflect the contractual terms of the derivatives, including the period to maturity, and market-based parameters such as interest rates, volatility, and the credit rating of the counterparty. Further, many of these models do not contain a high level of subjectivity as the techniques used in the models do not require significant judgment, and inputs to the model are readily observable from actively quoted markets. Such instruments are generally classified within level 2 of the fair value hierarchy.

In determining the fair value of Sony’s interest rate swap derivatives, Sony uses the present value of expected cash flows based on market observable interest rate yield curves commensurate with the term of each instrument. For foreign currency derivatives, Sony’s approach is to use forward contract and option valuation models employing market observable inputs, such as spot currency rates, time value and option volatilities. These derivatives are classified within level 2 since Sony primarily uses observable inputs in its valuation of its derivative assets and liabilities.

The fair value of Sony’s assets and liabilities that are measured at fair value on a recurring basis at March 31, 2017 and 2018 are as follows:

	Yen in millions
	March 31, 2017
									Presentation in the consolidated balance sheets
	Level 1		Level 2		Level 3		Total		Marketable securities		Securities investments and other		Other current assets/ liabilities		Other noncurrent assets/ liabilities
Assets:
Trading securities		611,108		310,212		—		921,320		921,320		—		—		—
Available-for-sale securities
Debt securities
Japanese national government bonds		—		1,343,401		—		1,343,401		18,483		1,324,918		—		—
Japanese local government bonds		—		60,531		—		60,531		8,518		52,013		—		—
Japanese corporate bonds		—		168,493		1,310		169,803		8,433		161,370		—		—
Foreign government bonds*1		—		27,042		—		27,042		1,007		26,035		—		—
Foreign corporate bonds*2		—		358,369		41,177		399,546		86,708		312,838		—		—
Other*3		—		—		15,192		15,192		—		15,192		—		—
Equity securities		125,306		182		—		125,488		—		125,488		—		—
Other investments*4		6,589		4,525		10,483		21,597		—		21,597		—		—
Derivative assets*5		981		26,279		—		27,260		—		—		25,409		1,851
Total assets		743,984		2,299,034		68,162		3,111,180		1,044,469		2,039,451		25,409		1,851
Liabilities:
Derivative liabilities*5		520		33,930		—		34,450		—		—		15,743		18,707
Total liabilities		520		33,930		—		34,450		—		—		15,743		18,707

	Yen in millions
	March 31, 2018
									Presentation in the consolidated balance sheets
	Level 1		Level 2		Level 3		Total		Marketable securities		Securities investments and other		Other current assets/ liabilities		Other noncurrent assets/ liabilities
Assets:
Trading securities		712,113		335,949		—		1,048,062		1,048,062		—		—		—
Available-for-sale securities
Debt securities
Japanese national government bonds		—		1,409,610		—		1,409,610		20,473		1,389,137		—		—
Japanese local government bonds		—		67,569		—		67,569		8,548		59,021		—		—
Japanese corporate bonds		—		208,708		—		208,708		8,041		200,667		—		—
Foreign government bonds*1		—		69,539		—		69,539		—		69,539		—		—
Foreign corporate bonds*2		—		338,587		27,878		366,465		88,228		278,237		—		—
Other*3		—		15,736		83,614		99,350		—		99,350		—		—
Equity securities		126,330		293		—		126,623		—		126,623		—		—
Other investments*4		6,192		5,099		9,104		20,395		—		20,395		—		—
Derivative assets*5		2,194		37,332		—		39,526		—		—		37,003		2,523
Total assets		846,829		2,488,422		120,596		3,455,847		1,173,352		2,242,969		37,003		2,523
Liabilities:
Derivative liabilities*5		1,407		34,317		—		35,724		—		—		20,550		15,174
Total liabilities		1,407		34,317		—		35,724		—		—		20,550		15,174

*1 2,215 million yen and 2,875 million yen are included in foreign securities for which the fair value option has been elected and classified in level 2 for the fiscal years ended March 31, 2017 and 2018, respectively, and are included in the consolidated balance sheets as securities investments and other.

*2 165,236 million yen and 160,470 million yen are included in foreign securities for which the fair value option has been elected and classified in level 2 for the fiscal years ended March 31, 2017 and 2018, respectively. In the consolidated balance sheets, 32,167 million yen and 25,955 million yen are included as marketable securities and 133,069 million yen and 134,515 million yen are included as securities investment and other for the fiscal years ended March 31, 2017 and 2018, respectively.

*3 14,619 million yen and 93,971 million yen are included in foreign securities for which the fair value option has been elected and classified in level 2 and level 3 for the fiscal years ended March 31, 2017 and 2018, respectively, and are included in the consolidated balance sheets as securities investments and other.

*4 Other investments include certain hybrid financial instruments and certain private equity investments.

*5 Derivative assets and liabilities are recognized and disclosed on a gross basis.

*6 Net gains of 502 million yen and 544 million yen arising from financial instruments for which the fair value option has been elected are included in financial services revenue in the consolidated statements of income for the fiscal years ended March 31, 2017 and 2018, respectively.

Transfers into level 1 were 2,833 million yen and 3,522 million yen for the fiscal years ended March 31, 2017 and 2018, respectively, as quoted prices for certain trading securities and available-for-sale securities became available in an active market. Transfers out of level 1 were 3,103 million yen and 3,086 million yen for the fiscal years ended March 31, 2017 and 2018, respectively, as quoted prices for certain trading securities and available-for-sale securities were not available in an active market.

The changes in fair value of level 3 assets and liabilities for the fiscal years ended March 31, 2017 and 2018 are as follows:

	Yen in millions
	Fiscal year ended March 31, 2017
	Assets
	Available-for-sale securities
	Debt securities
	Japanese corporate bonds			Foreign corporate bonds			Other			Other investments
Beginning balance		3,346			15,853			884			13,463
Total realized and unrealized gains (losses):
Included in earnings*1		—			1,091			514			328
Included in other comprehensive income (loss)*2		(20	)		(84	)		(1	)		(2,416	)
Purchases		—			35,335			14,026			247
Sales		—			—			—			—
Settlements		—			(10,021	)		(231	)		(1,139	)
Transfers into level 3*3		—			1,008			—			—
Transfers out of level 3*4		(2,016	)		(2,005	)		—			—
Ending balance		1,310			41,177			15,192			10,483
Changes in unrealized gains (losses) relating to instruments still held at reporting date:
Included in earnings*1		—			11			79			(27	)
	Yen in millions
	Fiscal year ended March 31, 2018
	Assets
	Available-for-sale securities
	Debt securities
	Japanese corporate bonds			Foreign corporate bonds			Other			Other investments
Beginning balance		1,310			41,177			15,192			10,483
Total realized and unrealized gains (losses):
Included in earnings*1		—			(307	)		(3,032	)		(65	)
Included in other comprehensive income (loss)*2		—			(84	)		1			(489	)
Purchases		—			12,604			74,736			139
Sales		—			—			—			(10	)
Settlements		—			(18,540	)		(3,283	)		(954	)
Transfers into level 3*3		—			—			—			—
Transfers out of level 3*4		(1,310	)		(6,972	)		—			—
Ending balance		—			27,878			83,614			9,104
Changes in unrealized gains (losses) relating to instruments still held at reporting date:
Included in earnings*1		—			(468	)		(2,278	)		(65	)

*1 Earning effects are included in financial services revenue in the consolidated statements of income.

*2 Unrealized gains (losses) are included in unrealized gains (losses) on securities in the consolidated statements of comprehensive income.

*3 Certain corporate bonds were transferred into level 3 because differences between the fair value determined by indicative quotes from dealers and the fair value determined by internally developed prices became significant and the observability of the inputs used decreased.

*4 Certain corporate bonds were transferred out of level 3 because observable market data became available.

Level 3 assets include certain private equity investments, and certain domestic and foreign corporate bonds for which quoted prices are not available in a market and where there is less transparency around inputs. In determining the fair value of such assets, Sony uses third-party information such as indicative quotes from dealers without adjustment. For validating the fair values, Sony primarily uses internal models which include management judgment or estimation of assumptions that market participants would use in pricing the asset.

(2) Assets and liabilities that are measured at fair value on a nonrecurring basis

Sony also has assets and liabilities that are required to be remeasured to fair value on a nonrecurring basis when certain circumstances occur. During the fiscal years ended March 31, 2017 and 2018, such remeasurements to fair value related primarily to the following:

	During the fiscal year ended March 31, 2017
	Estimated fair value						Amounts included in earnings
	Level 1		Level 2		Level 3
Assets:
Long-lived assets impairments		—		—		72		(39,137	)
Goodwill impairments		—		—		0		(112,069	)
								(151,206	)
	During the fiscal year ended March 31, 2018
	Estimated fair value						Amounts included in earnings
	Level 1		Level 2		Level 3
Assets:
Long-lived assets impairments		—		—		19,375		(53,741	)
								(53,741	)

Long-lived assets impairments

Sony recorded an impairment loss of 30,643 million yen for the fiscal year ended March 31, 2016, included within All Other, related to long-lived assets in the battery business asset group. In the fiscal year ended March 31, 2016, due to increasingly competitive markets, Sony conducted a further strategic review of the business and evolving market trends. Following this review, Sony further reduced the corresponding estimated future cash flows of this business and the estimated ability to recover the entire carrying amount of the long-lived assets within the period applicable to the impairment determination, resulting in an impairment charge.

Sony recorded impairment losses of 59,616 million yen and 23,860 million yen for the fiscal years ended March 31, 2016 and 2017, respectively, included within the Semiconductors segment, related to long-lived assets in the camera module business asset group. Due to a decrease in the projected future demand of camera modules, Sony conducted a strategic review of the business and its market conditions. Following this review, Sony reduced the corresponding estimated future cash flows and the estimated ability to recover the entire carrying amount of the long-lived assets within the period applicable to the impairment determination, resulting in an impairment charge for the fiscal year ended March 31, 2016. Sony decided to halt all development and production of high-functionality camera modules for external sales during the fiscal year ended March 31, 2017.

Sony recorded an impairment loss of 31,341 million yen for the fiscal year ended March 31, 2018, included within the MC segment, related to long-lived assets in the smartphone business asset group. Due to smartphone sales results and changes in the business environment since January 2018, Sony conducted a strategic review of its future profitability forecast for the smartphone business. Following this review, Sony reduced the corresponding estimated future cash flows of this business and the estimated ability to recover the entire carrying amount of the long-lived assets within the period applicable to the impairment determination, resulting in an impairment charge for the fiscal year ended March 31, 2018.

These measurements are classified as level 3 because significant unobservable inputs, such as the condition of the assets or projections of future cash flows, the timing of such cash flows and the discount rate reflecting the risk inherent in future cash flows, were considered in the fair value measurements. For the fiscal year ended March 31, 2016, a discount rate of 10% and projected revenue growth rates ranging from zero to 14% were used in the fair value measurements related to the long-lived assets for the battery business and a discount rate of 10% and projected revenue growth rates ranging from zero to 108% were used in the fair value measurements related to the long-lived assets for the camera module business. The high end of the camera module revenue growth rate reflects projected revenue from the introduction of new products in the near term. For the fiscal year ended March 31, 2017, a discount rate of 10% and projected declining revenue rates ranging from (1)% to 8% were used in the fair value measurements related to the long-lived assets for the camera module business. For the fiscal year ended March 31, 2018, a discount rate of 8.5% and projected revenue growth rates ranging from (8)% to 6% were used in the fair value measurements related to the long-lived assets for the smartphone business.

Goodwill impairments

Sony recorded an impairment loss of 112,069 million yen during the fiscal year ended March 31, 2017 against the goodwill of the Production & Distribution reporting unit in the Pictures segment. Refer to Note 9. Sony’s determination of the estimated fair value of the reporting unit was based on the present value of expected future cash flows including a terminal value which is based on an exit price using an earnings multiple applied to the final year of the forecasted earnings, and which also takes into consideration a control premium. These measurements are classified as level 3 because significant unobservable inputs, such as the projections of future cash flows, the timing of such cash flows, the earnings multiple, the growth rates beyond the forecast and mid-range plan periods, and the discount rate reflecting the risk inherent in future cash flows, were considered in the fair value measurements. An earnings multiple of 9.0x, growth rates beyond the forecast and mid-range plan periods ranging from 3.0% to 4.5% and a discount rate of 9.5% were used in the fair value measurement.

(3) Financial instruments

The estimated fair values by fair value hierarchy level of certain financial instruments that are not reported at fair value are summarized as follows:

	Yen in millions
	March 31, 2017
	Estimated fair value								Carrying amount
	Level 1		Level 2		Level 3		Total		Total
Assets:
Housing loans in the banking business		—		1,603,784		—		1,603,784		1,449,790
Total assets		—		1,603,784		—		1,603,784		1,449,790
Liabilities:
Long-term debt including the current portion		—		745,599		—		745,599		734,886
Investment contracts included in policyholders’ account in the life insurance business		—		710,191		—		710,191		686,182
Total liabilities		—		1,455,790		—		1,455,790		1,421,068

	Yen in millions
	March 31, 2018
	Estimated fair value								Carrying amount
	Level 1		Level 2		Level 3		Total		Total
Assets:
Housing loans in the banking business		—		1,686,842		—		1,686,842		1,522,415
Total assets		—		1,686,842		—		1,686,842		1,522,415
Liabilities:
Long-term debt including the current portion		—		877,576		—		877,576		848,973
Investment contracts included in policyholders’ account in the life insurance business		—		766,558		—		766,558		738,404
Total liabilities		—		1,644,134		—		1,644,134		1,587,377

The summary excludes cash and cash equivalents, call loans, time deposits, notes and accounts receivable, trade, call money, short-term borrowings, notes and accounts payable, trade and deposits from customers in the banking business because the carrying values of these financial instruments approximated their fair values due to their short-term nature. The summary also excludes held-to-maturity securities disclosed in Note 7.

Cash and cash equivalents, call loans and call money are classified in level 1. Time deposits, short-term borrowings, deposits from customers in the banking business are classified in level 2. Held-to-maturity securities, included in marketable securities and securities investments and other in the consolidated balance sheets, primarily include debt securities with quoted prices that are traded less frequently than exchange-traded instruments, such as the majority of government bonds and corporate bonds and are substantially all classified in level 2. The fair values of housing loans in the banking business, included in securities investments and other in the consolidated balance sheets, were estimated based on the discounted future cash flows using interest rates reflecting London Interbank Offered Rate base yield curves with certain risk premiums. The fair values of long-term debt including the current portion and investment contracts included in policyholders’ account in the life insurance business were estimated based on either the market value or the discounted future cash flows using Sony’s current incremental borrowing rates for similar liabilities.

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Derivative instruments and hedging activities

12 Months Ended

Mar. 31, 2018

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative instruments and hedging activities

14. Derivative instruments and hedging activities

Sony has certain financial instruments including financial assets and liabilities acquired in the normal course of business. Such financial instruments are exposed to market risk arising from the changes in foreign currency exchange rates and interest rates. In applying a consistent risk management strategy for the purpose of reducing such risk, Sony uses derivative financial instruments, which include foreign exchange forward contracts, foreign currency option contracts, and interest rate swap agreements (including interest rate and currency swap agreements). Certain other derivative financial instruments are entered into in the Financial Services segment for asset-liability management (“ALM”) purposes. These instruments are executed with creditworthy financial institutions, and virtually all foreign currency contracts are denominated in U.S. dollars, euros and other currencies of major countries. These derivatives generally mature or expire within six months after the balance sheet date. Other than derivatives utilized in the Financial Services segment for ALM, Sony does not use derivative financial instruments for trading or speculative purposes. These derivative transactions utilized for ALM in the Financial Services segment are executed within certain limits in accordance with an internal risk management policy.

Derivative financial instruments held by Sony are classified and accounted for as described below.

Fair value hedges

Both the derivatives designated as fair value hedges and the hedged items are reflected at fair value in the consolidated balance sheets. Changes in the fair value of the derivatives designated as fair value hedges, as well as offsetting changes in the carrying value of the underlying hedged items, are recognized in income. For the fiscal years ended March 31, 2016, 2017 and 2018, these fair value hedges were fully effective. In addition, there were no amounts excluded from the assessment of hedge effectiveness of fair value hedges.

Cash flow hedges

Changes in the fair value of derivatives designated as cash flow hedges are initially recorded in other comprehensive income (“OCI”) and reclassified into earnings when the hedged transaction affects earnings. For the fiscal year ended March 31, 2016, the ineffective portions of the hedging relationships were not significant. For the fiscal year ended March 31, 2017 and 2018, these cash flow hedges were fully effective. In addition, there were no amounts excluded from the assessment of hedge effectiveness for cash flow hedges.

Derivatives not designated as hedges

Changes in the fair value of derivatives not designated as hedges are recognized in income.

A description of the purpose and classification of the derivative financial instruments held by Sony is as follows:

Foreign exchange forward contracts and foreign currency option contracts

Foreign exchange forward contracts and purchased and written foreign currency option contracts are utilized primarily to limit the exposure affected by changes in foreign currency exchange rates on cash flows generated or anticipated by Sony’s transactions and accounts receivable and payable denominated in foreign currencies. The majority of written foreign currency option contracts are a part of range forward contract arrangements and expire in the same month with the corresponding purchased foreign currency option contracts.

Sony also entered into foreign exchange forward contracts which effectively fixed the cash flows from certain foreign currency denominated payables. Accordingly, these derivatives have been designated as cash flow hedges.

Foreign exchange forward contracts and foreign currency option contracts that do not qualify as hedges are marked-to-market with changes in value recognized in other income and expenses.

Foreign exchange forward contracts, foreign currency option contracts and currency swap agreements held by certain subsidiaries in the Financial Services segment are marked-to-market with changes in value recognized in financial services revenue.

Interest rate swap agreements (including interest rate and currency swap agreements)

Interest rate swap agreements are utilized primarily to lower funding costs, to diversify sources of funding and to limit Sony’s exposure associated with underlying debt instruments and available-for-sale debt securities resulting from adverse fluctuations in interest rates, foreign currency exchange rates and changes in fair values.

Interest rate swap agreements entered into in the Financial Services segment are used for reducing the risk arising from the changes in the fair value of fixed rate available-for-sale debt securities. These derivatives are considered to be a hedge against changes in the fair value of available-for-sale debt securities in the Financial Services segment. Accordingly, these derivatives have been designated as fair value hedges.

Certain subsidiaries in the Financial Services segment have interest rate swap agreements as part of their ALM, which are marked-to-market with changes in value recognized in financial service revenues.

Any other interest rate swap agreements that do not qualify as hedges, which are used for reducing the risk arising from changes of variable rate debt, are marked-to-market with changes in value recognized in other income and expenses.

Other agreements

Certain subsidiaries in the Financial Services segment have equity future contracts, other currency contracts and hybrid financial instruments as part of their ALM, which are marked-to-market with changes in value recognized in financial services revenue. The hybrid financial instruments, disclosed in Note 7 as debt securities, contained embedded derivatives that are not required to be bifurcated because the entire instruments are carried at fair value.

The estimated fair values of Sony’s outstanding derivative instruments are summarized as follows:

Derivatives designated as hedging instruments	Yen in millions
	Balance sheet location	Fair value				Balance sheet location	Fair value
		March 31					March 31
	Asset derivatives	2017		2018		Liability derivatives	2017		2018
Interest rate contracts	Prepaid expenses and other current assets		43		12	Current liabilities: Other		497		160
Interest rate contracts	Other assets: Other		95		286	Liabilities: Other		13,713		10,281
Foreign exchange contracts	Prepaid expenses and other current assets		—		48	Current liabilities: Other		31		1,535
			138		346			14,241		11,976
Derivatives not designated as hedging instruments	Yen in millions
	Balance sheet location	Fair value				Balance sheet location	Fair value
		March 31					March 31
	Asset derivatives	2017		2018		Liability derivatives	2017		2018
Interest rate contracts	Prepaid expenses and other current assets		3		12	Current liabilities: Other		221		299
Interest rate contracts	Other assets: Other		1,599		1,871	Liabilities: Other		4,374		3,612
Foreign exchange contracts	Prepaid expenses and other current assets		24,382		34,737	Current liabilities: Other		14,475		17,149
Foreign exchange contracts	Other assets: Other		157		366	Liabilities: Other		620		1,281
Equity contracts	Prepaid expenses and other current assets		981		2,194	Current liabilities: Other		519		1,407
			27,122		39,180			20,209		23,748
Total derivatives			27,260		39,526			34,450		35,724

Presented below are the effects of derivative instruments on the consolidated statements of income for the fiscal years ended March 31, 2016, 2017 and 2018.

Derivatives under fair value hedging relationships	Yen in millions
	Location of gain or (loss) recognized in income on derivative	Amount of gain or (loss) recognized in income on derivative
		Fiscal year ended March 31
		2016			2017			2018
Interest rate contracts	Financial services revenue		(8,300	)		1,967			(52	)
Foreign exchange contracts	Foreign exchange loss, net		3			(31	)		—
Total			(8,297	)		1,936			(52	)
	Yen in millions
Derivatives under cash flow hedging relationships	Location of gain or (loss) recognized in income on derivative	Fiscal year ended March 31
		2016			2017			2018
		Amount of gain or (loss) recognized in OCI on derivative
Foreign exchange contracts	—		1,914			6,715			(2,295	)
Total			1,914			6,715			(2,295	)
		Amount of gain or (loss) reclassified from accumulated OCI into income (effective portion)
Foreign exchange contracts	Foreign exchange loss, net		(8	)		—			—
Foreign exchange contracts	Cost of sales		(3,104	)		(5,583	)		1,111
Total			(3,112	)		(5,583	)		1,111

Derivatives not designated as hedging instruments	Yen in millions
	Location of gain or (loss) recognized in income on derivative	Amount of gain or (loss) recognized in income on derivative
		Fiscal year ended March 31
		2016			2017			2018
Interest rate contracts	Financial services revenue		(5,499	)		(935	)		(1,544	)
Foreign exchange contracts	Financial services revenue		4,166			(5,365	)		2,013
Foreign exchange contracts	Foreign exchange loss, net		(14,501	)		12,339			21,370
Equity contracts	Financial services revenue		3,267			(18,597	)		(11,665	)
Total			(12,567	)		(12,558	)		10,174

The following table summarizes additional information, including notional amounts, for each type of derivative:

	Yen in millions
	March 31, 2017					March 31, 2018
	Notional amount		Fair value			Notional amount		Fair value
Foreign exchange contracts:
Foreign exchange forward contracts		1,062,933		3,011			1,105,393		7,071
Currency option contracts purchased		212		1			206		1
Currency option contracts written		214		(1	)		156		(1	)
Currency swap agreements		1,439,395		4,074			1,230,254		4,613
Other currency contracts		64,944		2,328			84,623		3,502
Interest rate contracts:
Interest rate swap agreements		415,719		(17,065	)		398,291		(12,171	)
Equity contracts:
Equity future contracts		96,016		462			106,876		787

All derivatives are recognized as either assets or liabilities in the consolidated balance sheets on a gross basis, but certain subsidiaries have entered into master netting agreements or other similar agreements, which are mainly International Swaps and Derivatives Association (ISDA) Master Agreements. An ISDA Master Agreement is an agreement between two counterparties that may have multiple derivative contracts with each other, and such ISDA Master Agreement may provide for the net settlement of all or a specified group of these derivative contracts, through a single payment, in a single currency, in the event of a default on or affecting any one derivative contract, or a termination event affecting all or a specified group of derivative contracts. Presented below are the effects of offsetting derivative assets, derivative liabilities, financial assets and financial liabilities as of March 31, 2017 and 2018.

	Yen in millions
	As of March 31, 2017
	Gross amounts presented in the consolidated balance sheet		Gross amounts not offset in the consolidated balance sheet that are subject to master netting agreements
			Financial instruments		Cash collateral		Net amounts
Derivative assets subject to master netting agreements		11,554		6,584		277		4,693
Derivative assets not subject to master netting agreements		15,706						15,706
Total assets		27,260		6,584		277		20,399
Derivative liabilities subject to master netting agreements		33,261		6,644		18,631		7,986
Derivative liabilities not subject to master netting agreements		1,189						1,189
Repurchase, securities lending and similar arrangements		310,609		309,987		—		622
Total liabilities		345,059		316,631		18,631		9,797
	Yen in millions
	As of March 31, 2018
	Gross amounts presented in the consolidated balance sheet		Gross amounts not offset in the consolidated balance sheet that are subject to master netting agreements
			Financial instruments		Cash collateral		Net amounts
Derivative assets subject to master netting agreements		15,404		7,724		449		7,231
Derivative assets not subject to master netting agreements		24,122						24,122
Total assets		39,526		7,724		449		31,353
Derivative liabilities subject to master netting agreements		34,455		8,326		14,334		11,795
Derivative liabilities not subject to master netting agreements		1,269						1,269
Repurchase, securities lending and similar arrangements		335,586		334,246		—		1,340
Total liabilities		371,310		342,572		14,334		14,404

XML

Pension and severance plans

12 Months Ended

Mar. 31, 2018

Retirement Benefits [Abstract]

Pension and severance plans

15. Pension and severance plans

(1) Defined benefit and severance plans

Upon terminating employment, employees of Sony Corporation and its subsidiaries in Japan are entitled, under most circumstances, to lump-sum indemnities or pension payments as described below. Sony Corporation and certain of its subsidiaries’ pension plans utilize a point-based plan under which a point is added every year reflecting the individual employee’s performance over that year. Under the point-based plan, the amount of payment is determined based on the sum of cumulative points from past services and interest points earned on the cumulative points regardless of whether or not the employee is voluntarily retiring.

Under the plans, in general, the defined benefits cover 65% of the indemnities under existing regulations to employees. The remaining indemnities are covered by severance payments by the companies. The pension benefits are payable at the option of the retiring employee either in a lump-sum amount or monthly pension payments. Contributions to the plans are funded through several financial institutions in accordance with the applicable laws and regulations.

From April 1, 2012, Sony Corporation and substantially all of its subsidiaries in Japan have modified existing defined benefit pension plans such that life annuities will no longer accrue additional service benefits, with those participants instead accruing fixed-term annuities. The defined benefit pension plans were closed to new participants and a defined contribution plan was also introduced.

In addition, several of Sony’s foreign subsidiaries have defined benefit pension plans or severance indemnity plans, which cover substantially all of their employees. Under such plans, the related cost of benefits is currently funded or accrued. Benefits awarded under these plans are based primarily on the current rate of pay and length of service.

The components of net periodic benefit costs for the fiscal years ended March 31, 2016, 2017 and 2018 were as follows:

Japanese plans:

	Yen in millions
	Fiscal year ended March 31
	2016			2017			2018
Service cost		24,670			26,811			25,185
Interest cost		8,689			5,912			8,024
Expected return on plan assets		(20,853	)		(17,829	)		(16,440	)
Recognized actuarial loss		8,588			20,436			16,099
Amortization of prior service costs		(9,489	)		(9,490	)		(8,693	)
Net periodic benefit costs		11,605			25,840			24,175

Foreign plans:

	Yen in millions
	Fiscal year ended March 31
	2016			2017			2018
Service cost		3,504			2,958			3,181
Interest cost		12,096			10,426			10,393
Expected return on plan assets		(14,117	)		(11,000	)		(11,687	)
Amortization of net transition asset		10			9			5
Recognized actuarial loss		4,236			2,552			3,014
Amortization of prior service costs		(478	)		(463	)		(574	)
Losses on curtailments and settlements		354			43			1,058
Net periodic benefit costs		5,605			4,525			5,390

The estimated net actuarial loss and prior service cost for the defined benefit pension plans that will be amortized from accumulated other comprehensive income into net periodic benefit costs over the next fiscal year are 17,706 million yen and 8,114 million yen, respectively.

The changes in the benefit obligation and plan assets as well as the funded status and composition of amounts recognized in the consolidated balance sheets were as follows:

	Japanese plans						Foreign plans
	Yen in millions						Yen in millions
	March 31						March 31
	2017			2018			2017			2018
Change in benefit obligation:
Benefit obligation at beginning of the fiscal year		1,034,284			1,004,676			356,875			352,442
Service cost		26,811			25,185			2,958			3,181
Interest cost		5,912			8,024			10,426			10,393
Plan participants’ contributions		—			—			490			573
Actuarial (gain) loss		(33,333	)		21,920			20,045			663
Foreign currency exchange rate changes		—			—			(23,183	)		8,858
Curtailments and settlements		—			—			(1,507	)		(5,422	)
Other		(5	)		(8	)		—			—
Benefits paid		(28,993	)		(49,223	)		(13,662	)		(14,291	)
Benefit obligation at end of the fiscal year		1,004,676			1,010,574			352,442			356,397
Change in plan assets:
Fair value of plan assets at beginning of the fiscal year		679,432			699,008			256,341			259,177
Actual return on plan assets		35,508			38,896			29,346			13,426
Foreign currency exchange rate changes		—			—			(20,004	)		6,181
Employer contribution		6,640			6,090			6,738			9,040
Plan participants’ contributions		—			—			490			573
Curtailments and settlements		—			—			(1,161	)		(5,285	)
Benefits paid		(22,572	)		(32,917	)		(12,573	)		(13,367	)
Fair value of plan assets at end of the fiscal year		699,008			711,077			259,177			269,745
Funded status at end of the fiscal year		(305,668	)		(299,497	)		(93,265	)		(86,652	)

Amounts recognized in the consolidated balance sheets consist of:

	Japanese plans						Foreign plans
	Yen in millions						Yen in millions
	March 31						March 31
	2017			2018			2017			2018
Noncurrent assets		2,753			3,426			6,251			8,396
Current liabilities		—			—			(3,114	)		(4,121	)
Noncurrent liabilities		(308,421	)		(302,923	)		(96,402	)		(90,927	)
Ending balance		(305,668	)		(299,497	)		(93,265	)		(86,652	)
Amounts recognized in accumulated other comprehensive income, excluding tax effects, consist of:
	Japanese plans						Foreign plans
	Yen in millions						Yen in millions
	March 31						March 31
	2017			2018			2017			2018
Prior service cost (credit)		(25,415	)		(16,723	)		(1,034	)		(488	)
Net actuarial loss		317,397			299,852			78,548			73,404
Obligation existing at transition		—			—			(3	)		0
Ending balance		291,982			283,129			77,511			72,916

The accumulated benefit obligations for all defined benefit pension plans were as follows:

	Japanese plans				Foreign plans
	Yen in millions				Yen in millions
	March 31				March 31
	2017		2018		2017		2018
Accumulated benefit obligations		998,501		1,005,557		329,989		340,353

The projected benefit obligations, the accumulated benefit obligations and fair value of plan assets for pension plans with accumulated benefit obligations in excess of plan assets were as follows:

	Japanese plans				Foreign plans
	Yen in millions				Yen in millions
	March 31				March 31
	2017		2018		2017		2018
Projected benefit obligations		992,052		998,629		291,413		301,046
Accumulated benefit obligations		987,428		993,612		287,491		293,834
Fair value of plan assets		685,183		695,706		207,406		215,510

Weighted-average assumptions used to determine benefit obligations as of March 31, 2017 and 2018 were as follows:

	Japanese plans						Foreign plans
	March 31						March 31
	2017			2018			2017			2018
Discount rate		0.9	%		0.8	%		3.1	%		2.9	%
Rate of compensation increase		*			*			2.4			2.6

* Substantially all of Sony’s Japanese pension plans were point-based. Point-based plans do not incorporate a measure of compensation rate increases.

Weighted-average assumptions used to determine the net periodic benefit costs for the fiscal years ended March 31, 2016, 2017 and 2018 were as follows:

	Japanese plans									Foreign plans
	Fiscal year ended March 31									Fiscal year ended March 31
	2016			2017			2018			2016			2017			2018
Discount rate		1.0	%		0.6	%		0.9	%		3.1	%		3.2	%		3.1	%
Expected return on plan assets		3.0			2.7			2.4			4.8			4.8			4.6
Rate of compensation increase		*			*			*			2.9			2.8			2.4

* Substantially all of Sony’s Japanese pension plans were point-based. Point-based plans do not incorporate a measure of compensation rate increases.

Sony reviews these assumptions for changes in circumstances.

The weighted-average rate of compensation increase is calculated based only on the pay-related plans. The point-based plans discussed above are excluded from the calculation because payments made under the plan are not based on employee compensation.

The mortality rate assumptions are based on life expectancy and death rates for different types of participants. In the fiscal year ended March 31, 2016, Sony updated mortality rate assumptions to consider the latest mortality tables and in certain instances to utilize mortality tables based on gender.

To determine the expected long-term rate of return on pension plan assets, Sony considers the current and expected asset allocations, as well as the historical and expected long-term rates of returns on various categories of plan assets. Sony’s pension investment policy recognizes the expected growth and the variability risk associated with the long-term nature of pension liabilities, the returns and risks of diversification across asset classes, and the correlation among assets. The asset allocations are designed to maximize returns consistent with levels of liquidity and investment risk that are considered prudent and reasonable. While the pension investment policy gives appropriate consideration to recent market performance and historical returns, the investment assumptions utilized by Sony are designed to achieve a long-term return consistent with the long-term nature of the corresponding pension liabilities.

The investment objectives of Sony’s plan assets are designed to generate returns that will enable the plans to meet their future obligations. The precise amount for which these obligations will be settled depends on future events, including the retirement dates and life expectancy of the plans’ participants. The obligations are estimated using actuarial assumptions, based on the current economic environment and other pertinent factors. Sony’s investment strategy balances the requirement to generate returns, using potentially higher yielding assets such as equity securities, with the need to control risk in the portfolio with less volatile assets, such as fixed-income securities. Risks include, among others, inflation, volatility in equity values and changes in interest rates that could negatively impact the funding level of the plans, thereby increasing its dependence on contributions from Sony. To mitigate any potential concentration risk, thorough consideration is given to balancing the portfolio among industry sectors and geographies, taking into account interest rate sensitivity, dependence on economic growth, currency and other factors that affect investment returns. The target allocations as of March 31, 2018, are, as a result of Sony’s asset liability management, 28% of equity securities, 54% of fixed income securities and 18% of other investments for the pension plans of Sony Corporation and most of its subsidiaries in Japan, and, on a weighted average basis, 27% of equity securities, 46% of fixed income securities and 27% of other investments for the pension plans of foreign subsidiaries.

The fair values of the assets held by Japanese and foreign plans, which are classified in accordance with the fair value hierarchy described in Note 2, are as follows:

	Japanese plans
	Yen in millions
	Fair value at March 31, 2017		Fair value measurements using inputs considered as
Asset class			Level 1		Level 2		Level 3
Cash and cash equivalents		7,976		7,976		—		—
Equity:
Equity securities*1		157,012		152,852		4,160		—
Fixed income:
Government bonds*2		206,632		—		206,632		—
Corporate bonds*3		75,971		—		75,971		—
Asset-backed securities*4		1,105		—		1,105		—
Commingled funds*5		122,264		—		122,264		—
Commodity funds*6		21,098		—		21,098		—
Private equity*7		21,790		—		—		21,790
Hedge funds*8		67,235		—		—		67,235
Real estate and other*9		17,925		—		—		17,925
Total		699,008		160,828		431,230		106,950

	Japanese plans
	Yen in millions
	Fair value at March 31, 2018		Fair value measurements using inputs considered as
Asset class			Level 1		Level 2		Level 3
Cash and cash equivalents		9,446		9,446		—		—
Equity:
Equity securities*1		138,443		134,091		4,352		—
Fixed income:
Government bonds*2		225,879		—		225,879		—
Corporate bonds*3		79,323		—		79,323		—
Asset-backed securities*4		121		—		121		—
Commingled funds*5		122,950		—		122,950		—
Commodity funds*6		21,136		—		21,136		—
Private equity*7		24,144		—		—		24,144
Hedge funds*8		70,204		—		—		70,204
Real estate and other*9		19,431		—		—		19,431
Total		711,077		143,537		453,761		113,779

*1 Includes approximately 48 percent and 52 percent of Japanese equity securities, and 52 percent and 48 percent of foreign equity securities for the fiscal years ended March 31, 2017 and 2018, respectively.

*2 Includes approximately 46 percent and 49 percent of debt securities issued by Japanese national and local governments, and 54 percent and 51 percent of debt securities issued by foreign national and local governments for the fiscal years ended March 31, 2017 and 2018, respectively.

*3 Includes debt securities issued by Japanese and foreign corporation and government related agencies.

*4 Includes primarily mortgage-backed securities.

*5 Commingled funds represent pooled institutional investments, including primarily investment trusts. They include approximately 48 percent and 51 percent of investments in equity, 51 percent and 48 percent of investments in fixed income, and 1 percent and 1 percent of investments in other for the fiscal years ended March 31, 2017 and 2018, respectively.

*6 Represents commodity futures funds.

*7 Includes multiple private equity funds of funds that primarily invest in venture, buyout, and distressed markets in the U.S. and Europe.

*8 Includes primarily funds that invest in a portfolio of a broad range of hedge funds to diversify the risks and reduce the volatilities associated with a single hedge fund.

*9 Includes primarily private real estate investment trusts.

	Foreign plans
	Yen in millions
	Fair value at March 31, 2017		Fair value measurements using inputs considered as
Asset class			Level 1		Level 2		Level 3
Cash and cash equivalents		8,091		8,091		—		—
Equity:
Equity securities*1		33,103		31,783		1,320		—
Fixed income:
Government bonds*2		65,671		—		65,671		—
Corporate bonds*3		28,296		—		21,370		6,926
Asset-backed securities		982		—		982		—
Insurance contracts*4		5,135		—		5,135		—
Commingled funds*5		81,683		—		81,683		—
Real estate and other*6		36,216		—		13,287		22,929
Total		259,177		39,874		189,448		29,855

	Foreign plans
	Yen in millions
	Fair value at March 31, 2018		Fair value measurements using inputs considered as
Asset class			Level 1		Level 2		Level 3
Cash and cash equivalents		2,377		2,377		—		—
Equity:
Equity securities*1		30,916		29,814		1,102		—
Fixed income:
Government bonds*2		78,129		—		78,129		—
Corporate bonds*3		26,424		—		21,121		5,303
Asset-backed securities		960		—		960		—
Insurance contracts*4		18,670		—		5,941		12,729
Commingled funds*5		75,785		—		75,785		—
Real estate and other*6		36,484		—		10,508		25,976
Total		269,745		32,191		193,546		44,008

*1 Includes primarily foreign equity securities.

*2 Includes primarily foreign government debt securities.

*3 Includes primarily foreign corporate debt securities.

*4 Represents annuity contracts with or without profit sharing.

*5 Commingled funds represent pooled institutional investments including mutual funds, common trust funds, and collective investment funds. They are primarily comprised of foreign equities and fixed income investments.

*6 Includes primarily private real estate investment trusts.

Each level in the fair value hierarchy in which each plan asset is classified is determined based on inputs used to measure the fair values of the asset, and does not necessarily indicate the risks or rating of the asset.

The following is a description of the valuation techniques used to measure Japanese and foreign plan assets at fair value. The valuation techniques are applied consistently from period to period.

Equity securities are valued at the closing price reported in the active market in which the individual securities are traded. These assets are generally classified as level 1.

The fair value of fixed income securities is typically estimated using pricing models, quoted prices of securities with similar characteristics or discounted cash flows and are generally classified as level 2.

Commingled funds are typically valued using the net asset value provided by the administrator of the fund and reviewed by Sony. The net asset value is based on the value of the underlying assets owned by the fund, minus liabilities and divided by the number of shares or units outstanding. These assets are classified as level 1, level 2 or level 3 depending on availability of quoted market prices.

Commodity funds are valued using inputs that are derived principally from or corroborated by observable market data. These assets are generally classified as level 2.

Private equity and private real estate investment trust valuations require significant judgment due to the absence of quoted market prices, the inherent lack of liquidity and the long-term nature of such assets. These assets are initially valued at cost and are reviewed periodically utilizing available and relevant market data to determine if the carrying value of these assets should be adjusted. These investments are classified as level 3.

Hedge funds are valued using the net asset value as determined by the administrator or custodian of the fund. These investments are classified as level 3.

The following table sets forth a summary of changes in the fair values of Japanese and foreign plans’ level 3 assets for the fiscal years ended March 31, 2017 and 2018:

	Japanese plans
	Yen in millions
	Fair value measurement using significant unobservable inputs (Level 3)
	Private equity			Hedge funds		Real estate     and other		Total
Beginning balance at April 1, 2016		31,852			60,395		7,315		99,562
Return on assets held at end of year		425			2,817		599		3,841
Purchases, sales, and settlements, net		(10,487	)		4,023		10,011		3,547
Ending balance at March 31, 2017		21,790			67,235		17,925		106,950
Return on assets held at end of year		1,483			636		425		2,544
Purchases, sales, and settlements, net		871			2,333		1,081		4,285
Ending balance at March 31, 2018		24,144			70,204		19,431		113,779

	Foreign plans
	Yen in millions
	Fair value measurement using significant unobservable inputs (Level 3)
	Insurance contracts		Corporate bonds			Real estate and other			Total
Beginning balance at April 1, 2016		—		7,000			24,124			31,124
Return on assets held at end of year		—		—			84			84
Purchases, sales, and settlements, net		—		(44	)		(367	)		(411	)
Transfers, net		—		—			(8	)		(8	)
Other*		—		(30	)		(904	)		(934	)
Ending balance at March 31, 2017		—		6,926			22,929			29,855
Return on assets held at end of year		—		—			1,101			1,101
Purchases, sales, and settlements, net		12,651		(1,256	)		12			11,407
Transfers, net		—		—			1,181			1,181
Other*		78		(367	)		753			464
Ending balance at March 31, 2018		12,729		5,303			25,976			44,008

* Primarily consists of translation adjustments.

Sony makes contributions to its defined benefit pension plans as deemed appropriate by management after considering the fair value of plan assets, expected return on plan assets and the present value of benefit obligations. Sony expects to contribute approximately 11 billion yen to the Japanese plans and approximately 6 billion yen to the foreign plans during the fiscal year ending March 31, 2019.

The expected future benefit payments are as follows:

	Japanese plans		Foreign plans
Fiscal year ending March 31	Yen in millions		Yen in millions
2019		39,918		14,889
2020		40,328		15,039
2021		41,233		16,133
2022		42,609		16,689
2023		43,772		17,830
2024 — 2028		232,325		102,045

(2) Defined contribution plans

Total defined contribution expenses for the fiscal years ended March 31, 2016, 2017 and 2018 were as follows:

	Yen in millions
	Fiscal year ended March 31
	2016		2017		2018
Japanese plans		3,155		3,412		3,237
Foreign plans		12,419		10,458		11,379

XML

Stockholders' equity

12 Months Ended

Mar. 31, 2018

Equity [Abstract]

Stockholders' equity

16. Stockholders’ equity

(1) Common stock

Changes in the number of shares of common stock issued and outstanding during the fiscal years ended March 31, 2016, 2017 and 2018 have resulted from the following:

	Number of shares
Balance at March 31, 2015		1,169,773,260
Issuance of new shares		92,000,000
Exercise of stock acquisition rights		720,500
Balance at March 31, 2016		1,262,493,760
Exercise of stock acquisition rights		1,269,900
Balance at March 31, 2017		1,263,763,660
Issuance of new shares		218,000
Exercise of stock acquisition rights		2,565,700
Conversion of convertible bonds		4,789
Balance at March 31, 2018		1,266,552,149

At March 31, 2018, 37,962,769 shares of common stock would be issued upon the conversion or exercise of all convertible bonds and stock acquisition rights outstanding.

Conversions of convertible bonds into common stock are accounted for in accordance with the provisions of the Companies Act of Japan (Kaishaho) and related regulations (collectively the “Companies Act”) by crediting approximately one-half of the conversion proceeds to the common stock account and the remainder to the additional paid-in capital account.

Sony Corporation may purchase its own shares at any time by a resolution of the Board of Directors up to the retained earnings available for dividends to shareholders, in accordance with the Companies Act. No common stock had been acquired by the resolution of the Board of Directors during the fiscal years ended March 31, 2016, 2017 and 2018.

(2) Retained earnings

The amount of statutory retained earnings of Sony Corporation available for dividends to shareholders as of March 31, 2018 was 664,989 million yen. The appropriation of retained earnings for the fiscal year ended March 31, 2018, including cash dividends for the six-month period ended March 31, 2018, has been incorporated in the consolidated financial statements. This appropriation of retained earnings was approved at the meeting of the Board of Directors of Sony Corporation held on April 27, 2018 and was then recorded in the statutory books of account, in accordance with the Companies Act.

Retained earnings include Sony’s equity in undistributed earnings of affiliated companies accounted for by the equity method in the amount of 33,694 million yen and 37,859 million yen at March 31, 2017 and 2018, respectively.

(3) Other comprehensive income

Changes in accumulated other comprehensive income, net of tax, by component for the fiscal years ended March 31, 2016, 2017 and 2018 were as follows:

	Yen in millions
	Unrealized gains (losses) on securities			Unrealized gains (losses) on derivative instruments			Pension liability adjustment			Foreign currency translation adjustments			Total
Balance at March 31, 2015		154,153			—			(201,131	)		(338,305	)		(385,283	)
Other comprehensive income before reclassifications		45,527			1,914			(174,380	)		(83,899	)		(210,838	)
Amounts reclassified out of accumulated other comprehensive income		(43,307	)		(3,112	)		2,627			—			(43,792	)
Net other comprehensive income		2,220			(1,198	)		(171,753	)		(83,899	)		(254,630	)
Less: Other comprehensive income attributable to noncontrolling interests		15,637			—			(1,145	)		(1,087	)		13,405
Balance at March 31, 2016		140,736			(1,198	)		(371,739	)		(421,117	)		(653,318	)

	Yen in millions
	Unrealized gains (losses) on securities			Unrealized gains (losses) on derivative instruments			Pension liability adjustment			Foreign currency translation adjustments			Total
Balance at March 31, 2016		140,736			(1,198	)		(371,739	)		(421,117	)		(653,318	)
Other comprehensive income before reclassifications		(27,007	)		5,028			54,513			(17,988	)		14,546
Amounts reclassified out of accumulated other comprehensive income		(3,286	)		(3,888	)		8,719			—			1,545
Net other comprehensive income		(30,293	)		1,140			63,232			(17,988	)		16,091
Less: Other comprehensive income attributable to noncontrolling interests		(16,192	)		—			229			(2,495	)		(18,458	)
Balance at March 31, 2017		126,635			(58	)		(308,736	)		(436,610	)		(618,769	)
	Yen in millions
	Unrealized gains (losses) on securities			Unrealized gains (losses) on derivative instruments			Pension liability adjustment			Foreign currency translation adjustments			Total
Balance at March 31, 2017		126,635			(58	)		(308,736	)		(436,610	)		(618,769	)
Other comprehensive income before reclassifications		2,013			(2,295	)		1,779			(4,480	)		(2,983	)
Amounts reclassified out of accumulated other comprehensive income*1		(943	)		1,111			10,611			(1,855	)		8,924
Net other comprehensive income		1,070			(1,184	)		12,390			(6,335	)		5,941
Less: Other comprehensive income attributable to noncontrolling interests		1,514			—			98			2,306			3,918
Balance at March 31, 2018		126,191			(1,242	)		(296,444	)		(445,251	)		(616,746	)

*1 Foreign currency translation adjustments were transferred from accumulated other comprehensive income to net income as a result of a complete or substantially complete liquidation or sale of certain foreign subsidiaries and affiliates.

