Financial Statements for FY2026.6

freee K.K. and its subsidiaries

Consolidated financial statements and non-consolidated financial statements for the fiscal year ended June 30, 2026

1. Consolidated balance sheet

   1. Consolidated balance sheet

      (Thousands of yen)

      As of June 30, 2025

      As of June 30, 2026

      Assets

      Current assets
      Cash and deposits	35,789,632		36,187,021
      Accounts receivable - trade	※２ 3,619,898		※２ 4,999,068
      Purchased receivables	-		1,536,610
      Advances paid	3,982,166		7,158,047
      Segregated deposits	※１ 957,968		※１ 532,957
      Other	1,558,998		1,006,175
      Allowance for doubtful accounts	(33,756)		(1,062,688)
      Total current assets	45,874,908		50,357,192
      Non-current assets
      Property, plant and equipment
      Facilities attached to buildings	18,685		661,528
      Accumulated depreciation	(7,086)		(35,846)
      Facilities attached to buildings, net	11,598		625,682
      Tools, furniture and fixtures	87,542		517,091
      Accumulated depreciation	(30,751)		(107,363)
      Tools, furniture and fixtures, net	56,791		409,727
      Total property, plant and equipment	68,390		1,035,410
      Intangible assets
      Goodwill		590,517	949,398
      Software		2,547,104	5,402,451
      Software in progress		978,639	1,206,159
      Total intangible assets		4,116,261	7,558,008
      Investments and other assets
      Investment securities	※３	424,016	※３ 433,272
      Deferred tax assets		982,403	1,368,828
      Lease and guarantee deposits	※１	904,807	※１ 1,107,519
      Other		322,502	205,903
      Allowance for doubtful accounts		(97,606)	(145,342)
      Total investments and other assets		2,536,123	2,970,182
      Total non-current assets		6,720,774	11,563,601
      Total assets	52,595,683		61,920,793

      (Thousands of yen)

      As of June 30, 2025

      As of June 30, 2026

      Liabilities

      Current liabilities

      Short-term borrowings	※１,４	9,600,000	※１,４	14,300,000
      Other payable		1,835,436		1,723,467
      Accrued expenses		2,683,193		2,699,142
      Income taxes payable		139,296		279,537
      Unearned revenue		14,665,191		17,336,565
      Provision for bonuses		588,950		508,990
      Provision for stock-based compensation		11,784		285,204
      Other		1,786,953		1,453,205
      Total current liabilities		31,310,806		38,586,112

      Non-current liabilities

      Asset retirement obligation	1,533,896	1,976,086
      Provision for stock-based compensation	28,797	151,126
      Long-term other payable	10,000	-
      Other	48,899	20,945
      Total non-current liabilities	1,621,593	2,148,158
      Total liabilities	32,932,399	40,734,270
      Net assets
      Shareholders' equity
      Common stock	27,043,623	12,918,532
      Capital surplus	574,738	16,448,997
      Retained earnings (Accumulated deficit)	(8,133,721)	(7,055,816)
      Treasury stock	(650)	(1,291,607)
      Total shareholders' equity	19,483,989	21,020,105

      Accumulated other comprehensive income

      Valuation difference on available-for-sale securities	19,040	38,625
      Deferred gains or losses on hedges	4,321	29,910
      Foreign currency translation adjustment	4,706	7,492
      Total accumulated other comprehensive income	28,069	76,028
      Stock acquisition rights	151,224	90,389
      Total net assets	19,663,283	21,186,522
      Total liabilities and net assets	52,595,683	61,920,793

   2. Consolidated statement of income and consolidated statement of comprehensive income Consolidated statement of income

      (Thousands of yen)

      Fiscal year ended June 30, 2025

      Fiscal year ended June 30, 2026

      Cost of sales

      5,909,557

      8,043,961

      Selling, general and administrative expenses

      ※２,３ 26,750,070

      ※２,３ 33,306,287

      Non-operating income

      Lecture fee and other income

      1,449

      2,791

      Other

      9,503

      19,552

      Non-operating expenses

      Total non-operating income 28,273 80,961

      Refund received - 9,865

Operating profit 610,972 1,091,431

Gross profit 27,361,043 34,397,718

Net sales ※１ 33,270,601 ※１ 42,441,680

remuneration

using equity method

(Thousands of yen)

Fiscal year ended June 30, 2025

Fiscal year ended June 30, 2026

Profit 1,370,024 1,077,905

Other comprehensive income

1. Consolidated statement of changes in equity Fiscal year ended June 30, 2025

   (Thousands of yen)

   	Shareholdersʼ equity
   	Common stock	Capital surplus	Retained earnings (Accumulated deficit)	Treasury stock	Total shareholdersʼ equity
   Balance at beginning of period	26,348,152	42,133,180	(51,757,334)	(324)	16,723,673
   Changes during period
   Issuance of new shares	636,581	636,581			1,273,162
   Exercise of stock acquisition rights	58,889	58,889			117,779
   Deficit disposition		(42,253,912)	42,253,912		-
   Purchase of treasury stock				(650)	(650)
   Cancellation of treasury stock		(324)		324	-
   Transfer from retained earnings to capital surplus		324	(324)		-
   Profit attributable to owners of parent			1,370,024		1,370,024
   Net changes in items other than shareholdersʼ equity
   Total changes during period	695,470	(41,558,441)	43,623,612	(326)	2,760,316
   Balance at end of period	27,043,623	574,738	(8,133,721)	(650)	19,483,989

