Financial risk management

12 Months Ended

Mar. 31, 2024

Text Block1 [Abstract]

Financial risk management

6. Financial risk management

(1) Capital risk

Sony uses Return on Equity (“ROE”) as an indicator for capital risk management.

	March 31
	2023   Restated			2024
ROE*		16.4	%		13.7	%

* ROE is calculated using equity attributable to Sony Group Corporation’s stockholders.

Sony manages capital separately for the Financial Services segment and the Sony Group without the Financial Services segment because certain subsidiaries in the Financial Services segment are subject to the below restrictions. Sony also refers to the ratio of stockholders’ equity to total assets of the Sony Group without the Financial Services segment to ensure financial soundness.

In the Financial Services segment, Sony is required to maintain the soundness indicators at a certain level or higher based on the Insurance Business Act and the Banking Act of Japan. Material requirements which Sony is subject to are as follows:

Insurance business: Maintain solvency margin ratio

The life insurance subsidiary and the non-life insurance subsidiary have maintained a solvency margin ratio required by the Japanese domestic criteria.

Banking business: Maintain capital adequacy ratio

The banking subsidiary has maintained a capital adequacy ratio required by the Japanese domestic criteria.

Accordingly, lending and borrowing between subsidiaries in the Financial Services segment and the other companies within Sony Group is strictly limited. The carrying amounts of total assets of Sony Financial Group Inc. (“SFGI”) as of March 31, 2023 and 2024 are 19,912,827 million yen and 20,877,128 million yen, respectively. The carrying amounts of total liabilities of SFGI as of March 31, 2023 and 2024 are 18,728,102 million yen and 19,763,959 million yen, respectively. The amounts as of March 31, 2023 have been restated in accordance with IFRS 17.

(2) Interest rate risk

For interest rate risk inherent in the insurance business, which is included in the Financial Services segment, refer to Note 13. For interest rate risk inherent in the banking business, which is included in the Financial Services segment, refer to (7) Market risks for the banking business.

Risk management policy and exposure

Interest rate risk is the risk the fair value of a financial instrument or future cash flows of the financial instrument will fluctuate because of changes in market interest rates.

Sony without the Financial Services segment is exposed to interest rate risk that is mainly related to its liabilities such as short-term borrowings and long-term debt as well as bonds. The amount of interest will be affected by changes in market interest rates; therefore, Sony is exposed to the interest rate risk that the future cash outflows for interest payments will fluctuate.

Sony raises funds by issuing fixed-rate bonds in order to avoid an increase in future interest payments that is mainly resulting from an increase in interest rates.

Also, Sony utilizes interest rate swap agreements to reduce funding costs, to diversify sources of funding, and to hedge the downside risk on borrowings and debt securities resulting from unfavorable fluctuations of interest rates and currency exchange rates, and from changes in the fair value of financial instruments. Therefore, the interest rate risk associated with cash flows of Sony without the Financial Services segment is not significant.

(3) Price risk

For price risk inherent in the insurance business, which is included in the Financial Services segment, refer to Note 13. For price risk inherent in the banking business, which is included in the Financial Services segment, refer to (7) Market risks for the banking business.

Risk management policy and exposure

Sony is exposed to securities price risk inherent in holding of equities in other entities in Japan and overseas countries. Sony periodically assesses fair values of equity instruments and the financial conditions of the issuers of such equity instruments, and reviews its portfolio on a regular basis.

Price sensitivity analysis

The table below shows the effects on income before income taxes and other comprehensive income (before considering the tax effects) as of March 31, 2023 and 2024 if market prices of marketable equity instruments (e.g., stocks) had decreased by 10%.

	Yen in millions
	March 31
	2023			2024
Income before income taxes		(11,734	)		(24,621	)
Other comprehensive income (before considering the tax effects)		(9,800	)		(6,116	)

(4) Liquidity risk

For liquidity risk inherent in the insurance business, which is included in the Financial Services segment, refer to Note 13. This section does not include information regarding the insurance business other than maturity analysis for financial liabilities.