Reclassifications out of accumulated other comprehensive income for the fiscal years ended March 31, 2016, 2017 and 2018 were as follows:

	Yen in millions
Comprehensive income components	Amounts reclassified from accumulated other comprehensive income									Affected line items in consolidated statements of income
	2016			2017			2018
Unrealized gains (losses) on securities		(19,598	)		(4,560	)		(646	)	Financial services revenue
		(47,087	)		(30	)		(561	)	Gain on sale of securities investments, net
		3,063			—			—		Loss on devaluation of securities investments
Total before tax		(63,622	)		(4,590	)		(1,207	)
Tax expense or (benefit)		20,315			1,304			264
Net of tax		(43,307	)		(3,286	)		(943	)
Unrealized gains (losses) on derivative instruments		(8	)		—			—		Foreign exchange loss, net
		(3,104	)		(5,583	)		1,111		Cost of sales
Total before tax		(3,112	)		(5,583	)		1,111
Tax expense or (benefit)		—			1,695			—
Net of tax		(3,112	)		(3,888	)		1,111
Pension liability adjustment		2,867			13,044			11,034		*
Tax expense or (benefit)		(240	)		(4,325	)		(423	)
Net of tax		2,627			8,719			10,611
Foreign currency translation adjustments		—			—			(1,855	)	Other operating expense, net
Tax expense or (benefit)		—			—			—
Net of tax		—			—			(1,855	)
Total amounts reclassified out of accumulated other comprehensive income, net of tax		(43,792	)		1,545			8,924

* The amortization of pension and postretirement benefit components are included in the computation of net periodic pension cost. Refer to Note 15.

(4) Equity transactions with noncontrolling interests

Net income attributable to Sony Corporation’s stockholders and transfers (to) from the noncontrolling interests for the fiscal years ended March 31, 2016, 2017 and 2018 were as follows:

	Yen in millions
	Fiscal year ended March 31
	2016			2017			2018
Net income attributable to Sony Corporation’s stockholders		147,791			73,289			490,794
Transfers (to) from the noncontrolling interests:
Decrease in additional paid-in capital for purchase of additional shares in consolidated subsidiaries		(12,776	)		(53,927	)		(74	)
Change from net income attributable to Sony Corporation’s stockholders and transfers (to) from the noncontrolling interests		135,015			19,362			490,720

During the fiscal year ended March 31, 2017, Sony obtained full ownership of its U.S.-based music publishing subsidiary by acquiring the 50% interest in the subsidiary held by the Estate of Michael Jackson (the “Estate”). The aggregate cash consideration paid to the Estate was 750 million U.S. dollars, including 17 million U.S. dollars of distributions to which the subsidiary previously committed. The difference between cash consideration paid and the decrease in the carrying amount of the noncontrolling interests was recognized as a decrease to additional paid-in capital of 70,730 million yen.

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Stock-based compensation plans

12 Months Ended

Mar. 31, 2018

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Stock-based compensation plans

17. Stock-based compensation plans

The stock-based compensation expense for the fiscal years ended March 31, 2016, 2017 and 2018 was 1,944 million yen, 2,737 million yen and 5,249 million yen, respectively. The total cash received from exercises under all of the stock-based compensation plans during the fiscal years ended March 31, 2016, 2017 and 2018 was 1,578 million yen, 2,730 million yen and 7,129 million yen, respectively. Sony issued new shares upon exercise of these rights.

Sony has a stock-based compensation incentive plan for selected directors, corporate executive officers and employees in the form of a stock acquisition rights plan. The stock acquisition rights generally have three year graded vesting schedules and are exercisable up to ten years from the date of grant.

The weighted-average fair value per share at the date of grant of stock acquisition rights granted during the fiscal years ended March 31, 2016, 2017 and 2018 was 1,331 yen, 1,291 yen and 2,045 yen, respectively. The fair value of stock acquisition rights granted on the date of grant and used to recognize compensation expense for the fiscal years ended March 31, 2016, 2017 and 2018 was estimated using the Black-Scholes option-pricing model with the following weighted-average assumptions:

	Fiscal year ended March 31
	2016			2017			2018
Weighted-average assumptions
Risk-free interest rate		1.07%			1.10%			1.14%
Expected lives		7.12 y	ears		6.83 y	ears		6.55 y	ears
Expected volatility*		42.07%			40.00%			38.49%
Expected dividends		0.75%			0.66%			0.40%

* Expected volatility was based on the historical volatilities of Sony Corporation’s common stock over the expected life of the stock acquisition rights.

A summary of the activities regarding the stock acquisition rights plan during the fiscal year ended March 31, 2018 is as follows:

	Fiscal year ended March 31, 2018
	Number of shares		Weighted- average exercise price		Weighted- average remaining life		Total intrinsic value
			Yen		Years		Yen in millions
Outstanding at beginning of the fiscal year		15,519,400		3,147
Granted		2,978,900		4,297
Exercised		2,565,700		2,778
Forfeited or expired		1,926,700		4,864
Outstanding at end of the fiscal year		14,005,900		3,017		6.53		25,910
Exercisable at end of the fiscal year		7,905,100		2,653		4.61		19,647

The total intrinsic value of shares exercised under the stock acquisition rights plan during the fiscal years ended March 31, 2016, 2017 and 2018 was 1,338 million yen, 1,541 million yen and 6,970 million yen, respectively.

As of March 31, 2018, there was 5,698 million yen of total unrecognized compensation expense related to nonvested stock acquisition rights. This expense is expected to be recognized over a weighted-average period of 2.01 years.

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Kumamoto Earthquake

12 Months Ended

Mar. 31, 2018

Unusual or Infrequent Items, or Both [Abstract]

Kumamoto Earthquake

18. Kumamoto Earthquake

In April 2016, a series of earthquakes occurred in the Kumamoto region of Japan. These earthquakes caused damage to certain fixed assets, including buildings, machinery and equipment, as well as inventories in manufacturing sites located in the Kumamoto region.

For the fiscal year ended March 31, 2017, Sony incurred incremental losses and associated expenses including repair costs of fixed assets and a loss on disposal of inventories directly related to the damage caused by the earthquakes of 16,682 million yen. These losses and expenses were primarily recorded in cost of sales in the consolidated statements of income and were offset by insurance recoveries of 10,682 million yen, as described below. In addition, Sony incurred other expenses of 9,365 million yen, which included idle facility costs at manufacturing sites. These expenses were primarily recorded in cost of sales in the consolidated statements of income.

Sony has insurance policies that cover certain damage directly caused by the earthquakes for Sony Corporation and certain of its subsidiaries, including damage at manufacturing sites. The insurance policies cover the damage and costs associated with fixed assets and inventories, as well as incremental expenses including removal and cleaning costs. These policies also provide business interruption coverage, including coverage for lost profits. For the fiscal year ended March 31, 2017, Sony recorded insurance receivables of 10,682 million yen, representing a portion of the insurance recoveries that were deemed probable of collection up to the extent of the amount of corresponding losses recognized in the same period. Of the insurance receivables recorded during the period, substantially all relate to damaged assets and inventories, and do not include amounts for business interruption or lost profits. Sony concluded that the recoveries from insurance claims are probable based on the coverage under valid policies, communications with the insurance carriers, Sony’s past claims history with the insurance carriers, and Sony’s assessment that the insurance carriers have the financial ability to pay the claims. In March 2017, 10,000 million yen was agreed to by the insurance carriers. These receivables are recorded within other receivables, whereas the remaining receivables of 682 million yen is recorded in other current assets in the consolidated balance sheets as of the fiscal year ended March 31, 2017.

Sony has underwritten 2,000 million yen in reinsurance policies for the above insurance carriers related to the policy described above. The amount was recorded in other current liabilities in the consolidated balance sheets as of the fiscal year ended March 31, 2017 and was paid to the insurance carriers in the fiscal year ended March 31, 2018.

In April 2017, the remaining insurance claims of 10,000 million yen that were mainly for business interruption coverage were agreed to by the carriers. As a result, the total amount of insurance recoveries paid to Sony in April 2017 was 20,000 million yen. 9,318 million yen, which was the difference between 20,000 million yen and 10,682 million yen as described above, was recorded in other operating revenue for the fiscal year ended March 31, 2018. The proceeds from insurance recoveries were presented as cash flows from operating activities in the consolidated statements of cash flows for the fiscal year ended March 31, 2018.

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Restructuring charges

12 Months Ended

Mar. 31, 2018

Restructuring and Related Activities [Abstract]

Restructuring charges

19. Restructuring charges

As part of its effort to improve the performance of the various businesses, Sony has undertaken a number of restructuring initiatives. Sony defines restructuring initiatives as activities initiated by Sony, which are designed to generate a positive impact on future profitability. These activities include exiting a business or product category, implementing a headcount reduction program, realignment of its manufacturing sites to low-cost areas, utilizing the services of third-party original equipment and design manufacturers (OEMs and ODMs), a review of its development and design structure, and the streamlining of its sales and administrative functions. The restructuring activities are generally short term in nature and are generally completed within one year of initiation.

The changes in the accrued restructuring charges for the fiscal years ended March 31, 2016, 2017 and 2018 are as follows:

	Yen in millions
	Employee termination benefits			Non-cash write-downs and disposals, net*			Other associated costs			Total
Balance at March 31, 2015		36,721			—			14,196			50,917
Restructuring costs		27,401			1,828			7,298			36,527
Non-cash charges		—			(1,828	)		—			(1,828	)
Cash payments		(40,261	)		—			(11,232	)		(51,493	)
Adjustments		(1,330	)		—			1,473			143
Balance at March 31, 2016		22,531			—			11,735			34,266
Restructuring costs		9,854			42,717			7,142			59,713
Non-cash charges		—			(42,717	)		—			(42,717	)
Cash payments		(19,759	)		—			(8,871	)		(28,630	)
Adjustments		(992	)		—			(839	)		(1,831	)
Balance at March 31, 2017		11,634			—			9,167			20,801
Restructuring costs		18,999			2,233			1,147			22,379
Non-cash charges		—			(2,233	)		—			(2,233	)
Cash payments		(9,950	)		—			(6,352	)		(16,302	)
Adjustments		(1,197	)		—			226			(971	)
Balance at March 31, 2018		19,486			—			4,188			23,674

* Significant asset impairments excluded from restructuring charges are described in Note 13.

Total costs incurred in connection with these restructuring programs by segment for the fiscal years ended March 31, 2016, 2017 and 2018 are as follows:

	Yen in millions
	Fiscal year ended March 31, 2016
	Employee termination benefits			Other associated costs*			Total net restructuring charges			Depreciation associated with restructured assets		Total
Game & Network Services		15			120			135			—		135
Music		1,501			367			1,868			—		1,868
Pictures		1,594			7			1,601			5		1,606
Home Entertainment & Sound		1,181			26			1,207			—		1,207
Imaging Products & Solutions		78			126			204			—		204
Mobile Communications		17,259			3,669			20,928			710		21,638
Semiconductors		(11	)		(102	)		(113	)		—		(113	)
Financial Services		—			—			—			—		—
All Other and Corporate		5,784			4,913			10,697			1,017		11,714
Total		27,401			9,126			36,527			1,732		38,259

	Yen in millions
	Fiscal year ended March 31, 2017
	Employee termination benefits		Other associated costs*			Total net restructuring charges			Depreciation associated with restructured assets		Total
Game & Network Services		225		6			231			—		231
Music		2,116		1,474			3,590			—		3,590
Pictures		2,467		—			2,467			—		2,467
Home Entertainment & Sound		68		684			752			—		752
Imaging Products & Solutions		563		77			640			—		640
Mobile Communications		516		172			688			138		826
Semiconductors		4		(13	)		(9	)		—		(9	)
Financial Services		—		—			—			—		—
All Other and Corporate		3,895		47,459			51,354			364		51,718
Total		9,854		49,859			59,713			502		60,215

	Yen in millions
	Fiscal year ended March 31, 2018
	Employee termination benefits		Other associated costs*		Total net restructuring charges		Depreciation associated with restructured assets		Total
Game & Network Services		—		—		—		—		—
Music		6,358		272		6,630		—		6,630
Pictures		2,922		—		2,922		—		2,922
Home Entertainment & Sound		846		6		852		—		852
Imaging Products & Solutions		530		94		624		—		624
Mobile Communications		2,008		18		2,026		0		2,026
Semiconductors		28		—		28		—		28
Financial Services		—		—		—		—		—
All Other and Corporate		6,307		2,990		9,297		26		9,323
Total		18,999		3,380		22,379		26		22,405

* Other associated costs includes non-cash write-downs and disposals, net

Depreciation associated with restructured assets as used in the context of the disclosures regarding restructuring activities refers to the increase in depreciation expense caused by revising the useful life and the salvage value of depreciable fixed assets under an approved restructuring plan. Any impairment of the assets is recognized immediately in the period it is identified.

Retirement programs

Sony has undergone several headcount reduction programs to further reduce operating costs primarily in an effort to improve the performance of certain segments related to the Electronics business and reduce cost at the headquarters function. Through measures including the realignment of its manufacturing sites, a review of its development and design structure, and the streamlining of its sales and administrative functions, Sony has continued to implement a company-wide (including headquarters) rationalization. Sony intends to reallocate and optimize its workforce through programs including work reassignments and outplacements. The employee termination benefits costs in the above table are included in selling, general and administrative in the consolidated statements of income.

During the fiscal year ended March 31, 2016, the restructuring plans regarding the Mobile Communication segment progressed as planned by streamlining business operations, including the closure and consolidation of manufacturing sites, and the consolidation of headquarters and administrative functions described above. This restructuring program was substantially completed before March 31, 2017.

In an effort to optimize the organization and improve the performance of the music business, Sony has implemented a number of restructuring initiatives targeting operating effectiveness and cost reduction. These activities resulted in restructuring charges primarily consisting of headcount reductions totaling 6,630 million yen for the fiscal year ended March 31, 2018.

All Other and Corporate

As described in Note 25, Sony and Murata Manufacturing Co., Ltd. signed a binding definitive agreement on October 31, 2016 to transfer the Sony Group’s battery business to the Murata Group, which was completed on September 1, 2017. Sony classified certain assets and liabilities related to the battery business as held for sale and, as a result of the fair value valuation of these assets and liabilities, recorded impairment losses of 42,298 million yen in other operating expense, net in the consolidated statements of income for the fiscal year ended March 31, 2017.

As a result of efforts to optimize the sales and headquarters functions that indirectly support the Electronics businesses, which are described above, Sony recorded restructuring charges primarily consisting of headcount reductions totaling 7,112 million yen during the fiscal years ended March 31, 2016. There were no significant restructuring charges for the Electronics businesses during the fiscal year ended March 31, 2017 and 2018.

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Supplemental consolidated statements of income information

12 Months Ended

Mar. 31, 2018

Other Income and Expenses [Abstract]

Supplemental consolidated statements of income information

20. Supplemental consolidated statements of income information

(1) Other operating expense, net

Sony records transactions in other operating expense, net due to either the nature of the transaction or in consideration of factors including the relationship to Sony’s core operations.

Other operating expense, net is comprised of the following:

	Yen in millions
	March 31
	2016			2017			2018
Gain on sale of the U.S. headquarters building*1		(6,545	)		—			—
Gain on sale of Sony City Osaki*1		(4,914	)		(4,914	)		(4,914	)
Gain on sale and issuance of M3 shares*2		(2	)		(37,167	)		(18	)
(Gain) loss on purchase/sale of interests in subsidiaries and affiliates, net*3		(31,778	)		(4,259	)		(29,595	)
(Gain) loss on sale, disposal or impairment of assets, net*4		90,410			195,341			38,599
		47,171			149,001			4,072

*1 A portion of gain on sale and leaseback transactions is deferred and is amortized on a straight-line basis over the lease term.

*2 Refer to Note 5.

*3 Refer to Notes 24 and 25.

*4 Refer to Notes 9, 13, 19 and 25.

(2) Research and development costs

Research and development costs charged to cost of sales for the fiscal years ended March 31, 2016, 2017 and 2018 were 468,183 million yen, 447,456 million yen and 458,518 million yen, respectively.

(3) Advertising costs

Advertising costs included in selling, general and administrative expenses for the fiscal years ended March 31, 2016, 2017 and 2018 were 391,326 million yen, 363,815 million yen and 407,106 million yen, respectively.

(4) Shipping and handling costs

Shipping and handling costs for finished goods included in selling, general and administrative expenses for the fiscal years ended March 31, 2016, 2017 and 2018 were 50,803 million yen, 42,195 million yen and 46,252 million yen, respectively, which included the internal transportation costs of finished goods.

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Income taxes

12 Months Ended

Mar. 31, 2018

Income Tax Disclosure [Abstract]

Income taxes

21. Income taxes

Domestic and foreign components of income before income taxes and the provision for current and deferred income taxes attributable to such income are summarized as follows:

	Yen in millions
	Fiscal year ended March 31
	2016			2017		2018
Income before income taxes:
Sony Corporation and all subsidiaries in Japan		149,256			166,158		436,494
Foreign subsidiaries		155,248			85,461		262,555
		304,504			251,619		699,049
Income taxes — Current:
Sony Corporation and all subsidiaries in Japan		41,080			49,739		69,697
Foreign subsidiaries		53,498			50,521		57,988
		94,578			100,260		127,685
Income taxes — Deferred:
Sony Corporation and all subsidiaries in Japan		(1,745	)		11,478		29,640
Foreign subsidiaries		1,956			12,320		(5,555	)
		211			23,798		24,085
Total income tax expense		94,789			124,058		151,770

A reconciliation of the differences between the Japanese statutory tax rate and the effective tax rate is as follows:

	Fiscal year ended March 31
	2016			2017			2018
Statutory tax rate		33.6	%		31.7	%		31.5	%
Non-deductible expenses		1.6			2.3			0.8
Income tax credits		(2.0	)		(2.9	)		(0.6	)
Change in statutory tax rate and law		(3.3	)		0.3			(1.2	)
Change in valuation allowances		10.7			7.3			(5.2	)
Change in deferred tax liabilities on undistributed earnings of foreign subsidiaries and corporate joint ventures		(0.8	)		(1.4	)		(0.8	)
Lower tax rate applied to life and non-life insurance business in Japan		(2.3	)		(2.2	)		(0.8	)
Foreign income tax differential		(6.9	)		(3.0	)		(2.6	)
Adjustments to tax reserves		0.7			(1.1	)		(0.8	)
Effect of equity in net income of affiliated companies		0.0			0.0			0.0
Impairment of goodwill in the Pictures segment		—			15.0			—
Other		(0.2	)		3.3			1.4
Effective income tax rate		31.1	%		49.3	%		21.7	%

In March 2016, the Japanese legislature enacted tax law changes which included further lowering of the national corporate tax rate, limiting the annual use of net operating loss carryforwards to 55% of taxable income for the period ended March 31, 2018, and to 50% of taxable income for periods beginning on or after April 1, 2018. As a result, the statutory tax rate from the fiscal year ended March 31, 2017 onward will be approximately 31.5%. On December 22, 2017, the U.S. Tax Reform Act was signed into law, making significant changes to the U.S. tax rules. Changes include, but are not limited to, a corporate tax rate decrease from 35% to 21% effective for tax years beginning January 1, 2018 and the transition of U.S. international taxation from a worldwide tax system to a modified territorial system, with a one-time mandatory transition tax on previously deferred foreign earnings of U.S. subsidiaries.

Sony is required to record the effects of a tax law change in the period of enactment; however, shortly after the enactment of the U.S. Tax Reform Act, the U.S. Securities and Exchange Commission staff issued SAB 118, which allows a company to record a provisional amount when it does not have the necessary information available, prepared, or analyzed in reasonable detail to complete its accounting for the change in the tax law. The measurement period ends when the company has obtained, prepared and analyzed the information necessary to finalize its accounting, but cannot extend beyond one year.

Sony has calculated its best estimate of the impact of the U.S. Tax Reform Act in the March 31, 2018 income tax provision in accordance with its understanding of the U.S. Tax Reform Act and guidance available and, as a result, Sony has recorded an income tax benefit of 13,816 million yen in the fiscal year ended March 31, 2018 related to the reversal of a valuation allowance as a result of the change in future net operating loss carryforward rules in the U.S. to an unlimited life which will now allow certain deferred tax assets and deferred tax liabilities to offset. Given the valuation allowance recorded against net deferred tax assets in the U.S., the reduction in the corporate income tax rate did not have a material impact on the tax provision for the fiscal year ended March 31, 2018. In addition, given the existence of significant foreign tax credit carryforwards available, with a valuation allowance recorded against them, the mandatory transition tax on previously deferred foreign earnings also did not have a material impact on the tax provision for the fiscal year ended March 31, 2018.

The changes made by the U.S. Tax Reform Act are broad and complex. The final impact of the U.S. Tax Reform Act may differ from the above estimate, possibly materially, due to, among other things, changes in interpretations of the U.S. Tax Reform Act, any legislative action to address questions that arise because of the U.S. Tax Reform Act, any changes in accounting standards for income taxes or related interpretations in response to the U.S. Tax Reform Act or any updates or changes to estimates Sony has utilized to calculate the impact.

The significant components of deferred tax assets and liabilities are as follows:

	Yen in millions
	March 31
	2017			2018
Deferred tax assets:
Operating loss carryforwards for tax purposes		455,555			439,206
Accrued pension and severance costs		112,075			106,161
Amortization including film costs		181,243			95,069
Warranty reserves and accrued expenses		110,475			104,410
Future insurance policy benefits		30,884			33,812
Inventory		16,322			15,792
Depreciation		47,485			43,353
Tax credit carryforwards		134,427			125,327
Reserve for doubtful accounts		10,887			8,534
Impairment of investments		52,451			14,146
Deferred revenue		27,294			14,478
Other		158,420			132,800
Gross deferred tax assets		1,337,518			1,133,088
Less: Valuation allowance		(1,051,964	)		(899,835	)
Total deferred tax assets		285,554			233,253
Deferred tax liabilities:
Insurance acquisition costs		(160,308	)		(166,717	)
Future insurance policy benefits		(147,159	)		(167,058	)
Unbilled accounts receivable in the Pictures segment		(113,997	)		(63,196	)
Unrealized gains on securities		(78,643	)		(83,298	)
Intangible assets acquired through stock exchange offerings		(23,794	)		(23,949	)
Undistributed earnings of foreign subsidiaries and corporate joint ventures		(26,473	)		(14,160	)
Investment in M3		(34,775	)		(35,802	)
Other		(34,271	)		(32,164	)
Gross deferred tax liabilities		(619,420	)		(586,344	)
Net deferred tax liabilities		(333,866	)		(353,091	)

Based on the weight of the available positive and negative evidence, for the fiscal year ended March 31, 2018, Sony continued to maintain valuation allowances against the deferred tax assets at Sony Corporation and its national tax filing group in Japan, as well as at Sony Americas Holding Inc. (“SAHI”) and its consolidated tax filing group in the U.S., Sony Mobile Communications in Sweden, Sony Europe Limited in the U.K., certain subsidiaries in Brazil, and certain subsidiaries in other tax jurisdictions.

The net changes in the total valuation allowance were decreases of 21,764 million yen, 3,894 million yen and 152,129 million yen for the fiscal years ended March 31, 2016, 2017 and 2018, respectively.

The decrease in the valuation allowances during the fiscal year ended March 31, 2016 was primarily due to the effect of foreign currency translation adjustments at SAHI and its consolidated tax filing group in the U.S. and the reversal of valuation allowances for local tax purposes for certain Japanese subsidiaries based on the weight of the available positive and negative evidence, including the strength of earnings in recent years and their forecast of continuing profits. These decreases were partially offset by an increase in the valuation allowance for accrued pension and severance costs in the national tax filing group in Japan.

The decrease in the valuation allowances during the fiscal year ended March 31, 2017 was primarily due to the use of net operating loss carryforwards for the national tax filing group in Japan.

The decrease in the valuation allowances during the fiscal year ended March 31, 2018 was primarily due to the use of net operating loss carryforwards and other deferred tax assets for both the national tax filing group in Japan and the consolidated tax filing group in the U.S. The U.S. deferred tax assets were also reduced as a result of the reduction in the tax rate under the U.S. Tax Reform Act which had a corresponding reduction of the valuation allowance on those assets. In addition, valuation allowances were reversed in several jurisdictions, including France and Canada, as a result of sustained profitability.

Following the changes made by the U.S. Tax Reform Act, Sony changed its policy on dividends from foreign subsidiaries owned by the U.S. consolidated tax group. As a result, the estimated tax on the remittance of such earnings are now included in the deferred tax provision. At March 31, 2018, 14,880 million yen of deferred income taxes have not been provided on undistributed earnings of certain foreign subsidiaries and corporate joint ventures not expected to be remitted in the foreseeable future totaling 930,018 million yen, and the gain on the book/tax basis difference in subsidiaries, including a gain of 61,544 million yen on a subsidiary’s sale of stock arising from the issuance of common stock of Sony Music Entertainment (Japan) Inc. in a public offering to third parties in November 1991. Sony does not anticipate any significant tax consequences on the possible future disposition of these investments based on its tax planning strategies.

At March 31, 2018, Sony had net operating loss carryforwards, the tax effect of which totaled 439,206 million yen, which may be available as an offset against future taxable income on tax returns to be filed in various tax jurisdictions. With the exception of 132,979 million yen with no expiration period, substantially all of the total net operating loss carryforwards expire at various dates between the fiscal years ending March 31, 2019 and 2024.

Tax credit carryforwards at March 31, 2018 amounted to 125,327 million yen. With the exception of 19,048 million yen with no expiration period, substantially all of the total available tax credit carryforwards expire at various dates between the fiscal years ending March 31, 2019 and 2028.

A reconciliation of the beginning and ending gross amounts of unrecognized tax benefits is as follows:

	Yen in millions
	March 31
	2016			2017			2018
Balance at beginning of the fiscal year		165,434			114,126			119,529
Reductions for tax positions of prior years		(34,261	)		(558	)		(8,809	)
Additions for tax positions of prior years		6,253			13,353			4,681
Additions based on tax positions related to the current year		4,299			8,231			5,740
Settlements		(12,556	)		(8,300	)		(21,893	)
Lapse in statute of limitations		(8,229	)		(3,454	)		(3,469	)
Foreign currency translation adjustments		(6,814	)		(3,869	)		(354	)
Balance at end of the fiscal year		114,126			119,529			95,425
Total net amount of unrecognized tax benefits that, if recognized, would affect the effective tax rate		49,323			45,987			39,308

The major changes in the total gross amount of unrecognized tax benefit balances relate to transfer pricing adjustments, including as a result of the Bilateral Advance Pricing Agreements (“APAs”) and competent authority requests filed for certain subsidiaries in the G&NS, HE&S, IP&S, MC and Semiconductors segments and All Other, with respect to the intercompany cross-border transactions. The APAs include agreements between Sony and two taxing authorities under the authority of the mutual agreement procedure specified in income tax treaties. Sony reviews its estimated tax expense based on the progress made in these procedures, and the progress of transfer pricing audits generally, and makes adjustments to its estimates as necessary. In addition, the APAs are government to government negotiations, and therefore it is possible that the final outcomes of the agreements may differ from Sony’s current assessment of the more-likely-than-not outcomes of such agreements.

During the fiscal year ended March 31, 2016, Sony reversed 774 million yen of interest expense and recorded 674 million yen of penalties. At March 31, 2016, Sony had recorded liabilities of 9,261 million yen and 4,358 million yen for the payments of interest and penalties, respectively.

During the fiscal year ended March 31, 2017, Sony recorded 474 million yen of interest expense and reversed 597 million yen of penalties. At March 31, 2017, Sony had recorded liabilities of 9,735 million yen and 3,761 million yen for the payments of interest and penalties, respectively.

During the fiscal year ended March 31, 2018, Sony recorded 1,053 million yen of interest expense and 876 million yen of penalties. At March 31, 2018, Sony had recorded liabilities of 10,788 million yen and 4,637 million yen for the payments of interest and penalties, respectively.

Sony operates in multiple jurisdictions throughout the world, and its tax returns are periodically audited by Japanese and foreign taxing authorities. As a result of audit settlements, the conclusion of current examinations, the expiration of the statute of limitations in several jurisdictions and other reevaluations of Sony’s tax positions, it is expected that the amount of unrecognized tax benefits will change in the next twelve months. Accordingly, Sony believes it is reasonably possible that its existing unrecognized tax benefits may be reduced by an amount up to 2,768 million yen within the next twelve months.

Sony remains subject to examinations by Japanese taxing authorities for tax years from 2008 through 2017, and by the U.S. and other material foreign taxing authorities for tax years from 2013 through 2017.

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Reconciliation of the differences between basic and diluted EPS

12 Months Ended

Mar. 31, 2018

Earnings Per Share [Abstract]

Reconciliation of the differences between basic and diluted EPS

22. Reconciliation of the differences between basic and diluted EPS

Reconciliation of the differences between basic and diluted EPS for the fiscal years ended March 31, 2016, 2017 and 2018 is as follows:

	Yen in millions
	Fiscal year ended March 31
	2016		2017		2018
Net income attributable to Sony Corporation’s stockholders for basic and diluted EPS computation		147,791		73,289		490,794
	Thousands of shares
Weighted-average shares outstanding		1,237,802		1,262,023		1,263,895
Effect of dilutive securities:
Stock acquisition rights		2,109		2,358		4,565
Zero coupon convertible bonds		17,972		23,962		23,960
Weighted-average shares for diluted EPS computation		1,257,883		1,288,343		1,292,420
	Yen
Basic EPS		119.40		58.07		388.32
Diluted EPS		117.49		56.89		379.75

Potential shares of common stock which were excluded from the computation of diluted EPS for the fiscal years ended March 31, 2016, 2017 and 2018 were 11,357 thousand shares, 6,856 thousand shares and 2,921 thousand shares, respectively. Potential shares related to stock acquisition rights were excluded as anti-dilutive for the fiscal years ended March 31, 2016, 2017 and 2018 when the exercise price for those shares was in excess of the average market value of Sony’s common stock for those fiscal years. The zero coupon convertible bonds issued in July 2015 were included in the diluted EPS calculation under the if-converted method beginning upon issuance.

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Variable interest entities

12 Months Ended

Mar. 31, 2018

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Variable interest entities

23. Variable interest entities

Sony has, from time to time, entered into various arrangements with VIEs. These arrangements include several joint ventures in the recorded music business, an equity investment in the music publishing business, the financing of film production and the outsourcing of manufacturing operations. In addition, Sony has entered into several accounts receivable sales programs that involve VIEs, which are described in Note 6. For the VIEs that are described below, it has been determined that Sony is the primary beneficiary and, accordingly, these VIEs are consolidated by Sony.

Sony’s U.S. subsidiary that is engaged in the recorded music business has entered into several joint ventures with companies involved in the production and creation of recorded music. Sony has reviewed these joint ventures and determined that they are VIEs. Based on a qualitative assessment, it was determined that Sony has the power to direct the activities that most significantly impact the VIEs’ economic performance, as well as the obligation to absorb the losses of these VIEs as Sony is responsible for providing funding to these VIEs, and in most cases absorbs all losses until the VIEs become profitable. As a result, it has been determined that Sony is the primary beneficiary. The assets of Sony are not available to settle the obligations of these VIEs. As of March 31, 2018, the total assets and liabilities for these VIEs, on an aggregate basis, were 37,540 million yen and 24,625 million yen, respectively.

VIEs in which Sony holds a significant variable interest, but is not the primary beneficiary are described as follows:

As described in Note 5, on June 29, 2012, an investor group which included a wholly-owned subsidiary of Sony Corporation completed its acquisition of EMI Music Publishing. To effect the acquisition, the investor group formed DH Publishing, L.P. (“DHP”) which acquired EMI Music Publishing. In addition, DHP entered into an agreement with Sony’s U.S.-based music publishing subsidiary in which the subsidiary provides administration services to DHP (the “Administration Agreement”). DHP was determined to be a VIE as many of the decision making rights for the entity do not reside within the entity’s equity interests, but rather are embedded in the Administration Agreement. Under the terms of the Administration Agreement, the largest non-Sony shareholder has approval rights over decisions regarding the activities that most significantly impact DHP, including the acquisition and retention of copyrights and the licensing of songs. These approval rights result in Sony and the largest non-Sony shareholder sharing the power to direct the activities of DHP, and as such, Sony is not the primary beneficiary of the VIE. At March 31, 2018, the only amounts recorded on Sony’s consolidated balance sheet that relate to the VIE are Sony’s net investment of 213 million U.S. dollars and a net payable balance of 3 million U.S. dollars. Sony’s maximum exposure to losses as of March 31, 2018 is the aggregate amount recorded on its balance sheet of 210 million U.S. dollars.

Sony’s subsidiary in the Pictures segment entered into a distribution agreement with and made an investment in a production company that will develop, produce and finance feature-length motion pictures and television programming. The investment is accounted for under the cost method. The production company is a VIE as many of the decision making rights for the entity reside within the equity interests held by the management of the production company which are not at risk of economic loss. Based on a qualitative assessment, it was determined that Sony is not the primary beneficiary as Sony does not have the power to direct the activities of the production company. Sony’s maximum exposure to losses as of March 31, 2018 is the amount of investment and the future funding commitments, which total 26 million U.S. dollars.

As described in Note 6, certain accounts receivable sales programs also involve VIEs. These VIEs are all special purpose entities associated with the sponsor banks. Based on a qualitative assessment, Sony is not the primary beneficiary and therefore does not consolidate these entities as Sony does not have the power to direct the activities, an obligation to absorb losses, or the right to receive the residual returns of these VIEs. Sony’s maximum exposure to losses from these VIEs is considered insignificant.

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Acquisitions

12 Months Ended

Mar. 31, 2018

Business Combinations [Abstract]

Acquisitions

24. Acquisitions

(1) Sony Semiconductor acquisitions

On December 4, 2015, Sony Corporation and Toshiba Corporation (“Toshiba”) signed definitive agreements (the “Transfer Agreements”) to transfer to Sony Corporation and to Sony Semiconductor Manufacturing Corporation (“SCK”), a wholly-owned subsidiary of Sony, semiconductor fabrication facilities, equipment and related assets, as well as other related equipment and assets owned by Toshiba, for 19,000 million yen.

On March 31, 2016, pursuant to the Transfer Agreements, SCK acquired from Toshiba a portion of the semiconductor fabrication facilities, equipment and related assets (the “Toshiba Transferred Assets”) for 16,700 million yen. The purchase price for the Toshiba Transferred Assets is included within Other in the investing activities section of the consolidated statements of cash flows. SCK is utilizing the Toshiba Transferred Assets to establish a new technology center and further strengthen its production capacity for CMOS image sensors. The purchase price for the Toshiba Transferred Assets was allocated and recorded primarily to machinery and equipment. SCK also entered into a supply arrangement with Toshiba to manufacture and supply CMOS image sensors for a certain period following the acquisition. In connection with this acquisition, SCK also acquired related inventories from Toshiba.

As the purchase price for the Toshiba Transferred Assets was fully allocated to identifiable tangible and intangible assets and no liabilities were assumed, no goodwill was recorded as part of the acquisition. Pro forma results of operations have not been presented because the effect of the acquisition was not material.

(2) Orchard acquisition

In April 2015, Sony Music Entertainment (“SME”), a wholly owned subsidiary of Sony, increased its shareholding in The Orchard to 100% by acquiring Orchard Asset Holdings, LLC’s 49% equity interest for 22,168 million yen (185 million U.S. dollars).

Prior to the acquisition, SME’s interest in The Orchard was accounted for under the equity method of accounting. As a result of SME’s obtaining a controlling interest in The Orchard, Sony consolidated The Orchard in accordance with the accounting guidance for business combinations achieved in stages and remeasured the 51% equity interest in The Orchard that it owned prior to the acquisition at a fair value, and recognized a gain of 18,085 million yen (151 million U.S. dollars) in other operating expense, net in the consolidated statement of income.

As a result of the acquisition, Sony recorded 36,664 million yen (307 million U.S. dollars) of goodwill and 13,806 million yen (115 million U.S. dollars) of intangible assets. The cash consideration of 19,547 million yen (164 million U.S. dollars) paid in this transaction, net of cash received, is included within Other in the investing activities section of the consolidated statements of cash flows.

Pro forma results of operations have not been presented because the effect of the acquisition was not material.

(3) TEN Sports Network acquisition

On February 28, 2017, Sony Pictures Networks India, a wholly-owned subsidiary of Sony, completed the first phase of a two-phase acquisition of the TEN Sports Network in a majority of the countries and territories where TEN Sports Network operates, including India, for total consideration of 39,106 million yen (346 million U.S. dollars), of which 37,298 million yen (330 million U.S. dollars) was paid during the fiscal year ended March 31, 2017 and the remaining 1,772 million yen (16 million U.S. dollars) was paid during the fiscal year ended March 31, 2018. On September 15, 2017, Sony Pictures Networks India completed the final phase of the acquisition for cash consideration of 2,316 million yen (21 million U.S. dollars).

As a result of the acquisition, Sony recorded 26,489 million yen (235 million U.S. dollars) of goodwill and 14,910 million yen (132 million U.S. dollars) of intangible assets. The cash consideration paid in this transaction, net of cash received, is included within Other in the investing activities section of the consolidated statements of cash flows.

Pro forma results of operations have not been presented because the effect of the acquisition was not material.

(4) Other acquisitions

During the fiscal year ended March 31, 2016, Sony completed other acquisitions for total consideration of 46,233 million yen which were paid for primarily in cash and included the February 1, 2016 acquisition of Altair for total consideration of 25,565 million yen. Altair develops and sells products focused on LTE (Long Term Evolution) technologies. There was no material contingent consideration subject to future change. The cash consideration of 22,657 million yen paid in the Altair transaction is included within Other in the investing activities section of the consolidated statements of cash flows. As a result of these acquisitions, Sony recorded 36,128 million yen of goodwill and 14,983 million yen of intangible assets, of which 17,879 million yen of goodwill and 6,600 million yen of intangible assets related to the Altair transaction.

During the fiscal year ended March 31, 2017, Sony completed other acquisitions for total consideration of 12,409 million yen which were paid for primarily in cash and there was no material contingent consideration subject to future change. As a result of these acquisitions, Sony recorded 12,384 million yen of goodwill and 7,073 million yen of intangible assets.

During the fiscal year ended March 31, 2018, Sony completed other acquisitions for total consideration of 27,459 million yen which were paid for primarily in cash and there was no material contingent consideration subject to future change. As a result of these acquisitions, Sony recorded 20,013 million yen of goodwill and 4,980 million yen of intangible assets.

No significant amounts have been allocated to in-process research and development and all of the entities described above have been consolidated into Sony’s results of operations since their respective acquisition dates. Pro forma results of operations have not been presented because the effects of other acquisitions, individually and in aggregate, were not material.

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Divestitures

12 Months Ended

Mar. 31, 2018

Discontinued Operations and Disposal Groups [Abstract]

Divestitures

25. Divestitures

(1) Sale of the logistics business

On April 1, 2015, in connection with the formation of a logistics joint venture, Sony sold a part of its logistics business in Japan, Thailand, and Malaysia within Corporate to MITSUI-SOKO HOLDINGS Co., Ltd. for a sales price of 19,211 million yen. As a result of the sale, Sony recognized a gain of 12,284 million yen in other operating expense, net in the consolidated statement of income.

(2) Battery business

On October 31, 2016, Sony and Murata Manufacturing Co., Ltd. signed a binding definitive agreement to transfer the Sony Group’s battery business to the Murata Group which was completed on September 1, 2017. Sony classified certain assets and liabilities related to the battery business as held for sale and, as a result of the fair value valuation of these assets and liabilities, recorded impairment losses of 42,298 million yen in other operating expense, net in the consolidated statements of income for the fiscal year ended March 31, 2017.

(3) Sale of equity interest in Sony Electronics Huanan Co., Ltd.

On April 1, 2017, Sony transferred all of the equity interest in Sony Electronics Huanan Co., Ltd. (“SEH”), a wholly-owned subsidiary in the Semiconductors segment that manufactures camera modules, to Shen Zhen O-Film Tech Co., Ltd. The consideration for the transfer is approximately 234 million U.S. dollars, including the assumption of SEH’s debt and the sales price of approximately 95 million U.S. dollars. As the result of the transfer, Sony recognized a gain on transfer totaling 28,262 million yen in other operating expense, net in the consolidated statement of income for the fiscal year ended March 31, 2018.

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Collaborative arrangements

12 Months Ended

Mar. 31, 2018

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Collaborative arrangements

26. Collaborative arrangements

Sony’s collaborative arrangements primarily relate to arrangements entered into, through subsidiaries in the Pictures segment, with one or more active participants to jointly finance, produce and/or distribute motion pictures or television programming under which both the subsidiaries and the other active participants share in the risks and rewards of ownership. These arrangements are referred to as co-production and distribution arrangements.

Sony typically records an asset for only the portion of the motion pictures or television programming it owns and finances. Sony and the other participants typically distribute the product in different media or markets. Revenues earned and expenses incurred for the media or markets in which Sony distributes the product are typically recorded on a gross basis. Sony typically does not record revenues earned and expenses incurred when the other participants distribute the product. Sony and the other participants typically share in the profits from the distribution of the product in all media or markets. For motion pictures, if Sony is a net receiver of (1) Sony’s share of the profits from the media or markets distributed by the other participants less (2) the other participants’ share of the profits from the media or markets distributed by Sony then the net amount is recorded as net sales. If Sony is a net payer then the net amount is recorded in cost of sales. For television programming, Sony records its share of the profits from the media or markets distributed by the other participants as sales, and the other participants’ share of the profits from the media or markets distributed by Sony as cost of sales.

For the fiscal years ended March 31, 2016, 2017 and 2018, 30,888 million yen, 44,124 million yen and 49,547 million yen, respectively, were recorded as net sales for amounts due from the other participants and 38,303 million yen, 29,594 million yen and 24,280 million yen, respectively, were recorded as cost of sales for amounts owed to the other participants in these collaborative arrangements.

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Commitments, contingent liabilities and other

12 Months Ended

Mar. 31, 2018

Commitments and Contingencies Disclosure [Abstract]

Commitments, contingent liabilities and other

27. Commitments, contingent liabilities and other

(1) Loan commitments

Subsidiaries in the Financial Services segment have entered into loan agreements with their customers in accordance with the condition of the contracts. As of March 31, 2018, the total unused portion of the lines of credit extended under these contracts was 31,245 million yen. The aggregate amounts of future year-by-year payments for these loan commitments cannot be determined.

(2) Purchase commitments and other

Purchase commitments and other outstanding as of March 31, 2018 amounted to 367,991 million yen. The major components of these commitments are as follows:

Certain subsidiaries in the Pictures segment have entered into agreements with creative talent for the development and production of motion pictures and television programming as well as agreements with third parties to acquire completed motion pictures, or certain rights therein, and to acquire the rights to broadcast certain live action sporting events. These agreements cover various periods mainly within three years. As of March 31, 2018, these subsidiaries were committed to make payments under such contracts of 118,914 million yen.

Certain subsidiaries in the Music segment have entered into long-term contracts with recording artists, songwriters and companies for the future production, distribution and/or licensing of music product. These contracts cover various periods mainly within five years. As of March 31, 2018, these subsidiaries were committed to make payments of 73,259 million yen under such long-term contracts.

A subsidiary in the Game & Network Services segment has entered into long-term contracts for programming content. These contracts cover various periods mainly within two years. As of March 31, 2018, this subsidiary was committed to make payments of 26,227 million yen under such long-term contracts.

Sony has entered into long-term sponsorship contracts related to advertising and promotional rights. These contracts cover various periods mainly within two years. As of March 31, 2018, Sony has committed to make payments of 6,379 million yen under such long-term contracts.

The schedule of the aggregate amounts of year-by-year payment of purchase commitments during the next five fiscal years and thereafter is as follows:

Fiscal year ending March 31	Yen in millions
2019		211,713
2020		85,755
2021		25,249
2022		17,212
2023		12,014
Later fiscal years		16,048
Total		367,991

(3) Litigation

Beginning in 2009, the U.S. Department of Justice (“DOJ”), the European Commission and certain other governmental agencies outside the United States have conducted investigations relating to competition in the optical disk drives market. Sony Corporation and/or certain of its subsidiaries have been subject to these investigations. Sony understands that the investigations of several governmental agencies, including the DOJ, have ended, and the only remaining investigation has reached a settlement, which is subject to a final ruling from the relevant agency. However, proceedings initiated by the European Commission as a result of its investigation continue. In October 2015, the European Commission adopted a decision in which it fined Sony Corporation and certain of its subsidiaries 31 million euros; however, Sony filed an appeal against the decision with the European Union’s General Court. In addition, a number of direct and indirect purchaser lawsuits, including class actions, have been filed in certain jurisdictions in which the plaintiffs allege that Sony Corporation and certain of its subsidiaries violated antitrust laws and seek recovery of damages and other remedies. Certain of these lawsuits have been settled, including the class actions brought by the direct and indirect purchasers in the United States; however, certain other lawsuits continue. Based on the stage of the pending proceedings, it is not possible to estimate the amount of losses or range of possible losses, if any, that might ultimately result from adverse judgments, settlements or other resolution of all of these matters.

Since 2011, in relation to the secondary batteries business that was operated by Sony and certain of its subsidiaries, a number of direct and indirect purchaser lawsuits, including class actions, have been filed in certain jurisdictions in which the plaintiffs allege that Sony Corporation and certain of its subsidiaries violated antitrust laws and seek recovery of damages and other remedies. Certain of these lawsuits have been settled, including the class actions brought by the direct and indirect purchasers in the United States; however, certain other lawsuits are still pending. Based on the stage of the pending proceedings, it is not possible to estimate the amount of losses or range of possible losses, if any, that might ultimately result from adverse judgments, settlements or other resolution of all of these matters.

In addition, Sony Corporation and certain of its subsidiaries are defendants or otherwise involved in other pending legal and regulatory proceedings. However, based upon the information currently available, Sony believes that the outcome from such legal and regulatory proceedings would not have a material impact on Sony’s results of operations and financial position.

(4) Guarantees

Sony has issued guarantees that contingently require payments to guaranteed parties if certain specified events or conditions occur. The maximum potential amount of future payments under these guarantees as of March 31, 2018 amounted to 2,642 million yen.