   	Accumulated other comprehensive income				Stock acquisition rights	Total net assets
   	Valuation difference on available-for-sale securities	Deferred gains or losses on hedges	Foreign currency translation adjustment	Total accumulated other comprehensive income
   Balance at beginning of period	12,318	34,333	4,661	51,312	177,358	16,952,345
   Changes during period
   Issuance of new shares						1,273,162
   Exercise of stock acquisition rights						117,779
   Deficit disposition						-
   Purchase of treasury stock						(650)
   Cancellation of treasury stock						-
   Transfer from retained earnings to capital surplus						-
   Profit attributable to owners of parent						1,370,024
   Net changes in items other than shareholdersʼ equity	6,722	(30,011)	45	(23,243)	(26,134)	(49,377)
   Total changes during period	6,722	(30,011)	45	(23,243)	(26,134)	2,710,938
   Balance at end of period	19,040	4,321	4,706	28,069	151,224	19,663,283

   Fiscal year ended June 30, 2026

   (Thousands of yen)

   	Shareholdersʼ equity
   	Common stock	Capital surplus	Retained earnings (Accumulated deficit)	Treasury stock	Total shareholdersʼ equity
   Balance at beginning of period	27,043,623	574,738	(8,133,721)	(650)	19,483,989
   Changes during period
   Issuance of new shares	824,771	824,771			1,649,542
   Exercise of stock acquisition rights	50,137	50,137			100,275
   Purchase of treasury stock				(1,500,531)	(1,500,531)
   Disposal of treasury stock				208,923	208,923
   Cancellation of treasury stock		(650)		650	-
   Transfer from common stock to capital surplus	(15,000,000)	15,000,000			-
   Profit attributable to owners of parent			1,077,905		1,077,905
   Net changes in items other than shareholdersʼ equity
   Total changes during period	(14,125,090)	15,874,258	1,077,905	(1,290,956)	1,536,115
   Balance at end of period	12,918,532	16,448,997	(7,055,816)	(1,291,607)	21,020,105

   	Accumulated other comprehensive income				Stock acquisition rights	Total net assets
   	Valuation difference on available-for-sale securities	Deferred gains or losses on hedges	Foreign currency translation adjustment	Total accumulated other comprehensive income
   Balance at beginning of period	19,040	4,321	4,706	28,069	151,224	19,663,283
   Changes during period
   Issuance of new shares						1,649,542
   Exercise of stock acquisition rights						100,275
   Purchase of treasury stock						(1,500,531)
   Disposal of treasury stock						208,923
   Cancellation of treasury stock						-
   Transfer from common stock to capital surplus						-
   Profit attributable to owners of parent						1,077,905
   Net changes in items other than shareholdersʼ equity	19,584	25,588	2,785	47,958	(60,835)	(12,876)
   Total changes during period	19,584	25,588	2,785	47,958	(60,835)	1,523,238
   Balance at end of period	38,625	29,910	7,492	76,028	90,389	21,186,522

2. Consolidated statement of cash flows

(Thousands of yen)

(280,036)

739,107

Increase (decrease) in accounts payable -other

32,650

(47,914)

-

purchased

in

(increase)

Decrease receivables

(7,911)

(22,880)

Loss (gain) on sale of property, plant and equipment

28,867

Loss (gain) on valuation of investment securities

(79,960)

273,212

Increase (decrease) in provision for bonuses

Loss on amortization of restricted stock remuneration

103,453

93,187

Net cash provided by (used in) operating activities

3,661,980

1,519,264

Fiscal year ended June 30, 2025

Fiscal year ended June 30, 2026

Profit before income taxes

416,237

768,407

Amortization of goodwill

88,341

165,446

Increase (decrease) in allowance for doubtful accounts

51,641

8,752

Increase (decrease) in provision for stock-based compensation

24,502

520,495

Loss (gain) on investments in investment partnerships

20,379

21,085

Interest income

(17,320)

(48,751)

Stock issuance costs

4,099

4,379

Gain on reversal of stock acquisition rights

(9,515)

(46,785)

Decrease (increase) in trade receivables

(985,909)

(1,390,614)

Decrease (increase) in segregated deposits

(479,297)

425,010

Increase (decrease) in accrued expenses

116,000

15,938

Other, net

449,069

(155,901)

Interest received

17,320

48,751

Income taxes paid

(33,093)

(30,941)

Interest paid (76,072) (170,893)

Subtotal 3,753,825 1,672,348

Increase (decrease) in unearned revenue 3,276,280 2,664,467

Decrease (increase) in advances paid (1,691,957) (3,175,878)

Interest expenses 76,072 170,893

Stock-based compensation expenses 972,889 698,538

Depreciation 320,550 1,316,850

Cash flows from operating activities

(Thousands of yen)

Fiscal year ended June 30, 2025

Fiscal year ended June 30, 2026

Cash flows from investing activities

Purchase of property, plant and equipment (45,805) (610,013)

Purchase of shares of subsidiaries resulting in change in scope of consolidation

※２ (628,997)

※２ (713,107)

Proceeds from refund of leasehold and guarantee deposits

510 4,650

Net cash provided by (used in) investing activities

(4,601,221)

(5,898,044)

Other, net 1,390 10

Cash flows from financing activities

Net cash provided by (used in) financing activities

4,977,930 4,765,792

Effect of exchange rate change on cash and cash equivalents

45

2,785

Net increase (decrease) in cash and cash equivalents

4,038,735 389,798

Cash and cash equivalents at beginning of period

31,750,897

35,789,632

Cash and cash equivalents at end of period ※１ 35,789,632 ※１ 36,179,431

(Material matters that serve as the basis for preparation of consolidated financial statements)

1. Scope of consolidation

   The Company consolidated all of its subsidiaries. Number of consolidated subsidiaries: 5

   Names of consolidated subsidiaries freee biz K.K.