Risk management policy

The description below covers basic financial policy and figures for Sony’s consolidated operations except for the Financial Services segment and certain subsidiaries, which secure liquidity on their own. Furthermore, the banking business in 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 financial condition, 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 and investing activities (including asset sales) and by the available cash balance; however, Sony also raises funds as needed from financial and capital markets through means such as corporate bonds, commercial paper (“CP”) and bank loans. Sony Group Corporation, Sony Global Treasury Services Plc (“SGTS”), a finance subsidiary in the U.K. and Sony Capital Corporation (“SCC”), a finance subsidiary in the U.S., maintain CP programs with access to the Japanese, U.S. and European CP markets. The borrowing limits under these CP programs, translated into yen, were 1,257.1 billion yen in total for Sony Group Corporation, SGTS and SCC as of March 31, 2024. There were no amounts outstanding under the CP programs as of March 31, 2024. If disruption and volatility occur in financial and capital markets and Sony becomes unable to 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 766.4 billion yen in unused committed lines of credit, as of March 31, 2024. Details of those committed lines of credit are: a 350.0 billion yen committed line of credit contracted with a syndicate of Japanese banks, a 1.7 billion U.S. dollar multi-currency committed line of credit also contracted with a syndicate of Japanese banks and a 1.05 billion U.S. dollar multi-currency committed line of credit contracted with a syndicate of foreign banks. Sony currently believes that it can sustain sufficient liquidity through access to committed lines of credit with financial institutions, together with its available cash balance, even in the event that financial and capital markets become illiquid. 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. However, 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.

Cash Management

Sony manages its global cash management activities primarily through Sony Group Corporation in Japan, SCC in the U.S. and SGTS in other regions. The excess or shortage of cash at most of Sony’s subsidiaries is invested or funded by Sony Group Corporation, SGTS and SCC 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 Sony Group Corporation, SGTS and SCC, and cash shortfalls among subsidiaries are covered by loans through Sony Group Corporation, SGTS and SCC, 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 Sony Group Corporation, SGTS and SCC and that Sony meets 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.

Banking business in the Financial Services segment

In the banking business in the Financial Services segment, by formulating and conforming with liquidity risk management policies, Sony manages its liquidity risks. Sony defines liquidity risk as cash flow risk and market liquidity risk. Cash flow risk is the risk associated with losses due to Sony’s inability to make cash payments because of a failure to maintain sufficient cash reserves at settlement, as well as risks associated with losses if Sony is forced to raise funds under unfavorable conditions in order to fulfill cash payment obligations. The levels of cash flow risks are classified into phases based on the degree of pressure, and methods of risk management and reporting are set out for each phase, while guidelines are formulated and reviewed as necessary. Market liquidity risk is the risk associated with losses due to Sony’s inability to conduct market transactions, in particular due to an inability to unwind its market position at a given time, or due to Sony being forced to complete transactions under unfavorable market conditions, due to market turmoil or other factors. To manage market liquidity risk, Sony works to understand market liquidity conditions that pertain to the types of products it handles. Sony formulates and revises guidelines on a product-by-product basis, as necessary. The aforementioned liquidity risk management is carried out by the risk management division. The division periodically reports risk management conditions to the banking subsidiary’s Board of Directors and Executive Committee. In addition, the banking subsidiary’s internal audit division conducts audits of the risk management conditions.

Maturity analysis

The following table summarizes Sony’s financial liabilities as of March 31, 2023 and 2024.

	Yen in millions
	March 31, 2023
	Carrying amount		Total		Within 1 year		1 year to 2 years		2 years to 3 years		3 years to 4 years		4 years to 5 years		5+ years
Deposits from customers in the banking business*1		3,306,981		3,316,556		3,171,377		30,215		14,933		1,060		2,410		96,561
Bonds		349,332		354,169		26,039		40,986		110,862		35,591		80,416		60,275
Borrowings		2,988,994		3,025,480		1,998,315		70,690		147,447		270,268		62,571		476,189
Loan commitments		—		35,831		35,831		—		—		—		—		—
Derivative liabilities*2		34,123		33,766		28,886		623		1,041		912		918		1,386
Guarantee deposits received		40,568		40,568		31,085		272		19		58		13		9,121
Redeemable noncontrolling interests		47,326		48,616		—		24,844		10,397		4,572		198		8,605