In addition to the above, Sony also issues contractual product warranties under which it generally guarantees the performance of products delivered and services rendered for a certain period or term. The changes in the product warranty liability for the fiscal years ended March 31, 2016, 2017 and 2018 are as follows:

	Yen in millions
	Fiscal year ended March 31
	2016			2017			2018
Balance at beginning of the fiscal year		75,129			66,943			60,798
Additional liabilities for warranties		83,227			53,502			34,557
Settlements (in cash or in kind)		(81,462	)		(49,532	)		(32,549	)
Changes in estimate for pre-existing warranty reserve		(6,440	)		(7,927	)		(16,888	)
Translation adjustment		(3,511	)		(2,188	)		2,234
Balance at end of the fiscal year		66,943			60,798			48,152

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Business segment information

12 Months Ended

Mar. 31, 2018

Segment Reporting [Abstract]

Business segment information

28. Business segment information

The reportable segments presented below are the segments of Sony for which separate financial information is available and for which operating profit or loss amounts are evaluated regularly by the chief operating decision maker (“CODM”) in deciding how to allocate resources and in assessing performance. The CODM does not evaluate segments using discrete asset information. Sony’s CODM is its Chief Executive Officer and President.

Sony realigned its business segments from the first quarter of the fiscal year ended March 31, 2018. As a result of this realignment, the operation of the former Components segment is now included in All Other. In connection with this realignment, the sales and operating revenue and operating income (loss) of each segment for the comparable period have been reclassified to conform to the current presentation.

The G&NS segment includes network services businesses, the manufacture and sales of home gaming products and production and sales of software. The Music segment includes Recorded Music, Music Publishing and Visual Media and Platform businesses. The Pictures segment includes Motion Pictures, Television Productions and Media Networks businesses. The HE&S segment includes Televisions as well as Audio and Video businesses. The IP&S segment includes the Still and Video Cameras business. The MC segment includes the manufacture and sales of mobile phones and an internet-related service business. The Semiconductors segment includes the image sensors business. The Financial Services segment primarily represents individual life insurance and non-life insurance businesses in the Japanese market and the banking business in Japan. All Other consists of various operating activities, including the overseas disc manufacturing, recording media and battery businesses. Sony’s products and services are generally unique to a single operating segment.

Segment sales and operating revenue:

	Yen in millions
	Fiscal year ended March 31
	2016			2017			2018
Sales and operating revenue:
Game & Network Services —
Customers		1,479,775			1,581,568			1,848,298
Intersegment		72,118			68,231			95,514
Total		1,551,893			1,649,799			1,943,812
Music —
Customers		602,564			630,767			784,792
Intersegment		16,675			16,891			15,203
Total		619,239			647,658			799,995
Pictures —
Customers		935,827			901,230			1,010,173
Intersegment		2,315			1,899			894
Total		938,142			903,129			1,011,067
Home Entertainment & Sound —
Customers		1,155,085			1,034,215			1,221,734
Intersegment		3,957			4,789			999
Total		1,159,042			1,039,004			1,222,733
Imaging Products & Solutions —
Customers		677,231			571,499			647,163
Intersegment		6,724			8,134			8,729
Total		683,955			579,633			655,892
Mobile Communications —
Customers		1,121,925			752,688			713,916
Intersegment		5,548			6,457			9,826
Total		1,127,473			759,145			723,742
Semiconductors —
Customers		599,430			659,779			726,892
Intersegment		139,629			113,344			123,118
Total		739,059			773,123			850,010
Financial Services —
Customers		1,066,319			1,080,284			1,221,235
Intersegment		6,750			7,220			7,142
Total		1,073,069			1,087,504			1,228,377
All Other —
Customers		435,668			375,116			351,527
Intersegment		104,526			75,334			55,647
Total		540,194			450,450			407,174
Corporate and elimination		(326,354	)		(286,195	)		(298,820	)
Consolidated total		8,105,712			7,603,250			8,543,982

G&NS intersegment amounts primarily consist of transactions with All Other. Semiconductors intersegment amounts primarily consist of transactions with the MC segment, the G&NS segment and the IP&S segment. All Other intersegment amounts primarily consist of transactions with the Pictures segment, the Music segment and the G&NS segment. Corporate and elimination includes certain brand and patent royalty income.

Segment profit or loss:

	Yen in millions
	Fiscal year ended March 31
	2016			2017			2018
Operating income (loss):
Game & Network Services		88,668			135,553			177,478
Music		86,509			75,798			127,786
Pictures		38,507			(80,521	)		41,110
Home Entertainment & Sound		50,558			58,504			85,841
Imaging Products & Solutions		69,320			47,257			74,924
Mobile Communications		(61,435	)		10,164			(27,636	)
Semiconductors		14,500			(7,811	)		164,023
Financial Services		156,543			166,424			178,947
All Other		(41,252	)		(29,585	)		(23,530	)
Total		401,918			375,783			798,943
Corporate and elimination		(107,721	)		(87,081	)		(64,083	)
Consolidated operating income		294,197			288,702			734,860
Other income		66,849			14,418			23,728
Other expenses		(56,542	)		(51,501	)		(59,539	)
Consolidated income before income taxes		304,504			251,619			699,049

Operating income (loss) is sales and operating revenue less costs and expenses, and includes equity in net income (loss) of affiliated companies.

Corporate and elimination includes headquarters restructuring costs and certain other corporate expenses, including the amortization of certain intellectual property assets such as the cross-licensing of intangible assets acquired from Ericsson at the time of the Sony Mobile Communications acquisition, which are not allocated to segments.

Pursuant to a separation of Sony’s businesses into distinct subsidiaries and a realignment of corporate functions, changes have been made to the method of calculating the amount of pension and severance-related expenses allocated to Sony’s headquarters and each business segment. As a result of these changes, an increase in corporate costs totaling 7.5 billion yen is included in Corporate and elimination for the fiscal year ended March 31, 2018. Conversely, a decrease in expenses totaling the same amount is included in each business segment, mainly in the Semiconductors (3.2 billion yen) and IP&S (2.0 billion yen) segments. These changes have no impact on consolidated operating income.

Other significant items:

	Yen in millions
	Fiscal year ended March 31
	2016			2017			2018
Equity in net income (loss) of affiliated companies:
Game & Network Services		—			—			—
Music		3,801			5,435			4,483
Pictures		(981	)		(35	)		(129	)
Home Entertainment & Sound		—			—			—
Imaging Products & Solutions		—			—			—
Mobile Communications		(186	)		(79	)		(102	)
Semiconductors		—			—			—
Financial Services		(645	)		(3,601	)		(61	)
All Other		249			1,843			4,378
Consolidated total		2,238			3,563			8,569
Depreciation and amortization:
Game & Network Services		20,798			25,486			29,091
Music		17,795			16,124			18,230
Pictures		22,375			20,487			24,458
Home Entertainment & Sound		21,781			19,830			21,136
Imaging Products & Solutions		27,612			25,442			23,928
Mobile Communications		24,186			19,794			19,215
Semiconductors		100,964			102,328			99,258
Financial Services, including deferred insurance acquisition costs		102,270			47,056			79,843
All Other		17,767			7,407			5,910
Total		355,548			283,954			321,069
Corporate		41,543			43,094			40,375
Consolidated total		397,091			327,048			361,444

The following table includes a breakdown of sales and operating revenue to external customers by product category for certain segments. Sony management views each segment as a single operating segment.

	Yen in millions
	Fiscal year ended March 31
	2016		2017		2018
Sales and operating revenue:
Game & Network Services
Network		529,318		714,924		1,033,192
Hardware and Others		950,457		866,644		815,106
Total		1,479,775		1,581,568		1,848,298
Music
Recorded Music		412,718		388,948		446,960
Music Publishing		71,258		66,541		74,360
Visual Media and Platform		118,588		175,278		263,472
Total		602,564		630,767		784,792
Pictures
Motion Pictures		447,355		409,363		448,945
Television Productions		270,115		271,886		289,024
Media Networks		218,357		219,981		272,204
Total		935,827		901,230		1,010,173
Home Entertainment & Sound
Televisions		797,764		720,557		861,763
Audio and Video		354,946		311,771		357,194
Other		2,375		1,887		2,777
Total		1,155,085		1,034,215		1,221,734
Imaging Products & Solutions
Still and Video Cameras		428,777		351,834		415,318
Other		248,454		219,665		231,845
Total		677,231		571,499		647,163
Mobile Communications		1,121,925		752,688		713,916
Semiconductors		599,430		659,779		726,892
Financial Services		1,066,319		1,080,284		1,221,235
All Other		435,668		375,116		351,527
Corporate		31,888		16,104		18,252
Consolidated total		8,105,712		7,603,250		8,543,982

In the G&NS segment, Network includes network services relating to game, video and music content provided by Sony Interactive Entertainment; Hardware and Others includes home and portable game consoles, packaged software and peripheral devices. In the Music segment, Recorded Music includes the distribution of physical and digital recorded music and revenue derived from artists’ live performances; Music Publishing includes the management and licensing of the words and music of songs; Visual Media and Platform includes the production and distribution of animation titles, including game applications based on the animation titles, and various service offerings for music and visual products. In the Pictures segment, Motion Pictures includes the worldwide production, acquisition and distribution of motion pictures and direct-to-video content; Television Productions includes the production, acquisition and distribution of television programming; Media Networks includes the operation of television and digital networks worldwide. In the HE&S segment, Televisions includes LCD and OLED televisions; Audio and Video includes Blu-ray disc players and recorders, home audio, headphones and memory-based portable audio devices. In the IP&S segment, Still and Video Cameras includes interchangeable lens cameras, compact digital cameras, consumer video cameras and video cameras for broadcast; Other includes display products such as projectors and medical equipment.

Geographic Information:

Sales and operating revenue attributed to countries and areas based on location of external customers for the fiscal years ended March 31, 2016, 2017 and 2018 and property, plant and equipment, net as of March 31, 2017 and 2018 are as follows:

	Yen in millions
	Fiscal year ended March 31
	2016		2017		2018
Sales and operating revenue:
Japan		2,317,312		2,392,790		2,625,619
United States		1,733,759		1,673,768		1,835,705
Europe		1,881,329		1,634,683		1,841,457
China		540,497		557,995		674,718
Asia-Pacific		959,171		866,712		1,024,179
Other Areas		673,644		477,302		542,304
Total		8,105,712		7,603,250		8,543,982

	Yen in millions
	March 31
	2017		2018
Property, plant and equipment, net:
Japan		580,453		563,593
United States		101,167		97,979
Europe		24,273		23,302
China		13,466		11,232
Asia-Pacific		34,575		36,738
Other Areas		4,265		6,626
Total		758,199		739,470

Major countries and areas in each geographic segment excluding Japan, United States and China are as follows:

(1) Europe:	United Kingdom, France, Germany, Russia, Spain and Sweden
(2) Asia-Pacific:	India, South Korea, Oceania, Thailand and Malaysia
(3) Other Areas:	The Middle East/Africa, Brazil, Mexico and Canada

There are no individually material countries with respect to sales and operating revenue or property, plant and equipment, net included in Europe, Asia-Pacific and Other Areas.

Transfers between reportable business segments or geographic areas are made at individually negotiated prices that are intended to reflect a market-based transfer price.

There were no sales and operating revenue with any single major external customer for the fiscal years ended March 31, 2016, 2017 and 2018.

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Subsequent events

12 Months Ended

Mar. 31, 2018

Subsequent Events [Abstract]

Subsequent events

29. Subsequent events

(1) Public listing of Spotify

On April 3, 2018, Spotify Technology S.A. (“Spotify”) was publicly listed for trading on the New York Stock Exchange. Sony owned 5.707% of Spotify’s shares (5.082% on a fully diluted basis) at the time of the public listing. Due to the public listing and the subsequent sale of a portion of such shares owned by Sony, Sony expects to record an unrealized valuation gain for the shares Sony continues to hold after the listing and a realized gain for the shares sold, net of the estimated amount to be shared with its artists and distributed labels. The sum of the unrealized valuation gain (net) and the gain on the sale of shares (net) to be recorded for the fiscal year ending March 31, 2019 is expected to be approximately 100 billion yen in total.

(2) Acquisition of equity interest in EMI

On May 22, 2018, Sony Corporation of America (“SCA”), a wholly-owned subsidiary of Sony Corporation, and Nile Acquisition Holding Company Ltd., the entity through which a consortium led by Mubadala Investment Company owns an approximately 60% equity interest in DH Publishing, L.P. (“EMI”), which owns and manages EMI Music Publishing, signed a legally binding memorandum of understanding for the sale of such equity interest in EMI to SCA. The closing of the transaction is subject to certain closing conditions, including regulatory approvals. Sony currently owns an approximately 40% equity interest in EMI jointly through a majority-owned subsidiary of Sony Corporation. As a result of this transaction, Sony will indirectly own approximately 90% of the equity interest in EMI and it will become a consolidated subsidiary of Sony.

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SCHEDULE II VALUATION AND QUALIFYING ACCOUNTS

12 Months Ended

Mar. 31, 2018

Valuation and Qualifying Accounts [Abstract]

SCHEDULE II VALUATION AND QUALIFYING ACCOUNTS

SCHEDULE II

VALUATION AND QUALIFYING ACCOUNTS

SONY CORPORATION AND CONSOLIDATED SUBSIDIARIES

	Yen in millions
	Balance at beginning of period		Additions charged to costs and expenses		Deductions (Note 1)			Other (Note 2)			Balance at end of period
Fiscal year ended March 31, 2016:
Allowance for doubtful accounts and sales returns		86,598		56,687		(66,443	)		(4,059	)		72,783
Fiscal year ended March 31, 2017:
Allowance for doubtful accounts and sales returns		72,783		33,667		(50,858	)		(2,442	)		53,150
Fiscal year ended March 31, 2018:
Allowance for doubtful accounts and sales returns		53,150		45,515		(51,302	)		1,300			48,663
Notes: 1.  Reversal including amounts written off. 2.  Translation adjustments.
	Balance at beginning of period		Additions		Deductions			Other (Note 1)			Balance at end of period
Fiscal year ended March 31, 2016:
Valuation allowance — Deferred tax assets		1,077,622		154,171		(116,277	)		(59,658	)		1,055,858
Fiscal year ended March 31, 2017:
Valuation allowance — Deferred tax assets		1,055,858		149,697		(154,210	)		619			1,051,964
Fiscal year ended March 31, 2018:
Valuation allowance — Deferred tax assets		1,051,964		70,797		(123,597	)		(99,329	)		899,835

Note:

1. Translation adjustments and the effect of change in statutory tax rate.

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Summary of significant accounting policies (Policies)

12 Months Ended

Mar. 31, 2018

Accounting Policies [Abstract]

Basis of consolidation and accounting for investments in affiliated companies

Basis of consolidation and accounting for investments in affiliated companies -

The consolidated financial statements include the accounts of Sony Corporation and its majority-owned subsidiary companies, general partnerships and other entities in which Sony has a controlling interest, and variable interest entities for which Sony is the primary beneficiary. All intercompany transactions and accounts are eliminated. Investments in business entities in which Sony does not have control, but has the ability to exercise significant influence over operating and financial policies, generally through 20-50% ownership, are accounted for under the equity method. In addition, investments in general partnerships in which Sony does not have a controlling interest and limited partnerships are also accounted for under the equity method if more than minor influence over the operation of the investee exists (generally through more than 3-5% ownership). When the interest in the partnership is so minor that Sony has no significant influence over the operation of the investee, the cost method is used. Under the equity method, investments are stated at cost plus/minus Sony’s portion of equity in undistributed earnings or losses. Sony’s equity in current earnings or losses of such entities is reported net of income taxes and is included in operating income (loss) after the elimination of unrealized intercompany profits. If the value of an investment has declined and is judged to be other-than-temporary, the investment is written down to its estimated fair value.

On occasion, a consolidated subsidiary or an affiliated company accounted for by the equity method may issue its shares to third parties in either a public or private offering or upon conversion of convertible debt to common stock at amounts per share in excess of or less than Sony’s average per share carrying value. With respect to such transactions, the resulting gains or losses arising from the change in ownership interest are recorded in earnings within the fiscal year in which the change in interest transactions occur.

Gains or losses that result from a loss of a controlling financial interest in a subsidiary are recorded in earnings along with fair value remeasurement gains or losses on any retained investment in the entity, while a change in interest of a consolidated subsidiary that does not result in a change in control is accounted for as a capital transaction and no gains or losses are recorded in earnings.

The excess of the cost over the underlying net equity of investments in consolidated subsidiaries and affiliated companies accounted for on an equity basis is allocated to identifiable tangible and intangible assets and liabilities based on fair values at the date of acquisition. The unassigned residual value of the excess of the cost over Sony’s underlying net equity is recognized as goodwill as a component of the investment balance.

Use of estimates

Use of estimates -

The preparation of the consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The most significant estimates include those used in determining the valuation of investment securities, valuation of inventories, fair values of long-lived assets, fair values of goodwill and other intangible assets, fair values of assets and liabilities assumed in business combinations, product warranty liability, pension and severance plans, valuation of deferred tax assets, uncertain tax positions, film costs, and insurance related liabilities. Actual results could significantly differ from those estimates.

Translation of foreign currencies

Translation of foreign currencies -

All asset and liability accounts of foreign subsidiaries and affiliates are translated into Japanese yen at appropriate fiscal year end exchange rates and all income and expense accounts are translated at exchange rates that approximate those rates prevailing at the time of the transactions. The resulting translation adjustments are accumulated as a component of accumulated other comprehensive income. Upon remeasurement of a previously held equity interest in accordance with the accounting guidance for business combinations achieved in stages, accumulated translation adjustments, if any, are included in earnings.

Receivables and payables denominated in foreign currencies are translated at appropriate fiscal year end exchange rates and the resulting translation gains or losses are recognized into income.

Cash and cash equivalents

Cash and cash equivalents -

Cash and cash equivalents include all highly liquid investments, with original maturities of three months or less, that are readily convertible to known amounts of cash and are so near maturity that they present insignificant risk of changes in value because of changes in interest rates.

Marketable debt and equity securities

Marketable debt and equity securities -

Debt and equity securities designated as available-for-sale, whose fair values are readily determinable, are carried at fair value with unrealized gains or losses included as a component of accumulated other comprehensive income, net of applicable taxes. Debt and equity securities classified as trading securities are carried at fair value with unrealized gains or losses included in income. Debt securities that are expected to be held-to-maturity are carried at amortized cost. Individual securities classified as either available-for-sale or held-to-maturity are reduced to fair value by a charge to income when an other-than-temporary impairment is recognized. Realized gains and losses are determined on the average cost method and are reflected in income.

Sony regularly evaluates its investment portfolio to identify other-than-temporary impairments of individual securities. Factors that are considered by Sony in determining whether an other-than-temporary decline in value has occurred include: the length of time and extent to which the market value of the security has been less than its original cost, the financial condition, operating results, business plans and estimated future cash flows of the issuer of the security, other specific factors affecting the market value, deterioration of the credit condition of the issuer, sovereign risk, and whether or not Sony is able to retain the investment for a period of time sufficient to allow for the anticipated recovery in market value.

In evaluating the factors for available-for-sale securities whose fair values are readily determinable, Sony presumes a decline in value to be other-than-temporary if the fair value of the security is 20 percent or more below its original cost for an extended period of time (generally for a period of up to six months). This criterion is employed as a threshold to identify securities which may have a decline in value that is other-than-temporary. The presumption of an other-than-temporary impairment in such cases may be overcome if there is evidence to support that the decline is temporary in nature due to the existence of other factors which overcome the duration or magnitude of the decline. On the other hand, there may be cases where impairment losses are recognized when the decline in the fair value of the security is not more than 20 percent or such decline has not existed for an extended period of time, as a result of considering specific factors which may indicate that the decline in the fair value is other-than-temporary.

When an other-than-temporary impairment of a held-to-maturity debt security has occurred, the amount of the other-than-temporary impairment recognized in income depends on whether Sony intends to sell the security or more likely than not will be required to sell the security before recovery of its amortized cost. If the debt security meets either of these two criteria, the other-than-temporary impairment is recognized in income, measured as the entire difference between the security’s amortized cost and its fair value at the impairment measurement date. For other-than-temporary impairments of debt securities that do not meet these two criteria, the net amount recognized in income is a credit loss equal to the difference between the amortized cost of the debt security and its net present value calculated by discounting Sony’s best estimate of projected future cash flows at the effective interest rate implicit in the debt security prior to impairment. Any difference between the fair value and the net present value of the debt security at the impairment measurement date is recorded in accumulated other comprehensive income. Unrealized gains or losses on securities for which an other-than-temporary impairment has been recognized in income are presented as a separate component of accumulated other comprehensive income.

Equity securities in non-public companies

Equity securities in non-public companies -

Equity securities in non-public companies are primarily carried at cost if fair value is not readily determinable. If the value of a non-public equity investment is estimated to have declined and such decline is judged to be other-than-temporary, Sony recognizes the impairment of the investment and the carrying value is reduced to its fair value. Determination of impairment is based on the consideration of several factors, including operating results, business plans and estimated future cash flows. Fair value is determined through the use of various methodologies such as discounted cash flows, valuation of recent financings and comparable valuations of similar companies.

Allowance for doubtful accounts

Allowance for doubtful accounts -

Sony maintains an allowance for doubtful accounts to reserve for potentially uncollectible receivables. Sony reviews accounts receivable by amounts due from customers which are past due to identify specific customers with known disputes or collectability issues. In determining the amount of the reserve, Sony makes judgments about the creditworthiness of customers based on past collection experience and ongoing credit risk evaluations.

Inventories

Inventories -

Inventories in the Game & Network Services (“G&NS”), Music, Home Entertainment & Sound (“HE&S”), Imaging Products & Solutions (“IP&S”), Mobile Communications (“MC”) and Semiconductors segments as well as non-film inventories for the Pictures segment are valued at cost, not in excess of the net realizable value – i.e., estimated selling price in the ordinary course of business less predictable costs of completion and disposal, cost being determined on the “average cost” basis, except for the cost of finished products carried by certain subsidiary companies which is determined on the “first-in, first-out” basis.

Other receivables

Other receivables -

Other receivables include receivables which relate to arrangements with certain component manufacturers whereby Sony procures goods, including product components, for these component manufacturers and is reimbursed for the related purchases. No revenue or profit is recognized on these transfers. Sony will repurchase the inventory at a later date from the component manufacturers as either finished goods inventory or as partially assembled product.

Film costs

Film costs -

Film costs include direct production costs, production overhead and acquisition costs for both motion picture and television productions and are stated at the lower of unamortized cost or estimated fair value and classified as noncurrent assets. Film costs are amortized, and the estimated liabilities for residuals and participations are accrued using an individual-film-forecast method based on the ratio of current period actual revenues to the estimated remaining total revenues. Film costs also include broadcasting rights, which are recognized when the license period begins and the program is available for use, and consist of acquired programming to be aired on Sony’s worldwide channel network. Broadcasting rights are stated at the lower of unamortized cost or net realizable value, classified as either current or noncurrent assets based on timing of expected use. Broadcasting rights are amortized based on estimated usage or on a straight-line basis over the useful life, as appropriate, although broadcasting rights licensed under multi-year live-event sports programming agreements are generally amortized based on the ratio of the current period’s actual advertising revenue and an allocation of subscription fee revenue to the estimated total remaining attributable revenues. Estimates used in calculating the fair value of film costs and the net realizable value of broadcasting rights are based upon assumptions about future demand and market conditions and are reviewed on a periodic basis.

Property, plant and equipment and depreciation

Property, plant and equipment and depreciation -

Property, plant and equipment are stated at cost. Depreciation is computed using the straight-line method. Useful lives for depreciation range from two to 50 years for buildings and from two to 10 years for machinery and equipment. Significant renewals and additions are capitalized at cost. Maintenance and repairs, and minor renewals and betterments are charged to income as incurred.

Goodwill and other intangible assets

Goodwill and other intangible assets -

Goodwill and indefinite lived intangible assets are tested annually for impairment during the fourth quarter of the fiscal year and between annual tests if an event occurs or circumstances change that would more likely than not reduce the fair value below its carrying amount. Such an event or change in circumstances would include unfavorable variances from established business plans, significant changes in forecasted results or volatility inherent to external markets and industries, which are periodically reviewed by Sony’s management.

In the fiscal year ended March 31, 2018, Sony elected not to perform an optional qualitative assessment of goodwill and instead proceeded directly to a quantitative impairment test by comparing the fair value of a reporting unit with its carrying amount. Reporting units are Sony’s operating segments or one level below the operating segments. If the fair value of a reporting unit exceeds its carrying amount, goodwill of the reporting unit is not considered impaired. If the carrying amount of a reporting unit exceeds its fair value, an impairment loss is recognized in an amount equal to that excess, not to exceed the total amount of goodwill allocated to the reporting unit. Indefinite lived intangible assets are tested for impairment by comparing the fair value of the intangible asset with its carrying value, and if the carrying value of the intangible asset exceeds its fair value, an impairment loss is recognized in an amount equal to that excess.

The fair value of a reporting unit or indefinite lived intangible asset is generally determined using a discounted cash flow analysis. This approach uses significant estimates and assumptions, including projected future cash flows, the timing of such cash flows, discount rates reflecting the risk inherent in future cash flows, perpetual growth rates, earnings multiples, the determination of appropriate comparable entities and the determination of whether a premium or discount should be applied to comparables. Consideration is also given to Sony’s market capitalization in relation to the sum of the calculated fair values of the reporting units, including reporting units with no goodwill, and taking into account corporate level assets and liabilities not assigned to individual reporting units as well as a reasonable control premium.

The assumptions used for projected future cash flows and the timing of such cash flows are based on the forecast and mid-range plan (“MRP”) of each reporting unit and take into account such factors as historical experience, market and industry information, and current and forecasted economic conditions. Perpetual growth rates are utilized to determine a terminal cash flow value and are generally set after the three-year forecasted period for the MRP. Certain reporting units, such as those in the Pictures segment, utilize longer forecast periods and base the terminal value on an exit price using an earnings multiple applied to the final year of the forecasted earnings, which also takes into consideration a control premium. Discount rates are derived from the weighted average cost of capital of market participants in similar businesses.

When a business within a reporting unit is disposed of, goodwill is allocated to the disposed business using the relative fair value method.

Intangible assets with finite useful lives mainly consist of patent rights, know-how, license agreements, customer relationships, trademarks, software to be sold, leased or otherwise marketed, internal-use software, music catalogs, artist contracts, and television carriage contracts (broadcasting agreements). Patent rights, know-how, license agreements, trademarks, software to be sold, leased or otherwise marketed, and internal-use software are generally amortized on a straight-line basis over three to 10 years. Customer relationships, music catalogs, artist contracts and television carriage contracts (broadcasting agreements) are amortized on a straight-line basis, generally, over 10 to 40 years.

Capitalized software

Capitalized software -

The costs related to establishing the technological feasibility of software to be sold, leased or otherwise marketed are expensed as incurred as a part of research and development in cost of sales. Costs that are incurred to produce the finished product after technological feasibility is established are capitalized and amortized to cost of sales over the estimated economic life, which is generally three years. The technological feasibility of game software is established when the product master is completed. Consideration to capitalize game software development costs before this point is limited to the development costs of games for which technological feasibility can be proven at an earlier stage. At each balance sheet date, Sony performs reviews to ensure that unamortized capitalized software costs remain recoverable from future profits of the related software products.

The costs incurred for internal-use software during the application development stage are capitalized and amortized, mainly to selling, general and administrative expenses, on a straight-line basis over the estimated useful life. Costs related to the preliminary project stage and post implementation activities are expensed as incurred.

Deferred insurance acquisition costs

Deferred insurance acquisition costs -

Costs that vary with and are directly related to acquiring new insurance policies are deferred as long as they are recoverable. The deferred insurance acquisition costs include such items as commissions, medical examination costs and inspection report fees, and are subject to recoverability testing at least annually to ensure that the capitalized amounts do not exceed the present value of anticipated gross profits or premiums less benefits and maintenance expenses, as applicable. The deferred insurance acquisition costs for traditional life insurance contracts are amortized over the premium-paying period of the related insurance policies using assumptions consistent with those used in computing policy reserves. The deferred insurance acquisition costs for non-traditional life insurance contracts are amortized over the expected life in proportion to the estimated gross profits.

Product warranty

Product warranty -

Sony provides for the estimated cost of product warranties at the time revenue is recognized. The product warranty is calculated based upon product sales, estimated probability of failure and estimated cost per claim. The variables used in the calculation of the provision are reviewed on a periodic basis.

Certain subsidiaries in the G&NS, HE&S, IP&S, and MC segments offer extended warranty programs. The consideration received for extended warranty service is deferred and recognized as revenue on a straight-line basis over the term of the extended warranty.

Future insurance policy benefits

Future insurance policy benefits -

Liabilities for future insurance policy benefits are primarily comprised of the present value of estimated future payments to policyholders. These liabilities are computed by the net level premium method based upon the assumptions as to future investment yield, morbidity, mortality, withdrawals and other factors. These assumptions are reviewed on a periodic basis. Liabilities for future insurance policy benefits also include liabilities for guaranteed benefits related to certain non-traditional life and annuity contracts.

Policyholders' account in the life insurance business

Policyholders’ account in the life insurance business -

Liabilities for policyholders’ account in the life insurance business represent the contract value that has accrued to the benefit of the policyholders as of the balance sheet date. This liability is generally equal to the accumulated account deposits, plus interest credited, less policyholder withdrawals and other charges assessed against the account balances.

Impairment of long-lived assets

Impairment of long-lived assets -

Sony reviews the recoverability of the carrying value of its long-lived assets held and used, other than goodwill and intangible assets with indefinite lives, and assets to be disposed of, whenever events or changes in circumstances indicate that the individual carrying amount of an asset or asset group may not be recoverable. Long-lived assets to be held and used are reviewed for impairment by comparing the carrying value of the asset or asset group with their estimated undiscounted future cash flows. If the cash flows are determined to be less than the carrying value of the asset or asset group, an impairment loss would be recognized during the period for the amount by which the carrying value of the asset or asset group exceeds estimated fair value. Long-lived assets that are to be disposed of other than by sale are considered held and used until they are disposed of. Long-lived assets that are to be disposed of by sale are reported at the lower of their carrying value or fair value less cost to sell and are not depreciated. Fair value is determined using the present value of estimated net cash flows or comparable market values. This approach uses significant estimates and assumptions including projected future cash flows, the timing of such cash flows, discount rates reflecting the risk inherent in future cash flows, perpetual growth rates applied to determine terminal values, determination of appropriate market comparables and the determination of whether a premium or discount should be applied to comparables.

Fair value measurement

Fair value measurement -

Sony measures fair value as an exit price, or the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants as of the measurement date. Sony has elected the fair value option in the banking business for certain foreign securities. The election was made to mitigate accounting mismatches related to fluctuations of foreign exchange rates by allowing the gains and losses on the translation of these securities to be included in current earnings.

The accounting guidance for fair value measurements specifies a hierarchy of inputs to valuation techniques based on the extent to which inputs used in measuring fair value are observable in the market. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect Sony’s assumptions about the assumptions that market participants would use in pricing the asset or liability. Observable market data is used if such data is available without undue cost and effort. Each fair value measurement is reported in one of three levels which is determined by the lowest level input that is significant to the fair value measurement in its entirety.

These levels are:

Level 1	—	Inputs are unadjusted quoted prices for identical assets and liabilities in active markets.
Level 2	—	Inputs are based on observable inputs other than level 1 prices, such as quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active and model-derived valuations, in which all significant inputs are observable in active markets.
Level 3	—	One or more significant inputs are unobservable.

When available, Sony uses unadjusted quoted market prices in active markets to measure fair value and classifies such items within level 1. If quoted market prices are not available, fair value is based upon internally developed valuation techniques that use, where possible, current market-based or independently sourced market parameters, such as interest rates, currency rates and option volatilities. Items valued using internally generated models are classified according to the lowest level input that is significant to the valuation. For certain financial assets and liabilities, Sony determines fair value using third-party information such as indicative quotes from dealers and quantitative input from investment advisors following Sony’s established valuation procedures including validation against internally developed prices. Additionally, Sony considers both counterparty credit risk and Sony’s own creditworthiness in determining fair value. Sony attempts to mitigate credit risk to third parties by entering into netting agreements and actively monitoring the creditworthiness of counterparties and its exposure to credit risk through the use of credit limits and by selecting major international banks and financial institutions as counterparties.

Transfers between levels are deemed to have occurred at the beginning of the interim period in which the transfers occur.

Derivative financial instruments

Derivative financial instruments -

All derivatives are recognized as either assets or liabilities in the consolidated balance sheets at fair value on a gross basis. Changes in the fair value of derivative financial instruments are either recognized periodically in income or stockholders’ equity (as a component of accumulated other comprehensive income), depending on whether the derivative financial instrument qualifies as a hedge and the derivative is being used to hedge changes in fair value or cash flows.

The accounting guidance for hybrid financial instruments permits an entity to elect fair value remeasurement for any hybrid financial instrument if the hybrid instrument contains an embedded derivative that would otherwise be required to be bifurcated and accounted for separately under accounting guidance for derivative instruments and hedging activities. The election to measure the hybrid instrument at fair value is made on an instrument-by-instrument basis and is irreversible. Certain subsidiaries in the Financial Services segment had hybrid financial instruments, disclosed in Note 7 as debt securities, that contain embedded derivatives where the entire instrument was carried at fair value.

In accordance with accounting guidance for derivative instruments and hedging activities, various derivative financial instruments held by Sony are classified and accounted for as described below.

Fair value hedges

Changes in the fair value of derivatives designated and effective as fair value hedges for recognized assets or liabilities or unrecognized firm commitments are recognized in earnings as offsets to changes in the fair value of the related hedged assets or liabilities.

Cash flow hedges

Changes in the fair value of derivatives designated and effective as cash flow hedges for forecasted transactions or exposures associated with recognized assets or liabilities are initially recorded in other comprehensive income and reclassified into earnings when the hedged transaction affects earnings. Changes in the fair value of the ineffective portion are recognized immediately in earnings.

Derivatives not designated as hedges

Changes in the fair value of derivatives that are not designated as hedges are recognized immediately in earnings.

Assessment of hedges

When applying hedge accounting, Sony formally documents all hedging relationships between the derivatives designated as hedges and the hedged items, as well as its risk management objectives and strategies for undertaking various hedging activities. Sony links all hedges that are designated as fair value or cash flow hedges to specific assets or liabilities on the consolidated balance sheets or to the specific forecasted transactions. Sony also assesses, both at the inception of the hedge and on an on-going basis, whether the derivatives that are designated as hedges are highly effective in offsetting changes in fair value or cash flows of hedged items. When it is determined that a derivative is not highly effective as a hedge, Sony discontinues hedge accounting. Hedge ineffectiveness, if any, is included immediately in earnings.

Stock-based compensation

Stock-based compensation -

Sony accounts for stock-based compensation using the fair value based method, measured on the date of grant using the Black-Scholes option-pricing model. The expense is mainly included in selling, general and administrative expenses. Stock-based compensation is recognized, net of an estimated forfeiture rate, over the requisite service period using the accelerated method of amortization for grants with graded vesting. The estimated forfeiture rate is based on Sony’s historical experience in the stock acquisition rights plans where the majority of the vesting terms have been satisfied.

Revenue recognition

Revenue recognition -

Revenues from sales in the G&NS, Music, HE&S, IP&S, MC and Semiconductors segments are recognized when persuasive evidence of an arrangement exists, delivery has occurred or services have been rendered, the sales price is fixed or determinable, and collectability is reasonably assured. Delivery is considered to have occurred when the customer has taken title to the product and the risks and rewards of ownership have been substantively transferred. If the sales contract contains a customer acceptance provision, then sales are recognized after customer acceptance occurs or the acceptance provisions lapse. Revenues are recognized net of anticipated returns and sales incentives. Revenues from prepaid subscription fees, such as within the G&NS segment, are recognized ratably over the subscription term.

Revenue arrangements with customers may include multiple elements, including any combination of products, services and software. An example includes sales of electronics products with rights to receive promotional goods. For Sony’s multiple element arrangements where at least one of the elements is not subject to existing software or film revenue recognition guidance, elements are separated into more than one unit of accounting when the delivered element(s) have value to the customer on a standalone basis, and delivery of the undelivered element(s) is probable and substantially in the control of Sony. Revenue is then allocated to each unit of accounting based on the relative selling price of each unit of accounting based first on vendor-specific objective evidence of selling price (“VSOE”) if it exists, based next on third-party evidence of selling price (“TPE”) if VSOE does not exist, and, finally, if both VSOE and TPE do not exist, based on estimated selling prices (“ESP”). VSOE is limited to either the price charged for an element when it is sold separately or, for an element not yet being sold separately, the price established by management having the relevant authority; it must be probable that the price, once established, will not change before the separate introduction of the element into the market place. TPE is the price of Sony’s or any competitor’s largely interchangeable products or services in standalone sales to similarly situated customers. ESP is the price at which Sony would transact if the element were sold by Sony regularly on a standalone basis. When determining ESP, Sony considers all relevant inputs, including sales, cost and margin analysis of the product, targeted rate of return of the product, competitors’ and Sony’s pricing practices and customer perspectives.

Certain software products published by Sony provide limited online features at no additional cost to the customer. Generally, such features are considered to be incidental to the overall software product and an inconsequential deliverable. Accordingly, revenue related to software products containing these limited online features is not deferred.

Revenues from sales in the Pictures segment are recognized when persuasive evidence of an arrangement exists, the sales price is fixed or determinable and collectability is reasonably assured. Revenues from the theatrical exhibition of motion pictures are recognized as the customer exhibits the film. Revenues from the licensing of motion picture and television programming for pay and free television exhibition and other markets are recognized when the product is available for exploitation by the licensee and when any restrictions regarding the use of the product lapse. For home entertainment distribution, revenues from the sale of DVDs and Blu-ray Disc^TM, net of anticipated returns and sales incentives, are recognized when delivery has occurred and the product is available for sale to the public, and revenues from electronic sell-through and video-on-demand are recognized when the product is made available for viewing via digital distribution platforms. Certain motion picture and television program licensing arrangements involve an allocation to multiple elements, for example a fee for multiple territories and availability dates, that is based on relative fair value using management’s best estimate. Revenues from the sale of broadcast advertising are recognized when the advertisement is aired. Revenues from subscription fees received by television networks are recognized when the service is provided.

Traditional life insurance policies that the life insurance subsidiary underwrites, most of which are categorized as long-duration contracts, mainly consist of whole life, term life and accident and health insurance contracts. Premiums from these policies are reported as revenue when due from policyholders.

Amounts received as payment for non-traditional contracts such as interest sensitive whole life contracts, individual annuity contracts and other contracts without life contingencies are recognized in policyholders’ account in the life insurance business. Revenues from these contracts are comprised of fees earned for administrative and contract-holder services, which are recognized over the period of the contracts, and included in financial services revenue.

Property and casualty insurance policies that the non-life insurance subsidiary underwrites are primarily automotive insurance contracts which are categorized as short-duration contracts. Premiums from these policies are reported as revenue over the period of the contract in proportion to the amount of insurance protection provided.

Revenue is recognized net of any taxes collected from customers and subsequently remitted to governmental authorities.

Consideration given to a customer or a reseller

Consideration given to a customer or a reseller -

Sales incentives or other cash consideration given to a customer or a reseller, including payments for buydowns, slotting fees and cooperative advertising programs, are accounted for as a reduction of revenue unless Sony receives an identifiable benefit (goods or services) in exchange for the consideration, the fair value of the benefit is reasonably estimated and documentation from the reseller is received to support the amounts paid to the reseller. Payments meeting these criteria are recorded as selling, general and administrative expenses. For the fiscal years ended March 31, 2016, 2017 and 2018, consideration given to a reseller, primarily for free promotional shipping and cooperative advertising programs included in selling, general and administrative expenses, totaled 13,178 million yen, 12,046 million yen and 12,319 million yen, respectively.

Cost of sales

Cost of sales -

Costs classified as cost of sales relate to the producing and manufacturing of products and include items such as material cost, subcontractor cost, depreciation of fixed assets, amortization of intangible assets, personnel expenses, research and development costs, and amortization of film costs related to motion picture and television productions.

Research and development costs

Research and development costs -

Research and development costs, included in cost of sales, include items such as salaries, personnel expenses and other direct and indirect expenses associated with research and product development. Research and development costs are expensed as incurred.

Selling, general and administrative

Selling, general and administrative -

Costs classified as selling expenses relate to promoting and selling products and include items such as advertising, promotion, shipping and warranty expenses. General and administrative expenses include operating items such as officers’ salaries, personnel expenses, depreciation of fixed assets, office rental for sales, marketing and administrative divisions, a provision for doubtful accounts and amortization of intangible assets.

Financial services expenses

Financial services expenses -

Financial services expenses include a provision for policy reserves and amortization of deferred insurance acquisition costs, and all other operating costs, such as personnel expenses, depreciation of fixed assets, and office rental of subsidiaries, in the Financial Services segment.

Advertising costs

Advertising costs -

Advertising costs are expensed when the advertisement or commercial appears in the selected media.

Shipping and handling costs

Shipping and handling costs -

The majority of shipping and handling, warehousing and internal transfer costs for finished goods are included in selling, general and administrative expenses. An exception to this is in the Pictures segment where such costs are charged to cost of sales as they are an integral part of producing and distributing motion pictures and television programming. All other costs related to Sony’s distribution network are included in cost of sales, including inbound freight charges, purchasing and receiving costs, inspection costs and warehousing costs for raw materials and in-process inventory. Amounts paid by customers for shipping and handling costs are included in net sales.

Income taxes

Income taxes -

The provision for income taxes is computed based on the pretax income included in the consolidated statements of income, and the tax liability attributed to undistributed earnings of subsidiaries and affiliated companies accounted for by the equity method expected to be remitted in the foreseeable future. The asset and liability approach is used to recognize deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the carrying amounts and the tax bases of assets and liabilities.

Carrying amounts of deferred tax assets require a reduction by a valuation allowance if, based on the available evidence, it is more likely than not that such assets will not be realized. Accordingly, the need to establish valuation allowances for deferred tax assets is assessed periodically with appropriate consideration given to all positive and negative evidence related to the realization of the deferred tax assets. Management’s judgments related to this assessment consider, among other matters, the nature, frequency and severity of current and cumulative losses on an individual tax jurisdiction basis, forecasts of future profitability after consideration of uncertain tax positions, excess of appreciated asset value over the tax basis of net assets, the duration of statutory carryforward periods, the past utilization of net operating loss carryforwards prior to expiration, as well as prudent and feasible tax planning strategies which would be employed by Sony to prevent net operating loss and tax credit carryforwards from expiring unutilized.

Sony records assets and liabilities for unrecognized tax benefits resulting from uncertain tax positions taken or expected to be taken in a tax return. Sony continues to recognize interest and penalties, if any, with respect to income taxes, including unrecognized tax benefits, as interest expense and as income tax expense, respectively, in the consolidated statements of income. The amount of income taxes Sony pays is subject to ongoing audits by various taxing authorities, which may result in proposed assessments. In addition, several significant items related to intercompany transfer pricing are currently the subject of negotiations between taxing authorities in different jurisdictions as a result of pending advance pricing agreement applications and competent authority requests. Sony’s estimate for the potential outcome for any uncertain tax issues is judgmental and requires significant estimates. Sony assesses its income tax positions and records tax benefits for all years subject to examinations based upon the evaluation of the facts, circumstances and information available at that reporting date. For those tax positions for which it is more likely than not that a tax benefit will be sustained, Sony records the amount that has a greater than 50% likelihood of being realized upon settlement with a taxing authority that has full knowledge of all relevant information. If Sony does not believe that it is more likely than not that a tax benefit will be sustained, no tax benefit is recognized. However, Sony’s future results may include favorable or unfavorable adjustments to Sony’s estimated tax liabilities due to closure of income tax examinations, the outcome of negotiations between taxing authorities in different jurisdictions, new regulatory or judicial pronouncements or other relevant events. As a result, the amount of unrecognized tax benefits, and the effective tax rate, may fluctuate significantly.

The impact of the U.S. Tax Cuts and Jobs Act of 2017 (the “U.S. Tax Reform Act”) has been recorded on a provisional basis as defined in Staff Accounting Bulletin No. 118 (“SAB 118”) and additional guidance is to be issued by the U.S. Department of the Treasury on several provisions including the computation of the transition tax on historic foreign earnings. Additional guidance issued during the fiscal year ending March 31, 2019 could impact the information required for, and the calculation of, the transition tax charge. Further analysis performed and conclusions reached as part of the tax return filing process and the issuance of additional guidance related to the U.S. Tax Reform Act could affect the provisional amount recorded. Sony expects to complete its analysis of the impact of the U.S. Tax Reform Act no later than December 22, 2018.

Net income (loss) attributable to Sony Corporation's stockholders per share ("EPS")

Net income (loss) attributable to Sony Corporation’s stockholders per share (“EPS”) -

Basic EPS is computed based on the weighted-average number of shares of common stock outstanding during each period. The computation of diluted EPS reflects the maximum possible dilution from conversion, exercise, or contingent issuance of securities. All potentially dilutive securities are excluded from the calculation in a situation where there is a net loss attributable to Sony Corporation’s stockholders.

Recently adopted accounting pronouncements

(2) Recently adopted accounting pronouncements

Simplifying the test for goodwill impairment -

In January 2017, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2017-04 to simplify the accounting for goodwill impairment. This ASU eliminates the second step from the goodwill impairment test. Instead, an entity should perform its annual or interim goodwill impairment test by comparing the fair value of a reporting unit with its carrying amount and recognize an impairment charge for the amount by which the carrying amount exceeds the reporting unit’s fair value, not to exceed the total amount of goodwill allocated to the reporting unit. Sony has early adopted this ASU in the fiscal year ended March 31, 2018. The adoption of this ASU did not have a material impact on Sony’s results of operations and financial position.

Recent accounting pronouncements not yet adopted

(3) Recent accounting pronouncements not yet adopted

Revenue from contracts with customers -

In May 2014, the FASB issued ASU 2014-09 addressing revenue recognition which will supersede the current revenue recognition requirements, including most industry-specific guidance. The guidance requires an entity to recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services.

This guidance will be effective from the first quarter of Sony’s fiscal year beginning April 1, 2018. The guidance permits two methods of adoption: retrospectively to each prior period presented (“full retrospective method”), or retrospectively with the cumulative effect of initially applying the guidance recognized at the date of initial application (“modified retrospective method”). Sony will adopt this guidance using the modified retrospective method.

Sony has substantially completed its assessment of the impact of adopting this new guidance and does not expect that the adoption will have a material impact on Sony’s results of operations and financial position. Although Sony does not expect the impact of adopting the guidance to be material, there are several areas where Sony’s revenue recognition is expected to change as compared with historical U.S. GAAP. The more significant of these areas are as follows:

In the Pictures segment, (1) licensing revenue associated with certain renewals or extensions of existing agreements for motion pictures and television programming will be recognized at a later point in time, which is when the licensee can use and benefit from the content, instead of when the agreement is renewed or extended, and (2) licensing revenue associated with minimum guarantees for symbolic intellectual property (e.g., brands, trademarks and logos) will be recognized over the license term instead of at the inception of the license term.

In the MC segment, incremental costs of obtaining contracts for internet-related service business will be recognized as assets and amortized to expense over the contract period.

In addition, the ASU will change the presentation of certain items in the consolidated financial statements, such as sales returns, with no impact to the timing of the recognition of revenue or expense.