   Likha-iT Inc.

   freee founding loan support K.K. Logikura Inc.

   1 other company

   In the current fiscal year, Apollo Inc., which was a consolidated subsidiary in the prior fiscal year, has been excluded from the scope of consolidation due to an absorption-type merger by the Company, effective on July 1, 2025.

   GMO creators network, Inc., whose shares were acquired during the current fiscal year, has been included in the scope of consolidation. The company changed its trade name to freenance K.K. and was subsequently excluded from the scope of consolidation due to an absorption-type merger by the Company, effective on October 1, 2025.

   Logikura Inc., whose shares were acquired during the current fiscal year, has been included in the scope of consolidation.

2. Application of the equity method

   Number of associates accounted for by the equity method: 1 Name of associates: Incloop,Inc.

3. Accounting period of consolidated subsidiaries

   The closing date of all consolidated subsidiaries matches the consolidated closing date.

4. Accounting policies

   1. Valuation standards and methods for material assets

      1. Securities

         Available-for-sale securities

         Securities other than non-marketable securities

         Securities other than non-marketable securities classified as available-for-sale securities are stated at fair value (net unrealized gains or losses are reported as a separate component of net assets, and the cost of securities sold is determined mainly by the moving average method).

         Non-marketable securities

         Non-marketable securities classified as available-for-sale securities are carried at cost determined by the moving average method.

         Investments in investment limited partnerships and similar investments, defined as securities by Article 2, Section 2 of the Financial Instruments and Exchange Act, are recognized at the net amount corresponding to the owning portion under the equity method based on the most recent financial statements available as of the reporting date stipulated in the partnership agreement.

      2. Inventories

         Merchandise and work in progress are stated by the specific identification method (balance sheet amounts are determined by the devaluation method based on the decline in profitability).

      3. Derivative financial instruments

         Derivative financial instruments are stated at fair value.

   2. Depreciation and amortization methods for material depreciable and amortizable assets

      1. Property, plant and equipment

         Depreciation of property, plant and equipment of the Company and its consolidated subsidiaries is computed by the straight-line method.

         The range of estimated useful lives is principally from 3 to 15 years for facilities attached to buildings and from 3 to 15 years for tools, furniture and fixtures.

      2. Intangible assets

         Amortization of intangible assets of the Company and its consolidated subsidiaries is computed by the straight-line method.

         Amortization of software for internal use is based on its estimated useful life (2 to 5 years).

   3. Accounting treatment for deferred assets Stock issuance costs

      Stock issuance costs are expensed as incurred.

   4. Standards on recognition of material allowances

      1. Allowance for doubtful accounts

         Allowance for doubtful accounts is provided for possible losses arising from bad debt at an amount determined based on the historical default rates for normal accounts, and an estimate of uncollectible amounts determined by reference to specific doubtful accounts.

      2. Provision for bonuses

         Provision for bonuses is provided for the prospective payments of bonuses to employees accrued by the end of the current fiscal year.

      3. Provision for stock-based compensation

         Provision for stock-based compensation is provided for the prospective payments of compensation under the stock compensation plan to directors and employees, based on the estimated amount of payments as of the end of the current consolidated fiscal year.

   5. Foreign currency translations

      All monetary receivables and payables denominated in foreign currencies are translated into Japanese yen at the spot exchange rates in effect at the balance sheet date. Foreign exchange gains and losses from the translation are included in the consolidated statement of income.

      Assets and liabilities of the foreign consolidated subsidiaries are translated into Japanese yen at the rates of exchange in effect at the balance sheet date, and revenue and expense accounts are translated at the average rates of exchange in effect during the year. Differences arising from the translation are presented as foreign currency translation adjustments in the net assets of the consolidated balance sheet.

   6. Amortization method and period of goodwill

      Goodwill is amortized on a straight-line method over reasonable years (5 years), determined on an individual case basis.

   7. Scope of cash and cash equivalents in the consolidated statement of cash flows

      Cash and cash equivalents consist of cash on hand, cash in banks and short-term investments that are readily convertible into cash and that are exposed to insignificant changes in value. Cash equivalents comprise short-term investments which mature or become due within 3 months of the date of acquisition.

   8. Reporting of significant revenues and expenses

      In the Group's primary business, the platform business, the Group primarily provides cloud accounting software services. These services are available for the duration of the contract, and the obligations are fulfilled over time. The Group recognizes revenue from contracts with customers over the period of services rendered that are transferred to the customer.

   9. Hedge accounting method

      1. Hedge accounting method

         In principle, deferred hedge accounting is applied.

         Short-cut method, "Furiate-Shori," is applied for foreign exchange reservations which are qualified for such treatment.

      2. Hedging instruments and hedged items

         • Hedging instruments.......Foreign exchange reservation

         • Hedged items.................Forecasted transactions denominated in foreign currencies

      3. Hedging policy

         The Company utilizes derivative financial instruments mainly for the purpose of hedging its exposure to adverse fluctuations in foreign currency exchange rates based on expected future payment amounts and other factors, but does not enter into such transactions for speculative purposes.

      4. Assessment of hedge effectiveness

The assessment of hedge effectiveness is omitted as the terms of hedged items are substantially same as those of hedging instruments, and it is expected that the changes in market values will continue to offset each other after the inception of the hedge.