	Yen in millions
	March 31, 2023
	Carrying amount	Total		Within 1 year		1 year to 2 years		2 years to 3 years		3 years to 4 years		4 years to 5 years
Lease liabilities	532,246		593,967		90,244		80,476		68,143		55,189		47,665
			5 years to 6 years		6 years to 7 years		7 years to 8 years		8 years to 9 years		9 years to 10 years		10+ years
			56,603		37,539		34,588		25,798		18,384		79,338

*1 Demand deposits are included in the “Within 1 year” category.

*2 Breakdown of net settlements and gross settlements in the derivative liabilities are presented below.

	Yen in millions
	March 31, 2023
	Total		Within 1 year		1 year to 2 years		2 years to 3 years		3 years to 4 years		4 years to 5 years		5+ years
Derivative contracts
—Net settled
Paid		32,881		27,820		769		1,076		912		918		1,386
Derivative contracts
—Gross settled
Received		29,092		25,894		156		3,042		—		—		—
Paid		29,977		26,960		10		3,007		—		—		—

	Yen in millions
	March 31, 2024
	Carrying amount		Total		Within 1 year		1 year to 2 years		2 years to 3 years		3 years to 4 years		4 years to 5 years		5+ years
Deposits from customers in the banking business*1		3,845,607		3,870,349		3,687,051		22,043		11,422		2,728		3,069		144,036
Bonds		544,078		554,986		42,236		112,112		126,786		101,302		80,974		91,576
Borrowings		2,972,629		3,013,803		1,909,097		84,525		259,511		231,829		156,945		371,896
Loan commitments		—		50,965		50,965		—		—		—		—		—
Derivative liabilities*2		29,287		29,557		23,465		1,179		1,178		1,145		953		1,637
Guarantee deposits received		44,864		44,864		31,479		135		9		24		10		13,207
Redeemable noncontrolling interests		54,028		54,389		—		14,794		25,740		99		5,292		8,464

	Yen in millions
	March 31, 2024
	Carrying amount	Total		Within 1 year		1 year to 2 years		2 years to 3 years		3 years to 4 years		4 years to 5 years
Lease liabilities	571,726		671,899		106,505		96,090		85,917		68,624		57,850
		5 years to 6 years		6 years to 7 years		7 years to 8 years		8 years to 9 years		9 years to 10 years		10+ years
			51,240		47,630		37,279		29,390		21,954		69,420

*1 Demand deposits are included in the “Within 1 year” category.

*2 Breakdown of net settlements and gross settlements in the derivative liabilities are presented below.

	Yen in millions
	March 31, 2024
	Total		Within 1 year		1 year to 2 years		2 years to 3 years		3 years to 4 years		4 years to 5 years		5+ years
Derivative contracts
—Net settled
Paid		28,220		22,128		1,179		1,178		1,145		953		1,637
Derivative contracts
—Gross settled
Received		49,187		49,187		—		—		—		—		—
Paid		50,524		50,524		—		—		—		—		—

(5) Foreign exchange risk

For foreign exchange risk inherent in the insurance business, which is included in the Financial Services segment, refer to Note 13. For foreign exchange risk inherent in the banking business, which is included in the Financial Services segment, refer to (7) Market risks for the banking business.

Risk management policy and exposure

Costs and prices of products and services in transactions denominated in foreign currencies are affected by currency exchange rate fluctuation, which may have adverse impacts on Sony’s business, operating results, and financial condition. Sony seeks to reduce its exposure to foreign exchange risk mainly by using derivatives such as currency forward contracts or investing in securities denominated in the same currency.

The net amount of Sony’s exposure to foreign exchange risk mainly includes the following. Foreign exchange risk exposures that are mitigated by the use of derivatives are excluded.

	Yen in millions
	March 31
	2023		2024
U.S. dollar		45,316		81,000
Euro		1,459		282

* Net exposures resulting in a liability are presented as negative and net exposures resulting in an asset are presented as positive.