Recognition and measurement of financial assets and financial liabilities -

In January 2016, the FASB issued ASU 2016-01 amending various aspects of the recognition, measurement, presentation, and disclosure requirements for financial instruments. The changes mainly relate to the requirement to measure equity investments in unconsolidated subsidiaries, other than those accounted for under the equity method of accounting, at fair value with changes in fair value recognized in earnings. However, this ASU permits entities to elect to measure equity investments that do not have readily determinable fair values at cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for the identical or a similar investment of the same issuer. This ASU will be effective for Sony as of April 1, 2018. As a result of the adoption of this ASU, Sony will reclassify the unrealized gains and losses, net of tax, on equity securities previously classified as available-for-sale, from accumulated other comprehensive income to retained earnings. Sony anticipates that the adoption of this ASU will increase the volatility of Sony’s other income (expenses), net, resulting from the remeasurement of Sony’s equity investments.

Leases -

In February 2016, the FASB issued ASU 2016-02, which amends current leasing guidance. The ASU requires substantially all leases to be recognized on the balance sheet. This ASU will be effective for Sony as of the fiscal year beginning April 1, 2019, and early adoption is permitted. The impact of this ASU on Sony’s results of operations and financial position is being evaluated.

Measurement of credit losses on financial instruments -

In June 2016, the FASB issued ASU 2016-13, which amends the accounting guidance for credit losses on financial instruments. The ASU requires the consideration of all available relevant information when estimating expected credit losses, including past events, current conditions and forecasts and their implications for expected credit losses. This ASU will be effective for Sony as of the fiscal year beginning April 1, 2020, with early adoption permitted for the first quarter of the fiscal year beginning April 1, 2019. The impact of this ASU on Sony’s results of operations and financial position is being evaluated.

Classification of certain cash receipts and cash payments -

In August 2016, the FASB issued ASU 2016-15, which clarifies the classification of certain cash receipts and cash payments in the statement of cash flows. This guidance is effective from the first quarter of Sony’s fiscal year beginning April 1, 2018. Sony does not expect the impact on its consolidated financial statements to be material.

Intra-entity transfers of assets other than inventory -

In October 2016, the FASB issued ASU 2016-16, which amends the accounting for income taxes. This update requires recognition of the income tax consequences of an intra-entity transfer of assets other than inventory when the transfer occurs. Under current U.S. GAAP, recognition of the income tax consequences for asset transfers other than inventory cannot be recognized until the asset is sold to a third party. This ASU is required to be applied on a modified retrospective basis through a cumulative-effect adjustment to retained earnings as of the beginning of the period of adoption. This ASU will be effective for Sony as of the fiscal year beginning April 1, 2018. The adoption of this ASU is not expected to have a material impact on Sony’s results of operations and financial position.

Restricted cash -

In November 2016, the FASB issued ASU 2016-18, which requires that restricted cash and restricted cash equivalents be included with cash and cash equivalents in the statement of cash flows. This guidance also requires entities to disclose how the statement of cash flows that includes restricted cash and restricted cash equivalents with cash and cash equivalents reconciles to the balance sheet. The guidance is effective from the first quarter of Sony’s fiscal year beginning April 1, 2018. Sony does not expect the impact on its consolidated financial statements to be material.

Clarifying the definition of a business -

In January 2017, the FASB issued ASU 2017-01 which clarifies the definition of a business. The ASU requires an entity first to determine whether substantially all of the fair value of a set of assets acquired is concentrated in either a single identifiable asset or a group of similar identifiable assets. If this criterion is met, the acquired set of assets is not deemed to be a business. If the criterion is not met, the entity then must evaluate whether the set of assets meets the requirement to be deemed a business. To be considered a business, the acquired set of assets would have to include an input and a substantive process that together significantly contribute to the ability to create outputs. This ASU is effective for Sony as of the fiscal year beginning April 1, 2018. The adoption of this ASU is not expected to have a material impact on Sony’s results of operations and financial position.

Presentation of net periodic pension and postretirement benefit costs -

In March 2017, the FASB issued ASU 2017-07, which requires separate presentation of service costs and other components of net benefit costs. The service costs will only be presented with other employee compensation costs in operating income or capitalized, while the other components of net benefit costs will be presented outside of operating income, and will not be eligible for capitalization. This ASU will be effective for Sony as of the fiscal year beginning April 1, 2018. This ASU is required to be applied on a retrospective basis for the presentation of service costs and other components of net benefit costs, and on a prospective basis for the capitalization of only the service costs component of net benefit costs. The adoption of this ASU is not expected to have a material impact on Sony’s results of operations and financial position.

Premium amortization on purchased callable debt securities -

In March 2017, the FASB issued ASU 2017-08, which requires certain premiums on callable debt securities to be amortized to the earliest call date. The amortization period for callable debt securities purchased at a discount will not be affected. This ASU will be effective for Sony as of April 1, 2019. The impact of this ASU on Sony’s results of operations and financial position is being evaluated.

Targeted improvements to accounting for hedging activities -

In August 2017, the FASB issued ASU 2017-12, which made targeted improvements to the accounting for hedging activities. The amendments in this update simplify certain aspects of hedge accounting for both non-financial and financial risks and better align the recognition and measurement of hedge results with an entity’s risk management activities. This ASU also amends certain presentation and disclosure requirements for hedging activities and changes how an entity assesses hedge effectiveness. This ASU will be effective for Sony as of the fiscal year beginning April 1, 2019. The impact of this ASU on Sony’s results of operations and financial position is being evaluated.

Reclassifications

(4) Reclassifications

Certain reclassifications of the financial statements and accompanying footnotes for the fiscal years ended March 31, 2016 and 2017 have been made to conform to the presentation for the fiscal year ended March 31, 2018.

Out-of-period adjustments

(5) Out-of-period adjustments

For the fiscal year ended March 31, 2016, Sony recorded an out-of-period adjustment to correct an error in the amount of accruals for certain sales incentives being recorded at a subsidiary. The error began in the fiscal year ended March 31, 2009 and continued until it was identified by Sony during the fiscal year ended March 31, 2016. The adjustment, which related to the HE&S segment, impacted net sales and increased income before income taxes in the consolidated statements of income by 8,447 million yen for the fiscal year ended March 31, 2016. Sony determined that the adjustment was not material to the consolidated financial statements for the fiscal year ended March 31, 2016 or any prior periods.

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Inventories (Tables)

12 Months Ended

Mar. 31, 2018

Inventory Disclosure [Abstract]

Summary of Inventories

Inventories are comprised of the following:

	Yen in millions
	March 31
	2017		2018
Finished products		399,850		422,461
Work in process		140,718		153,257
Raw materials, purchased components and supplies		100,267		117,219
Inventories		640,835		692,937

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Film costs (Tables)

12 Months Ended

Mar. 31, 2018

Other Industries [Abstract]

Summary of Film Costs

Film costs are comprised of the following:

	Yen in millions
	March 31
	2017			2018
Motion picture productions:
Released		80,539			81,755
Completed and not released		5,608			1,728
In production and development		94,197			78,868
Television productions:
Released		120,693			127,790
In production and development		7,707			1,174
Broadcasting rights		65,725			72,125
Less: current portion of broadcasting rights included in inventories		(37,541	)		(35,795	)
Film costs		336,928			327,645

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Investments in affiliated companies (Tables)

12 Months Ended

Mar. 31, 2018

Equity Method Investments and Joint Ventures [Abstract]

Summarized Combined Financial Information Provided by Equity Investees

The summarized combined financial information that is based on information provided by the equity investees including information for significant equity affiliates and the reconciliation of such information to the consolidated financial statements is shown below:

Balance Sheets

	Yen in millions
	March 31
	2017			2018
Current assets		361,492			404,658
Noncurrent assets		834,765			868,455
Current liabilities		248,450			273,067
Noncurrent liabilities and noncontrolling interests		761,546			768,007
Percentage of ownership in equity investees		20%-50	%		20%-50	%

Statements of Income

	Yen in millions
	Fiscal year ended March 31
	2016			2017			2018
Net revenues		358,256			387,229			468,933
Operating income		32,884			37,800			56,729
Net income attributable to controlling interests		8,388			11,529			27,301
Percentage of ownership in equity investees		20%-50	%		20%-50	%		20%-50	%

Account Balances and Transactions with Affiliated Companies Accounted for under Equity Method

Account balances and transactions with affiliated companies accounted for under the equity method are presented below. There are no other material transactions or account balances with any other related parties.

	Yen in millions
	March 31
	2017		2018
Accounts receivable, trade		10,873		15,516
Accounts payable, trade		2,525		2,568
Short-term borrowings		20,650		22,849
Capital lease obligations		10,105		13,294

	Yen in millions
	Fiscal year ended March 31
	2016		2017		2018
Sales		33,569		31,238		45,415
Purchases		2,259		1,966		3,180
Lease payments		32,291		16,492		7,749

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Marketable securities and securities investments (Tables)

12 Months Ended

Mar. 31, 2018

Investments, Debt and Equity Securities [Abstract]

Aggregate Cost, Gross Unrealized Gains and Losses and Fair Value Pertaining to Available-for-Sale Securities and Held-to-Maturity Securities

Marketable securities and securities investments, primarily included in the Financial Services segment, are comprised of debt and equity securities for which the aggregate cost, gross unrealized gains and losses and fair value pertaining to available-for-sale securities and held-to-maturity securities are as follows:

	Yen in millions
	March 31, 2017									March 31, 2018
	Cost		Gross unrealized gains		Gross unrealized losses			Fair value		Cost		Gross unrealized gains		Gross unrealized losses			Fair value
Available-for-sale:
Debt securities:
Japanese national government bonds		1,161,493		182,836		(928	)		1,343,401		1,227,139		182,830		(359	)		1,409,610
Japanese local government bonds		60,450		144		(63	)		60,531		67,574		107		(112	)		67,569
Japanese corporate bonds		163,785		7,864		(1,846	)		169,803		199,880		9,844		(1,016	)		208,708
Foreign government bonds		27,601		359		(918	)		27,042		72,204		622		(3,287	)		69,539
Foreign corporate bonds		396,097		4,168		(719	)		399,546		365,457		1,649		(641	)		366,465
Other		15,192		—		(0	)		15,192		99,349		1		(0	)		99,350
		1,824,618		195,371		(4,474	)		2,015,515		2,031,603		195,053		(5,415	)		2,221,241
Equity securities		55,928		69,937		(377	)		125,488		55,676		71,723		(776	)		126,623
Held-to-maturity securities:
Japanese national government bonds		5,661,191		1,520,904		(30,553	)		7,151,542		5,892,868		1,635,036		(20,890	)		7,507,014
Japanese local government bonds		4,101		449		—			4,550		3,850		413		—			4,263
Japanese corporate bonds		230,011		12,346		(22,071	)		220,286		345,818		16,912		(17,390	)		345,340
Foreign government bonds		253,019		5,269		(22,868	)		235,420		300,220		8,310		(18,570	)		289,960
Foreign corporate bonds		198		18		—			216		198		13		—			211
		6,148,520		1,538,986		(75,492	)		7,612,014		6,542,954		1,660,684		(56,850	)		8,146,788
Total		8,029,066		1,804,294		(80,343	)		9,753,017		8,630,233		1,927,460		(63,041	)		10,494,652

Cost and Fair Value of Debt Securities Classified as Available-for-Sale Securities and Held-to-Maturity Securities by Contractual Maturity

The following table presents the cost and fair value of debt securities classified as available-for-sale securities and held-to-maturity securities by contractual maturity:

	Yen in millions
	March 31, 2018
	Available-for-sale securities				Held-to-maturity securities
	Cost		Fair value		Cost		Fair value
Due in one year or less		125,037		125,290		3,249		3,269
Due after one year through five years		421,676		422,987		27,805		29,417
Due after five years through ten years		542,642		626,888		334,206		382,175
Due after ten years		942,248		1,046,076		6,177,694		7,731,927
Total		2,031,603		2,221,241		6,542,954		8,146,788

Gross Unrealized Losses and Fair Value of Securities with Unrealized Losses, Aggregated by Investment Category and Length of Time in Continuous Unrealized Loss Position

The following tables present the gross unrealized losses on, and fair value of, Sony’s investment securities with unrealized losses, aggregated by investment category and the length of time that individual investment securities have been in a continuous unrealized loss position, at March 31, 2017 and 2018.

	Yen in millions
	March 31, 2017
	Less than 12 months					12 months or more					Total
	Fair value		Unrealized losses			Fair value		Unrealized losses			Fair value		Unrealized losses
Available-for-sale:
Debt securities:
Japanese national government bonds		52,825		(909	)		2,018		(19	)		54,843		(928	)
Japanese local government bonds		3,793		(6	)		14,270		(57	)		18,063		(63	)
Japanese corporate bonds		53,302		(1,761	)		20,489		(85	)		73,791		(1,846	)
Foreign government bonds		10,258		(577	)		7,792		(341	)		18,050		(918	)
Foreign corporate bonds		27,944		(143	)		24,662		(576	)		52,606		(719	)
		148,122		(3,396	)		69,231		(1,078	)		217,353		(4,474	)
Equity securities		11,878		(370	)		9		(7	)		11,887		(377	)
Held-to-maturity securities:
Japanese national government bonds		277,328		(30,553	)		—		—			277,328		(30,553	)
Japanese local government bonds		—		—			—		—			—		—
Japanese corporate bonds		146,004		(22,071	)		—		—			146,004		(22,071	)
Foreign government bonds		196,740		(22,868	)		—		—			196,740		(22,868	)
Foreign corporate bonds		—		—			—		—			—		—
		620,072		(75,492	)		—		—			620,072		(75,492	)
Total		780,072		(79,258	)		69,240		(1,085	)		849,312		(80,343	)

	Yen in millions
	March 31, 2018
	Less than 12 months					12 months or more					Total
	Fair value		Unrealized losses			Fair value		Unrealized losses			Fair value		Unrealized losses
Available-for-sale:
Debt securities:
Japanese national government bonds		10,118		(11	)		32,836		(348	)		42,954		(359	)
Japanese local government bonds		9,324		(11	)		14,729		(101	)		24,053		(112	)
Japanese corporate bonds		11,046		(10	)		64,119		(1,006	)		75,165		(1,016	)
Foreign government bonds		40,156		(2,281	)		7,752		(1,006	)		47,908		(3,287	)
Foreign corporate bonds		34,840		(69	)		21,191		(572	)		56,031		(641	)
Other		1,840		(0	)		315		(0	)		2,155		(0	)
		107,324		(2,382	)		140,942		(3,033	)		248,266		(5,415	)
Equity securities		13,859		(776	)		15		(0	)		13,874		(776	)
Held-to-maturity securities:
Japanese national government bonds		—		—			304,564		(20,890	)		304,564		(20,890	)
Japanese local government bonds		—		—			—		—			—		—
Japanese corporate bonds		—		—			174,815		(17,390	)		174,815		(17,390	)
Foreign government bonds		20,448		(704	)		134,230		(17,866	)		154,678		(18,570	)
Foreign corporate bonds		—		—			—		—			—		—
		20,448		(704	)		613,609		(56,146	)		634,057		(56,850	)
Total		141,631		(3,862	)		754,566		(59,179	)		896,197		(63,041	)

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Leases (Tables)

12 Months Ended

Mar. 31, 2018

Leases [Abstract]

Leased Assets under Capital Leases

Leased assets under capital leases are comprised of the following:

	Yen in millions
	March 31
Class of property	2017			2018
Machinery, equipment and others		66,722			82,260
Film costs		4,943			4,007
Accumulated amortization		(53,330	)		(58,861	)
		18,335			27,406

Future Minimum Lease Payments under Capital Leases with Present Value of Net Minimum Lease Payments

The following is a schedule by fiscal year of the future minimum lease payments under capital leases together with the present value of the net minimum lease payments as of March 31, 2018:

Fiscal year ending March 31	Yen in millions
2019		12,326
2020		15,101
2021		8,787
2022		4,773
2023		3,573
Later fiscal years		12,424
Total minimum lease payments		56,984
Less — Amount representing interest		7,150
Present value of net minimum lease payments		49,834
Less — Current obligations		11,432
Long-term capital lease obligations		38,402

Minimum Rental Payments Required under Operating Leases that have Initial or Remaining Noncancelable Lease Terms in Excess of One Year

The minimum rental payments required under operating leases that have initial or remaining noncancelable lease terms in excess of one year at March 31, 2018 are as follows:

Fiscal year ending March 31	Yen in millions
2019		57,810
2020		64,380
2021		38,495
2022		24,993
2023		20,280
Later fiscal years		81,305
Total minimum future rentals		287,263

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Goodwill and other intangible assets (Tables)

12 Months Ended

Mar. 31, 2018

Goodwill and Intangible Assets Disclosure [Abstract]

Acquired Intangible Assets other than Goodwill and Weighted-Average Amortization Period

Intangible assets other than goodwill acquired during the fiscal year ended March 31, 2018 totaled 110,788 million yen, of which 110,781 million yen is subject to amortization, and are comprised of the following:

	Intangible assets acquired during the fiscal year		Weighted-average amortization period
	Yen in millions		Years
Patent rights, know-how and license agreements		16,003		4
Software to be sold, leased or otherwise marketed		16,066		3
Internal-use software		69,205		5
Other		9,507		7

Intangible Assets Subject to Amortization

Intangible assets subject to amortization are comprised of the following:

	Yen in millions
	March 31, 2017					March 31, 2018
	Gross carrying amount		Accumulated amortization			Gross carrying amount		Accumulated amortization
Patent rights, know-how and license agreements		317,337		(251,401	)		175,980		(142,724	)
Customer relationships		37,289		(15,585	)		18,881		(7,615	)
Trademarks		31,630		(15,554	)		16,310		(8,451	)
Software to be sold, leased or otherwise marketed		117,897		(86,661	)		123,269		(92,457	)
Internal-use software		473,750		(310,408	)		494,649		(315,516	)
Music catalogs		218,321		(95,367	)		207,789		(94,210	)
Artist contracts		31,393		(29,001	)		28,534		(27,650	)
Television carriage contracts (broadcasting agreements)		74,780		(21,986	)		74,258		(25,884	)
Other		62,212		(46,624	)		58,543		(47,586	)
Total		1,364,609		(872,587	)		1,198,213		(762,093	)

Estimated Aggregate Amortization Expense for Intangible Assets

The estimated aggregate amortization expense for intangible assets for the next five fiscal years is as follows:

Fiscal year ending March 31	Yen in millions
2019		89,924
2020		73,516
2021		56,485
2022		39,050
2023		27,982

Total Carrying Amount of Intangible Assets having Indefinite Life

Total carrying amount of intangible assets having an indefinite life are comprised of the following:

	Yen in millions
	March 31
	2017		2018
Trademarks		70,220		68,922
Distribution agreements		18,834		18,834
Other		3,109		3,292
Total		92,163		91,048

Changes in Carrying Amount of Goodwill by Segment

The changes in the carrying amount of goodwill by segment for the fiscal years ended March 31, 2017 and 2018 are as follows:

	Yen in millions
	G&NS			Music			Pictures			HE&S			IP&S			MC			Semiconductors			Financial Services			All Other			Total
Balance, March 31, 2016:
Goodwill — gross		152,293			162,078			221,517			5,320			8,637			179,331			49,621			3,020			31,536			813,353
Accumulated impairments		—			(306	)		—			(5,320	)		(300	)		(176,045	)		—			(706	)		(24,386	)		(207,063	)
Goodwill		152,293			161,772			221,517			—			8,337			3,286			49,621			2,314			7,150			606,290
Increase (decrease) due to:
Acquisitions*1		—			7,689			29,363			—			—			—			—			61			—			37,113
Sales and dispositions		—			—			(60	)		—			—			—			—			—			—			(60	)
Impairments		—			—			(112,069	)		—			—			—			—			—			—			(112,069	)
Translation adjustments		(355	)		(3,351	)		(598	)		—			(186	)		—			(77	)		—			(11	)		(4,578	)
Other		—			—			—			—			—			—			(1,475	)		—			(2,683	)		(4,158	)
Balance, March 31, 2017:
Goodwill — gross		151,938			166,416			246,085			5,320			8,451			179,331			48,069			3,081			28,842			837,533
Accumulated impairments		—			(306	)		(107,932	)		(5,320	)		(300	)		(176,045	)		—			(706	)		(24,386	)		(314,995	)
Goodwill		151,938			166,110			138,153			—			8,151			3,286			48,069			2,375			4,456			522,538
Increase (decrease) due to:
Acquisitions		—			2,877			12,842			—			1,204			—			—			4,850			—			21,773
Sales and dispositions		—			(121	)		—			—			—			—			—			—			—			(121	)
Impairments		—			—			—			—			—			—			—			—			—			—
Translation adjustments		(1,332	)		(3,472	)		(6,583	)		—			162			—			(1,072	)		—			(85	)		(12,382	)
Other		—			—			—			—			—			—			(1,204	)		—			(112	)		(1,316	)
Balance, March 31, 2018:
Goodwill — gross		150,606			165,700			246,620			5,320			9,817			179,331			45,793			7,931			27,912			839,030
Accumulated impairments		—			(306	)		(102,208	)		(5,320	)		(300	)		(176,045	)		—			(706	)		(23,653	)		(308,538	)
Goodwill		150,606			165,394			144,412			—			9,517			3,286			45,793			7,225			4,259			530,492

*1 Acquisitions for the fiscal year ended March 31, 2017 relate mainly to the TEN Sports Network acquisition in the Pictures segment. Refer to Note 24.

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Insurance-related accounts (Tables)

12 Months Ended

Mar. 31, 2018

Insurance [Abstract]

Policyholders' Account in Life Insurance Business

Policyholders’ account in the life insurance business is comprised of the following:

	Yen in millions
	March 31
	2017		2018
Universal life insurance		1,809,142		1,951,906
Investment contracts		686,182		738,404
Other		135,749		130,392
Total		2,631,073		2,820,702

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Short-term borrowings and long-term debt (Tables)

12 Months Ended

Mar. 31, 2018

Debt Disclosure [Abstract]

Short-Term Borrowings

Short-term borrowings are comprised of the following:

	Yen in millions
	March 31
	2017		2018
Unsecured loans:
with a weighted-average interest rate of 7.29%		64,046
with a weighted-average interest rate of 3.95%				64,480
Secured loans:
with a weighted-average interest rate of 0.00%		20,000
with a weighted-average interest rate of 0.12%				27
Repurchase agreement:
with a weighted-average interest rate of 0.01%		310,609
with a weighted-average interest rate of 0.18%				335,586
Secured call money:
with a weighted-average interest rate of (0.08)%		70,000
with a weighted-average interest rate of (0.07)%				96,000
		464,655		496,093

Long-Term Debt

Long-term debt is comprised of the following:

	Yen in millions
	March 31
	2017		2018
Unsecured loans, representing obligations principally to banks:
Due 2017 to 2024, with interest rates ranging from 0.24% to 5.10% per annum		63,248
Due 2018 to 2024, with interest rates ranging from 0.01% to 5.10% per annum				49,454
Unsecured 0.43% bonds, due 2018		10,000
Unsecured 0.86% bonds, due 2018		150,000		150,000
Unsecured 2.00% bonds, due 2018		16,300		16,300
Unsecured 0.05% bonds, due 2019		69,793		69,879
Unsecured 2.07% bonds, due 2019		50,000		50,000
Unsecured 0.23% bonds, due 2021		89,670		89,744
Unsecured 0.11% bonds, due 2022				10,000
Unsecured 1.41% bonds, due 2022		10,000		10,000
Unsecured 0.28% bonds, due 2023		15,000		15,000
Unsecured 0.22% bonds, due 2025				10,000
Unsecured 0.42% bonds, due 2026		24,887		24,899
Unsecured zero coupon convertible bonds, due 2022		120,000		119,976
Secured 0.00% loans, due 2019 to 2020		70,000
Secured 0.00% loans, due 2019 to 2022				170,002
Capital lease obligations and other:
Due 2017 to 2027, with interest rates ranging from 0.36% to 8.90% per annum		34,224
Due 2018 to 2047, with interest rates ranging from 0.36% to 11.88% per annum				52,929
Guarantee deposits received		11,764		10,790
		734,886		848,973
Less — Portion due within one year		53,424		225,522
		681,462		623,451

Aggregate Amounts of Annual Maturities of Long-Term Debt

Aggregate amounts of annual maturities of long-term debt are as follows:

Fiscal year ending March 31	Yen in millions
2019		225,522
2020		155,490
2021		58,620
2022		204,428
2023		16,437
Later fiscal years		188,476
Total		848,973

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Housing loans and deposits from customers in the banking business (Tables)

12 Months Ended

Mar. 31, 2018

Banking and Thrift [Abstract]

Aggregate Amounts of Annual Maturities of Time Deposits with Remaining Term of More Than One Year

At March 31, 2018, aggregate amounts of annual maturities of time deposits with a remaining term of more than one year are as follows:

Fiscal year ending March 31	Yen in millions
2020		39,058
2021		19,395
2022		9,120
2023		11,295
2024		9,736
Later fiscal years		19,203
Total		107,807

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Fair value measurements (Tables)

12 Months Ended

Mar. 31, 2018

Fair Value Disclosures [Abstract]

Fair Value of Assets and Liabilities Measured on Recurring Basis

The fair value of Sony’s assets and liabilities that are measured at fair value on a recurring basis at March 31, 2017 and 2018 are as follows:

	Yen in millions
	March 31, 2017
									Presentation in the consolidated balance sheets
	Level 1		Level 2		Level 3		Total		Marketable securities		Securities investments and other		Other current assets/ liabilities		Other noncurrent assets/ liabilities
Assets:
Trading securities		611,108		310,212		—		921,320		921,320		—		—		—
Available-for-sale securities
Debt securities
Japanese national government bonds		—		1,343,401		—		1,343,401		18,483		1,324,918		—		—
Japanese local government bonds		—		60,531		—		60,531		8,518		52,013		—		—
Japanese corporate bonds		—		168,493		1,310		169,803		8,433		161,370		—		—
Foreign government bonds*1		—		27,042		—		27,042		1,007		26,035		—		—
Foreign corporate bonds*2		—		358,369		41,177		399,546		86,708		312,838		—		—
Other*3		—		—		15,192		15,192		—		15,192		—		—
Equity securities		125,306		182		—		125,488		—		125,488		—		—
Other investments*4		6,589		4,525		10,483		21,597		—		21,597		—		—
Derivative assets*5		981		26,279		—		27,260		—		—		25,409		1,851
Total assets		743,984		2,299,034		68,162		3,111,180		1,044,469		2,039,451		25,409		1,851
Liabilities:
Derivative liabilities*5		520		33,930		—		34,450		—		—		15,743		18,707
Total liabilities		520		33,930		—		34,450		—		—		15,743		18,707

	Yen in millions
	March 31, 2018
									Presentation in the consolidated balance sheets
	Level 1		Level 2		Level 3		Total		Marketable securities		Securities investments and other		Other current assets/ liabilities		Other noncurrent assets/ liabilities
Assets:
Trading securities		712,113		335,949		—		1,048,062		1,048,062		—		—		—
Available-for-sale securities
Debt securities
Japanese national government bonds		—		1,409,610		—		1,409,610		20,473		1,389,137		—		—
Japanese local government bonds		—		67,569		—		67,569		8,548		59,021		—		—
Japanese corporate bonds		—		208,708		—		208,708		8,041		200,667		—		—
Foreign government bonds*1		—		69,539		—		69,539		—		69,539		—		—
Foreign corporate bonds*2		—		338,587		27,878		366,465		88,228		278,237		—		—
Other*3		—		15,736		83,614		99,350		—		99,350		—		—
Equity securities		126,330		293		—		126,623		—		126,623		—		—
Other investments*4		6,192		5,099		9,104		20,395		—		20,395		—		—
Derivative assets*5		2,194		37,332		—		39,526		—		—		37,003		2,523
Total assets		846,829		2,488,422		120,596		3,455,847		1,173,352		2,242,969		37,003		2,523
Liabilities:
Derivative liabilities*5		1,407		34,317		—		35,724		—		—		20,550		15,174
Total liabilities		1,407		34,317		—		35,724		—		—		20,550		15,174

*1 2,215 million yen and 2,875 million yen are included in foreign securities for which the fair value option has been elected and classified in level 2 for the fiscal years ended March 31, 2017 and 2018, respectively, and are included in the consolidated balance sheets as securities investments and other.

*2 165,236 million yen and 160,470 million yen are included in foreign securities for which the fair value option has been elected and classified in level 2 for the fiscal years ended March 31, 2017 and 2018, respectively. In the consolidated balance sheets, 32,167 million yen and 25,955 million yen are included as marketable securities and 133,069 million yen and 134,515 million yen are included as securities investment and other for the fiscal years ended March 31, 2017 and 2018, respectively.

*3 14,619 million yen and 93,971 million yen are included in foreign securities for which the fair value option has been elected and classified in level 2 and level 3 for the fiscal years ended March 31, 2017 and 2018, respectively, and are included in the consolidated balance sheets as securities investments and other.

*4 Other investments include certain hybrid financial instruments and certain private equity investments.

*5 Derivative assets and liabilities are recognized and disclosed on a gross basis.

*6 Net gains of 502 million yen and 544 million yen arising from financial instruments for which the fair value option has been elected are included in financial services revenue in the consolidated statements of income for the fiscal years ended March 31, 2017 and 2018, respectively.

Changes in Fair Value of Level Three Assets and Liabilities

The changes in fair value of level 3 assets and liabilities for the fiscal years ended March 31, 2017 and 2018 are as follows:

	Yen in millions
	Fiscal year ended March 31, 2017
	Assets
	Available-for-sale securities
	Debt securities
	Japanese corporate bonds			Foreign corporate bonds			Other			Other investments
Beginning balance		3,346			15,853			884			13,463
Total realized and unrealized gains (losses):
Included in earnings*1		—			1,091			514			328
Included in other comprehensive income (loss)*2		(20	)		(84	)		(1	)		(2,416	)
Purchases		—			35,335			14,026			247
Sales		—			—			—			—
Settlements		—			(10,021	)		(231	)		(1,139	)
Transfers into level 3*3		—			1,008			—			—
Transfers out of level 3*4		(2,016	)		(2,005	)		—			—
Ending balance		1,310			41,177			15,192			10,483
Changes in unrealized gains (losses) relating to instruments still held at reporting date:
Included in earnings*1		—			11			79			(27	)
	Yen in millions
	Fiscal year ended March 31, 2018
	Assets
	Available-for-sale securities
	Debt securities
	Japanese corporate bonds			Foreign corporate bonds			Other			Other investments
Beginning balance		1,310			41,177			15,192			10,483
Total realized and unrealized gains (losses):
Included in earnings*1		—			(307	)		(3,032	)		(65	)
Included in other comprehensive income (loss)*2		—			(84	)		1			(489	)
Purchases		—			12,604			74,736			139
Sales		—			—			—			(10	)
Settlements		—			(18,540	)		(3,283	)		(954	)
Transfers into level 3*3		—			—			—			—
Transfers out of level 3*4		(1,310	)		(6,972	)		—			—
Ending balance		—			27,878			83,614			9,104
Changes in unrealized gains (losses) relating to instruments still held at reporting date:
Included in earnings*1		—			(468	)		(2,278	)		(65	)

*1 Earning effects are included in financial services revenue in the consolidated statements of income.

*2 Unrealized gains (losses) are included in unrealized gains (losses) on securities in the consolidated statements of comprehensive income.

*3 Certain corporate bonds were transferred into level 3 because differences between the fair value determined by indicative quotes from dealers and the fair value determined by internally developed prices became significant and the observability of the inputs used decreased.

*4 Certain corporate bonds were transferred out of level 3 because observable market data became available.

Assets and Liabilities Remeasured at Fair Value on a Nonrecurring Basis

	During the fiscal year ended March 31, 2017
	Estimated fair value						Amounts included in earnings
	Level 1		Level 2		Level 3
Assets:
Long-lived assets impairments		—		—		72		(39,137	)
Goodwill impairments		—		—		0		(112,069	)
								(151,206	)
	During the fiscal year ended March 31, 2018
	Estimated fair value						Amounts included in earnings
	Level 1		Level 2		Level 3
Assets:
Long-lived assets impairments		—		—		19,375		(53,741	)
								(53,741	)

Estimated Fair Values by Fair Value Hierarchy Level of Certain Financial Instruments not Reported at Fair Value

The estimated fair values by fair value hierarchy level of certain financial instruments that are not reported at fair value are summarized as follows:

	Yen in millions
	March 31, 2017
	Estimated fair value								Carrying amount
	Level 1		Level 2		Level 3		Total		Total
Assets:
Housing loans in the banking business		—		1,603,784		—		1,603,784		1,449,790
Total assets		—		1,603,784		—		1,603,784		1,449,790
Liabilities:
Long-term debt including the current portion		—		745,599		—		745,599		734,886
Investment contracts included in policyholders’ account in the life insurance business		—		710,191		—		710,191		686,182
Total liabilities		—		1,455,790		—		1,455,790		1,421,068

	Yen in millions
	March 31, 2018
	Estimated fair value								Carrying amount
	Level 1		Level 2		Level 3		Total		Total
Assets:
Housing loans in the banking business		—		1,686,842		—		1,686,842		1,522,415
Total assets		—		1,686,842		—		1,686,842		1,522,415
Liabilities:
Long-term debt including the current portion		—		877,576		—		877,576		848,973
Investment contracts included in policyholders’ account in the life insurance business		—		766,558		—		766,558		738,404
Total liabilities		—		1,644,134		—		1,644,134		1,587,377

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Derivative instruments and hedging activities (Tables)

12 Months Ended

Mar. 31, 2018

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Estimated Fair Values by Fair Value Hierarchy Level of Certain Financial Instruments not Reported at Fair Value

The estimated fair values of Sony’s outstanding derivative instruments are summarized as follows:

Derivatives designated as hedging instruments	Yen in millions
	Balance sheet location	Fair value				Balance sheet location	Fair value
		March 31					March 31
	Asset derivatives	2017		2018		Liability derivatives	2017		2018
Interest rate contracts	Prepaid expenses and other current assets		43		12	Current liabilities: Other		497		160
Interest rate contracts	Other assets: Other		95		286	Liabilities: Other		13,713		10,281
Foreign exchange contracts	Prepaid expenses and other current assets		—		48	Current liabilities: Other		31		1,535
			138		346			14,241		11,976
Derivatives not designated as hedging instruments	Yen in millions
	Balance sheet location	Fair value				Balance sheet location	Fair value
		March 31					March 31
	Asset derivatives	2017		2018		Liability derivatives	2017		2018
Interest rate contracts	Prepaid expenses and other current assets		3		12	Current liabilities: Other		221		299
Interest rate contracts	Other assets: Other		1,599		1,871	Liabilities: Other		4,374		3,612
Foreign exchange contracts	Prepaid expenses and other current assets		24,382		34,737	Current liabilities: Other		14,475		17,149
Foreign exchange contracts	Other assets: Other		157		366	Liabilities: Other		620		1,281
Equity contracts	Prepaid expenses and other current assets		981		2,194	Current liabilities: Other		519		1,407
			27,122		39,180			20,209		23,748
Total derivatives			27,260		39,526			34,450		35,724

Effects of Derivative Instruments on Consolidated Statements of Income

Presented below are the effects of derivative instruments on the consolidated statements of income for the fiscal years ended March 31, 2016, 2017 and 2018.

Derivatives under fair value hedging relationships	Yen in millions
	Location of gain or (loss) recognized in income on derivative	Amount of gain or (loss) recognized in income on derivative
		Fiscal year ended March 31
		2016			2017			2018
Interest rate contracts	Financial services revenue		(8,300	)		1,967			(52	)
Foreign exchange contracts	Foreign exchange loss, net		3			(31	)		—
Total			(8,297	)		1,936			(52	)
	Yen in millions
Derivatives under cash flow hedging relationships	Location of gain or (loss) recognized in income on derivative	Fiscal year ended March 31
		2016			2017			2018
		Amount of gain or (loss) recognized in OCI on derivative
Foreign exchange contracts	—		1,914			6,715			(2,295	)
Total			1,914			6,715			(2,295	)
		Amount of gain or (loss) reclassified from accumulated OCI into income (effective portion)
Foreign exchange contracts	Foreign exchange loss, net		(8	)		—			—
Foreign exchange contracts	Cost of sales		(3,104	)		(5,583	)		1,111
Total			(3,112	)		(5,583	)		1,111

Derivatives not designated as hedging instruments	Yen in millions
	Location of gain or (loss) recognized in income on derivative	Amount of gain or (loss) recognized in income on derivative
		Fiscal year ended March 31
		2016			2017			2018
Interest rate contracts	Financial services revenue		(5,499	)		(935	)		(1,544	)
Foreign exchange contracts	Financial services revenue		4,166			(5,365	)		2,013
Foreign exchange contracts	Foreign exchange loss, net		(14,501	)		12,339			21,370
Equity contracts	Financial services revenue		3,267			(18,597	)		(11,665	)
Total			(12,567	)		(12,558	)		10,174

Summary of Derivatives Additional Information Including Notional Amounts

The following table summarizes additional information, including notional amounts, for each type of derivative:

	Yen in millions
	March 31, 2017					March 31, 2018
	Notional amount		Fair value			Notional amount		Fair value
Foreign exchange contracts:
Foreign exchange forward contracts		1,062,933		3,011			1,105,393		7,071
Currency option contracts purchased		212		1			206		1
Currency option contracts written		214		(1	)		156		(1	)
Currency swap agreements		1,439,395		4,074			1,230,254		4,613
Other currency contracts		64,944		2,328			84,623		3,502
Interest rate contracts:
Interest rate swap agreements		415,719		(17,065	)		398,291		(12,171	)
Equity contracts:
Equity future contracts		96,016		462			106,876		787

Summary of Effects of Offsetting Derivative Assets, Derivative Liabilities, Financial Assets and Financial Liabilities

Presented below are the effects of offsetting derivative assets, derivative liabilities, financial assets and financial liabilities as of March 31, 2017 and 2018.

	Yen in millions
	As of March 31, 2017
	Gross amounts presented in the consolidated balance sheet		Gross amounts not offset in the consolidated balance sheet that are subject to master netting agreements
			Financial instruments		Cash collateral		Net amounts
Derivative assets subject to master netting agreements		11,554		6,584		277		4,693
Derivative assets not subject to master netting agreements		15,706						15,706
Total assets		27,260		6,584		277		20,399
Derivative liabilities subject to master netting agreements		33,261		6,644		18,631		7,986
Derivative liabilities not subject to master netting agreements		1,189						1,189
Repurchase, securities lending and similar arrangements		310,609		309,987		—		622
Total liabilities		345,059		316,631		18,631		9,797
	Yen in millions
	As of March 31, 2018
	Gross amounts presented in the consolidated balance sheet		Gross amounts not offset in the consolidated balance sheet that are subject to master netting agreements
			Financial instruments		Cash collateral		Net amounts
Derivative assets subject to master netting agreements		15,404		7,724		449		7,231
Derivative assets not subject to master netting agreements		24,122						24,122
Total assets		39,526		7,724		449		31,353
Derivative liabilities subject to master netting agreements		34,455		8,326		14,334		11,795
Derivative liabilities not subject to master netting agreements		1,269						1,269
Repurchase, securities lending and similar arrangements		335,586		334,246		—		1,340
Total liabilities		371,310		342,572		14,334		14,404

XML

Pension and severance plans (Tables)

12 Months Ended

Mar. 31, 2018

Retirement Benefits [Abstract]

Components of Net Periodic Benefit Costs

The components of net periodic benefit costs for the fiscal years ended March 31, 2016, 2017 and 2018 were as follows:

Japanese plans:

	Yen in millions
	Fiscal year ended March 31
	2016			2017			2018
Service cost		24,670			26,811			25,185
Interest cost		8,689			5,912			8,024
Expected return on plan assets		(20,853	)		(17,829	)		(16,440	)
Recognized actuarial loss		8,588			20,436			16,099
Amortization of prior service costs		(9,489	)		(9,490	)		(8,693	)
Net periodic benefit costs		11,605			25,840			24,175

Foreign plans:

	Yen in millions
	Fiscal year ended March 31
	2016			2017			2018
Service cost		3,504			2,958			3,181
Interest cost		12,096			10,426			10,393
Expected return on plan assets		(14,117	)		(11,000	)		(11,687	)
Amortization of net transition asset		10			9			5
Recognized actuarial loss		4,236			2,552			3,014
Amortization of prior service costs		(478	)		(463	)		(574	)
Losses on curtailments and settlements		354			43			1,058
Net periodic benefit costs		5,605			4,525			5,390

Changes in Benefit Obligation and Plan Assets as well as Funded Status and Composition of Amounts Recognized in Consolidated Balance Sheets

The changes in the benefit obligation and plan assets as well as the funded status and composition of amounts recognized in the consolidated balance sheets were as follows:

	Japanese plans						Foreign plans
	Yen in millions						Yen in millions
	March 31						March 31
	2017			2018			2017			2018
Change in benefit obligation:
Benefit obligation at beginning of the fiscal year		1,034,284			1,004,676			356,875			352,442
Service cost		26,811			25,185			2,958			3,181
Interest cost		5,912			8,024			10,426			10,393
Plan participants’ contributions		—			—			490			573
Actuarial (gain) loss		(33,333	)		21,920			20,045			663
Foreign currency exchange rate changes		—			—			(23,183	)		8,858
Curtailments and settlements		—			—			(1,507	)		(5,422	)
Other		(5	)		(8	)		—			—
Benefits paid		(28,993	)		(49,223	)		(13,662	)		(14,291	)
Benefit obligation at end of the fiscal year		1,004,676			1,010,574			352,442			356,397
Change in plan assets:
Fair value of plan assets at beginning of the fiscal year		679,432			699,008			256,341			259,177
Actual return on plan assets		35,508			38,896			29,346			13,426
Foreign currency exchange rate changes		—			—			(20,004	)		6,181
Employer contribution		6,640			6,090			6,738			9,040
Plan participants’ contributions		—			—			490			573
Curtailments and settlements		—			—			(1,161	)		(5,285	)
Benefits paid		(22,572	)		(32,917	)		(12,573	)		(13,367	)
Fair value of plan assets at end of the fiscal year		699,008			711,077			259,177			269,745
Funded status at end of the fiscal year		(305,668	)		(299,497	)		(93,265	)		(86,652	)

Amounts Recognized in Consolidated Balance Sheets

Amounts recognized in the consolidated balance sheets consist of:

	Japanese plans						Foreign plans
	Yen in millions						Yen in millions
	March 31						March 31
	2017			2018			2017			2018
Noncurrent assets		2,753			3,426			6,251			8,396
Current liabilities		—			—			(3,114	)		(4,121	)
Noncurrent liabilities		(308,421	)		(302,923	)		(96,402	)		(90,927	)
Ending balance		(305,668	)		(299,497	)		(93,265	)		(86,652	)

Amounts Recognized in Accumulated Other Comprehensive Income, Excluding Tax Effect

Amounts recognized in accumulated other comprehensive income, excluding tax effects, consist of:
	Japanese plans						Foreign plans
	Yen in millions						Yen in millions
	March 31						March 31
	2017			2018			2017			2018
Prior service cost (credit)		(25,415	)		(16,723	)		(1,034	)		(488	)
Net actuarial loss		317,397			299,852			78,548			73,404
Obligation existing at transition		—			—			(3	)		0
Ending balance		291,982			283,129			77,511			72,916

Accumulated Benefit Obligations for All Defined Benefit Pension Plans

The accumulated benefit obligations for all defined benefit pension plans were as follows:

	Japanese plans				Foreign plans
	Yen in millions				Yen in millions
	March 31				March 31
	2017		2018		2017		2018
Accumulated benefit obligations		998,501		1,005,557		329,989		340,353

Projected Benefit Obligations, Accumulated Benefit Obligations and Fair Value of Plan Assets for Pension Plans with Accumulated Benefit Obligations in Excess of Plan Assets

The projected benefit obligations, the accumulated benefit obligations and fair value of plan assets for pension plans with accumulated benefit obligations in excess of plan assets were as follows:

	Japanese plans				Foreign plans
	Yen in millions				Yen in millions
	March 31				March 31
	2017		2018		2017		2018
Projected benefit obligations		992,052		998,629		291,413		301,046
Accumulated benefit obligations		987,428		993,612		287,491		293,834
Fair value of plan assets		685,183		695,706		207,406		215,510

Weighted-Average Assumptions Used to Determine Benefit Obligations and Net Periodic Benefit Costs

Weighted-average assumptions used to determine benefit obligations as of March 31, 2017 and 2018 were as follows:

	Japanese plans						Foreign plans
	March 31						March 31
	2017			2018			2017			2018
Discount rate		0.9	%		0.8	%		3.1	%		2.9	%
Rate of compensation increase		*			*			2.4			2.6

* Substantially all of Sony’s Japanese pension plans were point-based. Point-based plans do not incorporate a measure of compensation rate increases.

Weighted-average assumptions used to determine the net periodic benefit costs for the fiscal years ended March 31, 2016, 2017 and 2018 were as follows:

	Japanese plans									Foreign plans
	Fiscal year ended March 31									Fiscal year ended March 31
	2016			2017			2018			2016			2017			2018
Discount rate		1.0	%		0.6	%		0.9	%		3.1	%		3.2	%		3.1	%
Expected return on plan assets		3.0			2.7			2.4			4.8			4.8			4.6
Rate of compensation increase		*			*			*			2.9			2.8			2.4

* Substantially all of Sony’s Japanese pension plans were point-based. Point-based plans do not incorporate a measure of compensation rate increases.

Fair Values of Assets Held by Japanese and Foreign Plans

The fair values of the assets held by Japanese and foreign plans, which are classified in accordance with the fair value hierarchy described in Note 2, are as follows:

	Japanese plans
	Yen in millions
	Fair value at March 31, 2017		Fair value measurements using inputs considered as
Asset class			Level 1		Level 2		Level 3
Cash and cash equivalents		7,976		7,976		—		—
Equity:
Equity securities*1		157,012		152,852		4,160		—
Fixed income:
Government bonds*2		206,632		—		206,632		—
Corporate bonds*3		75,971		—		75,971		—
Asset-backed securities*4		1,105		—		1,105		—
Commingled funds*5		122,264		—		122,264		—
Commodity funds*6		21,098		—		21,098		—
Private equity*7		21,790		—		—		21,790
Hedge funds*8		67,235		—		—		67,235
Real estate and other*9		17,925		—		—		17,925
Total		699,008		160,828		431,230		106,950

	Japanese plans
	Yen in millions
	Fair value at March 31, 2018		Fair value measurements using inputs considered as
Asset class			Level 1		Level 2		Level 3
Cash and cash equivalents		9,446		9,446		—		—
Equity:
Equity securities*1		138,443		134,091		4,352		—
Fixed income:
Government bonds*2		225,879		—		225,879		—
Corporate bonds*3		79,323		—		79,323		—
Asset-backed securities*4		121		—		121		—
Commingled funds*5		122,950		—		122,950		—
Commodity funds*6		21,136		—		21,136		—
Private equity*7		24,144		—		—		24,144
Hedge funds*8		70,204		—		—		70,204
Real estate and other*9		19,431		—		—		19,431
Total		711,077		143,537		453,761		113,779

*1 Includes approximately 48 percent and 52 percent of Japanese equity securities, and 52 percent and 48 percent of foreign equity securities for the fiscal years ended March 31, 2017 and 2018, respectively.