1. Valuation of goodwill

   1. Amount recorded in the consolidated financial statements for the current fiscal year

      (Thousands of yen)

      Fiscal year ended June 30, 2025

      Fiscal year ended June 30, 2026

      Goodwill 590,517 949,398

   2. Details of significant accounting estimates related to the identified items

      Goodwill as of the end of the current fiscal year arose mainly from the acquisitions of Logikura Inc., Apollo Inc., YUI Inc. and other companies.

      The Group makes groupings of assets in accordance with management accounting classifications based on business units to which goodwill is attributable. When there is an indication of impairment of goodwill and an assessment is made as to whether an impairment loss should be recognized, the total undiscounted future cash flows from the asset groups are estimated based on the future plans

      for each management accounting category where income and expenditure are continuously monitored. For the current fiscal year, the Group assessed whether there were any indications of impairment and determined that no such indications existed. In performing its impairment assessment, the Group

      treats the asset grouping (business unit) as the Platform business as a whole.

      Accounting estimates are subject to potential changes depending on future developments in the business environment and other factors, and if actual results differ from such estimates, the valuation of goodwill could be materially affected in the following fiscal yearʼs financial statements.

2. Recoverability of deferred tax assets

   1. Amount recorded in the consolidated financial statements for the current fiscal year

      (Thousands of yen)

      Fiscal year ended June 30, 2025

      Fiscal year ended June 30, 2026

      Deferred tax assets, net 982,403 1,368,828

      Before offsetting against deferred tax liabilities for the prior year: 993,227 thousand yen Before offsetting against deferred tax liabilities for the current year: 1,534,781 thousand yen

   2. Details of significant accounting estimates related to the identified items

      The Group recognizes deferred tax assets based on the timing and amounts of future taxable income estimated in its business plan, to the extent that realization is expected. The timing and amounts of such taxable income may be affected by fluctuations in uncertain future economic conditions. If assumptions or forecasts regarding ARR and net sales change and the actual timing and amounts of taxable income differ from the original estimates, the amount of deferred tax assets could be materially affected in the following fiscal yearʼs financial statements.

      (Accounting standards issued but not yet adopted)

      • “Accounting Standard for Leases ” (ASBJ Statement No. 34, September 13, 2024)

      • “Implementation Guidance on Accounting Standard for Leases ” (ASBJ Guidance No. 33, September 13, 2024), etc.

1. Overview

   As part of its efforts to make Japanese GAAP consistent with international accounting standards, the Accounting Standards Board of Japan (ASBJ) conducted deliberations, taking international accounting standards into account, toward the development of an accounting standard for leases under which a lessee recognizes assets and liabilities for all of its leases. As a result, the ASBJ issued the accounting standard for leases, etc., which, as its basic policy, is based on the single accounting model of IFRS 16 but incorporates only the major provisions of IFRS 16 rather than all of its provisions, with the aim of being simple and convenient and, in principle, requiring no adjustments even when the provisions of IFRS 16 are applied to non-consolidated financial statements.

   With respect to the lesseeʼs accounting treatment, as with IFRS 16, a single accounting model is applied to the method of allocating lease expenses of the lessee, under which depreciation of

   right-of-use assets and interest on lease liabilities are recorded for all leases, regardless of whether the lease is a finance lease or an operating lease.

2. Scheduled date of adoption

   To be applied from the beginning of the fiscal year ending June 30, 2028.

3. Effects of the application of the standards

The Company is currently in the process of determining the effects of the application of the “Accounting Standard for Leases, ” etc. on the consolidated financial statements.

1. Consolidated balance sheet

   "Provision for stock-based compensation," which was included in "Other" under "Current liabilities," and "Provision for stock-based compensation," which was included in "Other" under "Non-current liabilities" in the prior fiscal year, have been presented as separate accounts in the current fiscal year due to their increased financial materiality. To reflect this change in presentation, consolidated financial statements for the prior fiscal year have been reclassified.

   As a result, 1,798,738 thousand yen presented as "Other" under "Current liabilities" in the consolidated balance sheet for the prior fiscal year has been reclassified into "Provision for stock-based compensation" of 11,784 thousand yen and "Other" of 1,786,953 thousand yen. Additionally, 77,697 thousand yen presented as "Other" under "Non-current liabilities" has been reclassified into "Provision for stock-based compensation" of 28,797 thousand yen and "Other" of 48,899 thousand yen.

2. Consolidated statement of cash flows

"Increase (decrease) in provision for stock-based compensation," which was included in "Other, net" under "Cash flows from operating activities" in the prior fiscal year, has been presented as a separate account in the current fiscal year due to its increased financial materiality. To reflect this change in presentation, consolidated financial statements for the prior fiscal year have been reclassified.

As a result, 473,571 thousand yen presented as "Other, net" under "Cash flows from operating activities" in the consolidated statement of cash flows for the prior fiscal year has been reclassified into "Increase (decrease) in provision for stock-based compensation" of 24,502 thousand yen and "Other, net" of 449,069 thousand yen.

(Incentive plan to grant company shares to employees through a trust)

At the Board of Directors meeting on July 18, 2025, the Company resolved to introduce the Employee Stock Ownership Plan (J-ESOP) (hereinafter referred to as "the Plan"), an incentive plan to grant the Company's shares to its employees.

1. Outline of the Transaction

   The Plan is a scheme under which the Company grants its employees who meet certain requirements the Company's shares and cash equivalent to the fair value of such shares, based on the Stock Provision Rules stipulated by the Company.