Sensitivity analysis

The table below shows the effects on the income before income taxes regarding the financial instruments denominated in foreign currencies held by Sony as of March 31, 2023 and 2024 if the Japanese yen had strengthened by 10% against the U.S. dollar or euro. If the Japanese yen had weakened by 10% against the U.S. dollar or euro, there would be an opposite impact on income before income taxes in the same amount. This analysis was performed based on the assumption that all other variables stay the same.

	Yen in millions
	March 31
	2023			2024
U.S. dollar		(4,532	)		(8,100	)
Euro		(146	)		(28	)

(6) Credit risk

Risk management policy and exposure

Sony is exposed to credit risk in relation to its customers with outstanding trade receivables and the financial institutions who are the counterparties of derivative instruments that Sony holds to hedge the foreign exchange risk related to such trade receivables.

In order to manage risks inherent in trade receivables, Sony assesses management conditions and creditworthiness of prospective customers and sets credit limits before commencement of business in accordance with Sony’s internal rules regarding credit management. After commencement of business, in accordance with Sony’s internal rules regarding receivable management, Sony seeks to promptly identify and mitigate the risk of uncollectible receivables due to deterioration in the financial conditions of customers by managing payment due dates and outstanding balances by customer, consistently reviewing the status of transactions, payment history, and trends in the outstanding balance of customers, and actively monitoring their management and business conditions. Sony makes judgments about the creditworthiness of customers based on past collection experience, the current conditions, forecasts of future economic conditions and ongoing credit risk evaluations when calculating the loss allowances for the expected credit losses from trade receivables.

In addition, the credit risk inherent in derivative transactions is considered low since Sony enters into derivative transactions only with financial institutions with high creditworthiness or central clearing house counterparties, and such derivative transactions are collateralized.

The Financial Services segment formulates Fundamental Principles for Risk Management and manages risks depending on its subsidiaries’ size, characteristics and business. Risk Management Guidelines in the

Financial Services segment establish a detailed framework for risk management, and each of the subsidiaries in the Financial Services segment has developed a framework for risk management on its own depending on the characteristics of financial assets, including issuer credit risk on debt securities, counterparty risks and risks related to loans to individuals, including credit screenings, credit limits, the management of credit information, credit ratings, the setting of guarantees or collateral and the handling of problem assets on a case-by-case basis. Relevant departments of subsidiaries in the Financial Services segment periodically report risk management conditions to their Boards of Directors.

Risk exposure analysis

(a) Changes in the loss allowances

Trade and other receivables, and contract assets including non-current other receivables in the Pictures segment

	Yen in millions
	Lifetime expected credit losses
	Fiscal year ended March 31
	2023			2024
Balance at beginning of the fiscal year		31,341			27,534
Changes due to financial assets recognized at beginning of the fiscal year:
— Financial assets that have been derecognized		(4,568	)		(2,018	)
New financial assets originated or purchased		6,401			9,464
Write-offs		(6,647	)		(5,990	)
Changes in models/risk parameters		(1,409	)		643
Foreign exchange and other movements		2,416			3,433
Balance at end of the fiscal year		27,534			33,066
Debt Securities
	Yen in millions
	12-month expected credit losses *
	Fiscal year ended March 31
	2023			2024
Balance at beginning of the fiscal year		53			61
Changes due to financial assets recognized at beginning of the fiscal year:
— Financial assets that have been derecognized		(4	)		(10	)
New financial assets originated or purchased		13			8
Changes in models/risk parameters		(1	)		(1	)
Foreign exchange and other movements		—			—
Balance at end of the fiscal year		61			58

* For all debt securities, Sony considers that the credit risk has not increased significantly since initial recognition, and therefore the loss allowance is measured at an amount equal to 12-months of expected credit losses.

Substantially all of the loss allowances for debt securities are for debt securities measured at fair value through other comprehensive income as of March 31, 2023 and 2024.