*2 Includes approximately 46 percent and 49 percent of debt securities issued by Japanese national and local governments, and 54 percent and 51 percent of debt securities issued by foreign national and local governments for the fiscal years ended March 31, 2017 and 2018, respectively.

*3 Includes debt securities issued by Japanese and foreign corporation and government related agencies.

*4 Includes primarily mortgage-backed securities.

*5 Commingled funds represent pooled institutional investments, including primarily investment trusts. They include approximately 48 percent and 51 percent of investments in equity, 51 percent and 48 percent of investments in fixed income, and 1 percent and 1 percent of investments in other for the fiscal years ended March 31, 2017 and 2018, respectively.

*6 Represents commodity futures funds.

*7 Includes multiple private equity funds of funds that primarily invest in venture, buyout, and distressed markets in the U.S. and Europe.

*8 Includes primarily funds that invest in a portfolio of a broad range of hedge funds to diversify the risks and reduce the volatilities associated with a single hedge fund.

*9 Includes primarily private real estate investment trusts.

	Foreign plans
	Yen in millions
	Fair value at March 31, 2017		Fair value measurements using inputs considered as
Asset class			Level 1		Level 2		Level 3
Cash and cash equivalents		8,091		8,091		—		—
Equity:
Equity securities*1		33,103		31,783		1,320		—
Fixed income:
Government bonds*2		65,671		—		65,671		—
Corporate bonds*3		28,296		—		21,370		6,926
Asset-backed securities		982		—		982		—
Insurance contracts*4		5,135		—		5,135		—
Commingled funds*5		81,683		—		81,683		—
Real estate and other*6		36,216		—		13,287		22,929
Total		259,177		39,874		189,448		29,855

	Foreign plans
	Yen in millions
	Fair value at March 31, 2018		Fair value measurements using inputs considered as
Asset class			Level 1		Level 2		Level 3
Cash and cash equivalents		2,377		2,377		—		—
Equity:
Equity securities*1		30,916		29,814		1,102		—
Fixed income:
Government bonds*2		78,129		—		78,129		—
Corporate bonds*3		26,424		—		21,121		5,303
Asset-backed securities		960		—		960		—
Insurance contracts*4		18,670		—		5,941		12,729
Commingled funds*5		75,785		—		75,785		—
Real estate and other*6		36,484		—		10,508		25,976
Total		269,745		32,191		193,546		44,008

*1 Includes primarily foreign equity securities.

*2 Includes primarily foreign government debt securities.

*3 Includes primarily foreign corporate debt securities.

*4 Represents annuity contracts with or without profit sharing.

*5 Commingled funds represent pooled institutional investments including mutual funds, common trust funds, and collective investment funds. They are primarily comprised of foreign equities and fixed income investments.

*6 Includes primarily private real estate investment trusts.

Summary of Changes in Fair Values of Japanese and Foreign Plans' Level Three Assets

The following table sets forth a summary of changes in the fair values of Japanese and foreign plans’ level 3 assets for the fiscal years ended March 31, 2017 and 2018:

	Japanese plans
	Yen in millions
	Fair value measurement using significant unobservable inputs (Level 3)
	Private equity			Hedge funds		Real estate     and other		Total
Beginning balance at April 1, 2016		31,852			60,395		7,315		99,562
Return on assets held at end of year		425			2,817		599		3,841
Purchases, sales, and settlements, net		(10,487	)		4,023		10,011		3,547
Ending balance at March 31, 2017		21,790			67,235		17,925		106,950
Return on assets held at end of year		1,483			636		425		2,544
Purchases, sales, and settlements, net		871			2,333		1,081		4,285
Ending balance at March 31, 2018		24,144			70,204		19,431		113,779

	Foreign plans
	Yen in millions
	Fair value measurement using significant unobservable inputs (Level 3)
	Insurance contracts		Corporate bonds			Real estate and other			Total
Beginning balance at April 1, 2016		—		7,000			24,124			31,124
Return on assets held at end of year		—		—			84			84
Purchases, sales, and settlements, net		—		(44	)		(367	)		(411	)
Transfers, net		—		—			(8	)		(8	)
Other*		—		(30	)		(904	)		(934	)
Ending balance at March 31, 2017		—		6,926			22,929			29,855
Return on assets held at end of year		—		—			1,101			1,101
Purchases, sales, and settlements, net		12,651		(1,256	)		12			11,407
Transfers, net		—		—			1,181			1,181
Other*		78		(367	)		753			464
Ending balance at March 31, 2018		12,729		5,303			25,976			44,008

* Primarily consists of translation adjustments.

Expected Future Benefit Payments

The expected future benefit payments are as follows:

	Japanese plans		Foreign plans
Fiscal year ending March 31	Yen in millions		Yen in millions
2019		39,918		14,889
2020		40,328		15,039
2021		41,233		16,133
2022		42,609		16,689
2023		43,772		17,830
2024 — 2028		232,325		102,045

Total Defined Contribution Expenses

Total defined contribution expenses for the fiscal years ended March 31, 2016, 2017 and 2018 were as follows:

	Yen in millions
	Fiscal year ended March 31
	2016		2017		2018
Japanese plans		3,155		3,412		3,237
Foreign plans		12,419		10,458		11,379

XML

Stockholders' equity (Tables)

12 Months Ended

Mar. 31, 2018

Equity [Abstract]

Changes in Number of Shares of Common Stock Issued and Outstanding

Changes in the number of shares of common stock issued and outstanding during the fiscal years ended March 31, 2016, 2017 and 2018 have resulted from the following:

	Number of shares
Balance at March 31, 2015		1,169,773,260
Issuance of new shares		92,000,000
Exercise of stock acquisition rights		720,500
Balance at March 31, 2016		1,262,493,760
Exercise of stock acquisition rights		1,269,900
Balance at March 31, 2017		1,263,763,660
Issuance of new shares		218,000
Exercise of stock acquisition rights		2,565,700
Conversion of convertible bonds		4,789
Balance at March 31, 2018		1,266,552,149

Changes in Accumulated Other Comprehensive Income, Net of Tax

Changes in accumulated other comprehensive income, net of tax, by component for the fiscal years ended March 31, 2016, 2017 and 2018 were as follows:

	Yen in millions
	Unrealized gains (losses) on securities			Unrealized gains (losses) on derivative instruments			Pension liability adjustment			Foreign currency translation adjustments			Total
Balance at March 31, 2015		154,153			—			(201,131	)		(338,305	)		(385,283	)
Other comprehensive income before reclassifications		45,527			1,914			(174,380	)		(83,899	)		(210,838	)
Amounts reclassified out of accumulated other comprehensive income		(43,307	)		(3,112	)		2,627			—			(43,792	)
Net other comprehensive income		2,220			(1,198	)		(171,753	)		(83,899	)		(254,630	)
Less: Other comprehensive income attributable to noncontrolling interests		15,637			—			(1,145	)		(1,087	)		13,405
Balance at March 31, 2016		140,736			(1,198	)		(371,739	)		(421,117	)		(653,318	)

	Yen in millions
	Unrealized gains (losses) on securities			Unrealized gains (losses) on derivative instruments			Pension liability adjustment			Foreign currency translation adjustments			Total
Balance at March 31, 2016		140,736			(1,198	)		(371,739	)		(421,117	)		(653,318	)
Other comprehensive income before reclassifications		(27,007	)		5,028			54,513			(17,988	)		14,546
Amounts reclassified out of accumulated other comprehensive income		(3,286	)		(3,888	)		8,719			—			1,545
Net other comprehensive income		(30,293	)		1,140			63,232			(17,988	)		16,091
Less: Other comprehensive income attributable to noncontrolling interests		(16,192	)		—			229			(2,495	)		(18,458	)
Balance at March 31, 2017		126,635			(58	)		(308,736	)		(436,610	)		(618,769	)
	Yen in millions
	Unrealized gains (losses) on securities			Unrealized gains (losses) on derivative instruments			Pension liability adjustment			Foreign currency translation adjustments			Total
Balance at March 31, 2017		126,635			(58	)		(308,736	)		(436,610	)		(618,769	)
Other comprehensive income before reclassifications		2,013			(2,295	)		1,779			(4,480	)		(2,983	)
Amounts reclassified out of accumulated other comprehensive income*1		(943	)		1,111			10,611			(1,855	)		8,924
Net other comprehensive income		1,070			(1,184	)		12,390			(6,335	)		5,941
Less: Other comprehensive income attributable to noncontrolling interests		1,514			—			98			2,306			3,918
Balance at March 31, 2018		126,191			(1,242	)		(296,444	)		(445,251	)		(616,746	)

*1 Foreign currency translation adjustments were transferred from accumulated other comprehensive income to net income as a result of a complete or substantially complete liquidation or sale of certain foreign subsidiaries and affiliates.

Reclassifications Out of Accumulated Other Comprehensive Income

Reclassifications out of accumulated other comprehensive income for the fiscal years ended March 31, 2016, 2017 and 2018 were as follows:

	Yen in millions
Comprehensive income components	Amounts reclassified from accumulated other comprehensive income									Affected line items in consolidated statements of income
	2016			2017			2018
Unrealized gains (losses) on securities		(19,598	)		(4,560	)		(646	)	Financial services revenue
		(47,087	)		(30	)		(561	)	Gain on sale of securities investments, net
		3,063			—			—		Loss on devaluation of securities investments
Total before tax		(63,622	)		(4,590	)		(1,207	)
Tax expense or (benefit)		20,315			1,304			264
Net of tax		(43,307	)		(3,286	)		(943	)
Unrealized gains (losses) on derivative instruments		(8	)		—			—		Foreign exchange loss, net
		(3,104	)		(5,583	)		1,111		Cost of sales
Total before tax		(3,112	)		(5,583	)		1,111
Tax expense or (benefit)		—			1,695			—
Net of tax		(3,112	)		(3,888	)		1,111
Pension liability adjustment		2,867			13,044			11,034		*
Tax expense or (benefit)		(240	)		(4,325	)		(423	)
Net of tax		2,627			8,719			10,611
Foreign currency translation adjustments		—			—			(1,855	)	Other operating expense, net
Tax expense or (benefit)		—			—			—
Net of tax		—			—			(1,855	)
Total amounts reclassified out of accumulated other comprehensive income, net of tax		(43,792	)		1,545			8,924

* The amortization of pension and postretirement benefit components are included in the computation of net periodic pension cost. Refer to Note 15.

Net Income Attributable to Sony Corporation's Stockholders and Transfers (to) from Noncontrolling Interests

Net income attributable to Sony Corporation’s stockholders and transfers (to) from the noncontrolling interests for the fiscal years ended March 31, 2016, 2017 and 2018 were as follows:

	Yen in millions
	Fiscal year ended March 31
	2016			2017			2018
Net income attributable to Sony Corporation’s stockholders		147,791			73,289			490,794
Transfers (to) from the noncontrolling interests:
Decrease in additional paid-in capital for purchase of additional shares in consolidated subsidiaries		(12,776	)		(53,927	)		(74	)
Change from net income attributable to Sony Corporation’s stockholders and transfers (to) from the noncontrolling interests		135,015			19,362			490,720

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Stock-based compensation plans (Tables)

12 Months Ended

Mar. 31, 2018

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Weighted-Average Assumptions used to Determine Fair Value of Stock Acquisition Rights Granted

The fair value of stock acquisition rights granted on the date of grant and used to recognize compensation expense for the fiscal years ended March 31, 2016, 2017 and 2018 was estimated using the Black-Scholes option-pricing model with the following weighted-average assumptions:

	Fiscal year ended March 31
	2016			2017			2018
Weighted-average assumptions
Risk-free interest rate		1.07%			1.10%			1.14%
Expected lives		7.12 y	ears		6.83 y	ears		6.55 y	ears
Expected volatility*		42.07%			40.00%			38.49%
Expected dividends		0.75%			0.66%			0.40%

* Expected volatility was based on the historical volatilities of Sony Corporation’s common stock over the expected life of the stock acquisition rights.

Summary of Activities Regarding Stock Acquisition Rights Plan

A summary of the activities regarding the stock acquisition rights plan during the fiscal year ended March 31, 2018 is as follows:

	Fiscal year ended March 31, 2018
	Number of shares		Weighted- average exercise price		Weighted- average remaining life		Total intrinsic value
			Yen		Years		Yen in millions
Outstanding at beginning of the fiscal year		15,519,400		3,147
Granted		2,978,900		4,297
Exercised		2,565,700		2,778
Forfeited or expired		1,926,700		4,864
Outstanding at end of the fiscal year		14,005,900		3,017		6.53		25,910
Exercisable at end of the fiscal year		7,905,100		2,653		4.61		19,647

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Restructuring charges (Tables)

12 Months Ended

Mar. 31, 2018

Restructuring and Related Activities [Abstract]

Changes in Accrued Restructuring Charges

The changes in the accrued restructuring charges for the fiscal years ended March 31, 2016, 2017 and 2018 are as follows:

	Yen in millions
	Employee termination benefits			Non-cash write-downs and disposals, net*			Other associated costs			Total
Balance at March 31, 2015		36,721			—			14,196			50,917
Restructuring costs		27,401			1,828			7,298			36,527
Non-cash charges		—			(1,828	)		—			(1,828	)
Cash payments		(40,261	)		—			(11,232	)		(51,493	)
Adjustments		(1,330	)		—			1,473			143
Balance at March 31, 2016		22,531			—			11,735			34,266
Restructuring costs		9,854			42,717			7,142			59,713
Non-cash charges		—			(42,717	)		—			(42,717	)
Cash payments		(19,759	)		—			(8,871	)		(28,630	)
Adjustments		(992	)		—			(839	)		(1,831	)
Balance at March 31, 2017		11,634			—			9,167			20,801
Restructuring costs		18,999			2,233			1,147			22,379
Non-cash charges		—			(2,233	)		—			(2,233	)
Cash payments		(9,950	)		—			(6,352	)		(16,302	)
Adjustments		(1,197	)		—			226			(971	)
Balance at March 31, 2018		19,486			—			4,188			23,674

* Significant asset impairments excluded from restructuring charges are described in Note 13.

Total Costs Incurred in Connection with Restructuring Programs by Segment

Total costs incurred in connection with these restructuring programs by segment for the fiscal years ended March 31, 2016, 2017 and 2018 are as follows:

	Yen in millions
	Fiscal year ended March 31, 2016
	Employee termination benefits			Other associated costs*			Total net restructuring charges			Depreciation associated with restructured assets		Total
Game & Network Services		15			120			135			—		135
Music		1,501			367			1,868			—		1,868
Pictures		1,594			7			1,601			5		1,606
Home Entertainment & Sound		1,181			26			1,207			—		1,207
Imaging Products & Solutions		78			126			204			—		204
Mobile Communications		17,259			3,669			20,928			710		21,638
Semiconductors		(11	)		(102	)		(113	)		—		(113	)
Financial Services		—			—			—			—		—
All Other and Corporate		5,784			4,913			10,697			1,017		11,714
Total		27,401			9,126			36,527			1,732		38,259

	Yen in millions
	Fiscal year ended March 31, 2017
	Employee termination benefits		Other associated costs*			Total net restructuring charges			Depreciation associated with restructured assets		Total
Game & Network Services		225		6			231			—		231
Music		2,116		1,474			3,590			—		3,590
Pictures		2,467		—			2,467			—		2,467
Home Entertainment & Sound		68		684			752			—		752
Imaging Products & Solutions		563		77			640			—		640
Mobile Communications		516		172			688			138		826
Semiconductors		4		(13	)		(9	)		—		(9	)
Financial Services		—		—			—			—		—
All Other and Corporate		3,895		47,459			51,354			364		51,718
Total		9,854		49,859			59,713			502		60,215

	Yen in millions
	Fiscal year ended March 31, 2018
	Employee termination benefits		Other associated costs*		Total net restructuring charges		Depreciation associated with restructured assets		Total
Game & Network Services		—		—		—		—		—
Music		6,358		272		6,630		—		6,630
Pictures		2,922		—		2,922		—		2,922
Home Entertainment & Sound		846		6		852		—		852
Imaging Products & Solutions		530		94		624		—		624
Mobile Communications		2,008		18		2,026		0		2,026
Semiconductors		28		—		28		—		28
Financial Services		—		—		—		—		—
All Other and Corporate		6,307		2,990		9,297		26		9,323
Total		18,999		3,380		22,379		26		22,405

* Other associated costs includes non-cash write-downs and disposals, net

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Supplemental consolidated statements of income information (Tables)

12 Months Ended

Mar. 31, 2018

Other Income and Expenses [Abstract]

Components of Other Operating Expense, Net

Other operating expense, net is comprised of the following:

	Yen in millions
	March 31
	2016			2017			2018
Gain on sale of the U.S. headquarters building*1		(6,545	)		—			—
Gain on sale of Sony City Osaki*1		(4,914	)		(4,914	)		(4,914	)
Gain on sale and issuance of M3 shares*2		(2	)		(37,167	)		(18	)
(Gain) loss on purchase/sale of interests in subsidiaries and affiliates, net*3		(31,778	)		(4,259	)		(29,595	)
(Gain) loss on sale, disposal or impairment of assets, net*4		90,410			195,341			38,599
		47,171			149,001			4,072

*1 A portion of gain on sale and leaseback transactions is deferred and is amortized on a straight-line basis over the lease term.

*2 Refer to Note 5.

*3 Refer to Notes 24 and 25.

*4 Refer to Notes 9, 13, 19 and 25.

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Income taxes (Tables)

12 Months Ended

Mar. 31, 2018

Income Tax Disclosure [Abstract]

Components of Domestic and Foreign Income and Provision for Current and Deferred Income Taxes

Domestic and foreign components of income before income taxes and the provision for current and deferred income taxes attributable to such income are summarized as follows:

	Yen in millions
	Fiscal year ended March 31
	2016			2017		2018
Income before income taxes:
Sony Corporation and all subsidiaries in Japan		149,256			166,158		436,494
Foreign subsidiaries		155,248			85,461		262,555
		304,504			251,619		699,049
Income taxes — Current:
Sony Corporation and all subsidiaries in Japan		41,080			49,739		69,697
Foreign subsidiaries		53,498			50,521		57,988
		94,578			100,260		127,685
Income taxes — Deferred:
Sony Corporation and all subsidiaries in Japan		(1,745	)		11,478		29,640
Foreign subsidiaries		1,956			12,320		(5,555	)
		211			23,798		24,085
Total income tax expense		94,789			124,058		151,770

Reconciliation of Statutory Tax Rate and Effective Tax Rate

A reconciliation of the differences between the Japanese statutory tax rate and the effective tax rate is as follows:

	Fiscal year ended March 31
	2016			2017			2018
Statutory tax rate		33.6	%		31.7	%		31.5	%
Non-deductible expenses		1.6			2.3			0.8
Income tax credits		(2.0	)		(2.9	)		(0.6	)
Change in statutory tax rate and law		(3.3	)		0.3			(1.2	)
Change in valuation allowances		10.7			7.3			(5.2	)
Change in deferred tax liabilities on undistributed earnings of foreign subsidiaries and corporate joint ventures		(0.8	)		(1.4	)		(0.8	)
Lower tax rate applied to life and non-life insurance business in Japan		(2.3	)		(2.2	)		(0.8	)
Foreign income tax differential		(6.9	)		(3.0	)		(2.6	)
Adjustments to tax reserves		0.7			(1.1	)		(0.8	)
Effect of equity in net income of affiliated companies		0.0			0.0			0.0
Impairment of goodwill in the Pictures segment		—			15.0			—
Other		(0.2	)		3.3			1.4
Effective income tax rate		31.1	%		49.3	%		21.7	%

Components of Deferred Tax Assets and Liabilities

The significant components of deferred tax assets and liabilities are as follows:

	Yen in millions
	March 31
	2017			2018
Deferred tax assets:
Operating loss carryforwards for tax purposes		455,555			439,206
Accrued pension and severance costs		112,075			106,161
Amortization including film costs		181,243			95,069
Warranty reserves and accrued expenses		110,475			104,410
Future insurance policy benefits		30,884			33,812
Inventory		16,322			15,792
Depreciation		47,485			43,353
Tax credit carryforwards		134,427			125,327
Reserve for doubtful accounts		10,887			8,534
Impairment of investments		52,451			14,146
Deferred revenue		27,294			14,478
Other		158,420			132,800
Gross deferred tax assets		1,337,518			1,133,088
Less: Valuation allowance		(1,051,964	)		(899,835	)
Total deferred tax assets		285,554			233,253
Deferred tax liabilities:
Insurance acquisition costs		(160,308	)		(166,717	)
Future insurance policy benefits		(147,159	)		(167,058	)
Unbilled accounts receivable in the Pictures segment		(113,997	)		(63,196	)
Unrealized gains on securities		(78,643	)		(83,298	)
Intangible assets acquired through stock exchange offerings		(23,794	)		(23,949	)
Undistributed earnings of foreign subsidiaries and corporate joint ventures		(26,473	)		(14,160	)
Investment in M3		(34,775	)		(35,802	)
Other		(34,271	)		(32,164	)
Gross deferred tax liabilities		(619,420	)		(586,344	)
Net deferred tax liabilities		(333,866	)		(353,091	)

Reconciliation of Beginning and Ending Gross Amounts of Unrecognized Tax Benefits

A reconciliation of the beginning and ending gross amounts of unrecognized tax benefits is as follows:

	Yen in millions
	March 31
	2016			2017			2018
Balance at beginning of the fiscal year		165,434			114,126			119,529
Reductions for tax positions of prior years		(34,261	)		(558	)		(8,809	)
Additions for tax positions of prior years		6,253			13,353			4,681
Additions based on tax positions related to the current year		4,299			8,231			5,740
Settlements		(12,556	)		(8,300	)		(21,893	)
Lapse in statute of limitations		(8,229	)		(3,454	)		(3,469	)
Foreign currency translation adjustments		(6,814	)		(3,869	)		(354	)
Balance at end of the fiscal year		114,126			119,529			95,425
Total net amount of unrecognized tax benefits that, if recognized, would affect the effective tax rate		49,323			45,987			39,308

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Reconciliation of the differences between basic and diluted EPS (Tables)

12 Months Ended

Mar. 31, 2018

Earnings Per Share [Abstract]

Reconciliation of Differences between Basic and Diluted EPS

Reconciliation of the differences between basic and diluted EPS for the fiscal years ended March 31, 2016, 2017 and 2018 is as follows:

	Yen in millions
	Fiscal year ended March 31
	2016		2017		2018
Net income attributable to Sony Corporation’s stockholders for basic and diluted EPS computation		147,791		73,289		490,794
	Thousands of shares
Weighted-average shares outstanding		1,237,802		1,262,023		1,263,895
Effect of dilutive securities:
Stock acquisition rights		2,109		2,358		4,565
Zero coupon convertible bonds		17,972		23,962		23,960
Weighted-average shares for diluted EPS computation		1,257,883		1,288,343		1,292,420
	Yen
Basic EPS		119.40		58.07		388.32
Diluted EPS		117.49		56.89		379.75

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Commitments, contingent liabilities and other (Tables)

12 Months Ended

Mar. 31, 2018

Commitments and Contingencies Disclosure [Abstract]

Schedule of Aggregate Amounts of Year-by-Year Payment of Purchase Commitments

The schedule of the aggregate amounts of year-by-year payment of purchase commitments during the next five fiscal years and thereafter is as follows:

Fiscal year ending March 31	Yen in millions
2019		211,713
2020		85,755
2021		25,249
2022		17,212
2023		12,014
Later fiscal years		16,048
Total		367,991

Changes in Product Warranty Liability

The changes in the product warranty liability for the fiscal years ended March 31, 2016, 2017 and 2018 are as follows:

	Yen in millions
	Fiscal year ended March 31
	2016			2017			2018
Balance at beginning of the fiscal year		75,129			66,943			60,798
Additional liabilities for warranties		83,227			53,502			34,557
Settlements (in cash or in kind)		(81,462	)		(49,532	)		(32,549	)
Changes in estimate for pre-existing warranty reserve		(6,440	)		(7,927	)		(16,888	)
Translation adjustment		(3,511	)		(2,188	)		2,234
Balance at end of the fiscal year		66,943			60,798			48,152

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Business segment information (Tables)

12 Months Ended

Mar. 31, 2018

Segment Reporting [Abstract]

Components of Segment Sales and Operating Revenue

Segment sales and operating revenue:

	Yen in millions
	Fiscal year ended March 31
	2016			2017			2018
Sales and operating revenue:
Game & Network Services —
Customers		1,479,775			1,581,568			1,848,298
Intersegment		72,118			68,231			95,514
Total		1,551,893			1,649,799			1,943,812
Music —
Customers		602,564			630,767			784,792
Intersegment		16,675			16,891			15,203
Total		619,239			647,658			799,995
Pictures —
Customers		935,827			901,230			1,010,173
Intersegment		2,315			1,899			894
Total		938,142			903,129			1,011,067
Home Entertainment & Sound —
Customers		1,155,085			1,034,215			1,221,734
Intersegment		3,957			4,789			999
Total		1,159,042			1,039,004			1,222,733
Imaging Products & Solutions —
Customers		677,231			571,499			647,163
Intersegment		6,724			8,134			8,729
Total		683,955			579,633			655,892
Mobile Communications —
Customers		1,121,925			752,688			713,916
Intersegment		5,548			6,457			9,826
Total		1,127,473			759,145			723,742
Semiconductors —
Customers		599,430			659,779			726,892
Intersegment		139,629			113,344			123,118
Total		739,059			773,123			850,010
Financial Services —
Customers		1,066,319			1,080,284			1,221,235
Intersegment		6,750			7,220			7,142
Total		1,073,069			1,087,504			1,228,377
All Other —
Customers		435,668			375,116			351,527
Intersegment		104,526			75,334			55,647
Total		540,194			450,450			407,174
Corporate and elimination		(326,354	)		(286,195	)		(298,820	)
Consolidated total		8,105,712			7,603,250			8,543,982

G&NS intersegment amounts primarily consist of transactions with All Other. Semiconductors intersegment amounts primarily consist of transactions with the MC segment, the G&NS segment and the IP&S segment. All Other intersegment amounts primarily consist of transactions with the Pictures segment, the Music segment and the G&NS segment. Corporate and elimination includes certain brand and patent royalty income.

Segment profit or loss:

	Yen in millions
	Fiscal year ended March 31
	2016			2017			2018
Operating income (loss):
Game & Network Services		88,668			135,553			177,478
Music		86,509			75,798			127,786
Pictures		38,507			(80,521	)		41,110
Home Entertainment & Sound		50,558			58,504			85,841
Imaging Products & Solutions		69,320			47,257			74,924
Mobile Communications		(61,435	)		10,164			(27,636	)
Semiconductors		14,500			(7,811	)		164,023
Financial Services		156,543			166,424			178,947
All Other		(41,252	)		(29,585	)		(23,530	)
Total		401,918			375,783			798,943
Corporate and elimination		(107,721	)		(87,081	)		(64,083	)
Consolidated operating income		294,197			288,702			734,860
Other income		66,849			14,418			23,728
Other expenses		(56,542	)		(51,501	)		(59,539	)
Consolidated income before income taxes		304,504			251,619			699,049

Operating income (loss) is sales and operating revenue less costs and expenses, and includes equity in net income (loss) of affiliated companies.

Corporate and elimination includes headquarters restructuring costs and certain other corporate expenses, including the amortization of certain intellectual property assets such as the cross-licensing of intangible assets acquired from Ericsson at the time of the Sony Mobile Communications acquisition, which are not allocated to segments.

Pursuant to a separation of Sony’s businesses into distinct subsidiaries and a realignment of corporate functions, changes have been made to the method of calculating the amount of pension and severance-related expenses allocated to Sony’s headquarters and each business segment. As a result of these changes, an increase in corporate costs totaling 7.5 billion yen is included in Corporate and elimination for the fiscal year ended March 31, 2018. Conversely, a decrease in expenses totaling the same amount is included in each business segment, mainly in the Semiconductors (3.2 billion yen) and IP&S (2.0 billion yen) segments. These changes have no impact on consolidated operating income.

Other significant items:

	Yen in millions
	Fiscal year ended March 31
	2016			2017			2018
Equity in net income (loss) of affiliated companies:
Game & Network Services		—			—			—
Music		3,801			5,435			4,483
Pictures		(981	)		(35	)		(129	)
Home Entertainment & Sound		—			—			—
Imaging Products & Solutions		—			—			—
Mobile Communications		(186	)		(79	)		(102	)
Semiconductors		—			—			—
Financial Services		(645	)		(3,601	)		(61	)
All Other		249			1,843			4,378
Consolidated total		2,238			3,563			8,569
Depreciation and amortization:
Game & Network Services		20,798			25,486			29,091
Music		17,795			16,124			18,230
Pictures		22,375			20,487			24,458
Home Entertainment & Sound		21,781			19,830			21,136
Imaging Products & Solutions		27,612			25,442			23,928
Mobile Communications		24,186			19,794			19,215
Semiconductors		100,964			102,328			99,258
Financial Services, including deferred insurance acquisition costs		102,270			47,056			79,843
All Other		17,767			7,407			5,910
Total		355,548			283,954			321,069
Corporate		41,543			43,094			40,375
Consolidated total		397,091			327,048			361,444

The following table includes a breakdown of sales and operating revenue to external customers by product category for certain segments. Sony management views each segment as a single operating segment.

	Yen in millions
	Fiscal year ended March 31
	2016		2017		2018
Sales and operating revenue:
Game & Network Services
Network		529,318		714,924		1,033,192
Hardware and Others		950,457		866,644		815,106
Total		1,479,775		1,581,568		1,848,298
Music
Recorded Music		412,718		388,948		446,960
Music Publishing		71,258		66,541		74,360
Visual Media and Platform		118,588		175,278		263,472
Total		602,564		630,767		784,792
Pictures
Motion Pictures		447,355		409,363		448,945
Television Productions		270,115		271,886		289,024
Media Networks		218,357		219,981		272,204
Total		935,827		901,230		1,010,173
Home Entertainment & Sound
Televisions		797,764		720,557		861,763
Audio and Video		354,946		311,771		357,194
Other		2,375		1,887		2,777
Total		1,155,085		1,034,215		1,221,734
Imaging Products & Solutions
Still and Video Cameras		428,777		351,834		415,318
Other		248,454		219,665		231,845
Total		677,231		571,499		647,163
Mobile Communications		1,121,925		752,688		713,916
Semiconductors		599,430		659,779		726,892
Financial Services		1,066,319		1,080,284		1,221,235
All Other		435,668		375,116		351,527
Corporate		31,888		16,104		18,252
Consolidated total		8,105,712		7,603,250		8,543,982

Components of Segment Profit or Loss

Segment profit or loss:

	Yen in millions
	Fiscal year ended March 31
	2016			2017			2018
Operating income (loss):
Game & Network Services		88,668			135,553			177,478
Music		86,509			75,798			127,786
Pictures		38,507			(80,521	)		41,110
Home Entertainment & Sound		50,558			58,504			85,841
Imaging Products & Solutions		69,320			47,257			74,924
Mobile Communications		(61,435	)		10,164			(27,636	)
Semiconductors		14,500			(7,811	)		164,023
Financial Services		156,543			166,424			178,947
All Other		(41,252	)		(29,585	)		(23,530	)
Total		401,918			375,783			798,943
Corporate and elimination		(107,721	)		(87,081	)		(64,083	)
Consolidated operating income		294,197			288,702			734,860
Other income		66,849			14,418			23,728
Other expenses		(56,542	)		(51,501	)		(59,539	)
Consolidated income before income taxes		304,504			251,619			699,049

Components of Other Significant Items

Other significant items:

	Yen in millions
	Fiscal year ended March 31
	2016			2017			2018
Equity in net income (loss) of affiliated companies:
Game & Network Services		—			—			—
Music		3,801			5,435			4,483
Pictures		(981	)		(35	)		(129	)
Home Entertainment & Sound		—			—			—
Imaging Products & Solutions		—			—			—
Mobile Communications		(186	)		(79	)		(102	)
Semiconductors		—			—			—
Financial Services		(645	)		(3,601	)		(61	)
All Other		249			1,843			4,378
Consolidated total		2,238			3,563			8,569
Depreciation and amortization:
Game & Network Services		20,798			25,486			29,091
Music		17,795			16,124			18,230
Pictures		22,375			20,487			24,458
Home Entertainment & Sound		21,781			19,830			21,136
Imaging Products & Solutions		27,612			25,442			23,928
Mobile Communications		24,186			19,794			19,215
Semiconductors		100,964			102,328			99,258
Financial Services, including deferred insurance acquisition costs		102,270			47,056			79,843
All Other		17,767			7,407			5,910
Total		355,548			283,954			321,069
Corporate		41,543			43,094			40,375
Consolidated total		397,091			327,048			361,444

The following table includes a breakdown of sales and operating revenue to external customers by product category for certain segments. Sony management views each segment as a single operating segment.

	Yen in millions
	Fiscal year ended March 31
	2016		2017		2018
Sales and operating revenue:
Game & Network Services
Network		529,318		714,924		1,033,192
Hardware and Others		950,457		866,644		815,106
Total		1,479,775		1,581,568		1,848,298
Music
Recorded Music		412,718		388,948		446,960
Music Publishing		71,258		66,541		74,360
Visual Media and Platform		118,588		175,278		263,472
Total		602,564		630,767		784,792
Pictures
Motion Pictures		447,355		409,363		448,945
Television Productions		270,115		271,886		289,024
Media Networks		218,357		219,981		272,204
Total		935,827		901,230		1,010,173
Home Entertainment & Sound
Televisions		797,764		720,557		861,763
Audio and Video		354,946		311,771		357,194
Other		2,375		1,887		2,777
Total		1,155,085		1,034,215		1,221,734
Imaging Products & Solutions
Still and Video Cameras		428,777		351,834		415,318
Other		248,454		219,665		231,845
Total		677,231		571,499		647,163
Mobile Communications		1,121,925		752,688		713,916
Semiconductors		599,430		659,779		726,892
Financial Services		1,066,319		1,080,284		1,221,235
All Other		435,668		375,116		351,527
Corporate		31,888		16,104		18,252
Consolidated total		8,105,712		7,603,250		8,543,982

Sales and Operating Revenue to External Customers by Product Category

The following table includes a breakdown of sales and operating revenue to external customers by product category for certain segments. Sony management views each segment as a single operating segment.

	Yen in millions
	Fiscal year ended March 31
	2016		2017		2018
Sales and operating revenue:
Game & Network Services
Network		529,318		714,924		1,033,192
Hardware and Others		950,457		866,644		815,106
Total		1,479,775		1,581,568		1,848,298
Music
Recorded Music		412,718		388,948		446,960
Music Publishing		71,258		66,541		74,360
Visual Media and Platform		118,588		175,278		263,472
Total		602,564		630,767		784,792
Pictures
Motion Pictures		447,355		409,363		448,945
Television Productions		270,115		271,886		289,024
Media Networks		218,357		219,981		272,204
Total		935,827		901,230		1,010,173
Home Entertainment & Sound
Televisions		797,764		720,557		861,763
Audio and Video		354,946		311,771		357,194
Other		2,375		1,887		2,777
Total		1,155,085		1,034,215		1,221,734
Imaging Products & Solutions
Still and Video Cameras		428,777		351,834		415,318
Other		248,454		219,665		231,845
Total		677,231		571,499		647,163
Mobile Communications		1,121,925		752,688		713,916
Semiconductors		599,430		659,779		726,892
Financial Services		1,066,319		1,080,284		1,221,235
All Other		435,668		375,116		351,527
Corporate		31,888		16,104		18,252
Consolidated total		8,105,712		7,603,250		8,543,982

Sales and Operating Revenue Attributed to Countries and Areas Based on Location of External Customers and Long-Lived Assets

Sales and operating revenue attributed to countries and areas based on location of external customers for the fiscal years ended March 31, 2016, 2017 and 2018 and property, plant and equipment, net as of March 31, 2017 and 2018 are as follows:

	Yen in millions
	Fiscal year ended March 31
	2016		2017		2018
Sales and operating revenue:
Japan		2,317,312		2,392,790		2,625,619
United States		1,733,759		1,673,768		1,835,705
Europe		1,881,329		1,634,683		1,841,457
China		540,497		557,995		674,718
Asia-Pacific		959,171		866,712		1,024,179
Other Areas		673,644		477,302		542,304
Total		8,105,712		7,603,250		8,543,982

	Yen in millions
	March 31
	2017		2018
Property, plant and equipment, net:
Japan		580,453		563,593
United States		101,167		97,979
Europe		24,273		23,302
China		13,466		11,232
Asia-Pacific		34,575		36,738
Other Areas		4,265		6,626
Total		758,199		739,470

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Summary of Significant Accounting Policies - Additional Information (Detail) - JPY (¥) ¥ in Millions		12 Months Ended
	Apr. 01, 2018	Mar. 31, 2018	Mar. 31, 2017	Mar. 31, 2016
Summary Of Significant Accounting Policies [Line Items]
Description of evaluating factors in relation to available for sale securities		If the fair value of the security is 20 percent or more below its original cost for an extended period of time (generally for a period of up to six months)
Percentage of other-than-temporary fair value of security		20.00%
Consideration given to a reseller, primarily for free promotional shipping and cooperative advertising programs included in selling, general and administrative expenses		¥ 12,319	¥ 12,046	¥ 13,178
Subsequent event | Accounting Standards Update 2016-01 [Member]
Summary Of Significant Accounting Policies [Line Items]
Reclassification of accumulated other comprehensive income classified as available-for-sale to retained earnings	¥ 0
Home Entertainment & Sound | Error in the amount of accruals for certain sales incentives being recorded at a subsidiary
Summary Of Significant Accounting Policies [Line Items]
Out of period adjustment to correct error				¥ 8,447
Software to be sold, leased or otherwise marketed
Summary Of Significant Accounting Policies [Line Items]
Amortization period of intangible assets		3 years
Minimum | Buildings
Summary Of Significant Accounting Policies [Line Items]
Useful lives for depreciation		2 years
Minimum | Machinery, equipment and others
Summary Of Significant Accounting Policies [Line Items]
Useful lives for depreciation		2 years
Minimum | Patent rights; know-how; license agreements; trademarks; software to be sold, leased or otherwise marketed, and internal-use software
Summary Of Significant Accounting Policies [Line Items]
Amortization period of intangible assets		3 years
Minimum | Customer relationships, music catalogs, artist contracts and television carriage contracts (broadcasting agreements)
Summary Of Significant Accounting Policies [Line Items]
Amortization period of intangible assets		10 years
Maximum | Buildings
Summary Of Significant Accounting Policies [Line Items]
Useful lives for depreciation		50 years
Maximum | Machinery, equipment and others
Summary Of Significant Accounting Policies [Line Items]
Useful lives for depreciation		10 years
Maximum | Patent rights; know-how; license agreements; trademarks; software to be sold, leased or otherwise marketed, and internal-use software
Summary Of Significant Accounting Policies [Line Items]
Amortization period of intangible assets		10 years
Maximum | Customer relationships, music catalogs, artist contracts and television carriage contracts (broadcasting agreements)
Summary Of Significant Accounting Policies [Line Items]
Amortization period of intangible assets		40 years

XML

Inventories (Summary of Inventories) (Detail) - JPY (¥) ¥ in Millions	Mar. 31, 2018	Mar. 31, 2017
Inventory Disclosure [Abstract]
Finished products	¥ 422,461	¥ 399,850
Work in process	153,257	140,718
Raw materials, purchased components and supplies	117,219	100,267
Inventories	¥ 692,937	¥ 640,835

XML

Film Costs (Summary of Film Costs) (Detail) - JPY (¥) ¥ in Millions	Mar. 31, 2018	Mar. 31, 2017
Motion picture productions:
Released	¥ 81,755	¥ 80,539
Completed and not released	1,728	5,608
In production and development	78,868	94,197
Television productions:
Released	127,790	120,693
In production and development	1,174	7,707
Broadcasting rights	72,125	65,725
Less: current portion of broadcasting rights included in inventories	(35,795)	(37,541)
Film costs	¥ 327,645	¥ 336,928

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Film Costs - Additional Information (Detail) ¥ in Billions	12 Months Ended
	Mar. 31, 2018 JPY (¥)
Film Costs [Abstract]
Unamortized film costs of released motion picture and television productions	91.00%
Completed film costs expected to be amortized during the next twelve months	¥ 123
Accrued participation liabilities expected to be paid in next twelve months	¥ 158

XML

Investments in Affiliated Companies (Summarized Combined Financial Information Provided by Equity Investees) (Detail) - JPY (¥) ¥ in Millions	12 Months Ended
	Mar. 31, 2018	Mar. 31, 2017	Mar. 31, 2016
Schedule of Equity Method Investments [Line Items]
Current assets	¥ 404,658	¥ 361,492
Noncurrent assets	868,455	834,765
Current liabilities	273,067	248,450
Noncurrent liabilities and noncontrolling interests	768,007	761,546
Net revenues	468,933	387,229	¥ 358,256
Operating income	56,729	37,800	32,884
Net income attributable to controlling interests	¥ 27,301	¥ 11,529	¥ 8,388
Minimum
Schedule of Equity Method Investments [Line Items]
Percentage of ownership in equity investees	20.00%	20.00%	20.00%
Maximum
Schedule of Equity Method Investments [Line Items]
Percentage of ownership in equity investees	50.00%	50.00%	50.00%

XML

Investments in Affiliated Companies - Additional Information (Detail) ¥ in Millions, $ in Millions			12 Months Ended
	Jan. 30, 2017 JPY (¥) shares	Jun. 29, 2012 USD ($)	Mar. 31, 2018 JPY (¥) Entity	Mar. 31, 2017 JPY (¥) Entity	Mar. 31, 2016 JPY (¥)	Jan. 29, 2017	Apr. 01, 2015
Schedule of Equity Method Investments [Line Items]
Aggregate carrying value of investments in several affiliated companies			¥ 99,944
Fair value of investments in several affiliated companies			¥ 533,932
Number of affiliated companies accounted for under the equity method | Entity			107	109
Dividends received from affiliated companies			¥ 5,613	¥ 7,970	¥ 7,282
EMI Music Publishing
Schedule of Equity Method Investments [Line Items]
Business acquisition total consideration | $		$ 2,200
DH Publishing, L.P.
Schedule of Equity Method Investments [Line Items]
Business acquisition total consideration | $		$ 320
Percentage of equity interest		39.80%
M3, Inc.
Schedule of Equity Method Investments [Line Items]
Percentage of equity interest	34.00%					39.35%
Number of shares sold | shares	17,302,700
Number of shares held | shares	127,381,600
Cash consideration from sale of shares	¥ 51,968
Gain on sale of shares				37,167
Difference between carrying value and underlying net assets			¥ 98,938
Difference between carrying value and underlying net assets, accounting treatment for amounts allocated to intangible assets			The amounts allocated to intangible assets are amortized net of the related tax effects to equity in net income (loss) of affiliated companies over their respective estimated useful lives, principally 10 years, using the straight-line method.
SFI Leasing Company, Limited
Schedule of Equity Method Investments [Line Items]
Percentage of equity interest			34.00%
MITSUI-SOKO Supply Chain Solutions, Inc
Schedule of Equity Method Investments [Line Items]
Percentage of equity interest							34.00%
MITSUI-SOKO Supply Chain Solutions, Inc | General and Administrative Expenses
Schedule of Equity Method Investments [Line Items]
Related party transaction, amounts of transaction			¥ 9,123	13,752
MITSUI-SOKO Supply Chain Solutions, Inc | Accrued Expenses
Schedule of Equity Method Investments [Line Items]
Related party transaction, account balances			¥ 3,662	¥ 4,922
Nile Acquisition LLC
Schedule of Equity Method Investments [Line Items]
Percentage of equity ownership		74.90%

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Investments in Affiliated Companies (Account Balances and Transactions with Affiliated Companies Accounted for under Equity Method) (Detail) - JPY (¥) ¥ in Millions	12 Months Ended
	Mar. 31, 2018	Mar. 31, 2017	Mar. 31, 2016
Schedule of Equity Method Investments [Line Items]
Short-term borrowings	¥ 496,093	¥ 464,655
Equity Method Investee
Schedule of Equity Method Investments [Line Items]
Accounts receivable, trade	15,516	10,873
Accounts payable, trade	2,568	2,525
Short-term borrowings	22,849	20,650
Capital lease obligations	13,294	10,105
Sales	45,415	31,238	¥ 33,569
Purchases	3,180	1,966	2,259
Lease payments	¥ 7,749	¥ 16,492	¥ 32,291

XML

Transfer of Financial Assets - Additional Information (Detail) - JPY (¥) ¥ in Millions	12 Months Ended
	Mar. 31, 2018	Mar. 31, 2017	Mar. 31, 2016
Transfers and Servicing [Abstract]
Trade accounts receivable sold	¥ 84,718	¥ 73,185	¥ 53,267