   In order to acquire the shares to be granted in the future, the Company entrusts money to Custody Bank of Japan, Ltd. (Trust Account E) as trust assets for the Plan and the Custody Bank of Japan, Ltd. acquires the Company's shares by subscribing for the new shares issued by the Company using the entrusted money.

2. Company shares remaining in the trust

The Company's shares remaining in the trust are recorded as "Treasury stock" under net assets at the book value in the trust (excluding incidental costs).

The book value and number of such treasury stock are 1,291,078 thousand yen and 332,324 shares, respectively, as of the end of the current consolidated fiscal year.

*1

Assets pledged as collateral and liabilities secured by the collateral

In addition to the above, the deposited items with the Legal Affairs Bureau as business security deposits in accordance with the Building Lots and Buildings Transaction Business Law are as follows:

(Thousands of yen)

Fiscal year ended June 30, 2025

Fiscal year ended June 30, 2026

Lease and guarantee deposits 10,000 10,000

Further, the following lease and guarantee deposits have been deposited with the Legal Affairs Bureau in accordance with the Act on Provision of Financial Services and the Development of the Accessible Environment.

Fiscal year ended June 30, 2025

(Thousands of yen) Fiscal year ended

June 30, 2026

Lease and guarantee deposits 10,000 11,000

*2

Receivables from contracts with customers in accounts receivable are as follows:

Fiscal year ended June 30, 2025

(Thousands of yen) Fiscal year ended

June 30, 2026

Accounts receivable - trade 3,619,898 4,999,068

Investment securities relating to associates are as follows:

Fiscal year ended June 30, 2025

(Thousands of yen) Fiscal year ended

June 30, 2026

Investment securities (shares) 15,000 15,000

*4

For the purpose of efficiently procuring working capital for the credit card business and other operations, the Group has entered into overdraft agreements. The unused borrowing facilities under such overdraft agreements as of the end of the current fiscal year are as follows.

Fiscal year ended June 30, 2025

(Thousands of yen) Fiscal year ended

June 30, 2026

Total amount of overdraft agreements 11,500,000 24,500,000

Outstanding borrowings 9,600,000 14,300,000

Unused commitment 1,900,000 10,200,000

*1

Revenue from contracts with customers

With regard to net sales, revenue from contracts with customers and revenue from other sources are not separately presented. The amount of revenue from contracts with customers is as follows:

(Thousands of yen)

Fiscal year ended June 30, 2025

Fiscal year ended June 30, 2026

Revenue from contracts with customers 33,270,601 42,441,680

*2

Major components of selling, general and administrative expenses are as follows:

(Thousands of yen)

The total amount of research and development expenses included in general and administrative expenses is as follows:

Fiscal year ended June 30, 2025

(Thousands of yen) Fiscal year ended

June 30, 2026

Research and development expenses 4,742,027 6,549,561

*4

Components of gain on sale of non-current assets are as follows:

Fiscal year ended June 30, 2025

(Thousands of yen) Fiscal year ended

June 30, 2026

Tools, furniture and fixtures 22,880 7,911

*

Reclassification adjustments and tax effects concerning other comprehensive income are as follows:

(Thousands of yen)

Valuation difference on available-for-sale securities

Fiscal year ended June 30, 2025

Fiscal year ended June 30, 2026

Amount arising during the period 10,050 19,002

Foreign currency translation adjustment

Amount arising during the period 45 2,785

Reclassification adjustments for gains and losses

realized in net income - -

Fiscal year ended June 30, 2025

1. Issued shares

   Types of shares Number of shares

   at July 1, 2024

   Increase Decrease Number of shares at June 30, 2025

   Common stock	58,600,020	664,590	42,930	59,221,680
   Total	58,600,020	664,590	42,930	59,221,680

   Overview of reasons for changes:

   Major details of the increase and decrease of Common stock are as follows:

   Exercise of stock acquisition rights 241,641 shares

   Issuance of new shares as restricted shares 422,949 shares

   Cancellation of treasury stock on August 5, 2024 42,930 shares

2. Treasury stock

   Types of shares Number of shares

   at July 1, 2024

   Increase Decrease Number of shares at June 30, 2025

   Common stock	42,930	62,551	42,930	62,551
   Total	42,930	62,551	42,930	62,551

   Overview of reasons for changes:

   Major details of the increase and decrease of Treasury stock are as follows: Acquisition of shares without compensation under the restricted stock remuneration plan

   62,370 shares

   Acquisition of shares through purchase of odd-lot shares 181 shares Cancellation of treasury stock on August 5, 2024 42,930 shares

3. Stock acquisition rights

   Company name	Description	Types of shares to be issued	Number of shares to be issued				Balance at June 30, 2025 (Thousands of yen)
   			Number of shares at July 1, 2024	Increase	Decrease	Number of shares at June 30, 2025
   Filing company	Stock acquisition rights as stock options	-	-	-	-	-	151,224
   Total			-	-	-	-	151,224

4. Dividend

   1. Amount of dividends paid Not applicable.

   2. Dividend whose effective date is in the next term though its reference date was in the current term

Not applicable.