Loans

	Yen in millions
	12-month expected credit losses			Lifetime expected credit losses			Total
Balance as of April 1, 2022		164			927			1,091
Changes due to financial assets recognized as of April 1, 2022:
— Transfer to lifetime expected credit losses		(1	)		1			—
— Transfer to 12-month expected credit losses		80			(80	)		—
— Financial assets that have been derecognized		(6	)		(285	)		(291	)
New financial assets originated or purchased		51			20			71
Changes in models/risk parameters		25			241			266
Foreign exchange and other movements		—			—			—
Balance as of March 31, 2023		313			824			1,137
Changes due to financial assets recognized as of March 31, 2023:
— Transfer to lifetime expected credit losses		(1	)		1			—
— Transfer to 12-month expected credit losses		106			(106	)		—
— Financial assets that have been derecognized		(24	)		(227	)		(251	)
New financial assets originated or purchased		45			823			869
Changes in models/risk parameters		(162	)		187			24
Foreign exchange and other movements		—			—			—
Balance as of March 31, 2024		277			1,502			1,779

Loans that are credit-impaired as of March 31, 2023 and 2024 were not significant.

(b) Description of collateral held as security and other credit enhancements

Sony assesses creditworthiness of each customer on an individual project basis. When it is determined to extend credit to a customer, the amount of collateral to be obtained will be based on the credit assessment for the customer by management. Collateral held as security includes, but is not limited to the following:

• Floating charges on all assets and businesses of the customer

• Specific or related guarantees

• Debt guarantees from customers and loan agreements with favorable and unfavorable covenant terms

The carrying amount of the financial assets, without taking into account any collateral held or credit enhancements, represents Sony’s maximum exposure to credit risk on these assets. For maximum exposure to credit risk of securities to which impairment requirements in IFRS 9 “Financial Instrument” (“IFRS 9”) are not applied without taking into account any collateral held or other credit enhancements, refer to Note 5.

In the Financial Services segment, housing loans have sufficient collateral, which results in no significant loss allowance being recognized. In addition, certain securities received as collateral for short-term lending transactions are permitted to be sold or repledged. The fair value of the securities which were not sold or repledged as collateral was 4,691 million yen as of March 31, 2023 and none as of March 31, 2024. None of the securities were sold or repledged as collateral as of March 31, 2023 or 2024. The securities are not recognized in the consolidated statements of financial position until being sold or repledged as collateral. 

(c) Credit risk exposure by risk rating grades

Credit risk exposure by risk rating grades as of March 31, 2023 and 2024, is as follows:

Trade and other receivables, and contract assets including non-current other receivables in the Pictures segment

	Yen in millions
	March 31
	2023		2024
Outstanding receivables by overview period of overdue (Gross carrying amount)
Not past due or due within 30 days		1,849,112		2,224,058
Due over 30 to 90 days		46,332		47,942
Due over 90 days		63,519		75,740
Total		1,958,963		2,347,740

Debt securities

Debt securities held in the Financial Services segment are substantially all composed of investment grade debt securities, and, as a financial instrument subject to IFRS 9 impairment requirements, 12-month expected losses are recorded.

The following table shows an analysis of the gross carrying amount for debt securities measured at amortized cost or at fair value through other comprehensive income based on a credit rating system in the Financial Services segment, which is primarily a composite of external credit ratings as of March 31, 2023 and 2024.

	Yen in millions
	March 31
	2023 Restated		2024
Debt securities by credit ratings (Gross carrying amount)
AAA		536,009		659,016
AA		2,807,684		3,122,639
A		7,328,136		7,111,836
BBB		9,625		15,668
Other		6,434		3,004
Total		10,687,888		10,912,163

Loans

Loans held in the banking business in the Financial Services segment are regularly reassessed by the credit ratings of debtors, and as a financial instrument subject to IFRS 9 impairment requirements, 12-month or lifetime expected credit losses are recorded depending on whether or not the credit risk has increased significantly since initial recognition or not.

The following table shows an analysis of the gross carrying amount for loans measured at amortized cost based on credit ratings by debtors in the banking business in the Financial Services segment as of March 31, 2023 and 2024.