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Marketable Securities and Securities Investments (Aggregate Cost, Gross Unrealized Gains and Losses and Fair Value Pertaining to Available-for-Sale Securities and Held-to-Maturity Securities) (Detail) - JPY (¥) ¥ in Millions	Mar. 31, 2018	Mar. 31, 2017
Schedule of Investments [Line Items]
Held-to-maturity securities, Cost	¥ 6,542,954	¥ 6,148,520
Held-to-maturity securities, Gross unrealized gains	1,660,684	1,538,986
Held-to-maturity securities, Gross unrealized losses	(56,850)	(75,492)
Held-to-maturity securities, Fair value	8,146,788	7,612,014
Marketable securities and securities investments, Cost	8,630,233	8,029,066
Marketable securities and securities investments, Gross unrealized gains	1,927,460	1,804,294
Marketable securities and securities investments, Gross unrealized losses	(63,041)	(80,343)
Marketable securities and securities investments, Fair value	10,494,652	9,753,017
Debt securities
Schedule of Investments [Line Items]
Available-for-Sale, Cost	2,031,603	1,824,618
Available-for-Sale, Gross unrealized gains	195,053	195,371
Available-for-Sale, Gross unrealized losses	(5,415)	(4,474)
Available-for-Sale, Fair value	2,221,241	2,015,515
Equity securities
Schedule of Investments [Line Items]
Available-for-Sale, Cost	55,676	55,928
Available-for-Sale, Gross unrealized gains	71,723	69,937
Available-for-Sale, Gross unrealized losses	(776)	(377)
Available-for-Sale, Fair value	126,623	125,488
Japanese national government bonds
Schedule of Investments [Line Items]
Held-to-maturity securities, Cost	5,892,868	5,661,191
Held-to-maturity securities, Gross unrealized gains	1,635,036	1,520,904
Held-to-maturity securities, Gross unrealized losses	(20,890)	(30,553)
Held-to-maturity securities, Fair value	7,507,014	7,151,542
Japanese national government bonds | Debt securities
Schedule of Investments [Line Items]
Available-for-Sale, Cost	1,227,139	1,161,493
Available-for-Sale, Gross unrealized gains	182,830	182,836
Available-for-Sale, Gross unrealized losses	(359)	(928)
Available-for-Sale, Fair value	1,409,610	1,343,401
Japanese local government bonds
Schedule of Investments [Line Items]
Held-to-maturity securities, Cost	3,850	4,101
Held-to-maturity securities, Gross unrealized gains	413	449
Held-to-maturity securities, Fair value	4,263	4,550
Japanese local government bonds | Debt securities
Schedule of Investments [Line Items]
Available-for-Sale, Cost	67,574	60,450
Available-for-Sale, Gross unrealized gains	107	144
Available-for-Sale, Gross unrealized losses	(112)	(63)
Available-for-Sale, Fair value	67,569	60,531
Japanese corporate bonds
Schedule of Investments [Line Items]
Held-to-maturity securities, Cost	345,818	230,011
Held-to-maturity securities, Gross unrealized gains	16,912	12,346
Held-to-maturity securities, Gross unrealized losses	(17,390)	(22,071)
Held-to-maturity securities, Fair value	345,340	220,286
Japanese corporate bonds | Debt securities
Schedule of Investments [Line Items]
Available-for-Sale, Cost	199,880	163,785
Available-for-Sale, Gross unrealized gains	9,844	7,864
Available-for-Sale, Gross unrealized losses	(1,016)	(1,846)
Available-for-Sale, Fair value	208,708	169,803
Foreign government bonds
Schedule of Investments [Line Items]
Held-to-maturity securities, Cost	300,220	253,019
Held-to-maturity securities, Gross unrealized gains	8,310	5,269
Held-to-maturity securities, Gross unrealized losses	(18,570)	(22,868)
Held-to-maturity securities, Fair value	289,960	235,420
Foreign government bonds | Debt securities
Schedule of Investments [Line Items]
Available-for-Sale, Cost	72,204	27,601
Available-for-Sale, Gross unrealized gains	622	359
Available-for-Sale, Gross unrealized losses	(3,287)	(918)
Available-for-Sale, Fair value	69,539	27,042
Foreign corporate bonds
Schedule of Investments [Line Items]
Held-to-maturity securities, Cost	198	198
Held-to-maturity securities, Gross unrealized gains	13	18
Held-to-maturity securities, Fair value	211	216
Foreign corporate bonds | Debt securities
Schedule of Investments [Line Items]
Available-for-Sale, Cost	365,457	396,097
Available-for-Sale, Gross unrealized gains	1,649	4,168
Available-for-Sale, Gross unrealized losses	(641)	(719)
Available-for-Sale, Fair value	366,465	399,546
Other
Schedule of Investments [Line Items]
Available-for-Sale, Cost	99,349	15,192
Available-for-Sale, Gross unrealized gains	1
Available-for-Sale, Gross unrealized losses	0	0
Available-for-Sale, Fair value	¥ 99,350	¥ 15,192

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Marketable Securities and Securities Investments (Cost and Fair Value of Debt Securities Classified as Available-for-Sale Securities and Held-to-Maturity Securities by Contractual Maturity) (Detail) - JPY (¥) ¥ in Millions	Mar. 31, 2018	Mar. 31, 2017
Available for Sale Securities, Cost
Due in one year or less	¥ 125,037
Due after one year through five years	421,676
Due after five years through ten years	542,642
Due after ten years	942,248
Total	2,031,603
Available-for-sale securities, Fair value
Due in one year or less	125,290
Due after one year through five years	422,987
Due after five years through ten years	626,888
Due after ten years	1,046,076
Total	2,221,241
Held-to-maturity securities, Cost
Due in one year or less	3,249
Due after one year through five years	27,805
Due after five years through ten years	334,206
Due after ten years	6,177,694
Held-to-maturity securities, Cost	6,542,954	¥ 6,148,520
Held-to-maturity securities, Fair value
Due in one year or less	3,269
Due after one year through five years	29,417
Due after five years through ten years	382,175
Due after ten years	7,731,927
Total	¥ 8,146,788	¥ 7,612,014

XML

Marketable Securities and Securities Investments - Additional Information (Detail) - JPY (¥) ¥ in Millions	12 Months Ended
	Mar. 31, 2018	Mar. 31, 2017	Mar. 31, 2016
Investment Holdings [Line Items]
Proceeds from sales of available-for-sale securities	¥ 39,982	¥ 75,319	¥ 315,043
Gross realized gains from available-for-sale securities	1,257	2,297	67,205
Gross realized losses from available-for-sale securities	2	37	186
Marketable securities classified as trading securities	1,048,062	921,320
Net unrealized gains on trading securities	48,047	56,593
Net unrealized losses on trading securities			45,841
Investment in non public companies	52,361	61,323
Total realized impairment losses on securities investments	¥ 5,175	7,566	¥ 3,566
Olympus Corporation
Investment Holdings [Line Items]
Gross realized gains from available-for-sale securities		¥ 46,757

XML

Marketable Securities and Securities Investments (Gross Unrealized Losses and Fair Value of Securities with Unrealized Losses, Aggregated by Investment Category and Length of Time of Continuous Unrealized Loss Position) (Detail) - JPY (¥) ¥ in Millions	Mar. 31, 2018	Mar. 31, 2017
Investments, Unrealized Loss Position [Line Items]
Available-for-sale securities, less than 12 months, fair value	¥ 107,324	¥ 148,122
Available-for-sale securities, less than 12 months, unrealized losses	(2,382)	(3,396)
Available-for-sale securities, 12 months or more, fair value	140,942	69,231
Available-for-sale securities, 12 months or more, unrealized losses	(3,033)	(1,078)
Available-for-sale securities, fair value, total	248,266	217,353
Available-for-sale securities, unrealized losses, total	(5,415)	(4,474)
Held-to-maturity securities, less than 12 months, fair value	20,448	620,072
Held-to-maturity securities, less than 12 months, unrealized losses	(704)	(75,492)
Held-to-maturity securities, 12 months or more, fair value	613,609
Held-to-maturity securities, 12 months or more , unrealized losses	(56,146)
Held-to-maturity securities, fair value, total	634,057	620,072
Held-to-maturity securities, unrealized losses, total	(56,850)	(75,492)
Held-to-maturity And Available-for-sale securities, less than 12 months, fair value	141,631	780,072
Held-to-maturity And Available-for-sale securities, less than 12 months, unrealized losses	(3,862)	(79,258)
Held-to-maturity And Available-for-sale securities, 12 months or more, fair value	754,566	69,240
Held-to-maturity And Available-for-sale securities, 12 months or more, unrealized losses	(59,179)	(1,085)
Held-to-maturity And Available-for-sale securities, fair value, total	896,197	849,312
Held-to-maturity And Available-for-sale securities, unrealized losses, total	(63,041)	(80,343)
Equity securities
Investments, Unrealized Loss Position [Line Items]
Available-for-sale securities, less than 12 months, fair value	13,859	11,878
Available-for-sale securities, less than 12 months, unrealized losses	(776)	(370)
Available-for-sale securities, 12 months or more, fair value	15	9
Available-for-sale securities, 12 months or more, unrealized losses	0	(7)
Available-for-sale securities, fair value, total	13,874	11,887
Available-for-sale securities, unrealized losses, total	(776)	(377)
Japanese national government bonds
Investments, Unrealized Loss Position [Line Items]
Available-for-sale securities, less than 12 months, fair value	10,118	52,825
Available-for-sale securities, less than 12 months, unrealized losses	(11)	(909)
Available-for-sale securities, 12 months or more, fair value	32,836	2,018
Available-for-sale securities, 12 months or more, unrealized losses	(348)	(19)
Available-for-sale securities, fair value, total	42,954	54,843
Available-for-sale securities, unrealized losses, total	(359)	(928)
Held-to-maturity securities, less than 12 months, fair value		277,328
Held-to-maturity securities, less than 12 months, unrealized losses		(30,553)
Held-to-maturity securities, 12 months or more, fair value	304,564
Held-to-maturity securities, 12 months or more , unrealized losses	(20,890)
Held-to-maturity securities, fair value, total	304,564	277,328
Held-to-maturity securities, unrealized losses, total	(20,890)	(30,553)
Japanese local government bonds
Investments, Unrealized Loss Position [Line Items]
Available-for-sale securities, less than 12 months, fair value	9,324	3,793
Available-for-sale securities, less than 12 months, unrealized losses	(11)	(6)
Available-for-sale securities, 12 months or more, fair value	14,729	14,270
Available-for-sale securities, 12 months or more, unrealized losses	(101)	(57)
Available-for-sale securities, fair value, total	24,053	18,063
Available-for-sale securities, unrealized losses, total	(112)	(63)
Japanese corporate bonds
Investments, Unrealized Loss Position [Line Items]
Available-for-sale securities, less than 12 months, fair value	11,046	53,302
Available-for-sale securities, less than 12 months, unrealized losses	(10)	(1,761)
Available-for-sale securities, 12 months or more, fair value	64,119	20,489
Available-for-sale securities, 12 months or more, unrealized losses	(1,006)	(85)
Available-for-sale securities, fair value, total	75,165	73,791
Available-for-sale securities, unrealized losses, total	(1,016)	(1,846)
Held-to-maturity securities, less than 12 months, fair value		146,004
Held-to-maturity securities, less than 12 months, unrealized losses		(22,071)
Held-to-maturity securities, 12 months or more, fair value	174,815
Held-to-maturity securities, 12 months or more , unrealized losses	(17,390)
Held-to-maturity securities, fair value, total	174,815	146,004
Held-to-maturity securities, unrealized losses, total	(17,390)	(22,071)
Foreign government bonds
Investments, Unrealized Loss Position [Line Items]
Available-for-sale securities, less than 12 months, fair value	40,156	10,258
Available-for-sale securities, less than 12 months, unrealized losses	(2,281)	(577)
Available-for-sale securities, 12 months or more, fair value	7,752	7,792
Available-for-sale securities, 12 months or more, unrealized losses	(1,006)	(341)
Available-for-sale securities, fair value, total	47,908	18,050
Available-for-sale securities, unrealized losses, total	(3,287)	(918)
Held-to-maturity securities, less than 12 months, fair value	20,448	196,740
Held-to-maturity securities, less than 12 months, unrealized losses	(704)	(22,868)
Held-to-maturity securities, 12 months or more, fair value	134,230
Held-to-maturity securities, 12 months or more , unrealized losses	(17,866)
Held-to-maturity securities, fair value, total	154,678	196,740
Held-to-maturity securities, unrealized losses, total	(18,570)	(22,868)
Foreign corporate bonds
Investments, Unrealized Loss Position [Line Items]
Available-for-sale securities, less than 12 months, fair value	34,840	27,944
Available-for-sale securities, less than 12 months, unrealized losses	(69)	(143)
Available-for-sale securities, 12 months or more, fair value	21,191	24,662
Available-for-sale securities, 12 months or more, unrealized losses	(572)	(576)
Available-for-sale securities, fair value, total	56,031	52,606
Available-for-sale securities, unrealized losses, total	(641)	¥ (719)
Other
Investments, Unrealized Loss Position [Line Items]
Available-for-sale securities, less than 12 months, fair value	1,840
Available-for-sale securities, less than 12 months, unrealized losses	0
Available-for-sale securities, 12 months or more, fair value	315
Available-for-sale securities, 12 months or more, unrealized losses	0
Available-for-sale securities, fair value, total	2,155
Available-for-sale securities, unrealized losses, total	¥ 0

XML

Leases (Leased Assets under Capital Leases) (Detail) - JPY (¥) ¥ in Millions	Mar. 31, 2018	Mar. 31, 2017
Capital Leased Assets [Line Items]
Accumulated amortization	¥ (58,861)	¥ (53,330)
Leased assets under capital leases, Net	27,406	18,335
Machinery, equipment and others
Capital Leased Assets [Line Items]
Leased assets under capital leases	82,260	66,722
Film costs
Capital Leased Assets [Line Items]
Leased assets under capital leases	¥ 4,007	¥ 4,943

XML

Leases (Future Minimum Lease Payments under Capital Leases with Present Value of Net Minimum Lease Payments) (Detail) ¥ in Millions	Mar. 31, 2018 JPY (¥)
Capital Leases, Future Minimum Payments, Present Value of Net Minimum Payments, Fiscal Year Maturity [Abstract]
2019	¥ 12,326
2020	15,101
2021	8,787
2022	4,773
2023	3,573
Later fiscal years	12,424
Total minimum lease payments	56,984
Less - Amount representing interest	7,150
Present value of net minimum lease payments	49,834
Less - Current obligations	11,432
Long-term capital lease obligations	38,402
Present value of net minimum lease payments	¥ 49,834

XML

Leases (Minimum Rental Payments Required under Operating Leases that have Initial or Remaining Noncancelable Lease Terms in Excess of One Year) (Detail) ¥ in Millions	Mar. 31, 2018 JPY (¥)
Operating Leases, Future Minimum Payments Due, Fiscal Year Maturity [Abstract]
2019	¥ 57,810
2020	64,380
2021	38,495
2022	24,993
2023	20,280
Later fiscal years	81,305
Total minimum future rentals	¥ 287,263

XML

Leases - Additional Information (Detail) - JPY (¥) ¥ in Millions	12 Months Ended
	Mar. 31, 2018	Mar. 31, 2017	Mar. 31, 2016
Leases Disclosure [Line Items]
Rental expenses under operating leases	¥ 77,950	¥ 77,976	¥ 94,000
Sublease rental received under operating leases	1,325	1,157	1,138
Total minimum rentals to be received in future under noncancelable subleases for operating leases	2,792
Sale and Leaseback Transactions Regarding Certain Machinery and Equipment with SFI Leasing Company, Limited
Leases Disclosure [Line Items]
Net cash proceeds from sale and leaseback transaction	¥ 2,538	¥ 2,679	¥ 1,856
Sale and leaseback transaction, average terms	2 years	2 years	2 years

XML

Goodwill and Other Intangible Assets - Additional Information (Detail) - JPY (¥) ¥ in Millions	12 Months Ended
	Mar. 31, 2018	Mar. 31, 2017	Mar. 31, 2016
Goodwill and Intangible Assets Disclosure [Line Items]
Finite and indefinite lived intangible assets acquired	¥ 110,788
Acquired finite lived intangible assets subject to amortization	110,781
Aggregate amortization expense for intangible assets	123,450	¥ 121,634	¥ 125,616
Goodwill	530,492	522,538	606,290
Impairments		112,069
Pictures
Goodwill and Intangible Assets Disclosure [Line Items]
Goodwill	¥ 144,412	138,153	¥ 221,517
Impairments		112,069
Pictures | Production and Distribution
Goodwill and Intangible Assets Disclosure [Line Items]
Goodwill		0
Impairments		¥ 112,069

XML

Goodwill and Other Intangible Assets (Acquired Intangible Assets and Weighted-Average Amortization Period) (Detail) ¥ in Millions	12 Months Ended
	Mar. 31, 2018 JPY (¥)
Acquired Finite-Lived Intangible Assets [Line Items]
Intangible assets acquired	¥ 110,781
Patent rights, know-how and license agreements
Acquired Finite-Lived Intangible Assets [Line Items]
Intangible assets acquired	¥ 16,003
Weighted-average amortization period	4 years
Software to be sold, leased or otherwise marketed
Acquired Finite-Lived Intangible Assets [Line Items]
Intangible assets acquired	¥ 16,066
Weighted-average amortization period	3 years
Internal-use software
Acquired Finite-Lived Intangible Assets [Line Items]
Intangible assets acquired	¥ 69,205
Weighted-average amortization period	5 years
Other
Acquired Finite-Lived Intangible Assets [Line Items]
Intangible assets acquired	¥ 9,507
Weighted-average amortization period	7 years

XML

Goodwill and Other Intangible Assets (Intangible Assets Subject to Amortization) (Detail) - JPY (¥) ¥ in Millions	Mar. 31, 2018	Mar. 31, 2017
Finite-Lived Intangible Assets [Line Items]
Gross carrying amount	¥ 1,198,213	¥ 1,364,609
Accumulated amortization	(762,093)	(872,587)
Patent rights, know-how and license agreements
Finite-Lived Intangible Assets [Line Items]
Gross carrying amount	175,980	317,337
Accumulated amortization	(142,724)	(251,401)
Customer relationships
Finite-Lived Intangible Assets [Line Items]
Gross carrying amount	18,881	37,289
Accumulated amortization	(7,615)	(15,585)
Trademarks
Finite-Lived Intangible Assets [Line Items]
Gross carrying amount	16,310	31,630
Accumulated amortization	(8,451)	(15,554)
Software to be sold, leased or otherwise marketed
Finite-Lived Intangible Assets [Line Items]
Gross carrying amount	123,269	117,897
Accumulated amortization	(92,457)	(86,661)
Internal-use software
Finite-Lived Intangible Assets [Line Items]
Gross carrying amount	494,649	473,750
Accumulated amortization	(315,516)	(310,408)
Music catalogs
Finite-Lived Intangible Assets [Line Items]
Gross carrying amount	207,789	218,321
Accumulated amortization	(94,210)	(95,367)
Artist contracts
Finite-Lived Intangible Assets [Line Items]
Gross carrying amount	28,534	31,393
Accumulated amortization	(27,650)	(29,001)
Television carriage contracts (broadcasting agreements)
Finite-Lived Intangible Assets [Line Items]
Gross carrying amount	74,258	74,780
Accumulated amortization	(25,884)	(21,986)
Other
Finite-Lived Intangible Assets [Line Items]
Gross carrying amount	58,543	62,212
Accumulated amortization	¥ (47,586)	¥ (46,624)

XML

Goodwill and Other Intangible Assets (Estimated Aggregate Amortization Expense for Intangible Assets) (Detail) ¥ in Millions	Mar. 31, 2018 JPY (¥)
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract]
2019	¥ 89,924
2020	73,516
2021	56,485
2022	39,050
2023	¥ 27,982

XML

Goodwill and Other Intangible Assets (Total Carrying Amount of Intangible Assets Having Indefinite Life) (Detail) - JPY (¥) ¥ in Millions	Mar. 31, 2018	Mar. 31, 2017
Indefinite-lived Intangible Assets [Line Items]
Carrying amount of intangible assets having an indefinite life	¥ 91,048	¥ 92,163
Trademarks
Indefinite-lived Intangible Assets [Line Items]
Carrying amount of intangible assets having an indefinite life	68,922	70,220
Distribution agreements
Indefinite-lived Intangible Assets [Line Items]
Carrying amount of intangible assets having an indefinite life	18,834	18,834
Other
Indefinite-lived Intangible Assets [Line Items]
Carrying amount of intangible assets having an indefinite life	¥ 3,292	¥ 3,109

XML

Goodwill and Other Intangible Assets (Changes in Carrying Amount of Goodwill by Segment) (Detail) - JPY (¥) ¥ in Millions	12 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Goodwill [Line Items]
Goodwill - gross	¥ 837,533	¥ 813,353
Accumulated impairments	(314,995)	(207,063)
Goodwill	522,538	606,290
Increase (decrease) due to:
Acquisitions	21,773	37,113	[1]
Sales and dispositions	(121)	(60)
Impairments		(112,069)
Translation adjustments	(12,382)	(4,578)
Other	(1,316)	(4,158)
Goodwill - gross	839,030	837,533
Accumulated impairments	(308,538)	(314,995)
Goodwill	530,492	522,538
Game & Network Services
Goodwill [Line Items]
Goodwill - gross	151,938	152,293
Goodwill	151,938	152,293
Increase (decrease) due to:
Translation adjustments	(1,332)	(355)
Goodwill - gross	150,606	151,938
Goodwill	150,606	151,938
Music
Goodwill [Line Items]
Goodwill - gross	166,416	162,078
Accumulated impairments	(306)	(306)
Goodwill	166,110	161,772
Increase (decrease) due to:
Acquisitions	2,877	7,689	[1]
Sales and dispositions	(121)
Translation adjustments	(3,472)	(3,351)
Goodwill - gross	165,700	166,416
Accumulated impairments	(306)	(306)
Goodwill	165,394	166,110
Pictures
Goodwill [Line Items]
Goodwill - gross	246,085	221,517
Accumulated impairments	(107,932)
Goodwill	138,153	221,517
Increase (decrease) due to:
Acquisitions	12,842	29,363	[1]
Sales and dispositions		(60)
Impairments		(112,069)
Translation adjustments	(6,583)	(598)
Goodwill - gross	246,620	246,085
Accumulated impairments	(102,208)	(107,932)
Goodwill	144,412	138,153
Home Entertainment & Sound
Goodwill [Line Items]
Goodwill - gross	5,320	5,320
Accumulated impairments	(5,320)	(5,320)
Increase (decrease) due to:
Goodwill - gross	5,320	5,320
Accumulated impairments	(5,320)	(5,320)
Imaging Products & Solutions
Goodwill [Line Items]
Goodwill - gross	8,451	8,637
Accumulated impairments	(300)	(300)
Goodwill	8,151	8,337
Increase (decrease) due to:
Acquisitions	1,204
Translation adjustments	162	(186)
Goodwill - gross	9,817	8,451
Accumulated impairments	(300)	(300)
Goodwill	9,517	8,151
Mobile Communications
Goodwill [Line Items]
Goodwill - gross	179,331	179,331
Accumulated impairments	(176,045)	(176,045)
Goodwill	3,286	3,286
Increase (decrease) due to:
Goodwill - gross	179,331	179,331
Accumulated impairments	(176,045)	(176,045)
Goodwill	3,286	3,286
Semiconductors
Goodwill [Line Items]
Goodwill - gross	48,069	49,621
Goodwill	48,069	49,621
Increase (decrease) due to:
Translation adjustments	(1,072)	(77)
Other	(1,204)	(1,475)
Goodwill - gross	45,793	48,069
Goodwill	45,793	48,069
Financial Services
Goodwill [Line Items]
Goodwill - gross	3,081	3,020
Accumulated impairments	(706)	(706)
Goodwill	2,375	2,314
Increase (decrease) due to:
Acquisitions	4,850	61	[1]
Goodwill - gross	7,931	3,081
Accumulated impairments	(706)	(706)
Goodwill	7,225	2,375
All Other
Goodwill [Line Items]
Goodwill - gross	28,842	31,536
Accumulated impairments	(24,386)	(24,386)
Goodwill	4,456	7,150
Increase (decrease) due to:
Translation adjustments	(85)	(11)
Other	(112)	(2,683)
Goodwill - gross	27,912	28,842
Accumulated impairments	(23,653)	(24,386)
Goodwill	¥ 4,259	¥ 4,456

[1] Acquisitions for the fiscal year ended March 31, 2017 relate mainly to the TEN Sports Network acquisition in the Pictures segment. Refer to Note 24.

XML

Insurance-Related Accounts - Additional Information (Detail) - JPY (¥) ¥ in Millions	12 Months Ended
	Mar. 31, 2018	Mar. 31, 2017	Mar. 31, 2016
Liability for Future Policy Benefit, by Product Segment [Line Items]
Combined amounts of statutory net equity of insurance subsidiaries which is not measured in accordance with U.S. GAAP	¥ 525,976	¥ 502,999
Life insurance revenues	857,766	754,242	¥ 803,549
Non-life insurance revenues	105,497	97,581	93,928
Amortization of deferred insurance acquisition costs charged to income	68,137	36,130	¥ 92,203
Future insurance policy benefits	¥ 5,211,421	¥ 4,823,687
Minimum
Liability for Future Policy Benefit, by Product Segment [Line Items]
Interest rates for future policy benefit based on market conditions and expected investment returns	1.00%
Minimum | Interest Sensitive Whole Life Contracts
Liability for Future Policy Benefit, by Product Segment [Line Items]
Credited interest rates associated with policyholder contract deposits	1.80%
Minimum | Investment Contracts
Liability for Future Policy Benefit, by Product Segment [Line Items]
Credited interest rates associated with policyholder contract deposits	0.01%
Maximum
Liability for Future Policy Benefit, by Product Segment [Line Items]
Interest rates for future policy benefit based on market conditions and expected investment returns	4.50%
Maximum | Interest Sensitive Whole Life Contracts
Liability for Future Policy Benefit, by Product Segment [Line Items]
Credited interest rates associated with policyholder contract deposits	2.00%
Maximum | Investment Contracts
Liability for Future Policy Benefit, by Product Segment [Line Items]
Credited interest rates associated with policyholder contract deposits	6.30%

XML

Insurance-Related Accounts (Policyholders' Account in Life Insurance Business) (Detail) - JPY (¥) ¥ in Millions	Mar. 31, 2018	Mar. 31, 2017
Policyholders Account In Life Insurance Business [Abstract]
Policyholders' account in the life insurance business	¥ 2,820,702	¥ 2,631,073
Universal Life Insurance
Policyholders Account In Life Insurance Business [Abstract]
Policyholders' account in the life insurance business	1,951,906	1,809,142
Investment Contracts
Policyholders Account In Life Insurance Business [Abstract]
Policyholders' account in the life insurance business	738,404	686,182
Other
Policyholders Account In Life Insurance Business [Abstract]
Policyholders' account in the life insurance business	¥ 130,392	¥ 135,749

XML

Short-Term Borrowings and Long-Term Debt (Short-Term Borrowings) (Detail) - JPY (¥) ¥ in Millions	Mar. 31, 2018	Mar. 31, 2017
Short-term Debt [Line Items]
Short-term borrowings	¥ 496,093	¥ 464,655
Unsecured Loans Weighted Average Interest Rate 7.29%
Short-term Debt [Line Items]
Short-term borrowings		64,046
Unsecured Loans Weighted Average Interest Rate 3.95%
Short-term Debt [Line Items]
Short-term borrowings	64,480
Secured Loans Weighted Average Interest Rate 0.00%
Short-term Debt [Line Items]
Short-term borrowings		20,000
Secured Loans Weighted Average Interest Rate 0.12%
Short-term Debt [Line Items]
Short-term borrowings	27
Repurchase agreement, weighted average interest rate of 0.01%
Short-term Debt [Line Items]
Short-term borrowings		310,609
Repurchase agreement, weighted average interest rate 0.18%
Short-term Debt [Line Items]
Short-term borrowings	335,586
Secured Call Money Weighted Average Interest Rate 0.08%
Short-term Debt [Line Items]
Short-term borrowings		¥ 70,000
Secured Call Money Weighted Average Interest Rate 0.07%
Short-term Debt [Line Items]
Short-term borrowings	¥ 96,000

XML

Short-Term Borrowings and Long-Term Debt (Short-Term Borrowings) (Parenthetical) (Detail)	Mar. 31, 2018	Mar. 31, 2017
Unsecured Loans Weighted Average Interest Rate 7.29%
Short-term Debt [Line Items]
Debt weighted-average interest rate		7.29%
Unsecured Loans Weighted Average Interest Rate 3.95%
Short-term Debt [Line Items]
Debt weighted-average interest rate	3.95%
Secured Loans Weighted Average Interest Rate 0.00%
Short-term Debt [Line Items]
Debt weighted-average interest rate		0.00%
Secured Loans Weighted Average Interest Rate 0.12%
Short-term Debt [Line Items]
Debt weighted-average interest rate	0.12%
Repurchase agreement, weighted average interest rate of 0.01%
Short-term Debt [Line Items]
Debt weighted-average interest rate		0.01%
Repurchase agreement, weighted average interest rate 0.18%
Short-term Debt [Line Items]
Debt weighted-average interest rate	0.18%
Secured Call Money Weighted Average Interest Rate 0.08%
Short-term Debt [Line Items]
Debt weighted-average interest rate		(0.08%)
Secured Call Money Weighted Average Interest Rate 0.07%
Short-term Debt [Line Items]
Debt weighted-average interest rate	(0.07%)

XML

Short-Term Borrowings and Long-Term Debt - Additional Information (Detail) ¥ / shares in Units, ¥ in Millions, $ in Millions		1 Months Ended			12 Months Ended
	Jul. 21, 2015 JPY (¥) TradingDay ¥ / shares	Sep. 30, 2016 USD ($)	Mar. 31, 2016 USD ($)	Mar. 31, 2012 USD ($)	Mar. 31, 2018 JPY (¥)	Mar. 31, 2017 JPY (¥)	Sep. 30, 2016 JPY (¥)
Debt Instrument [Line Items]
Unsecured bank loans in connection with acquiring Ericsson's 50% equity interest in Sony Ericsson | $				$ 1,365
Unsecured bank loans in connection with acquiring Ericsson's 50% equity interest in Sony Ericsson, repayment amount | $		$ 683	$ 682
Long-term debt including current portion					¥ 848,973	¥ 734,886
Securities Pledged as Collateral
Debt Instrument [Line Items]
Marketable securities and securities investments pledged as collateral, book value					38,375
Pledged housing loans, book value					306,589
Long-term secured loan					170,000
Minimum
Debt Instrument [Line Items]
Unsecured bank loans in connection with acquiring Ericsson's 50% equity interest in Sony Ericsson, maturity terms				6 years
Maximum
Debt Instrument [Line Items]
Unsecured bank loans in connection with acquiring Ericsson's 50% equity interest in Sony Ericsson, maturity terms				10 years
Committed Lines of Credit
Debt Instrument [Line Items]
Line of credit facility, remaining borrowing capacity					¥ 459,860
Line of credit facility, period up to which company can borrow					180 days
Commercial Paper Programs
Debt Instrument [Line Items]
Line of credit facility, remaining borrowing capacity					¥ 818,720
Line of credit facility, period up to which company can borrow					270 days
Repurchase agreement, weighted average interest rate of 0.01%
Debt Instrument [Line Items]
Securities investments pledged as collateral, book value					¥ 267,538
Secured Call Money Weighted Average Interest Rate 0.08% | Securities Pledged as Collateral
Debt Instrument [Line Items]
Marketable securities and securities investments pledged as collateral, book value					119,213
Cash settlements, variation margins of futures markets and certain other purposes
Debt Instrument [Line Items]
Marketable securities and securities investments pledged as collateral, book value					9,618
Unsecured zero coupon convertible bonds, due 2022
Debt Instrument [Line Items]
Long-term debt including current portion	¥ 120,000				¥ 119,976	¥ 120,000
Debt instrument interest rate	130.00%
Stock acquisition rights, start date	Sep. 01, 2015
Conversion price per common share | ¥ / shares	¥ 5,008.0
Amount in excess of dividends for which conversion price is adjusted | ¥ / shares	¥ 25
Debt instrument outstanding percentage	100.00%
Debt instrument redeemable date	Jul. 21, 2020
Debt instrument conversion price percentage on consecutive trading days	130.00%
Debt instrument, convertible, consecutive trading days | TradingDay	20
Basis for conversion bonds outstanding					If the closing sales price per share of Sony's common stock on the Tokyo Stock Exchange is 130% or more of the conversion price of the Zero Coupon Convertible Bonds for 20 consecutive trading days.
Unsecured zero coupon convertible bonds, due 2022 | Minimum
Debt Instrument [Line Items]
Stock acquisition rights, end date	Sep. 28, 2022
Conversion price per common share | ¥ / shares	¥ 3,526.5
Unsecured Debt
Debt Instrument [Line Items]
Aggregate principal amount newly issued for repayment of borrowings and debt							¥ 200,000

XML

Short-Term Borrowings and Long-Term Debt (Long-Term Debt) (Detail) - JPY (¥) ¥ in Millions	Mar. 31, 2018	Mar. 31, 2017	Jul. 21, 2015
Debt Instrument [Line Items]
Long-term debt including current portion	¥ 848,973	¥ 734,886
Less - Portion due within one year	225,522	53,424
Total	623,451	681,462
Unsecured loans, due 2017 to 2024, with interest rates ranging from 0.24% to 5.10% per annum
Debt Instrument [Line Items]
Long-term debt including current portion		63,248
Unsecured loans, due 2018 to 2024, with interest rates ranging from 0.01% to 5.10% per annum
Debt Instrument [Line Items]
Long-term debt including current portion	49,454
Unsecured 0.43% bonds, due 2018
Debt Instrument [Line Items]
Long-term debt including current portion		10,000
Unsecured 0.86% bonds, due 2018
Debt Instrument [Line Items]
Long-term debt including current portion	150,000	150,000
Unsecured 2.00% bonds, due 2018
Debt Instrument [Line Items]
Long-term debt including current portion	16,300	16,300
Unsecured 0.05% bonds, due 2019
Debt Instrument [Line Items]
Long-term debt including current portion	69,879	69,793
Unsecured 2.07% bonds, due 2019
Debt Instrument [Line Items]
Long-term debt including current portion	50,000	50,000
Unsecured 0.23% bonds, due 2021
Debt Instrument [Line Items]
Long-term debt including current portion	89,744	89,670
Unsecured 0.11% bonds, due 2022
Debt Instrument [Line Items]
Long-term debt including current portion	10,000
Unsecured 1.41% bonds, due 2022
Debt Instrument [Line Items]
Long-term debt including current portion	10,000	10,000
Unsecured 0.28% bonds, due 2023
Debt Instrument [Line Items]
Long-term debt including current portion	15,000	15,000
Unsecured 0.22% bonds, due 2025
Debt Instrument [Line Items]
Long-term debt including current portion	10,000
Unsecured 0.42% bonds, due 2026
Debt Instrument [Line Items]
Long-term debt including current portion	24,899	24,887
Unsecured zero coupon convertible bonds, due 2022
Debt Instrument [Line Items]
Long-term debt including current portion	119,976	120,000	¥ 120,000
Secured 0.00% loans, due 2019 to 2020
Debt Instrument [Line Items]
Long-term debt including current portion		70,000
Secured 0.00% loans, due 2019 to 2022
Debt Instrument [Line Items]
Long-term debt including current portion	170,002
Capital lease obligation and other, due 2017 to 2027
Debt Instrument [Line Items]
Long-term debt including current portion		34,224
Capital lease obligation and other, due 2018 to 2047
Debt Instrument [Line Items]
Long-term debt including current portion	52,929
Guarantee deposits received
Debt Instrument [Line Items]
Long-term debt including current portion	¥ 10,790	¥ 11,764

XML

Short-Term Borrowings and Long-Term Debt (Long-Term Debt) (Parenthetical) (Detail)	Mar. 31, 2018	Mar. 31, 2017
Unsecured loans, due 2017 to 2024, with interest rates ranging from 0.24% to 5.10% per annum | Minimum
Debt Instrument [Line Items]
Debt instrument interest rate		0.24%
Unsecured loans, due 2017 to 2024, with interest rates ranging from 0.24% to 5.10% per annum | Maximum
Debt Instrument [Line Items]
Debt instrument interest rate		5.10%
Unsecured loans, due 2018 to 2024, with interest rates ranging from 0.01% to 5.10% per annum | Minimum
Debt Instrument [Line Items]
Debt instrument interest rate	0.01%
Unsecured loans, due 2018 to 2024, with interest rates ranging from 0.01% to 5.10% per annum | Maximum
Debt Instrument [Line Items]
Debt instrument interest rate	5.10%
Unsecured 0.43% bonds, due 2018
Debt Instrument [Line Items]
Debt instrument interest rate		0.43%
Unsecured 0.86% bonds, due 2018
Debt Instrument [Line Items]
Debt instrument interest rate	0.86%	0.86%
Unsecured 2.00% bonds, due 2018
Debt Instrument [Line Items]
Debt instrument interest rate	2.00%	2.00%
Unsecured 0.05% bonds, due 2019
Debt Instrument [Line Items]
Debt instrument interest rate	0.05%	0.05%
Unsecured 2.07% bonds, due 2019
Debt Instrument [Line Items]
Debt instrument interest rate	2.07%	2.07%
Unsecured 0.23% bonds, due 2021
Debt Instrument [Line Items]
Debt instrument interest rate	0.23%	0.23%
Unsecured 0.11% bonds, due 2022
Debt Instrument [Line Items]
Debt instrument interest rate	0.11%
Unsecured 1.41% bonds, due 2022
Debt Instrument [Line Items]
Debt instrument interest rate	1.41%	1.41%
Unsecured 0.28% bonds, due 2023
Debt Instrument [Line Items]
Debt instrument interest rate	0.28%	0.28%
Unsecured 0.22% bonds, due 2025
Debt Instrument [Line Items]
Debt instrument interest rate	0.22%
Unsecured 0.42% bonds, due 2026
Debt Instrument [Line Items]
Debt instrument interest rate	0.42%	0.42%
Secured 0.00% loans, due 2019 to 2020
Debt Instrument [Line Items]
Debt instrument interest rate	0.00%	0.00%
Secured 0.00% loans, due 2019 to 2022
Debt Instrument [Line Items]
Debt instrument interest rate	0.00%	0.00%
Capital lease obligation and other, due 2017 to 2027 | Minimum
Debt Instrument [Line Items]
Debt instrument interest rate		0.36%
Capital lease obligation and other, due 2017 to 2027 | Maximum
Debt Instrument [Line Items]
Debt instrument interest rate		8.90%
Capital lease obligation and other, due 2018 to 2047 | Minimum
Debt Instrument [Line Items]
Debt instrument interest rate		0.36%
Capital lease obligation and other, due 2018 to 2047 | Maximum
Debt Instrument [Line Items]
Debt instrument interest rate		11.88%

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Short-Term Borrowings and Long-Term Debt (Aggregate Amounts of Annual Maturities of Long-Term Debt) (Detail) - JPY (¥) ¥ in Millions	Mar. 31, 2018	Mar. 31, 2017
Debt Disclosure [Abstract]
2019	¥ 225,522
2020	155,490
2021	58,620
2022	204,428
2023	16,437
Later fiscal years	188,476
Total	¥ 848,973	¥ 734,886

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Housing Loans and Deposits from Customers in the Banking Business - Additional Information (Detail) - JPY (¥) ¥ in Millions	Mar. 31, 2018	Mar. 31, 2017
Housing Loans And Deposits From Customers [Abstract]
Housing loans in the banking business, Carrying amount	¥ 1,522,415	¥ 1,449,790
Allowance for credit losses of housing loans in the banking business	717	866
Balance of time deposits issued in amounts of 10 million yen or more	¥ 279,943	¥ 275,638

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Housing Loans and Deposits from Customers in the Banking Business (Aggregate Amounts of Annual Maturities of Time Deposits with Remaining Term of More Than One Year) (Detail) ¥ in Millions	Mar. 31, 2018 JPY (¥)
Interest-bearing Deposit Liabilities [Abstract]
2020	¥ 39,058
2021	19,395
2022	9,120
2023	11,295
2024	9,736
Later fiscal years	19,203
Total	¥ 107,807

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Fair Value Measurements (Fair Value of Assets and Liabilities Measured on Recurring Basis) (Detail) - JPY (¥) ¥ in Millions		Mar. 31, 2018	Mar. 31, 2017
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Trading securities		¥ 1,048,062	¥ 921,320
Derivative assets		39,526	27,260
Derivative liabilities		35,724	34,450
Other
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities		99,350	15,192
Fair Value, Measurements, Recurring
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Trading securities		1,048,062	921,320
Other investments	[1]	20,395	21,597
Derivative assets	[2]	39,526	27,260
Total assets		3,455,847	3,111,180
Derivative liabilities	[2]	35,724	34,450
Total liabilities		35,724	34,450
Fair Value, Measurements, Recurring | Japanese national government bonds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities		1,409,610	1,343,401
Fair Value, Measurements, Recurring | Japanese local government bonds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities		67,569	60,531
Fair Value, Measurements, Recurring | Japanese corporate bonds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities		208,708	169,803
Fair Value, Measurements, Recurring | Foreign government bonds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	[3]	69,539	27,042
Fair Value, Measurements, Recurring | Foreign corporate bonds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	[4]	366,465	399,546
Fair Value, Measurements, Recurring | Other
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	[5]	99,350	15,192
Fair Value, Measurements, Recurring | Equity securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities		126,623	125,488
Marketable securities | Fair Value, Measurements, Recurring
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Trading securities		1,048,062	921,320
Total assets		1,173,352	1,044,469
Marketable securities | Fair Value, Measurements, Recurring | Japanese national government bonds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities		20,473	18,483
Marketable securities | Fair Value, Measurements, Recurring | Japanese local government bonds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities		8,548	8,518
Marketable securities | Fair Value, Measurements, Recurring | Japanese corporate bonds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities		8,041	8,433
Marketable securities | Fair Value, Measurements, Recurring | Foreign government bonds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	[3]		1,007
Marketable securities | Fair Value, Measurements, Recurring | Foreign corporate bonds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	[4]	88,228	86,708
Securities investments and other | Fair Value, Measurements, Recurring
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Other investments	[1]	20,395	21,597
Total assets		2,242,969	2,039,451
Securities investments and other | Fair Value, Measurements, Recurring | Japanese national government bonds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities		1,389,137	1,324,918
Securities investments and other | Fair Value, Measurements, Recurring | Japanese local government bonds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities		59,021	52,013
Securities investments and other | Fair Value, Measurements, Recurring | Japanese corporate bonds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities		200,667	161,370
Securities investments and other | Fair Value, Measurements, Recurring | Foreign government bonds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	[3]	69,539	26,035
Securities investments and other | Fair Value, Measurements, Recurring | Foreign corporate bonds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	[4]	278,237	312,838
Securities investments and other | Fair Value, Measurements, Recurring | Other
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	[5]	99,350	15,192
Securities investments and other | Fair Value, Measurements, Recurring | Equity securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities		126,623	125,488
Other current assets/liabilities | Fair Value, Measurements, Recurring
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	[2]	37,003	25,409
Total assets		37,003	25,409
Derivative liabilities	[2]	20,550	15,743
Total liabilities		20,550	15,743
Other noncurrent assets/liabilities | Fair Value, Measurements, Recurring
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative assets	[2]	2,523	1,851
Total assets		2,523	1,851
Derivative liabilities	[2]	15,174	18,707
Total liabilities		15,174	18,707
Level 1 | Fair Value, Measurements, Recurring
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Trading securities		712,113	611,108
Other investments	[1]	6,192	6,589
Derivative assets	[2]	2,194	981
Total assets		846,829	743,984
Derivative liabilities	[2]	1,407	520
Total liabilities		1,407	520
Level 1 | Fair Value, Measurements, Recurring | Equity securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities		126,330	125,306
Level 2 | Fair Value, Measurements, Recurring
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Trading securities		335,949	310,212
Other investments	[1]	5,099	4,525
Derivative assets	[2]	37,332	26,279
Total assets		2,488,422	2,299,034
Derivative liabilities	[2]	34,317	33,930
Total liabilities		34,317	33,930
Level 2 | Fair Value, Measurements, Recurring | Japanese national government bonds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities		1,409,610	1,343,401
Level 2 | Fair Value, Measurements, Recurring | Japanese local government bonds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities		67,569	60,531
Level 2 | Fair Value, Measurements, Recurring | Japanese corporate bonds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities		208,708	168,493
Level 2 | Fair Value, Measurements, Recurring | Foreign government bonds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	[3]	69,539	27,042
Level 2 | Fair Value, Measurements, Recurring | Foreign corporate bonds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	[4]	338,587	358,369
Level 2 | Fair Value, Measurements, Recurring | Other
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	[5]	15,736
Level 2 | Fair Value, Measurements, Recurring | Equity securities
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities		293	182
Level 3 | Fair Value, Measurements, Recurring
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Other investments	[1]	9,104	10,483
Total assets		120,596	68,162
Level 3 | Fair Value, Measurements, Recurring | Japanese corporate bonds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities			1,310
Level 3 | Fair Value, Measurements, Recurring | Foreign corporate bonds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	[4]	27,878	41,177
Level 3 | Fair Value, Measurements, Recurring | Other
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	[5]	¥ 83,614	¥ 15,192

[1] Other investments include certain hybrid financial instruments and certain private equity investments.

[2] Derivative assets and liabilities are recognized and disclosed on a gross basis.

[3] 2,215 million yen and 2,875 million yen are included in foreign securities for which the fair value option has been elected and classified in level 2 for the fiscal years ended March 31, 2017 and 2018, respectively, and are included in the consolidated balance sheets as securities investments and other.

[4] 165,236 million yen and 160,470 million yen are included in foreign securities for which the fair value option has been elected and classified in level 2 for the fiscal years ended March 31, 2017 and 2018, respectively. In the consolidated balance sheets, 32,167 million yen and 25,955 million yen are included as marketable securities and 133,069 million yen and 134,515 million yen are included as securities investment and other for the fiscal years ended March 31, 2017 and 2018, respectively.

[5] 14,619 million yen and 93,971 million yen are included in foreign securities for which the fair value option has been elected and classified in level 2 and level 3 for the fiscal years ended March 31, 2017 and 2018, respectively, and are included in the consolidated balance sheets as securities investments and other.