Fiscal year ended June 30, 2026

1. Issued shares

   Types of shares Number of shares

   at July 1, 2025

   Increase Decrease Number of shares at June 30, 2026

   Common stock	59,221,680	622,273	62,551	59,781,402
   Total	59,221,680	622,273	62,551	59,781,402

   Overview of reasons for changes:

   Major details of the increase and decrease of Common stock are as follows:

   Exercise of stock acquisition rights 196,599 shares

   Issuance of new shares as restricted shares 39,573 shares

   Issuance of new shares through a third-party allotment in connection with the contribution to the Employee Stock Ownership Plan (J-ESOP)

   386,101 shares

   Cancellation of treasury stock on August 18, 2025 62,551 shares

2. Treasury stock

   Types of shares Number of shares

   at July 1, 2025

   Increase Decrease Number of shares at June 30, 2026

   Common stock	62,551	453,791	116,328	400,014
   Total	62,551	453,791	116,328	400,014

   Overview of reasons for changes:

   Major details of the increase and decrease of Treasury stock are as follows: Acquisition of shares without compensation under the restricted stock remuneration plan

   67,522 shares

   Acquisition of shares through purchase of odd-lot shares 168 shares Acquisition of treasury stock in connection with the additional contribution to

   the Employee Stock Ownership Plan (J-ESOP) based on the resolution of the Board of Directors

   386,101 shares

   Cancellation of treasury stock on August 18, 2025 62,551 shares

   Decrease due to the grant of shares to employees under the Employee Stock Ownership Plan (J-ESOP)

   53,777 shares

   (Note) The number of shares as of the end of the current fiscal year includes 332,324 shares of the Company held by Custody Bank of Japan, Ltd. (Trust Account E) as trust assets under the Employee Stock Ownership Plan (J-ESOP).

3. Stock acquisition rights

   Company name	Description	Types of shares to be issued	Number of shares to be issued				Balance at June 30, 2026 (Thousands of yen)
   			Number of shares at July 1, 2025	Increase	Decrease	Number of shares at June 30, 2026
   Filing company	Stock acquisition rights as stock options	-	-	-	-	-	90,389
   Total			-	-	-	-	90,389

4. Dividend

   1. Amount of dividends paid Not applicable.

   2. Dividend whose effective date is in the next term though its reference date was in the current term

Not applicable.

*1

A reconciliation between cash and cash equivalents in the consolidated statement of cash flows, and cash and deposits in the consolidated balance sheet is as follows:

(Thousands of yen)

*2

Major components of assets and liabilities of consolidated subsidiaries in which the Company newly acquired shares.

Fiscal year ended June 30, 2025

The components of assets and liabilities at the beginning of the consolidation as the Company newly acquired the shares of Apollo Inc., and reconciliation between the acquisition costs and the payments for the shares, net are as follows:

The components of assets and liabilities at the beginning of the consolidation as the Company newly acquired the shares of YUI Inc., and reconciliation between the acquisition costs and the payments for the shares, net are as follows:

Fiscal year ended June 30, 2026

The components of assets and liabilities at the beginning of the consolidation as the Company newly acquired the shares of freenance K.K., and reconciliation between the acquisition costs and the payments for the shares, net are as follows:

The components of assets and liabilities at the beginning of the consolidation as the Company newly acquired the shares of Logikura Inc., and reconciliation between the acquisition costs and the payments for the shares, net are as follows:

(Thousands of yen)

*3

Significant non-cash transactions

Fiscal year ended June 30, 2025

(Thousands of yen) Fiscal year ended

June 30, 2026

Significant asset retirement obligations recognized - 436,249

Operating lease transactions (As lessee)

Future minimum lease payments under non-cancellable operating lease contracts are as follows:

(Thousands of yen)

1. Conditions of financial instruments

   1. Company policy for financial instruments

      The Groupʼs fund management is limited to short-term cash deposits and other low-risk investments. For financing, the Group raises funds through third-party allotments of new shares and other means in accordance with its funding plans, while working capital for businesses such as the credit card business is procured through bank borrowings and other means in response to funding needs. With respect to derivative transactions, the Group uses them mainly for the purpose of hedging against foreign exchange fluctuation risk and has a policy of not engaging in speculative transactions.

   2. Nature and extent of risks arising from financial instruments

      Accounts receivable - trade, purchased receivables and advances paid are exposed to customer credit risk. Lease and guarantee deposits are mainly related to the lease agreement of the headquarters office and exposed to the counterpartyʼs credit risk. Other payable and income taxes payable are due within one year. Investment securities are exposed to the issuersʼ credit risks.

      Foreign exchange reservations are used to hedge against the adverse impact of fluctuations in foreign currency exchange rates on foreign currency denominated payables.

      Short-term borrowings are used for financing related to the card business. Short-term borrowings with variable interest rates are exposed to the risk of interest rate fluctuations.

      Hedging instruments, hedged items, hedging policy, and assessment of hedge effectiveness are stated in "４. Accounting policies - (9) Hedge accounting method" under (Material matters that serve as the basis for preparation of consolidated financial statements).

   3. Risk management for financial instruments

      1. Credit risk management

         As to accounts receivable - trade, in accordance with internal rules of credit control, the Group controls due dates and balances of individual customers and monitors their financial conditions to identify and reduce the default risk of the counterparties at an early stage. As to investment securities, the Group periodically reviews the financial condition of the issuer and continuously reviews its holdings.

      2. Liquidity risk management

         The Group prepares and updates internal funds management plans in a timely manner based on the reports submitted by each department. In addition, the Group maintains a certain level of liquidity on hand, thereby managing liquidity risk.

      3. Market risk management

         The Group uses derivative transactions for the purpose of hedging risks of foreign currency exchange fluctuations on trade payables denominated in foreign currencies. These derivative transactions of the Group are carried out pursuant to the internal rules that stipulate transaction authority. Short-term borrowings with variable interest rates are exposed to the risk of interest rate fluctuations. However, the Group regularly monitors the market interest rate conditions.