	Yen in millions
	March 31, 2023
	Normal*						Other than Normal						Total
	12-month expected credit losses		Lifetime expected credit losses		Sub total		12-month expected credit losses		Lifetime expected credit losses		Sub total
Loans
Housing loans		3,124,410		140		3,124,550		2,173		3,350		5,523		3,130,073
Other		16,852		242		17,094		4		74		78		17,172
Total		3,141,262		382		3,141,644		2,177		3,424		5,601		3,147,245

	Yen in millions
	March 31, 2024
	Normal*						Other than Normal						Total
	12-month expected credit losses		Lifetime expected credit losses		Sub total		12-month expected credit losses		Lifetime expected credit losses		Sub total
Loans
Housing loans		3,570,142		247		3,570,389		1,998		2,706		4,704		3,575,093
Other		15,755		378		16,133		5		96		101		16,234
Total		3,585,897		625		3,586,522		2,003		2,802		4,805		3,591,327

* Normal is defined as borrowers who have strong results and no particular problems with their financial position.

(d) Credit risk for debt securities designated to be measured at fair value through profit or loss

The credit risk exposures for debt securities designated to be measured at fair value through profit or loss were 1,486,566 million yen, and 1,243,109 million yen as of March 31, 2023 and 2024, respectively. The changes in the fair value attributable to the changes in credit risk were an increase of 509 million yen for the fiscal year ended March 31, 2023 and a decrease of 969 million yen for the fiscal year ended March 31, 2024. The cumulative changes were an increase of 2,535 million yen and 1,566 million yen as of March 31, 2023 and 2024, respectively. The amounts as of March 31, 2023 have been restated in accordance with IFRS 17.

(7) Market risks for the banking business

In the banking business, by formulating and conforming with market risk management policies, Sony manages the risk of loss for when the value of assets and liabilities (including off-balance-sheet items), and income from assets and liabilities could be adversely affected by changes in various market risk factors, such as interest rates, exchange rates and stock prices. Market risk management policies specify details such as risk management methods and procedures. Based on ALM and risk management policies determined by the banking subsidiary’s Board of Directors, an ALM committee and a risk management committee typically meet once each month to understand and confirm actual conditions and deliberate future measures and risk conditions. On a daily basis, the risk management division maintains an overall understanding of interest, exchange rates and durations of financial assets and liabilities, and monitors Value at Risk (“VaR”), which quantifies the maximum expected loss which could occur during a given holding period and at a given probability, and interest rate sensitivity analysis, and confirms regulatory compliance. Sony also conducts interest rate swaps and other derivative transactions to hedge against interest and exchange rate fluctuation risks. VaR is calculated by the historical method (time period: 250 days, confidence level: 99.0%) and is used for quantitative analysis in managing interest and exchange rate fluctuation risks. The total market risk volume as of March 31, 2023 and 2024 was 21,433 million yen and 18,046 million yen, respectively. VaR is based on the assumption that risk parameters other than interest rates and exchange rates are fixed. In the event that fluctuations exceed the rational forecast band for interest and exchange rates, the risk impact may exceed the amount calculated. The aforementioned market risk management is carried out primarily by the risk management division. The division periodically reports risk management conditions to the banking subsidiary’s Board of Directors and Executive Committee. In addition, the banking subsidiary’s internal audit division conducts audits of the risk management conditions.

(8) Effect of IBOR reform

Due to the reform and replacement of benchmark interest rates such as the London Interbank Offered Rate (“LIBOR”), the use of other interbank offered rates (“IBORs”) has become a priority for global regulators. The use of LIBOR ceased as of December 31, 2021, except for the use of certain U.S. dollar (“USD”) LIBORs. USD LIBOR was abolished and lost its representativeness as of June 2023.

As mentioned above, the JPY and GBP IBORs were abolished on December 31, 2021 and replaced by alternative interest rates such as the Tokyo Overnight Average Rate and the Sterling Overnight Index Average. USD LIBOR was abolished on June 30, 2023 and replaced by the Secured Overnight Financing Rate (SOFR).

For contracts that used USD LIBOR as of March 31, 2023, Sony has completed the amendment of agreements for the transition to alternative interest rate benchmarks as of March 31, 2024.