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Fair Value Measurements (Fair Value of Assets and Liabilities Measured on Recurring Basis) (Parenthetical) (Detail) - JPY (¥) ¥ in Millions	12 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Net gains from financial instruments for which fair value option has been elected	¥ 544	¥ 502
Level 2 | Fair Value, Measurements, Recurring | Foreign corporate bonds: foreign securities for which fair value option has been elected
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	160,470	165,236
Level 2 | Marketable securities | Fair Value, Measurements, Recurring | Foreign corporate bonds: foreign securities for which fair value option has been elected
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	25,955	32,167
Level 2 | Securities investments and other | Fair Value, Measurements, Recurring | Foreign government bonds: foreign securities for which fair value option has been elected
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	2,875	2,215
Level 2 | Securities investments and other | Fair Value, Measurements, Recurring | Foreign corporate bonds: foreign securities for which fair value option has been elected
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	134,515	133,069
Level 3 | Securities investments and other | Fair Value, Measurements, Recurring | Other: foreign securities for which fair value option has been elected
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Available-for-sale securities	¥ 93,971	¥ 14,619

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Fair Value Measurements - Additional Information (Detail) - JPY (¥) ¥ in Millions	12 Months Ended
	Mar. 31, 2018	Mar. 31, 2017	Mar. 31, 2016
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Transfers into level 1	¥ 3,522	¥ 2,833
Transfers out of level 1	3,086	3,103
Impairments		112,069
All Other | Battery Business Asset Group
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Impairment of long-lived assets			¥ 30,643
All Other | Battery Business Asset Group | Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value measurements, discount rate			10.00%
All Other | Battery Business Asset Group | Minimum | Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value measurements, projected revenue growth rate			0.00%
All Other | Battery Business Asset Group | Maximum | Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value measurements, projected revenue growth rate			14.00%
Semiconductors | Camera Module Business Asset Group
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Impairment of long-lived assets		¥ 23,860	¥ 59,616
Semiconductors | Camera Module Business Asset Group | Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value measurements, discount rate		10.00%	10.00%
Semiconductors | Camera Module Business Asset Group | Minimum | Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value measurements, projected revenue growth rate		(1.00%)	0.00%
Semiconductors | Camera Module Business Asset Group | Maximum | Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value measurements, projected revenue growth rate		8.00%	108.00%
Mobile Communications | Smartphone Business Asset Group
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Impairment of long-lived assets	¥ 31,341
Mobile Communications | Smartphone Business Asset Group | Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value measurements, discount rate	8.50%
Mobile Communications | Smartphone Business Asset Group | Minimum | Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value measurements, projected revenue growth rate	(8.00%)
Mobile Communications | Smartphone Business Asset Group | Maximum | Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value measurements, projected revenue growth rate	6.00%
Pictures
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Impairments		¥ 112,069
Pictures | Production and Distribution
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Impairments		¥ 112,069
Pictures | Production and Distribution | Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value measurements, discount rate		9.50%
Fair value measurements, earnings multiple		9
Pictures | Production and Distribution | Minimum | Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value measurements, projected revenue growth rate		3.00%
Pictures | Production and Distribution | Maximum | Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Fair value measurements, projected revenue growth rate		4.50%

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Fair Value Measurements (Changes in Fair Value of Level Three Assets and Liabilities) (Detail) - JPY (¥) ¥ in Millions		12 Months Ended
		Mar. 31, 2018	Mar. 31, 2017
Other Investments
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Beginning balance		¥ 10,483	¥ 13,463
Total realized and unrealized gains (losses), included in earnings	[1]	(65)	328
Total realized and unrealized gains (losses), included in other comprehensive income (loss)	[2]	(489)	(2,416)
Purchases		139	247
Sales		(10)
Settlements		(954)	(1,139)
Ending balance		9,104	10,483
Changes in unrealized gains (losses) relating to instruments still held at reporting date included in earnings	[1]	(65)	(27)
Available-for-sale securities | Japanese corporate bonds
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Beginning balance		1,310	3,346
Total realized and unrealized gains (losses), included in other comprehensive income (loss)	[2]		(20)
Transfers out of level 3	[3]	(1,310)	(2,016)
Ending balance			1,310
Available-for-sale securities | Foreign corporate bonds
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Beginning balance		41,177	15,853
Total realized and unrealized gains (losses), included in earnings	[1]	(307)	1,091
Total realized and unrealized gains (losses), included in other comprehensive income (loss)	[2]	(84)	(84)
Purchases		12,604	35,335
Settlements		(18,540)	(10,021)
Transfers into level 3	[4]		1,008
Transfers out of level 3	[3]	(6,972)	(2,005)
Ending balance		27,878	41,177
Changes in unrealized gains (losses) relating to instruments still held at reporting date included in earnings	[1]	(468)	11
Available-for-sale securities | Other
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Beginning balance		15,192	884
Total realized and unrealized gains (losses), included in earnings	[1]	(3,032)	514
Total realized and unrealized gains (losses), included in other comprehensive income (loss)	[2]	1	(1)
Purchases		74,736	14,026
Settlements		(3,283)	(231)
Ending balance		83,614	15,192
Changes in unrealized gains (losses) relating to instruments still held at reporting date included in earnings	[1]	¥ (2,278)	¥ 79

[1] Earning effects are included in financial services revenue in the consolidated statements of income.

[2] Unrealized gains (losses) are included in unrealized gains (losses) on securities in the consolidated statements of comprehensive income.

[3] Certain corporate bonds were transferred out of level 3 because observable market data became available.

[4] Certain corporate bonds were transferred into level 3 because differences between the fair value determined by indicative quotes from dealers and the fair value determined by internally developed prices became significant and the observability of the inputs used decreased.

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Fair Value Measurements (Assets and Liabilities Remeasured At Fair Value on a Nonrecurring Basis) (Detail) - JPY (¥) ¥ in Millions	12 Months Ended
	Mar. 31, 2018	Mar. 31, 2017
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Nonrecurring changes in fair value, Amounts included in earnings	¥ (53,741)	¥ (151,206)
Fair Value, Measurements, Nonrecurring | Level 3
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Long-lived assets, Estimated fair value	19,375	72
Goodwill, Estimated fair value		0
Long-lived assets impairments
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Nonrecurring changes in fair value, Amounts included in earnings	¥ (53,741)	(39,137)
Goodwill impairments
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Nonrecurring changes in fair value, Amounts included in earnings		¥ (112,069)

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Fair Value Measurements (Estimated Fair Values by Fair Value Hierarchy Level of Certain Financial Instruments not Reported at Fair Value) (Detail) - JPY (¥) ¥ in Millions	Mar. 31, 2018	Mar. 31, 2017
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Housing loans in the banking business, Carrying amount	¥ 1,522,415	¥ 1,449,790
Total assets, Carrying amount	19,065,538	17,660,556
Long-term debt including the current portion, Carrying amount	848,973	734,886
Total liabilities	15,409,171	14,513,076
Estimated fair value
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Housing loans in the banking business, Estimated fair value	1,686,842	1,603,784
Total assets, Estimated fair value	1,686,842	1,603,784
Long-term debt including the current portion, Estimated fair value	877,576	745,599
Investment contracts included in policyholders' account in the life insurance business, Estimated fair value	766,558	710,191
Total liabilities, Estimated fair value	1,644,134	1,455,790
Carrying amount
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Housing loans in the banking business, Carrying amount	1,522,415	1,449,790
Total assets, Carrying amount	1,522,415	1,449,790
Long-term debt including the current portion, Carrying amount	848,973	734,886
Investment contracts included in policyholders' account in the life insurance business, Carrying amount	738,404	686,182
Total liabilities	1,587,377	1,421,068
Level 2 | Estimated fair value
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Housing loans in the banking business, Estimated fair value	1,686,842	1,603,784
Total assets, Estimated fair value	1,686,842	1,603,784
Long-term debt including the current portion, Estimated fair value	877,576	745,599
Investment contracts included in policyholders' account in the life insurance business, Estimated fair value	766,558	710,191
Total liabilities, Estimated fair value	¥ 1,644,134	¥ 1,455,790

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Derivative Instruments and Hedging Activities (Estimated Fair Values of Outstanding Derivative Instruments) (Detail) - JPY (¥) ¥ in Millions	Mar. 31, 2018	Mar. 31, 2017
Derivatives, Fair Value [Line Items]
Derivative assets	¥ 39,526	¥ 27,260
Derivative liabilities	35,724	34,450
Designated as hedging instrument
Derivatives, Fair Value [Line Items]
Derivative assets	346	138
Derivative liabilities	11,976	14,241
Designated as hedging instrument | Interest rate contracts | Current liabilities: Other
Derivatives, Fair Value [Line Items]
Derivative liabilities	160	497
Designated as hedging instrument | Interest rate contracts | Liabilities: Other
Derivatives, Fair Value [Line Items]
Derivative liabilities	10,281	13,713
Designated as hedging instrument | Interest rate contracts | Prepaid expenses and other current assets
Derivatives, Fair Value [Line Items]
Derivative assets	12	43
Designated as hedging instrument | Interest rate contracts | Other assets: Other
Derivatives, Fair Value [Line Items]
Derivative assets	286	95
Designated as hedging instrument | Foreign exchange contracts | Current liabilities: Other
Derivatives, Fair Value [Line Items]
Derivative liabilities	1,535	31
Designated as hedging instrument | Foreign exchange contracts | Prepaid expenses and other current assets
Derivatives, Fair Value [Line Items]
Derivative assets	48
Not designated as hedging instrument
Derivatives, Fair Value [Line Items]
Derivative assets	39,180	27,122
Derivative liabilities	23,748	20,209
Not designated as hedging instrument | Interest rate contracts | Current liabilities: Other
Derivatives, Fair Value [Line Items]
Derivative liabilities	299	221
Not designated as hedging instrument | Interest rate contracts | Liabilities: Other
Derivatives, Fair Value [Line Items]
Derivative liabilities	3,612	4,374
Not designated as hedging instrument | Interest rate contracts | Prepaid expenses and other current assets
Derivatives, Fair Value [Line Items]
Derivative assets	12	3
Not designated as hedging instrument | Interest rate contracts | Other assets: Other
Derivatives, Fair Value [Line Items]
Derivative assets	1,871	1,599
Not designated as hedging instrument | Foreign exchange contracts | Current liabilities: Other
Derivatives, Fair Value [Line Items]
Derivative liabilities	17,149	14,475
Not designated as hedging instrument | Foreign exchange contracts | Liabilities: Other
Derivatives, Fair Value [Line Items]
Derivative liabilities	1,281	620
Not designated as hedging instrument | Foreign exchange contracts | Prepaid expenses and other current assets
Derivatives, Fair Value [Line Items]
Derivative assets	34,737	24,382
Not designated as hedging instrument | Foreign exchange contracts | Other assets: Other
Derivatives, Fair Value [Line Items]
Derivative assets	366	157
Not designated as hedging instrument | Equity Contracts | Current liabilities: Other
Derivatives, Fair Value [Line Items]
Derivative liabilities	1,407	519
Not designated as hedging instrument | Equity Contracts | Prepaid expenses and other current assets
Derivatives, Fair Value [Line Items]
Derivative assets	¥ 2,194	¥ 981

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Derivative Instruments and Hedging Activities (Effects of Derivative Instruments on Consolidated Statements of Income) (Detail) - JPY (¥) ¥ in Millions	12 Months Ended
	Mar. 31, 2018	Mar. 31, 2017	Mar. 31, 2016
Derivative Instruments, Gain (Loss) [Line Items]
Amount of gain or (loss) reclassified from accumulated OCI into income (effective portion)	¥ 1,111	¥ (5,583)	¥ (3,112)
Foreign exchange contracts | Foreign exchange loss, net
Derivative Instruments, Gain (Loss) [Line Items]
Amount of gain or (loss) reclassified from accumulated OCI into income (effective portion)			(8)
Foreign exchange contracts | Cost of Sales
Derivative Instruments, Gain (Loss) [Line Items]
Amount of gain or (loss) reclassified from accumulated OCI into income (effective portion)	1,111	(5,583)	(3,104)
Not designated as hedging instrument
Derivative Instruments, Gain (Loss) [Line Items]
Amount of gain or (loss) recognized in income on derivative	10,174	(12,558)	(12,567)
Not designated as hedging instrument | Interest rate contracts | Financial services revenue
Derivative Instruments, Gain (Loss) [Line Items]
Amount of gain or (loss) recognized in income on derivative	(1,544)	(935)	(5,499)
Not designated as hedging instrument | Foreign exchange contracts | Financial services revenue
Derivative Instruments, Gain (Loss) [Line Items]
Amount of gain or (loss) recognized in income on derivative	2,013	(5,365)	4,166
Not designated as hedging instrument | Foreign exchange contracts | Foreign exchange loss, net
Derivative Instruments, Gain (Loss) [Line Items]
Amount of gain or (loss) recognized in income on derivative	21,370	12,339	(14,501)
Not designated as hedging instrument | Equity Contracts | Financial services revenue
Derivative Instruments, Gain (Loss) [Line Items]
Amount of gain or (loss) recognized in income on derivative	(11,665)	(18,597)	3,267
Fair Value Hedging
Derivative Instruments, Gain (Loss) [Line Items]
Amount of gain or (loss) recognized in income on derivative	(52)	1,936	(8,297)
Fair Value Hedging | Interest rate contracts | Financial services revenue
Derivative Instruments, Gain (Loss) [Line Items]
Amount of gain or (loss) recognized in income on derivative	(52)	1,967	(8,300)
Fair Value Hedging | Foreign exchange contracts | Foreign exchange loss, net
Derivative Instruments, Gain (Loss) [Line Items]
Amount of gain or (loss) recognized in income on derivative		(31)	3
Cash Flow Hedging
Derivative Instruments, Gain (Loss) [Line Items]
Amount of gain or (loss) recognized in OCI on derivative	(2,295)	6,715	1,914
Cash Flow Hedging | Foreign exchange contracts
Derivative Instruments, Gain (Loss) [Line Items]
Amount of gain or (loss) recognized in OCI on derivative	¥ (2,295)	¥ 6,715	¥ 1,914

XML

Derivative Instruments and Hedging Activities (Summary of Derivatives Additional Information Including Notional Amounts) (Detail) - JPY (¥) ¥ in Millions	Mar. 31, 2018	Mar. 31, 2017
Foreign exchange forward contracts
Derivative [Line Items]
Notional amount	¥ 1,105,393	¥ 1,062,933
Fair value	7,071	3,011
Currency option contracts purchased
Derivative [Line Items]
Notional amount	206	212
Fair value	1	1
Currency option contracts written
Derivative [Line Items]
Notional amount	156	214
Fair value	(1)	(1)
Currency swap agreements
Derivative [Line Items]
Notional amount	1,230,254	1,439,395
Fair value	4,613	4,074
Other currency contracts
Derivative [Line Items]
Notional amount	84,623	64,944
Fair value	3,502	2,328
Interest rate swap agreements
Derivative [Line Items]
Notional amount	398,291	415,719
Fair value	(12,171)	(17,065)
Equity future contracts
Derivative [Line Items]
Notional amount	106,876	96,016
Fair value	¥ 787	¥ 462

XML

Derivative Instruments and Hedging Activities (Summary of Effects of Offsetting Derivative Assets, Derivative Liabilities, Financial Assets and Financial Liabilities) (Detail) (Detail) - JPY (¥) ¥ in Millions	Mar. 31, 2018	Mar. 31, 2017
Offsetting Asset and Liabilities [Line Items]
Gross amounts presented in consolidated balance sheet, Derivative asset	¥ 39,526	¥ 27,260
Financial instruments, Derivative asset	7,724	6,584
Cash collateral, Derivative asset	449	277
Net amounts, Derivative asset	31,353	20,399
Gross amounts presented in the consolidated balance sheet, Derivative liability	35,724	34,450
Gross amounts presented in the consolidated balance sheet, Repurchase, securities lending and similar arrangements	335,586	310,609
Financial instruments, Repurchase, securities lending and similar arrangements	334,246	309,987
Net amounts, Repurchase, securities lending and similar arrangements	1,340	622
Gross amounts presented in the consolidated balance sheet, Total liabilities	371,310	345,059
Financial instruments, Total liabilities	342,572	316,631
Cash collateral, Total liabilities	14,334	18,631
Net amounts, Total liabilities	14,404	9,797
Subject to master netting arrangement
Offsetting Asset and Liabilities [Line Items]
Gross amounts presented in consolidated balance sheet, Derivative asset	15,404	11,554
Financial instruments, Derivative asset	7,724	6,584
Cash collateral, Derivative asset	449	277
Net amounts, Derivative asset	7,231	4,693
Gross amounts presented in the consolidated balance sheet, Derivative liability	34,455	33,261
Financial instruments, Derivative liability	8,326	6,644
Cash collateral, Derivative liability	14,334	18,631
Net amounts, Derivative liability	11,795	7,986
Not subject to master netting arrangement
Offsetting Asset and Liabilities [Line Items]
Gross amounts presented in consolidated balance sheet, Derivative asset	24,122	15,706
Net amounts, Derivative asset	24,122	15,706
Gross amounts presented in the consolidated balance sheet, Derivative liability	1,269	1,189
Net amounts, Derivative liability	¥ 1,269	¥ 1,189

XML

Pension and Severance Plans - Additional Information (Detail) - JPY (¥) ¥ in Millions	12 Months Ended
	Mar. 31, 2017	Mar. 31, 2018
Defined Benefit Plan Disclosure [Line Items]
Percentage of the indemnities under existing regulations to employees covered by defined benefits	65.00%
Expected amortization of net actuarial loss from accumulated other comprehensive income in next fiscal year		¥ 17,706
Expected amortization of prior service cost from accumulated other comprehensive income in next fiscal year		8,114
Japan
Defined Benefit Plan Disclosure [Line Items]
Expected contribution in defined benefit pension plans		¥ 11,000
Japan | Private equity
Defined Benefit Plan Disclosure [Line Items]
Percentage of investments in equity securities for the pension plans		28.00%
Japan | Fixed income funds
Defined Benefit Plan Disclosure [Line Items]
Percentage of investments in equity securities for the pension plans		54.00%
Japan | Other investment funds
Defined Benefit Plan Disclosure [Line Items]
Percentage of investments in equity securities for the pension plans		18.00%
Foreign plans
Defined Benefit Plan Disclosure [Line Items]
Expected contribution in defined benefit pension plans		¥ 6,000
Foreign plans | Private equity
Defined Benefit Plan Disclosure [Line Items]
Percentage of investments in equity securities for the pension plans		27.00%
Foreign plans | Fixed income funds
Defined Benefit Plan Disclosure [Line Items]
Percentage of investments in equity securities for the pension plans		46.00%
Foreign plans | Other investment funds
Defined Benefit Plan Disclosure [Line Items]
Percentage of investments in equity securities for the pension plans		27.00%

XML

Pension and Severance Plans (Components of Net Periodic Benefit Costs) (Detail) - JPY (¥) ¥ in Millions	12 Months Ended
	Mar. 31, 2018	Mar. 31, 2017	Mar. 31, 2016
Japan
Defined Benefit Plan Disclosure [Line Items]
Service cost	¥ 25,185	¥ 26,811	¥ 24,670
Interest cost	8,024	5,912	8,689
Expected return on plan assets	(16,440)	(17,829)	(20,853)
Recognized actuarial loss	16,099	20,436	8,588
Amortization of prior service costs	(8,693)	(9,490)	(9,489)
Net periodic benefit costs	24,175	25,840	11,605
Foreign plans
Defined Benefit Plan Disclosure [Line Items]
Service cost	3,181	2,958	3,504
Interest cost	10,393	10,426	12,096
Expected return on plan assets	(11,687)	(11,000)	(14,117)
Amortization of net transition asset	5	9	10
Recognized actuarial loss	3,014	2,552	4,236
Amortization of prior service costs	(574)	(463)	(478)
Losses on curtailments and settlements	1,058	43	354
Net periodic benefit costs	¥ 5,390	¥ 4,525	¥ 5,605

XML

Pension and Severance Plans (Changes in Benefit Obligation and Plan Assets as well as Funded Status and Composition of Amounts Recognized in Consolidated Balance Sheets) (Detail) - JPY (¥) ¥ in Millions	12 Months Ended
	Mar. 31, 2018	Mar. 31, 2017	Mar. 31, 2016
Japan
Change in benefit obligation:
Benefit obligation at beginning of the fiscal year	¥ 1,004,676	¥ 1,034,284
Service cost	25,185	26,811	¥ 24,670
Interest cost	8,024	5,912	8,689
Actuarial (gain) loss	21,920	(33,333)
Other	(8)	(5)
Benefits paid	(49,223)	(28,993)
Benefit obligation at end of the fiscal year	1,010,574	1,004,676	1,034,284
Change in plan assets:
Fair value of plan assets at beginning of the fiscal year	699,008	679,432
Actual return on plan assets	38,896	35,508
Employer contribution	6,090	6,640
Benefits paid	(32,917)	(22,572)
Fair value of plan assets at end of the fiscal year	711,077	699,008	679,432
Funded status at end of the fiscal year	(299,497)	(305,668)
Foreign plans
Change in benefit obligation:
Benefit obligation at beginning of the fiscal year	352,442	356,875
Service cost	3,181	2,958	3,504
Interest cost	10,393	10,426	12,096
Plan participants' contributions	573	490
Actuarial (gain) loss	663	20,045
Foreign currency exchange rate changes	8,858	(23,183)
Curtailments and settlements	(5,422)	(1,507)
Benefits paid	(14,291)	(13,662)
Benefit obligation at end of the fiscal year	356,397	352,442	356,875
Change in plan assets:
Fair value of plan assets at beginning of the fiscal year	259,177	256,341
Actual return on plan assets	13,426	29,346
Foreign currency exchange rate changes	6,181	(20,004)
Employer contribution	9,040	6,738
Plan participants' contributions	573	490
Curtailments and settlements	(5,285)	(1,161)
Benefits paid	(13,367)	(12,573)
Fair value of plan assets at end of the fiscal year	269,745	259,177	¥ 256,341
Funded status at end of the fiscal year	¥ (86,652)	¥ (93,265)

XML

Pension and Severance Plans (Amounts Recognized in Consolidated Balance Sheets) (Detail) - JPY (¥) ¥ in Millions	Mar. 31, 2018	Mar. 31, 2017
Japan
Defined Benefit Plan Disclosure [Line Items]
Noncurrent assets	¥ 3,426	¥ 2,753
Noncurrent liabilities	(302,923)	(308,421)
Ending balance	(299,497)	(305,668)
Foreign plans
Defined Benefit Plan Disclosure [Line Items]
Noncurrent assets	8,396	6,251
Current liabilities	(4,121)	(3,114)
Noncurrent liabilities	(90,927)	(96,402)
Ending balance	¥ (86,652)	¥ (93,265)

XML

Pension and Severance Plans (Amounts Recognized in Accumulated Other Comprehensive Income, Excluding Tax Effects) (Detail) - JPY (¥) ¥ in Millions	Mar. 31, 2018	Mar. 31, 2017
Japan
Defined Benefit Plan Disclosure [Line Items]
Prior service cost (credit)	¥ (16,723)	¥ (25,415)
Net actuarial loss	299,852	317,397
Ending balance	283,129	291,982
Foreign plans
Defined Benefit Plan Disclosure [Line Items]
Prior service cost (credit)	(488)	(1,034)
Net actuarial loss	73,404	78,548
Obligation existing at transition	0	(3)
Ending balance	¥ 72,916	¥ 77,511

XML

Pension and Severance Plans (Accumulated Benefit Obligations for All Defined Benefit Pension Plans) (Detail) - JPY (¥) ¥ in Millions	Mar. 31, 2018	Mar. 31, 2017
Japan
Defined Benefit Plan Disclosure [Line Items]
Accumulated benefit obligations	¥ 1,005,557	¥ 998,501
Foreign plans
Defined Benefit Plan Disclosure [Line Items]
Accumulated benefit obligations	¥ 340,353	¥ 329,989

XML

Pension and Severance Plans (Projected Benefit Obligations, Accumulated Benefit Obligations and Fair Value of Plan Assets for Pension Plans with Accumulated Benefit Obligations in Excess of Plan Assets) (Detail) - JPY (¥) ¥ in Millions	Mar. 31, 2018	Mar. 31, 2017
Japan
Defined Benefit Plan Disclosure [Line Items]
Projected benefit obligations	¥ 998,629	¥ 992,052
Accumulated benefit obligations	993,612	987,428
Fair value of plan assets	695,706	685,183
Foreign plans
Defined Benefit Plan Disclosure [Line Items]
Projected benefit obligations	301,046	291,413
Accumulated benefit obligations	293,834	287,491
Fair value of plan assets	¥ 215,510	¥ 207,406

XML

Pension and Severance Plans (Weighted-Average Assumptions Used to Determine Benefit Obligations and Net Periodic Benefit Costs) (Detail)		12 Months Ended
		Mar. 31, 2018	Mar. 31, 2017	Mar. 31, 2016
Japan
Defined Benefit Plan, Weighted Average Assumptions Used in Calculating Benefit Obligation [Abstract]
Discount rate		0.80%	0.90%
Rate of compensation increase	[1]
Defined Benefit Plan, Weighted Average Assumptions Used in Calculating Net Periodic Benefit Cost [Abstract]
Discount rate		0.90%	0.60%	1.00%
Expected return on plan assets		2.40%	2.70%	3.00%
Rate of compensation increase	[1]
Foreign plans
Defined Benefit Plan, Weighted Average Assumptions Used in Calculating Benefit Obligation [Abstract]
Discount rate		2.90%	3.10%
Rate of compensation increase		2.60%	2.40%
Defined Benefit Plan, Weighted Average Assumptions Used in Calculating Net Periodic Benefit Cost [Abstract]
Discount rate		3.10%	3.20%	3.10%
Expected return on plan assets		4.60%	4.80%	4.80%
Rate of compensation increase		2.40%	2.80%	2.90%

[1] Substantially all of Sony's Japanese pension plans were point-based. Point-based plans do not incorporate a measure of compensation rate increases.

XML

Pension and Severance Plans (Fair Values of Assets Held by Japanese and Foreign Plans) (Detail) - JPY (¥) ¥ in Millions		Mar. 31, 2018		Mar. 31, 2017		Mar. 31, 2016
Japan
Defined Benefit Plan Disclosure [Line Items]
Fair values of the assets held		¥ 711,077		¥ 699,008		¥ 679,432
Japan | Cash and cash equivalents
Defined Benefit Plan Disclosure [Line Items]
Fair values of the assets held		9,446		7,976
Japan | Equity securities
Defined Benefit Plan Disclosure [Line Items]
Fair values of the assets held	[1]	138,443		157,012
Japan | Government bonds
Defined Benefit Plan Disclosure [Line Items]
Fair values of the assets held	[2]	225,879		206,632
Japan | Corporate bonds
Defined Benefit Plan Disclosure [Line Items]
Fair values of the assets held	[3]	79,323		75,971
Japan | Asset-backed securities
Defined Benefit Plan Disclosure [Line Items]
Fair values of the assets held	[4]	121		1,105
Japan | Commingled funds
Defined Benefit Plan Disclosure [Line Items]
Fair values of the assets held	[5]	122,950		122,264
Japan | Commodity Funds
Defined Benefit Plan Disclosure [Line Items]
Fair values of the assets held	[6]	21,136		21,098
Japan | Private equity
Defined Benefit Plan Disclosure [Line Items]
Fair values of the assets held	[7]	24,144		21,790
Japan | Hedge funds
Defined Benefit Plan Disclosure [Line Items]
Fair values of the assets held	[8]	70,204		67,235
Japan | Real estate and other
Defined Benefit Plan Disclosure [Line Items]
Fair values of the assets held	[9]	19,431		17,925
Foreign plans
Defined Benefit Plan Disclosure [Line Items]
Fair values of the assets held		269,745		259,177		256,341
Foreign plans | Cash and cash equivalents
Defined Benefit Plan Disclosure [Line Items]
Fair values of the assets held		2,377		8,091
Foreign plans | Equity securities
Defined Benefit Plan Disclosure [Line Items]
Fair values of the assets held	[10]	30,916		33,103
Foreign plans | Government bonds
Defined Benefit Plan Disclosure [Line Items]
Fair values of the assets held	[11]	78,129		65,671
Foreign plans | Corporate bonds
Defined Benefit Plan Disclosure [Line Items]
Fair values of the assets held	[12]	26,424		28,296
Foreign plans | Asset-backed securities
Defined Benefit Plan Disclosure [Line Items]
Fair values of the assets held		960		982
Foreign plans | Commingled funds
Defined Benefit Plan Disclosure [Line Items]
Fair values of the assets held	[13]	75,785		81,683
Foreign plans | Real estate and other
Defined Benefit Plan Disclosure [Line Items]
Fair values of the assets held	[9]	36,484		36,216
Foreign plans | Insurance contracts
Defined Benefit Plan Disclosure [Line Items]
Fair values of the assets held	[14]	18,670		5,135
Level 1 | Japan
Defined Benefit Plan Disclosure [Line Items]
Fair values of the assets held		143,537		160,828
Level 1 | Japan | Cash and cash equivalents
Defined Benefit Plan Disclosure [Line Items]
Fair values of the assets held		9,446		7,976
Level 1 | Japan | Equity securities
Defined Benefit Plan Disclosure [Line Items]
Fair values of the assets held	[1]	134,091		152,852
Level 1 | Foreign plans
Defined Benefit Plan Disclosure [Line Items]
Fair values of the assets held		32,191		39,874
Level 1 | Foreign plans | Cash and cash equivalents
Defined Benefit Plan Disclosure [Line Items]
Fair values of the assets held		2,377		8,091
Level 1 | Foreign plans | Equity securities
Defined Benefit Plan Disclosure [Line Items]
Fair values of the assets held	[10]	29,814		31,783
Level 2 | Japan
Defined Benefit Plan Disclosure [Line Items]
Fair values of the assets held		453,761		431,230
Level 2 | Japan | Equity securities
Defined Benefit Plan Disclosure [Line Items]
Fair values of the assets held	[1]	4,352		4,160
Level 2 | Japan | Government bonds
Defined Benefit Plan Disclosure [Line Items]
Fair values of the assets held	[2]	225,879		206,632
Level 2 | Japan | Corporate bonds
Defined Benefit Plan Disclosure [Line Items]
Fair values of the assets held	[3]	79,323		75,971
Level 2 | Japan | Asset-backed securities
Defined Benefit Plan Disclosure [Line Items]
Fair values of the assets held	[4]	121		1,105
Level 2 | Japan | Commingled funds
Defined Benefit Plan Disclosure [Line Items]
Fair values of the assets held	[5]	122,950		122,264
Level 2 | Japan | Commodity Funds
Defined Benefit Plan Disclosure [Line Items]
Fair values of the assets held	[6]	21,136		21,098
Level 2 | Foreign plans
Defined Benefit Plan Disclosure [Line Items]
Fair values of the assets held		193,546		189,448
Level 2 | Foreign plans | Equity securities
Defined Benefit Plan Disclosure [Line Items]
Fair values of the assets held	[10]	1,102		1,320
Level 2 | Foreign plans | Government bonds
Defined Benefit Plan Disclosure [Line Items]
Fair values of the assets held	[11]	78,129		65,671
Level 2 | Foreign plans | Corporate bonds
Defined Benefit Plan Disclosure [Line Items]
Fair values of the assets held	[12]	21,121		21,370
Level 2 | Foreign plans | Asset-backed securities
Defined Benefit Plan Disclosure [Line Items]
Fair values of the assets held		960		982
Level 2 | Foreign plans | Commingled funds
Defined Benefit Plan Disclosure [Line Items]
Fair values of the assets held	[13]	75,785		81,683
Level 2 | Foreign plans | Real estate and other
Defined Benefit Plan Disclosure [Line Items]
Fair values of the assets held	[9]	10,508		13,287
Level 2 | Foreign plans | Insurance contracts
Defined Benefit Plan Disclosure [Line Items]
Fair values of the assets held	[14]	5,941		5,135
Level 3 | Japan
Defined Benefit Plan Disclosure [Line Items]
Fair values of the assets held		113,779		106,950		99,562
Level 3 | Japan | Private equity
Defined Benefit Plan Disclosure [Line Items]
Fair values of the assets held		24,144	[7]	21,790	[7]	31,852
Level 3 | Japan | Hedge funds
Defined Benefit Plan Disclosure [Line Items]
Fair values of the assets held		70,204	[8]	67,235	[8]	60,395
Level 3 | Japan | Real estate and other
Defined Benefit Plan Disclosure [Line Items]
Fair values of the assets held		19,431	[9]	17,925	[9]	7,315
Level 3 | Foreign plans
Defined Benefit Plan Disclosure [Line Items]
Fair values of the assets held		44,008		29,855		31,124
Level 3 | Foreign plans | Corporate bonds
Defined Benefit Plan Disclosure [Line Items]
Fair values of the assets held		5,303	[12]	6,926	[12]	7,000
Level 3 | Foreign plans | Real estate and other
Defined Benefit Plan Disclosure [Line Items]
Fair values of the assets held		25,976	[9]	¥ 22,929	[9]	¥ 24,124
Level 3 | Foreign plans | Insurance contracts
Defined Benefit Plan Disclosure [Line Items]
Fair values of the assets held	[14]	¥ 12,729

[1] Includes approximately 48 percent and 52 percent of Japanese equity securities, and 52 percent and 48 percent of foreign equity securities for the fiscal years ended March 31, 2017 and 2018, respectively.

[2] Includes approximately 46 percent and 49 percent of debt securities issued by Japanese national and local governments, and 54 percent and 51 percent of debt securities issued by foreign national and local governments for the fiscal years ended March 31, 2017 and 2018, respectively.

[3] Includes debt securities issued by Japanese and foreign corporation and government related agencies.

[4] Includes primarily mortgage-backed securities.

[5] Commingled funds represent pooled institutional investments, including primarily investment trusts. They include approximately 48 percent and 51 percent of investments in equity, 51 percent and 48 percent of investments in fixed income, and 1 percent and 1 percent of investments in other for the fiscal years ended March 31, 2017 and 2018, respectively.

[6] Represents commodity futures funds.

[7] Includes multiple private equity funds of funds that primarily invest in venture, buyout, and distressed markets in the U.S. and Europe.

[8] Includes primarily funds that invest in a portfolio of a broad range of hedge funds to diversify the risks and reduce the volatilities associated with a single hedge fund.

[9] Includes primarily private real estate investment trusts.

[10] Includes primarily foreign equity securities.

[11] Includes primarily foreign government debt securities.

[12] Includes primarily foreign corporate debt securities.

[13] Commingled funds represent pooled institutional investments including mutual funds, common trust funds, and collective investment funds. They are primarily comprised of foreign equities and fixed income investments.

[14] Represents annuity contracts with or without profit sharing.

XML

Pension and Severance Plans (Fair Values of Assets Held by Japanese and Foreign Plans) (Parenthetical) (Detail) - Japan	Mar. 31, 2018	Mar. 31, 2017
Commingled funds | Equity securities
Defined Benefit Plan Disclosure [Line Items]
Percentage of investments	51.00%	48.00%
Commingled funds | Fixed Income Securities
Defined Benefit Plan Disclosure [Line Items]
Percentage of investments	48.00%	51.00%
Commingled funds | Other investment funds
Defined Benefit Plan Disclosure [Line Items]
Percentage of investments	1.00%	1.00%
Japanese equity securities
Defined Benefit Plan Disclosure [Line Items]
Percentage of investments	52.00%	48.00%
Foreign equity securities
Defined Benefit Plan Disclosure [Line Items]
Percentage of investments	48.00%	52.00%
Japanese National and Local Government Debt Securities
Defined Benefit Plan Disclosure [Line Items]
Percentage of investments	49.00%	46.00%
Foreign National and Local Government Debt Securities
Defined Benefit Plan Disclosure [Line Items]
Percentage of investments	51.00%	54.00%

XML

Pension and Severance Plans (Summary of Changes in Fair Values of Japanese and Foreign Plans' Level Three Assets) (Detail) - JPY (¥) ¥ in Millions		12 Months Ended
		Mar. 31, 2018		Mar. 31, 2017
Japan
Defined Benefit Plan Disclosure [Line Items]
Fair value of plan assets at beginning of the fiscal year		¥ 699,008		¥ 679,432
Fair value of plan assets at end of the fiscal year		711,077		699,008
Japan | Private equity
Defined Benefit Plan Disclosure [Line Items]
Fair value of plan assets at beginning of the fiscal year	[1]	21,790
Fair value of plan assets at end of the fiscal year	[1]	24,144		21,790
Japan | Hedge funds
Defined Benefit Plan Disclosure [Line Items]
Fair value of plan assets at beginning of the fiscal year	[2]	67,235
Fair value of plan assets at end of the fiscal year	[2]	70,204		67,235
Japan | Corporate bonds
Defined Benefit Plan Disclosure [Line Items]
Fair value of plan assets at beginning of the fiscal year	[3]	75,971
Fair value of plan assets at end of the fiscal year	[3]	79,323		75,971
Japan | Real estate and other
Defined Benefit Plan Disclosure [Line Items]
Fair value of plan assets at beginning of the fiscal year	[4]	17,925
Fair value of plan assets at end of the fiscal year	[4]	19,431		17,925
Foreign plans
Defined Benefit Plan Disclosure [Line Items]
Fair value of plan assets at beginning of the fiscal year		259,177		256,341
Fair value of plan assets at end of the fiscal year		269,745		259,177
Foreign plans | Corporate bonds
Defined Benefit Plan Disclosure [Line Items]
Fair value of plan assets at beginning of the fiscal year	[5]	28,296
Fair value of plan assets at end of the fiscal year	[5]	26,424		28,296
Foreign plans | Real estate and other
Defined Benefit Plan Disclosure [Line Items]
Fair value of plan assets at beginning of the fiscal year	[4]	36,216
Fair value of plan assets at end of the fiscal year	[4]	36,484		36,216
Foreign plans | Insurance contracts
Defined Benefit Plan Disclosure [Line Items]
Fair value of plan assets at beginning of the fiscal year	[6]	5,135
Fair value of plan assets at end of the fiscal year	[6]	18,670		5,135
Level 3 | Japan
Defined Benefit Plan Disclosure [Line Items]
Fair value of plan assets at beginning of the fiscal year		106,950		99,562
Return on assets held at end of year		2,544		3,841
Purchases, sales, and settlements, net		4,285		3,547
Fair value of plan assets at end of the fiscal year		113,779		106,950
Level 3 | Japan | Private equity
Defined Benefit Plan Disclosure [Line Items]
Fair value of plan assets at beginning of the fiscal year		21,790	[1]	31,852
Return on assets held at end of year		1,483		425
Purchases, sales, and settlements, net		871		(10,487)
Fair value of plan assets at end of the fiscal year	[1]	24,144		21,790
Level 3 | Japan | Hedge funds
Defined Benefit Plan Disclosure [Line Items]
Fair value of plan assets at beginning of the fiscal year		67,235	[2]	60,395
Return on assets held at end of year		636		2,817
Purchases, sales, and settlements, net		2,333		4,023
Fair value of plan assets at end of the fiscal year	[2]	70,204		67,235
Level 3 | Japan | Real estate and other
Defined Benefit Plan Disclosure [Line Items]
Fair value of plan assets at beginning of the fiscal year		17,925	[4]	7,315
Return on assets held at end of year		425		599
Purchases, sales, and settlements, net		1,081		10,011
Fair value of plan assets at end of the fiscal year	[4]	19,431		17,925
Level 3 | Foreign plans
Defined Benefit Plan Disclosure [Line Items]
Fair value of plan assets at beginning of the fiscal year		29,855		31,124
Return on assets held at end of year		1,101		84
Purchases, sales, and settlements, net		11,407		(411)
Transfers, net		1,181		(8)
Other	[7]	464		(934)
Fair value of plan assets at end of the fiscal year		44,008		29,855
Level 3 | Foreign plans | Corporate bonds
Defined Benefit Plan Disclosure [Line Items]
Fair value of plan assets at beginning of the fiscal year		6,926	[5]	7,000
Purchases, sales, and settlements, net		(1,256)		(44)
Other	[7]	(367)		(30)
Fair value of plan assets at end of the fiscal year	[5]	5,303		6,926
Level 3 | Foreign plans | Real estate and other
Defined Benefit Plan Disclosure [Line Items]
Fair value of plan assets at beginning of the fiscal year		22,929	[4]	24,124
Return on assets held at end of year		1,101		84
Purchases, sales, and settlements, net		12		(367)
Transfers, net		1,181		(8)
Other	[7]	753		(904)
Fair value of plan assets at end of the fiscal year	[4]	25,976		¥ 22,929
Level 3 | Foreign plans | Insurance contracts
Defined Benefit Plan Disclosure [Line Items]
Purchases, sales, and settlements, net		12,651
Other	[7]	78
Fair value of plan assets at end of the fiscal year	[6]	¥ 12,729

[1] Includes multiple private equity funds of funds that primarily invest in venture, buyout, and distressed markets in the U.S. and Europe.

[2] Includes primarily funds that invest in a portfolio of a broad range of hedge funds to diversify the risks and reduce the volatilities associated with a single hedge fund.

[3] Includes debt securities issued by Japanese and foreign corporation and government related agencies.

[4] Includes primarily private real estate investment trusts.

[5] Includes primarily foreign corporate debt securities.

[6] Represents annuity contracts with or without profit sharing.

[7] Primarily consists of translation adjustments.

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Pension and Severance Plans (Expected Future Benefit Payments) (Detail) ¥ in Millions	Mar. 31, 2018 JPY (¥)
Japan
Defined Benefit Plan Disclosure [Line Items]
2019	¥ 39,918
2020	40,328
2021	41,233
2022	42,609
2023	43,772
2024 - 2028	232,325
Foreign plans
Defined Benefit Plan Disclosure [Line Items]
2019	14,889
2020	15,039
2021	16,133
2022	16,689
2023	17,830
2024 - 2028	¥ 102,045

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Pension and Severance Plans (Total Defined Contribution Expenses) (Detail) - JPY (¥) ¥ in Millions	12 Months Ended
	Mar. 31, 2018	Mar. 31, 2017	Mar. 31, 2016
Japan
Defined Contribution Plan Disclosure [Line Items]
Defined contribution expenses	¥ 3,237	¥ 3,412	¥ 3,155
Foreign plans
Defined Contribution Plan Disclosure [Line Items]
Defined contribution expenses	¥ 11,379	¥ 10,458	¥ 12,419

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Stockholders' Equity (Changes in Number of Shares of Common Stock Issued and Outstanding) (Detail) - shares	12 Months Ended
	Mar. 31, 2018	Mar. 31, 2017	Mar. 31, 2016
Equity [Abstract]
Common stock, shares issued, beginning balance	1,263,763,660	1,262,493,760	1,169,773,260
Issuance of new shares	218,000		92,000,000
Exercise of stock acquisition rights	2,565,700	1,269,900	720,500
Conversion of convertible bonds	4,789
Common stock, shares issued, ending balance	1,266,552,149	1,263,763,660	1,262,493,760

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Stockholders' Equity - Additional Information (Detail) ¥ in Millions, $ in Millions	12 Months Ended
	Mar. 31, 2018 JPY (¥) shares	Mar. 31, 2017 JPY (¥) shares	Mar. 31, 2017 USD ($) shares	Mar. 31, 2016 shares	Mar. 31, 2017 USD ($)
Stockholders Equity Note [Line Items]
Common stock shares would be issued upon conversion or exercise of all convertible bonds and stock acquisition rights outstanding | shares	37,962,769
Common stock had been acquired by the resolution of the Board of Directors | shares	0	0	0	0
Retained earnings available for dividends to shareholders	¥ 664,989
Undistributed earnings of affiliated companies accounted for by equity method	¥ 37,859	¥ 33,694
U.S.-based Music Publishing Subsidiary
Stockholders Equity Note [Line Items]
Percentage of equity ownership		50.00%			50.00%
Businesses acquisition payment of cash consideration | $			$ 750
Distributions to which the subsidiary previously committed, included in aggregate cash consideration | $					$ 17
Decrease to additional paid-in capital resulting from difference between cash consideration paid and decrease in noncontrolling interests		¥ 70,730

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Stockholders' Equity (Changes in Accumulated Other Comprehensive Income, Net of Tax) (Detail) - JPY (¥) ¥ in Millions		12 Months Ended
		Mar. 31, 2018		Mar. 31, 2017	Mar. 31, 2016
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning Balance		¥ 3,135,422		¥ 3,124,410	¥ 2,928,469
Other comprehensive income before reclassifications		(2,983)		14,546	(210,838)
Amounts reclassified out of accumulated other comprehensive income		8,924	[1]	1,545	(43,792)
Net other comprehensive income		5,941		16,091	(254,630)
Less: Other comprehensive income attributable to noncontrolling interests		3,918		(18,458)	13,405
Ending Balance		3,647,157		3,135,422	3,124,410
Accumulated other comprehensive income (loss)
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning Balance		(618,769)		(653,318)	(385,283)
Ending Balance		(616,746)		(618,769)	(653,318)
Unrealized gains (losses) on securities
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning Balance		126,635		140,736	154,153
Other comprehensive income before reclassifications		2,013		(27,007)	45,527
Amounts reclassified out of accumulated other comprehensive income		(943)	[1]	(3,286)	(43,307)
Net other comprehensive income		1,070		(30,293)	2,220
Less: Other comprehensive income attributable to noncontrolling interests		1,514		(16,192)	15,637
Ending Balance		126,191		126,635	140,736
Pension liability adjustment
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning Balance		(308,736)		(371,739)	(201,131)
Other comprehensive income before reclassifications		1,779		54,513	(174,380)
Amounts reclassified out of accumulated other comprehensive income		10,611	[1]	8,719	2,627
Net other comprehensive income		12,390		63,232	(171,753)
Less: Other comprehensive income attributable to noncontrolling interests		98		229	(1,145)
Ending Balance		(296,444)		(308,736)	(371,739)
Foreign currency translation adjustments
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning Balance		(436,610)		(421,117)	(338,305)
Other comprehensive income before reclassifications		(4,480)		(17,988)	(83,899)
Amounts reclassified out of accumulated other comprehensive income	[1]	(1,855)
Net other comprehensive income		(6,335)		(17,988)	(83,899)
Less: Other comprehensive income attributable to noncontrolling interests		2,306		(2,495)	(1,087)
Ending Balance		(445,251)		(436,610)	(421,117)
Unrealized gains (losses) on derivative instruments
Accumulated Other Comprehensive Income (Loss) [Line Items]
Beginning Balance		(58)		(1,198)
Other comprehensive income before reclassifications		(2,295)		5,028	1,914
Amounts reclassified out of accumulated other comprehensive income		1,111	[1]	(3,888)	(3,112)
Net other comprehensive income		(1,184)		1,140	(1,198)
Ending Balance		¥ (1,242)		¥ (58)	¥ (1,198)

[1] Foreign currency translation adjustments were transferred from accumulated other comprehensive income to net income as a result of a complete or substantially complete liquidation or sale of certain foreign subsidiaries and affiliates.

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Stockholders' Equity (Reclassifications Out of Accumulated Other Comprehensive Income) (Detail) - JPY (¥) ¥ in Millions		12 Months Ended
		Mar. 31, 2018	Mar. 31, 2017	Mar. 31, 2016
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Financial services revenue		¥ 1,221,235	¥ 1,080,284	¥ 1,066,319
Foreign exchange loss, net		(30,634)	(22,181)	(20,565)
Gain on sale of securities investments, net		1,517	225	52,068
Cost of sales		(5,188,259)	(4,753,010)	(5,166,894)
Loss on devaluation of securities investments		(4,955)	(7,629)	(3,309)
Income before income taxes		699,049	251,619	304,504
Tax expense or (benefit)		(151,770)	(124,058)	(94,789)
Net income attributable to Sony Corporation's stockholders		490,794	73,289	147,791
Amount reclassified from accumulated other comprehensive income (loss)
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Net income attributable to Sony Corporation's stockholders		8,924	1,545	(43,792)
Amount reclassified from accumulated other comprehensive income (loss) | Unrealized gains (losses) on securities
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Financial services revenue		(646)	(4,560)	(19,598)
Gain on sale of securities investments, net		(561)	(30)	(47,087)
Loss on devaluation of securities investments				3,063
Income before income taxes		(1,207)	(4,590)	(63,622)
Tax expense or (benefit)		264	1,304	20,315
Net income attributable to Sony Corporation's stockholders		(943)	(3,286)	(43,307)
Amount reclassified from accumulated other comprehensive income (loss) | Unrealized gains (losses) on derivative instruments
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Foreign exchange loss, net				(8)
Cost of sales		1,111	(5,583)	(3,104)
Income before income taxes		1,111	(5,583)	(3,112)
Tax expense or (benefit)			1,695
Net income attributable to Sony Corporation's stockholders		1,111	(3,888)	(3,112)
Amount reclassified from accumulated other comprehensive income (loss) | Pension liability adjustment
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Pension liability adjustment	[1]	11,034	13,044	2,867
Tax expense or (benefit)		(423)	(4,325)	(240)
Net income attributable to Sony Corporation's stockholders		10,611	¥ 8,719	¥ 2,627
Amount reclassified from accumulated other comprehensive income (loss) | Foreign currency translation adjustments
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items]
Foreign currency translation adjustments		(1,855)
Net income attributable to Sony Corporation's stockholders		¥ (1,855)

[1] The amortization of pension and postretirement benefit components are included in the computation of net periodic pension cost. Refer to Note 15.