   4. Supplementary information on fair values of financial instruments

      Since variable factors are reflected in estimating the fair value, different assumptions and factors could result in a different fair value.

      The contract amounts of derivative transactions in the note "Derivative transaction" are not in themselves indicative of the market risk associated with the derivative transactions.

2. Fair values of financial instruments

   Carrying amounts, fair values, and differences of financial instruments are as follows.

   (Thousands of yen)

   Fiscal year ended June 30, 2025 Carrying amount Fair value Difference Assets:

   Investment securities

   Available-for-sale securities 50,000	50,000	-
   Lease and guarantee deposits 904,807	889,797	(15,009)
   Total 954,807	939,797	(15,009)
   Liabilities: Long-term other payable 10,000	9,922	(77)
   Total 10,000	9,922	(77)
   Derivative transactions (*2) 6,381	6,381	-

   *1: Cash and deposits, accounts receivable, advances paid, short-term borrowings, segregated deposits, other payable, accrued expenses and income taxes payable are omitted because they are cash or are settled within a short time and the fair value is almost equal to the book value.

   *2: Net receivables and payables, which were derived from derivative transactions, are presented in net amounts.

   *3: Non-marketable securities

   (Thousands of yen) Fiscal year ended

                                                                June 30, 2025       Unlisted shares (*1) 56,585

   Investments in investment partnerships (*2) 317,431

   *1: Unlisted shares are not included in the table because they do not have quoted market prices.

   *2: Investments in investment partnerships are not subject to fair value disclosure in accordance with Paragraph 24-16 of the "Guidance on Accounting Standard for Measurement of Fair Value" (ASBJ Guidance No. 31, June 17, 2021).

   (Thousands of yen)

   Fiscal year ended June 30, 2026 Carrying amount Fair value Difference Assets:

   Investment securities

   Available-for-sale securities 70,849	70,849	-
   Lease and guarantee deposits 1,107,519	843,392	(264,126)
   Total 1,178,368	914,242	(264,126)
   Derivative transactions (*2) 45,229	45,229	-

   *1: Cash and deposits, accounts receivable, purchased receivables, advances paid, segregated deposits, short-term borrowings, other payable, accrued expenses and income taxes payable are omitted because they are cash or are settled within a short time and the fair value is almost equal to the book value.

   *2: Net receivables and payables, which were derived from derivative transactions, are presented in net amounts.

   *3: Non-marketable securities

   (Thousands of yen) Fiscal year ended

                                                                June 30, 2026       Unlisted shares (*1) 63,787

   Investments in investment partnerships (*2) 298,636

   *1: Unlisted shares are not included in the table because they do not have quoted market prices.

   *2: Investments in investment partnerships are not subject to fair value disclosure in accordance with Paragraph 24-16 of the "Guidance on Accounting Standard for Measurement of Fair Value" (ASBJ Guidance No. 31, June 17, 2021).

   Footnotes:

   1. Redemption schedule for monetary claims after the consolidated closing date

      Fiscal year ended June 30, 2025

      (Thousands of yen)

      Due in 1 year or less

      Due after 1 year through 5 years

      Due after 5 years through 10 years

      Due after 10 years

      Cash and deposits	35,789,632	-	-	-
      Accounts receivable - trade	3,619,898	-	-	-
      Advances paid	3,982,166	-	-	-
      Segregated deposits	957,968	-	-	-
      Lease and guarantee deposits	-	806,284	21,622	76,900
      Total assets	44,349,666	806,284	21,622	76,900

      Fiscal year ended June 30, 2026

      (Thousands of yen)

      Due in 1 year or less

      Due after 1 year through 5 years

      Due after 5 years through 10 years

      Due after 10 years

      Cash and deposits	36,187,021	-	-	-
      Accounts receivable - trade	4,999,068	-	-	-
      Purchased receivables	1,536,610	-	-	-
      Advances paid	7,158,047	-	-	-
      Segregated deposits	532,957	-	-	-
      Lease and guarantee deposits	64,997	40,004	24,800	977,717
      Total assets	50,478,702	40,004	24,800	977,717

   2. The scheduled repayment amounts of other interest-bearing debt following the consolidated closing date

      Fiscal year ended June 30, 2025

      (Thousands of yen)

      	1 year or less	1-2 years	2-3 years	3-4 years	4-5 years	5 years over
      Short-term borrowings	9,600,000	-	-	-	-	-
      Total liabilities	9,600,000	-	-	-	-	-

      Fiscal year ended June 30, 2026

      (Thousands of yen)

      	1 year or less	1-2 years	2-3 years	3-4 years	4-5 years	5 years over
      Short-term borrowings	14,300,000	-	-	-	-	-
      Total liabilities	14,300,000	-	-	-	-	-

3. Fair value of financial instruments by levels

   The fair value of financial instruments is classified into the following three levels based on the observability and materiality of the inputs used to calculate fair value.

   Level 1: Fair value derived from quoted prices (unadjusted) in active markets for identical assets or liabilities.

   Level 2: Fair value derived from inputs observable directly or indirectly that are not included in Level 1 inputs.

   Level 3: Fair value derived from material unobservable inputs.

   When multiple inputs that have a significant impact on the fair value calculation are used, the fair value is classified at the lowest level.