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Stockholders' Equity (Net Income Attributable to Sony Corporation's Stockholders and Transfers (to) from Noncontrolling Interests) (Detail) - JPY (¥) ¥ in Millions	12 Months Ended
	Mar. 31, 2018	Mar. 31, 2017	Mar. 31, 2016
Equity [Abstract]
Net income attributable to Sony Corporation's stockholders	¥ 490,794	¥ 73,289	¥ 147,791
Transfers (to) from the noncontrolling interests:
Decrease in additional paid-in capital for purchase of additional shares in consolidated subsidiaries	(74)	(53,927)	(12,776)
Change from net income attributable to Sony Corporation's stockholders and transfers (to) from the noncontrolling interests	¥ 490,720	¥ 19,362	¥ 135,015

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Stock-Based Compensation Plans - Additional Information (Detail) - JPY (¥) ¥ / shares in Units, ¥ in Millions	12 Months Ended
	Mar. 31, 2018	Mar. 31, 2017	Mar. 31, 2016
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock-based compensation expense	¥ 5,249	¥ 2,737	¥ 1,944
Total cash received from exercise of stock-based compensation plans	¥ 7,129	¥ 2,730	¥ 1,578
Stock Acquisition Rights Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Equity-based compensation plan, vesting period	3 years
Weighted-average fair value per share of stock acquisition rights granted	¥ 2,045	¥ 1,291	¥ 1,331
Total intrinsic value of shares exercised under stock acquisition rights plan	¥ 6,970	¥ 1,541	¥ 1,338
Total unrecognized compensation expense	¥ 5,698
Total unrecognized compensation expense, weighted-average period to be recognized	2 years 4 days
Stock Acquisition Rights Plan | Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Equity-based compensation plan, expiration period	10 years

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Stock-Based Compensation Plans (Weighted-Average Assumptions used to Determine Fair Value of Stock Acquisition Rights Granted) (Detail)		12 Months Ended
		Mar. 31, 2018	Mar. 31, 2017	Mar. 31, 2016
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]
Risk-free interest rate		1.14%	1.10%	1.07%
Expected lives		6 years 6 months 18 days	6 years 9 months 29 days	7 years 1 month 13 days
Expected volatility	[1]	38.49%	40.00%	42.07%
Expected dividends		0.40%	0.66%	0.75%

[1] Expected volatility was based on the historical volatilities of Sony Corporation's common stock over the expected life of the stock acquisition rights.

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Stock-Based Compensation Plans (Summary of Activities Regarding Stock Acquisition Rights Plan) (Detail) - JPY (¥) ¥ / shares in Units, ¥ in Millions	12 Months Ended
	Mar. 31, 2018	Mar. 31, 2017	Mar. 31, 2016
Number of shares
Exercised	2,565,700	1,269,900	720,500
Stock Acquisition Rights Plan
Number of shares
Outstanding at beginning of the fiscal year	15,519,400
Granted	2,978,900
Exercised	2,565,700
Forfeited or expired	1,926,700
Outstanding at end of the fiscal year	14,005,900	15,519,400
Exercisable at end of the fiscal year	7,905,100
Weighted average exercise price
Outstanding at beginning of the fiscal year	¥ 3,147
Granted	4,297
Exercised	2,778
Forfeited or expired	4,864
Outstanding at end of the fiscal year	3,017	¥ 3,147
Exercisable at end of the fiscal year	¥ 2,653
Weighted-average remaining life
Outstanding at end of the fiscal year	6 years 6 months 10 days
Exercisable at end of the fiscal year	4 years 7 months 10 days
Total intrinsic Value
Outstanding at end of the fiscal year	¥ 25,910
Exercisable at end of the fiscal year	¥ 19,647

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Kumamoto Earthquake - Additional Information (Detail) - JPY (¥) ¥ in Millions	1 Months Ended	12 Months Ended
	Apr. 30, 2017	Mar. 31, 2018	Mar. 31, 2017	Mar. 31, 2016
Business Interruption Loss [Line Items]
Incremental losses and associated expenses directly related to the damage caused by earthquakes, together with other expenses		¥ 5,188,259	¥ 4,753,010	¥ 5,166,894
Insurance claim paid by insurance carriers	¥ 20,000
Other Operating Revenue
Business Interruption Loss [Line Items]
Difference amount recorded in other operating revenue from insurance recoveries	9,318
Repair Costs of Fixed Assets and a Loss on Disposal of Inventories
Business Interruption Loss [Line Items]
Incremental losses and associated expenses directly related to the damage caused by earthquakes, together with other expenses			16,682
Insurance recoveries			10,682
Insurance receivables agreed by insurance carriers			10,000
Remaining insurance receivables			682
Amount due to certain carrier as reinsurance			2,000
Amount paid to insurance carriers		¥ 2,000
Idle Facility Costs at Manufacturing Sites
Business Interruption Loss [Line Items]
Incremental losses and associated expenses directly related to the damage caused by earthquakes, together with other expenses			¥ 9,365
Business Interruption Coverage
Business Interruption Loss [Line Items]
Insurance receivables agreed by insurance carriers	¥ 10,000

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Restructuring Charges - Additional Information (Detail) - JPY (¥) ¥ in Millions	12 Months Ended
	Mar. 31, 2018	Mar. 31, 2017	Mar. 31, 2016
Restructuring Charges [Line Items]
Restructuring and related activities, term description	The restructuring activities are generally short term in nature and are generally completed within one year of initiation.
Restructuring costs	¥ 22,379	¥ 59,713	¥ 36,527
Battery Business Asset Group | Discontinued Operations, Held-for-sale | Other Operating Expense, Net
Restructuring Charges [Line Items]
Impairment losses recorded as a result of fair value valuation of assets and liabilities		42,298
Music
Restructuring Charges [Line Items]
Restructuring costs	6,630	3,590	1,868
Headcount Reduction | Corporate
Restructuring Charges [Line Items]
Restructuring costs	0	¥ 0	¥ 7,112
Headcount Reduction | Music
Restructuring Charges [Line Items]
Restructuring costs	¥ 6,630

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Restructuring Charges (Changes in Accrued Restructuring Charges) (Detail) - JPY (¥) ¥ in Millions		12 Months Ended
		Mar. 31, 2018	Mar. 31, 2017	Mar. 31, 2016
Restructuring Cost and Reserve [Line Items]
Accrued restructuring charges, beginning balance		¥ 20,801	¥ 34,266	¥ 50,917
Restructuring costs		22,379	59,713	36,527
Non-cash charges		(2,233)	(42,717)	(1,828)
Cash payments		(16,302)	(28,630)	(51,493)
Adjustments		(971)	(1,831)	143
Accrued restructuring charges, ending balance		23,674	20,801	34,266
Employee termination benefits
Restructuring Cost and Reserve [Line Items]
Accrued restructuring charges, beginning balance		11,634	22,531	36,721
Restructuring costs		18,999	9,854	27,401
Cash payments		(9,950)	(19,759)	(40,261)
Adjustments		(1,197)	(992)	(1,330)
Accrued restructuring charges, ending balance		19,486	11,634	22,531
Non-cash write-downs and disposals, net
Restructuring Cost and Reserve [Line Items]
Restructuring costs	[1]	2,233	42,717	1,828
Non-cash charges	[1]	(2,233)	(42,717)	(1,828)
Other associated costs
Restructuring Cost and Reserve [Line Items]
Accrued restructuring charges, beginning balance		9,167	11,735	14,196
Restructuring costs		1,147	7,142	7,298
Cash payments		(6,352)	(8,871)	(11,232)
Adjustments		226	(839)	1,473
Accrued restructuring charges, ending balance		¥ 4,188	¥ 9,167	¥ 11,735

[1] Significant asset impairments excluded from restructuring charges are described in Note 13.

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Restructuring Charges (Total Costs Incurred in Connection with Restructuring Programs by Segment) (Detail) - JPY (¥) ¥ in Millions		12 Months Ended
		Mar. 31, 2018	Mar. 31, 2017	Mar. 31, 2016
Restructuring Cost and Reserve [Line Items]
Restructuring costs		¥ 22,379	¥ 59,713	¥ 36,527
Depreciation associated with restructured assets		26	502	1,732
Total		22,405	60,215	38,259
Game & Network Services
Restructuring Cost and Reserve [Line Items]
Restructuring costs			231	135
Total			231	135
Music
Restructuring Cost and Reserve [Line Items]
Restructuring costs		6,630	3,590	1,868
Total		6,630	3,590	1,868
Pictures
Restructuring Cost and Reserve [Line Items]
Restructuring costs		2,922	2,467	1,601
Depreciation associated with restructured assets				5
Total		2,922	2,467	1,606
Home Entertainment & Sound
Restructuring Cost and Reserve [Line Items]
Restructuring costs		852	752	1,207
Total		852	752	1,207
Imaging Products & Solutions
Restructuring Cost and Reserve [Line Items]
Restructuring costs		624	640	204
Total		624	640	204
Mobile Communications
Restructuring Cost and Reserve [Line Items]
Restructuring costs		2,026	688	20,928
Depreciation associated with restructured assets		0	138	710
Total		2,026	826	21,638
Semiconductors
Restructuring Cost and Reserve [Line Items]
Restructuring costs		28	(9)	(113)
Total		28	(9)	(113)
All Other and Corporate
Restructuring Cost and Reserve [Line Items]
Restructuring costs		9,297	51,354	10,697
Depreciation associated with restructured assets		26	364	1,017
Total		9,323	51,718	11,714
Employee termination benefits
Restructuring Cost and Reserve [Line Items]
Restructuring costs		18,999	9,854	27,401
Employee termination benefits | Game & Network Services
Restructuring Cost and Reserve [Line Items]
Restructuring costs			225	15
Employee termination benefits | Music
Restructuring Cost and Reserve [Line Items]
Restructuring costs		6,358	2,116	1,501
Employee termination benefits | Pictures
Restructuring Cost and Reserve [Line Items]
Restructuring costs		2,922	2,467	1,594
Employee termination benefits | Home Entertainment & Sound
Restructuring Cost and Reserve [Line Items]
Restructuring costs		846	68	1,181
Employee termination benefits | Imaging Products & Solutions
Restructuring Cost and Reserve [Line Items]
Restructuring costs		530	563	78
Employee termination benefits | Mobile Communications
Restructuring Cost and Reserve [Line Items]
Restructuring costs		2,008	516	17,259
Employee termination benefits | Semiconductors
Restructuring Cost and Reserve [Line Items]
Restructuring costs		28	4	(11)
Employee termination benefits | All Other and Corporate
Restructuring Cost and Reserve [Line Items]
Restructuring costs		6,307	3,895	5,784
Other associated costs
Restructuring Cost and Reserve [Line Items]
Restructuring costs	[1]	3,380	49,859	9,126
Other associated costs | Game & Network Services
Restructuring Cost and Reserve [Line Items]
Restructuring costs	[1]		6	120
Other associated costs | Music
Restructuring Cost and Reserve [Line Items]
Restructuring costs	[1]	272	1,474	367
Other associated costs | Pictures
Restructuring Cost and Reserve [Line Items]
Restructuring costs	[1]			7
Other associated costs | Home Entertainment & Sound
Restructuring Cost and Reserve [Line Items]
Restructuring costs	[1]	6	684	26
Other associated costs | Imaging Products & Solutions
Restructuring Cost and Reserve [Line Items]
Restructuring costs	[1]	94	77	126
Other associated costs | Mobile Communications
Restructuring Cost and Reserve [Line Items]
Restructuring costs	[1]	18	172	3,669
Other associated costs | Semiconductors
Restructuring Cost and Reserve [Line Items]
Restructuring costs	[1]		(13)	(102)
Other associated costs | All Other and Corporate
Restructuring Cost and Reserve [Line Items]
Restructuring costs	[1]	¥ 2,990	¥ 47,459	¥ 4,913

[1] Other associated costs includes non-cash write-downs and disposals, net

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Supplemental Consolidated Statements of Income Information (Components of Other Operating Expense, Net) (Detail) - JPY (¥) ¥ in Millions		12 Months Ended
		Mar. 31, 2018	Mar. 31, 2017	Mar. 31, 2016
Component Of Other Operating Income And Expense [Line Items]
(Gain) loss on purchase/sale of interests in subsidiaries and affiliates, net	[1]	¥ (29,595)	¥ (4,259)	¥ (31,778)
(Gain) loss on sale, disposal or impairment of assets, net	[2]	38,599	195,341	90,410
Other operating (income) expense, net		4,072	149,001	47,171
M3, Inc.
Component Of Other Operating Income And Expense [Line Items]
Gain on sale and issuance of M3 shares	[3]	(18)	(37,167)	(2)
United States Head Quarters
Component Of Other Operating Income And Expense [Line Items]
Gain on sale of building	[4]			(6,545)
Sony City Osaki
Component Of Other Operating Income And Expense [Line Items]
Gain on sale of building	[4]	¥ (4,914)	¥ (4,914)	¥ (4,914)

[1] Refer to Notes 24 and 25.

[2] Refer to Notes 9, 13, 19 and 25.

[3] Refer to Note 5.

[4] A portion of gain on sale and leaseback transactions is deferred and is amortized on a straight-line basis over the lease term.

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Supplemental Consolidated Statements of Income Information - Additional Information (Detail) - JPY (¥) ¥ in Millions	12 Months Ended
	Mar. 31, 2018	Mar. 31, 2017	Mar. 31, 2016
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Research and development costs	¥ 458,518	¥ 447,456	¥ 468,183
Advertising costs included in selling general and administrative expenses	407,106	363,815	391,326
Shipping and handling costs	¥ 46,252	¥ 42,195	¥ 50,803

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Income Taxes (Components of Domestic and Foreign Income and Provision for Current and Deferred Income Taxes) (Detail) - JPY (¥) ¥ in Millions	12 Months Ended
	Mar. 31, 2018	Mar. 31, 2017	Mar. 31, 2016
Income before income taxes:
Sony Corporation and all subsidiaries in Japan	¥ 436,494	¥ 166,158	¥ 149,256
Foreign subsidiaries	262,555	85,461	155,248
Income before income taxes	699,049	251,619	304,504
Income taxes - Current:
Sony Corporation and all subsidiaries in Japan	69,697	49,739	41,080
Foreign subsidiaries	57,988	50,521	53,498
Current	127,685	100,260	94,578
Income taxes - Deferred:
Sony Corporation and all subsidiaries in Japan	29,640	11,478	(1,745)
Foreign subsidiaries	(5,555)	12,320	1,956
Deferred	24,085	23,798	211
Total income tax expense	¥ 151,770	¥ 124,058	¥ 94,789

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Income Taxes (Reconciliation of Statutory Tax Rate and Effective Tax Rate) (Detail)	12 Months Ended
	Mar. 31, 2018	Mar. 31, 2017	Mar. 31, 2016
Reconciliation of Effective Income Tax Rate [Line Items]
Statutory tax rate	31.50%	31.70%	33.60%
Non-deductible expenses	0.80%	2.30%	1.60%
Income tax credits	(0.60%)	(2.90%)	(2.00%)
Change in statutory tax rate and law	(1.20%)	0.30%	(3.30%)
Change in valuation allowances	(5.20%)	7.30%	10.70%
Change in deferred tax liabilities on undistributed earnings of foreign subsidiaries and corporate joint ventures	(0.80%)	(1.40%)	(0.80%)
Lower tax rate applied to life and non-life insurance business in Japan	(0.80%)	(2.20%)	(2.30%)
Foreign income tax differential	(2.60%)	(3.00%)	(6.90%)
Adjustments to tax reserves	(0.80%)	(1.10%)	0.70%
Effect of equity in net income of affiliated companies	0.00%	0.00%	0.00%
Other	1.40%	3.30%	(0.20%)
Effective income tax rate	21.70%	49.30%	31.10%
Pictures
Reconciliation of Effective Income Tax Rate [Line Items]
Impairment of goodwill in the Pictures segment		15.00%

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Income Taxes - Additional Information (Detail) - JPY (¥) ¥ in Millions	1 Months Ended	3 Months Ended	9 Months Ended	12 Months Ended
	Mar. 31, 2017	Mar. 31, 2018	Dec. 31, 2017	Mar. 31, 2018	Mar. 31, 2017	Mar. 31, 2016
Income Taxes [Line Items]
Statutory tax rate				31.50%	31.70%	33.60%
Provisional income tax benefit				¥ 13,816
Net increase (decrease) in total valuation allowance				152,129	¥ 3,894	¥ 21,764
Undistributed earnings of foreign subsidiaries and corporate joint ventures not expected to be remitted, for which deferred income taxes have not been provided		¥ 930,018		930,018
Deferred tax liabilities not accounted for undistributed earnings		14,880		14,880
Operating loss carryforwards for tax purposes	¥ 455,555	439,206		439,206	455,555
Operating loss carryforwards for tax purposes with no expiration period		132,979		132,979
Tax credit carryforwards	134,427	125,327		125,327	134,427
Tax credit carryforwards with no expiration period		19,048		19,048
Interest expense recorded				1,053	474	774
Penalties recorded				876	597	674
Liabilities recorded for the payments of interest	9,735	10,788		10,788	9,735	9,261
Liabilities recorded for the payments of penalties	¥ 3,761	4,637		4,637	¥ 3,761	¥ 4,358
Maximum unrecognized tax benefits expected reduction within the next 12 months		¥ 2,768		2,768
U.S. [Member]
Income Taxes [Line Items]
Statutory tax rate		21.00%	35.00%
Sony Music Entertainment (Japan) Inc
Income Taxes [Line Items]
Gain on subsidiary's sale of stock arising from issuance of common stock, for which deferred income taxes have not been provided		¥ 61,544		¥ 61,544
Fiscal year ended March 31, 2018
Income Taxes [Line Items]
Percentage of the limitations on annual use of net operating loss carryforwards due to tax law changes						55.00%
Fiscal year beginning on or after April 1, 2018
Income Taxes [Line Items]
Percentage of the limitations on annual use of net operating loss carryforwards due to tax law changes						50.00%
Fiscal year ended March 31, 2017 and onward
Income Taxes [Line Items]
Statutory tax rate	31.50%
Earliest Tax Year
Income Taxes [Line Items]
Total net operating loss carryforwards expiration date				Mar. 31, 2019
Tax credit carryforwards expiration date				Mar. 31, 2019
Earliest Tax Year | Domestic country
Income Taxes [Line Items]
Tax years subject to examinations				2008
Earliest Tax Year | Foreign country
Income Taxes [Line Items]
Tax years subject to examinations				2013
Latest Tax Year
Income Taxes [Line Items]
Total net operating loss carryforwards expiration date				Mar. 31, 2024
Tax credit carryforwards expiration date				Mar. 31, 2028
Latest Tax Year | Domestic country
Income Taxes [Line Items]
Tax years subject to examinations				2017
Latest Tax Year | Foreign country
Income Taxes [Line Items]
Tax years subject to examinations				2017

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Income Taxes (Components of Deferred Tax Assets and Liabilities) (Detail) - JPY (¥) ¥ in Millions	Mar. 31, 2018	Mar. 31, 2017
Deferred tax assets:
Operating loss carryforwards for tax purposes	¥ 439,206	¥ 455,555
Accrued pension and severance costs	106,161	112,075
Amortization including film costs	95,069	181,243
Warranty reserves and accrued expenses	104,410	110,475
Future insurance policy benefits	33,812	30,884
Inventory	15,792	16,322
Depreciation	43,353	47,485
Tax credit carryforwards	125,327	134,427
Reserve for doubtful accounts	8,534	10,887
Impairment of investments	14,146	52,451
Deferred revenue	14,478	27,294
Other	132,800	158,420
Gross deferred tax assets	1,133,088	1,337,518
Less: Valuation allowance	(899,835)	(1,051,964)
Total deferred tax assets	233,253	285,554
Deferred tax liabilities:
Insurance acquisition costs	(166,717)	(160,308)
Future insurance policy benefits	(167,058)	(147,159)
Unrealized gains on securities	(83,298)	(78,643)
Intangible assets acquired through stock exchange offerings	(23,949)	(23,794)
Undistributed earnings of foreign subsidiaries and corporate joint ventures	(14,160)	(26,473)
Investment in M3	(35,802)	(34,775)
Other	(32,164)	(34,271)
Gross deferred tax liabilities	(586,344)	(619,420)
Net deferred tax liabilities	(353,091)	(333,866)
Pictures
Deferred tax liabilities:
Unbilled accounts receivable in the Pictures segment	¥ (63,196)	¥ (113,997)

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Income Taxes (Reconciliation of Beginning and Ending Gross Amounts of Unrecognized Tax Benefits) (Detail) - JPY (¥) ¥ in Millions	12 Months Ended
	Mar. 31, 2018	Mar. 31, 2017	Mar. 31, 2016
Income Tax Disclosure [Abstract]
Balance at beginning of the fiscal year	¥ 119,529	¥ 114,126	¥ 165,434
Reductions for tax positions of prior years	(8,809)	(558)	(34,261)
Additions for tax positions of prior years	4,681	13,353	6,253
Additions based on tax positions related to the current year	5,740	8,231	4,299
Settlements	(21,893)	(8,300)	(12,556)
Lapse in statute of limitations	(3,469)	(3,454)	(8,229)
Foreign currency translation adjustments	(354)	(3,869)	(6,814)
Balance at end of the fiscal year	95,425	119,529	114,126
Total net amount of unrecognized tax benefits that, if recognized, would affect the effective tax rate	¥ 39,308	¥ 45,987	¥ 49,323

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Reconciliation of the Differences between Basic and Diluted EPS (Reconciliation of the Differences between Basic and Diluted EPS) (Detail) - JPY (¥) ¥ / shares in Units, shares in Thousands, ¥ in Millions	12 Months Ended
	Mar. 31, 2018	Mar. 31, 2017	Mar. 31, 2016
Earnings Per Share [Abstract]
Net income attributable to Sony Corporation's stockholders for basic and diluted EPS computation	¥ 490,794	¥ 73,289	¥ 147,791
Weighted-average shares outstanding	1,263,895	1,262,023	1,237,802
Effect of dilutive securities:
Stock acquisition rights	4,565	2,358	2,109
Zero coupon convertible bonds	23,960	23,962	17,972
Weighted-average shares for diluted EPS computation	1,292,420	1,288,343	1,257,883
Basic EPS	¥ 388.32	¥ 58.07	¥ 119.40
Diluted EPS	¥ 379.75	¥ 56.89	¥ 117.49

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Reconciliation of the Differences between Basic and Diluted EPS - Additional Information (Detail) - shares shares in Thousands	12 Months Ended
	Mar. 31, 2018	Mar. 31, 2017	Mar. 31, 2016
Earnings Per Share [Abstract]
Potential shares of common stock upon the exercise of stock acquisition rights and convertible bonds excluded from the computation of diluted EPS	2,921	6,856	11,357

XML

Variable Interest Entities - Additional Information (Detail) ¥ in Millions	Mar. 31, 2018 JPY (¥)	Mar. 31, 2018 USD ($)	Mar. 31, 2017 JPY (¥)
Variable Interest Entity [Line Items]
Net investment related to VIE | ¥	¥ 157,389		¥ 149,371
Joint ventures with companies involved in production and creation of recorded music
Variable Interest Entity [Line Items]
Variable interest entity primary beneficiary, aggregate total assets | ¥	37,540
Variable interest entity primary beneficiary, aggregate total liabilities | ¥	¥ 24,625
DH Publishing, L.P. | Variable Interest Entity, Not Primary Beneficiary
Variable Interest Entity [Line Items]
Net investment related to VIE		$ 213,000,000
Net payable related to VIE		3,000,000
Amount of maximum exposure to losses		210,000,000
Subsidiary in Pictures Segment | Variable Interest Entity, Not Primary Beneficiary
Variable Interest Entity [Line Items]
Amount of maximum exposure to losses		$ 26,000,000

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Acquisitions - Additional Information (Detail) ¥ in Millions, $ in Millions					1 Months Ended		12 Months Ended
	Feb. 28, 2017 JPY (¥)	Feb. 28, 2017 USD ($)	Feb. 01, 2016 JPY (¥)	Dec. 04, 2015 JPY (¥)	Apr. 30, 2015 JPY (¥)	Apr. 30, 2015 USD ($)	Mar. 31, 2018 JPY (¥)	Mar. 31, 2018 USD ($)	Mar. 31, 2017 JPY (¥)	Mar. 31, 2017 USD ($)	Mar. 31, 2016 JPY (¥)	Sep. 15, 2017 JPY (¥)	Sep. 15, 2017 USD ($)	Mar. 31, 2017 USD ($)
Business Acquisition [Line Items]
Goodwill							¥ 530,492		¥ 522,538		¥ 606,290
Transfer Agreements with Toshiba Corporation
Business Acquisition [Line Items]
Business acquisition total consideration											16,700
Goodwill											0
Liabilities assumed											0
Transfer Agreements with Toshiba Corporation | Planned
Business Acquisition [Line Items]
Business acquisition total consideration				¥ 19,000
Orchard Media Inc
Business Acquisition [Line Items]
Business acquisition total consideration					¥ 22,168	$ 185
Goodwill									36,664					$ 307
Step acquisition, total percentage of equity ownership					100.00%	100.00%
Step acquisition, percentage of equity interest acquired					49.00%	49.00%
Step acquisition, percentage of equity ownership immediately before additional acquisition					51.00%	51.00%
Step acquisition, recognized gain on remeasurement of fair value of equity ownership immediately before additional acquisition									18,085	$ 151
Intangible assets acquired									13,806					115
Cash consideration for acquisition									19,547	164
TEN Sports Network [Member]
Business Acquisition [Line Items]
Business acquisition total consideration	¥ 39,106	$ 346
Goodwill									26,489					235
Intangible assets acquired									14,910					$ 132
Cash consideration for acquisition							1,772	$ 16	37,298	$ 330
Cash consideration payable												¥ 2,316	$ 21
Other acquisitions
Business Acquisition [Line Items]
Business acquisition total consideration							27,459		12,409		46,233
Goodwill							20,013		12,384		36,128
Intangible assets acquired							¥ 4,980		7,073		¥ 14,983
Significant amounts allocated to in-process research and development									¥ 0
Altair
Business Acquisition [Line Items]
Business acquisition total consideration			¥ 25,565
Goodwill			17,879
Intangible assets acquired			6,600
Cash consideration for acquisition			¥ 22,657
Acquisition date											Feb. 01, 2016

XML

Divestitures - Additional Information (Detail) ¥ in Millions, $ in Millions			12 Months Ended
	Apr. 01, 2017 USD ($)	Apr. 01, 2015 JPY (¥)	Mar. 31, 2018 JPY (¥)	Mar. 31, 2017 JPY (¥)
Battery Business Asset Group | Discontinued Operations, Held-for-sale | Other Operating Expense, Net
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Impairment losses recorded as a result of fair value valuation of assets and liabilities				¥ 42,298
Part of Logistics Business | Disposal Group, Disposed of by Sale
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Consideration for sale of subsidiaries		¥ 19,211
Gain on sale of business		¥ 12,284
Sony Electronics Huanan Co., Ltd [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Consideration for sale of subsidiaries | $	$ 234
Sales price of business | $	$ 95
Gain (loss) on sale of investments			¥ 28,262

XML

Collaborative Arrangements - Additional Information (Detail) - JPY (¥) ¥ in Millions	12 Months Ended
	Mar. 31, 2018	Mar. 31, 2017	Mar. 31, 2016
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Cost of sales	¥ 5,188,259	¥ 4,753,010	¥ 5,166,894
Net sales	7,231,613	¥ 6,443,328	6,949,357
Pictures | Collaborative Arrangements, Co-production and Distribution Arrangements
Collaborative Arrangements and Non-collaborative Arrangement Transactions [Line Items]
Collaborative arrangement, income statement classification description		Sony and the other participants typically share in the profits from the distribution of the product in all media or markets. For motion pictures, if Sony is a net receiver of (1) Sony’s share of the profits from the media or markets distributed by the other participants less (2) the other participants’ share of the profits from the media or markets distributed by Sony then the net amount is recorded as net sales. If Sony is a net payer then the net amount is recorded in cost of sales. For television programming, Sony records its share of the profits from the media or markets distributed by the other participants as sales, and the other participants’ share of the profits from the media or markets distributed by Sony as cost of sales.
Cost of sales	24,280	¥ 29,594	38,303
Net sales	¥ 49,547	¥ 44,124	¥ 30,888

XML

Commitments, Contingent Liabilities and Other - Additional Information (Detail) € in Millions, ¥ in Millions	1 Months Ended	12 Months Ended
	Oct. 31, 2015 EUR (€)	Mar. 31, 2018 JPY (¥)
Commitments and Contingencies Disclosure [Line Items]
Purchase commitments and other outstanding		¥ 367,991
Litigation case about optical disk drive business, fine from European Commission | €	€ 31
Maximum potential amount of future payments under guarantees		2,642
Financial Services
Commitments and Contingencies Disclosure [Line Items]
Unused portion of lines of credit extended to customers		31,245
Pictures
Commitments and Contingencies Disclosure [Line Items]
Purchase commitments and other outstanding		¥ 118,914
Purchase commitments and other outstanding, term		3 years
Music
Commitments and Contingencies Disclosure [Line Items]
Purchase commitments and other outstanding		¥ 73,259
Purchase commitments and other outstanding, term		5 years
Game & Network Services
Commitments and Contingencies Disclosure [Line Items]
Purchase commitments and other outstanding		¥ 26,227
Purchase commitments and other outstanding, term		2 years
Advertising and Promotional Rights
Commitments and Contingencies Disclosure [Line Items]
Purchase commitments and other outstanding		¥ 6,379
Purchase commitments and other outstanding, term		2 years

XML

Commitments, Contingent Liabilities and Other (Schedule of Aggregate Amounts of Year-by-Year Payment of Purchase Commitments) (Detail) ¥ in Millions	Mar. 31, 2018 JPY (¥)
Unrecorded Unconditional Purchase Obligation, Fiscal Year Maturity [Abstract]
2019	¥ 211,713
2020	85,755
2021	25,249
2022	17,212
2023	12,014
Later fiscal years	16,048
Total	¥ 367,991

XML

Commitments, Contingent Liabilities and Other (Changes in Product Warranty Liability) (Detail) - JPY (¥) ¥ in Millions	12 Months Ended
	Mar. 31, 2018	Mar. 31, 2017	Mar. 31, 2016
Movement in Standard and Extended Product Warranty Accrual, Increase (Decrease) [Roll Forward]
Balance at beginning of the fiscal year	¥ 60,798	¥ 66,943	¥ 75,129
Additional liabilities for warranties	34,557	53,502	83,227
Settlements (in cash or in kind)	(32,549)	(49,532)	(81,462)
Changes in estimate for pre-existing warranty reserve	(16,888)	(7,927)	(6,440)
Translation adjustment	2,234	(2,188)	(3,511)
Balance at end of the fiscal year	¥ 48,152	¥ 60,798	¥ 66,943

XML

Business Segment Information (Components of Segment Sales and Operating Revenue) (Detail) - JPY (¥) ¥ in Millions	12 Months Ended
	Mar. 31, 2018	Mar. 31, 2017	Mar. 31, 2016
Segment Reporting, Revenue Reconciling Item [Line Items]
Sales and operating revenue, Total	¥ 8,543,982	¥ 7,603,250	¥ 8,105,712
Game & Network Services
Segment Reporting, Revenue Reconciling Item [Line Items]
Sales and operating revenue, Total	1,848,298	1,581,568	1,479,775
Music
Segment Reporting, Revenue Reconciling Item [Line Items]
Sales and operating revenue, Total	784,792	630,767	602,564
Pictures
Segment Reporting, Revenue Reconciling Item [Line Items]
Sales and operating revenue, Total	1,010,173	901,230	935,827
Home Entertainment & Sound
Segment Reporting, Revenue Reconciling Item [Line Items]
Sales and operating revenue, Total	1,221,734	1,034,215	1,155,085
Imaging Products & Solutions
Segment Reporting, Revenue Reconciling Item [Line Items]
Sales and operating revenue, Total	647,163	571,499	677,231
Mobile Communications
Segment Reporting, Revenue Reconciling Item [Line Items]
Sales and operating revenue, Total	713,916	752,688	1,121,925
Semiconductors
Segment Reporting, Revenue Reconciling Item [Line Items]
Sales and operating revenue, Total	726,892	659,779	599,430
Financial Services
Segment Reporting, Revenue Reconciling Item [Line Items]
Sales and operating revenue, Total	1,221,235	1,080,284	1,066,319
All Other
Segment Reporting, Revenue Reconciling Item [Line Items]
Sales and operating revenue, Total	351,527	375,116	435,668
Intersegment | Game & Network Services
Segment Reporting, Revenue Reconciling Item [Line Items]
Sales and operating revenue, Total	95,514	68,231	72,118
Intersegment | Music
Segment Reporting, Revenue Reconciling Item [Line Items]
Sales and operating revenue, Total	15,203	16,891	16,675
Intersegment | Pictures
Segment Reporting, Revenue Reconciling Item [Line Items]
Sales and operating revenue, Total	894	1,899	2,315
Intersegment | Home Entertainment & Sound
Segment Reporting, Revenue Reconciling Item [Line Items]
Sales and operating revenue, Total	999	4,789	3,957
Intersegment | Imaging Products & Solutions
Segment Reporting, Revenue Reconciling Item [Line Items]
Sales and operating revenue, Total	8,729	8,134	6,724
Intersegment | Mobile Communications
Segment Reporting, Revenue Reconciling Item [Line Items]
Sales and operating revenue, Total	9,826	6,457	5,548
Intersegment | Semiconductors
Segment Reporting, Revenue Reconciling Item [Line Items]
Sales and operating revenue, Total	123,118	113,344	139,629
Intersegment | Financial Services
Segment Reporting, Revenue Reconciling Item [Line Items]
Sales and operating revenue, Total	7,142	7,220	6,750
Intersegment | All Other
Segment Reporting, Revenue Reconciling Item [Line Items]
Sales and operating revenue, Total	55,647	75,334	104,526
Operating Segments | Game & Network Services
Segment Reporting, Revenue Reconciling Item [Line Items]
Sales and operating revenue, Total	1,943,812	1,649,799	1,551,893
Operating Segments | Music
Segment Reporting, Revenue Reconciling Item [Line Items]
Sales and operating revenue, Total	799,995	647,658	619,239
Operating Segments | Pictures
Segment Reporting, Revenue Reconciling Item [Line Items]
Sales and operating revenue, Total	1,011,067	903,129	938,142
Operating Segments | Home Entertainment & Sound
Segment Reporting, Revenue Reconciling Item [Line Items]
Sales and operating revenue, Total	1,222,733	1,039,004	1,159,042
Operating Segments | Imaging Products & Solutions
Segment Reporting, Revenue Reconciling Item [Line Items]
Sales and operating revenue, Total	655,892	579,633	683,955
Operating Segments | Mobile Communications
Segment Reporting, Revenue Reconciling Item [Line Items]
Sales and operating revenue, Total	723,742	759,145	1,127,473
Operating Segments | Semiconductors
Segment Reporting, Revenue Reconciling Item [Line Items]
Sales and operating revenue, Total	850,010	773,123	739,059
Operating Segments | Financial Services
Segment Reporting, Revenue Reconciling Item [Line Items]
Sales and operating revenue, Total	1,228,377	1,087,504	1,073,069
Operating Segments | All Other
Segment Reporting, Revenue Reconciling Item [Line Items]
Sales and operating revenue, Total	407,174	450,450	540,194
Corporate and Eliminations
Segment Reporting, Revenue Reconciling Item [Line Items]
Sales and operating revenue, Total	¥ (298,820)	¥ (286,195)	¥ (326,354)

XML

Business Segment Information (Components of Segment Profit or Loss) (Detail) - JPY (¥) ¥ in Millions	12 Months Ended
	Mar. 31, 2018	Mar. 31, 2017	Mar. 31, 2016
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Operating income (loss)	¥ 734,860	¥ 288,702	¥ 294,197
Other income	23,728	14,418	66,849
Other expenses	(59,539)	(51,501)	(56,542)
Consolidated income before income taxe	699,049	251,619	304,504
Operating Segments
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Operating income (loss)	798,943	375,783	401,918
Operating Segments | Game & Network Services
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Operating income (loss)	177,478	135,553	88,668
Operating Segments | Music
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Operating income (loss)	127,786	75,798	86,509
Operating Segments | Pictures
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Operating income (loss)	41,110	(80,521)	38,507
Operating Segments | Home Entertainment & Sound
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Operating income (loss)	85,841	58,504	50,558
Operating Segments | Imaging Products & Solutions
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Operating income (loss)	74,924	47,257	69,320
Operating Segments | Mobile Communications
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Operating income (loss)	(27,636)	10,164	(61,435)
Operating Segments | Semiconductors
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Operating income (loss)	164,023	(7,811)	14,500
Operating Segments | Financial Services
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Operating income (loss)	178,947	166,424	156,543
Operating Segments | All Other
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Operating income (loss)	(23,530)	(29,585)	(41,252)
Corporate and Eliminations
Segment Reporting, Reconciling Item for Operating Profit (Loss) from Segment to Consolidated [Line Items]
Operating income (loss)	¥ (64,083)	¥ (87,081)	¥ (107,721)

XML

Business Segment Information - Additional Information (Detail)	12 Months Ended
	Mar. 31, 2018 JPY (¥)
Corporate and Eliminations
Segment Reporting Disclosure [Line Items]
Increase in corporate income	¥ 7.5
Imaging Products & Solutions
Segment Reporting Disclosure [Line Items]
Increase in allocated expenses	2,000,000,000
Semiconductors
Segment Reporting Disclosure [Line Items]
Increase in allocated expenses	¥ 3,200,000,000

XML

Business Segment Information (Components of Other Significant Items) (Detail) - JPY (¥) ¥ in Millions	12 Months Ended
	Mar. 31, 2018	Mar. 31, 2017	Mar. 31, 2016
Segment Reporting, Other Significant Reconciling Item [Line Items]
Equity in net income (loss) of affiliated companies	¥ 8,569	¥ 3,563	¥ 2,238
Depreciation and amortization	361,444	327,048	397,091
Corporate
Segment Reporting, Other Significant Reconciling Item [Line Items]
Depreciation and amortization	40,375	43,094	41,543
Operating Segments
Segment Reporting, Other Significant Reconciling Item [Line Items]
Depreciation and amortization	321,069	283,954	355,548
Operating Segments | Game & Network Services
Segment Reporting, Other Significant Reconciling Item [Line Items]
Depreciation and amortization	29,091	25,486	20,798
Operating Segments | Music
Segment Reporting, Other Significant Reconciling Item [Line Items]
Equity in net income (loss) of affiliated companies	4,483	5,435	3,801
Depreciation and amortization	18,230	16,124	17,795
Operating Segments | Pictures
Segment Reporting, Other Significant Reconciling Item [Line Items]
Equity in net income (loss) of affiliated companies	(129)	(35)	(981)
Depreciation and amortization	24,458	20,487	22,375
Operating Segments | Home Entertainment & Sound
Segment Reporting, Other Significant Reconciling Item [Line Items]
Depreciation and amortization	21,136	19,830	21,781
Operating Segments | Imaging Products & Solutions
Segment Reporting, Other Significant Reconciling Item [Line Items]
Depreciation and amortization	23,928	25,442	27,612
Operating Segments | Mobile Communications
Segment Reporting, Other Significant Reconciling Item [Line Items]
Equity in net income (loss) of affiliated companies	(102)	(79)	(186)
Depreciation and amortization	19,215	19,794	24,186
Operating Segments | Semiconductors
Segment Reporting, Other Significant Reconciling Item [Line Items]
Depreciation and amortization	99,258	102,328	100,964
Operating Segments | Financial Services
Segment Reporting, Other Significant Reconciling Item [Line Items]
Equity in net income (loss) of affiliated companies	(61)	(3,601)	(645)
Depreciation and amortization	79,843	47,056	102,270
Operating Segments | All Other
Segment Reporting, Other Significant Reconciling Item [Line Items]
Equity in net income (loss) of affiliated companies	4,378	1,843	249
Depreciation and amortization	¥ 5,910	¥ 7,407	¥ 17,767

XML

Business Segment Information (Sales and Operating Revenue to External Customers by Product Category) (Detail) - JPY (¥) ¥ in Millions	12 Months Ended
	Mar. 31, 2018	Mar. 31, 2017	Mar. 31, 2016
Revenue from External Customer [Line Items]
Sales and operating revenue, Total	¥ 8,543,982	¥ 7,603,250	¥ 8,105,712
Game & Network Services
Revenue from External Customer [Line Items]
Sales and operating revenue, Total	1,848,298	1,581,568	1,479,775
Game & Network Services | Network
Revenue from External Customer [Line Items]
Sales and operating revenue, Total	1,033,192	714,924	529,318
Game & Network Services | Hardware and other products and services [Member]
Revenue from External Customer [Line Items]
Sales and operating revenue, Total	815,106	866,644	950,457
Music
Revenue from External Customer [Line Items]
Sales and operating revenue, Total	784,792	630,767	602,564
Music | Recorded Music
Revenue from External Customer [Line Items]
Sales and operating revenue, Total	446,960	388,948	412,718
Music | Music Publishing
Revenue from External Customer [Line Items]
Sales and operating revenue, Total	74,360	66,541	71,258
Music | Visual Media and Platform
Revenue from External Customer [Line Items]
Sales and operating revenue, Total	263,472	175,278	118,588
Pictures
Revenue from External Customer [Line Items]
Sales and operating revenue, Total	1,010,173	901,230	935,827
Pictures | Motion Pictures
Revenue from External Customer [Line Items]
Sales and operating revenue, Total	448,945	409,363	447,355
Pictures | Television Productions
Revenue from External Customer [Line Items]
Sales and operating revenue, Total	289,024	271,886	270,115
Pictures | Media Networks
Revenue from External Customer [Line Items]
Sales and operating revenue, Total	272,204	219,981	218,357
Home Entertainment & Sound
Revenue from External Customer [Line Items]
Sales and operating revenue, Total	1,221,734	1,034,215	1,155,085
Home Entertainment & Sound | Televisions
Revenue from External Customer [Line Items]
Sales and operating revenue, Total	861,763	720,557	797,764
Home Entertainment & Sound | Audio and Video
Revenue from External Customer [Line Items]
Sales and operating revenue, Total	357,194	311,771	354,946
Home Entertainment & Sound | Other Products and Services
Revenue from External Customer [Line Items]
Sales and operating revenue, Total	2,777	1,887	2,375
Imaging Products & Solutions
Revenue from External Customer [Line Items]
Sales and operating revenue, Total	647,163	571,499	677,231
Imaging Products & Solutions | Other Products and Services
Revenue from External Customer [Line Items]
Sales and operating revenue, Total	231,845	219,665	248,454
Imaging Products & Solutions | Still and Video Cameras
Revenue from External Customer [Line Items]
Sales and operating revenue, Total	415,318	351,834	428,777
Mobile Communications
Revenue from External Customer [Line Items]
Sales and operating revenue, Total	713,916	752,688	1,121,925
Semiconductors
Revenue from External Customer [Line Items]
Sales and operating revenue, Total	726,892	659,779	599,430
Financial Services
Revenue from External Customer [Line Items]
Sales and operating revenue, Total	1,221,235	1,080,284	1,066,319
All Other
Revenue from External Customer [Line Items]
Sales and operating revenue, Total	351,527	375,116	435,668
Corporate
Revenue from External Customer [Line Items]
Sales and operating revenue, Total	¥ 18,252	¥ 16,104	¥ 31,888

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Business Segment Information (Sales and Operating Revenue Attributed to Countries Based on Location of Customers and Long-Lived Assets) (Detail) - JPY (¥) ¥ in Millions	12 Months Ended
	Mar. 31, 2018	Mar. 31, 2017	Mar. 31, 2016
Revenue from External Customer [Line Items]
Sales and operating revenue, Total	¥ 8,543,982	¥ 7,603,250	¥ 8,105,712
Property, plant and equipment, net	739,470	758,199
Japan
Revenue from External Customer [Line Items]
Sales and operating revenue, Total	2,625,619	2,392,790	2,317,312
Property, plant and equipment, net	563,593	580,453
United States
Revenue from External Customer [Line Items]
Sales and operating revenue, Total	1,835,705	1,673,768	1,733,759
Property, plant and equipment, net	97,979	101,167
Europe
Revenue from External Customer [Line Items]
Sales and operating revenue, Total	1,841,457	1,634,683	1,881,329
Property, plant and equipment, net	23,302	24,273
China
Revenue from External Customer [Line Items]
Sales and operating revenue, Total	674,718	557,995	540,497
Property, plant and equipment, net	11,232	13,466
Asia Pacific
Revenue from External Customer [Line Items]
Sales and operating revenue, Total	1,024,179	866,712	959,171
Property, plant and equipment, net	36,738	34,575
Other Areas
Revenue from External Customer [Line Items]
Sales and operating revenue, Total	542,304	477,302	¥ 673,644
Property, plant and equipment, net	¥ 6,626	¥ 4,265

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Subsequent Events - Additional Information (Detail) - JPY (¥) ¥ in Billions	1 Months Ended
	Apr. 03, 2018	May 22, 2018	Jun. 29, 2012
DH Publishing, L.P.
Subsequent Event [Line Items]
Equity method investment, ownership percentage			39.80%
Subsequent event | DH Publishing, L.P.
Subsequent Event [Line Items]
Acquisition of equity interest percentage		60.00%
Subsequent event | EMI Music Publishing
Subsequent Event [Line Items]
Ownership percentage		40.00%
Equity method investment, ownership percentage		90.00%
Spotify Technology SA | Subsequent event
Subsequent Event [Line Items]
Expected unrealized valuation gain net and gain on sale of shares net	¥ 100
Ownership percentage	5.707%
Percentage of fully diluted ownership interest	5.082%

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Valuation and Qualifying Accounts (Detail) - JPY (¥) ¥ in Millions		12 Months Ended
		Mar. 31, 2018	Mar. 31, 2017	Mar. 31, 2016
Allowance for doubtful accounts and sales returns
Valuation and Qualifying Accounts Disclosure [Line Items]
Balance at beginning of period		¥ 53,150	¥ 72,783	¥ 86,598
Additions charged to costs and expenses		45,515	33,667	56,687
Deductions	[1]	(51,302)	(50,858)	(66,443)
Other	[2]	1,300	(2,442)	(4,059)
Balance at end of period		48,663	53,150	72,783
Valuation allowance - Deferred tax assets
Valuation and Qualifying Accounts Disclosure [Line Items]
Balance at beginning of period		1,051,964	1,055,858	1,077,622
Additions charged to costs and expenses		70,797	149,697	154,171
Deductions		(123,597)	(154,210)	(116,277)
Other	[3]	(99,329)	619	(59,658)
Balance at end of period		¥ 899,835	¥ 1,051,964	¥ 1,055,858

[1] Reversal including amounts written off.

[2] Translation adjustments.

[3] Translation adjustments and the effect of change in statutory tax rate.