   1. Financial assets measured at fair value

      Fiscal year ended June 30, 2025

      (Thousands of yen)

      Classification	Fair value
      	Level 1	Level 2	Level 3	Total
      Investment securities
      Available-for-sale securities	-	-	50,000	50,000
      Derivative transactions	-	6,381	-	6,381
      Total assets	-	6,381	50,000	56,381

      Fiscal year ended June 30, 2026

      (Thousands of yen)

      Classification	Fair value
      	Level 1	Level 2	Level 3	Total
      Investment securities
      Available-for-sale securities	20,849	-	50,000	70,849
      Derivative transactions	-	45,229	-	45,229
      Total assets	20,849	45,229	50,000	116,078

   2. Financial assets and financial liabilities other than those measured at fair value Fiscal year ended June 30, 2025

(Thousands of yen)

Fiscal year ended June 30, 2026

(Thousands of yen)

(Note) Valuation techniques and inputs are as follows:

Investment securities

Listed shares are valued using market prices. Since listed shares are traded in active markets, they are classified as Level 1 fair value.

In addition, stock acquisition rights for unlisted shares are measured based on the best available information obtained from the issuing company, taking into account the issuerʼs credit status and business progress, and are classified as Level 3 fair value.

Derivative transactions

Fair value of currency-related transactions is calculated based on fair value information obtained from counterparty financial institutions and is classified as Level 2 fair value.

Lease and guarantee deposits

Fair value of lease and guarantee deposits is calculated as the present value of future cash flows discounted at an appropriate index such as the yield on Japanese government bonds, and is classified as Level 2 fair value.

Long-term other payable

Fair value of long-term other payable is calculated as the present value discounted at an appropriate index such as the yield on Japanese government bonds, and is classified as Level 2 fair value.

1. Available-for-sale securities

   Fiscal year ended June 30, 2025

   (Thousands of yen)

   	Types of securities	Carrying amount	Acquisition cost	Difference
   Securities whose carrying amount exceeds their acquisition cost	Others	-	-	-
   	Subtotal	-	-	-
   Securities whose carrying amount does not exceed their acquisition cost	Others	50,000	50,000	-
   	Subtotal	50,000	50,000	-
   	Total	50,000	50,000	-

   Note:

   Unlisted securities of 42,756 thousand yen, investments in associates of 13,829 thousand yen, and investments in investment partnerships of 317,431 thousand yen are not included in the table above because they are shares and other securities without a market price.

   Fiscal year ended June 30, 2026

   (Thousands of yen)

   	Types of securities	Carrying amount	Acquisition cost	Difference
   Securities whose carrying amount exceeds their acquisition cost	Stock	-	-	-
   	Others	-	-	-
   	Subtotal	-	-	-
   Securities whose carrying amount does not exceed their acquisition cost	Stock	20,849	49,999	(29,150)
   	Others	50,000	50,000	-
   	Subtotal	70,849	99,999	(29,150)
   	Total	70,849	99,999	(29,150)

   Note:

   Unlisted securities of 50,089 thousand yen, investments in associates of 13,697 thousand yen, and investments in investment partnerships of 298,636 thousand yen are not included in the table above because they are shares and other securities without a market price.

2. Available-for-sale securities sold during the fiscal year Fiscal year ended June 30, 2025

   Not applicable.

   Fiscal year ended June 30, 2026 Not applicable.

3. Securities subject to the recognition of impairment losses Fiscal year ended June 30, 2025

An impairment loss of 28,867 thousand yen was recognized for investment securities (shares classified as available-for-sale securities: 28,867 thousand yen).

Fiscal year ended June 30, 2026

An impairment loss of 32,650 thousand yen was recognized for investment securities (shares classified as available-for-sale securities: 32,650 thousand yen).

Derivative transactions for which hedge accounting is not adopted

1. Currency-related transactions

   Fiscal year ended June 30, 2025 Not applicable.

   Fiscal year ended June 30, 2026

   (Thousands of yen)

   Category	Type of transaction	Notional amounts	Portion due after one year included herein	Fair value	Valuation gain (loss)
   Transactions other than market transactions	Foreign exchange reservation USD	149,541	-	1,552	1,552
   Total		149,541	-	1,552	1,552

   Note: Fair value is calculated based on prices obtained from counterparty financial institutions.

2. Interest-related transaction

Fiscal year ended June 30, 2025 Not applicable.

Fiscal year ended June 30, 2026 Not applicable.

Derivative transactions for which hedge accounting is adopted

1. Currency-related transactions

   Fiscal year ended June 30, 2025

   (Thousands of yen)

   Method of hedge accounting	Type of transaction	Major hedged items	Notional amounts	Portion due after one year included herein	Fair value
   Short-cut method (Furiate-Shori)	Foreign exchange reservation USD	Forecasted transactions denominated in foreign currencies	1,694,591	-	6,381
   Total			1,694,591	-	6,381

   Note: Fair value is calculated based on prices obtained from counterparty financial institutions.

   Fiscal year ended June 30, 2026

   (Thousands of yen)

   Method of hedge accounting	Type of transaction	Major hedged items	Notional amounts	Portion due after one year included herein	Fair value
   Short-cut method (Furiate-Shori)	Foreign exchange reservation USD	Forecasted transactions denominated in foreign currencies	3,035,443	-	43,677
   Total			3,035,443	-	43,677

   Note: Fair value is calculated based on prices obtained from counterparty financial institutions.

2. Interest-related transaction

Fiscal year ended June 30, 2025 Not applicable.

Fiscal year ended June 30, 2026 Not applicable.

1. Amount recognized as expense and account item of stock options Not applicable.

2. Amount recognized as profit due to forfeiture of stock options which were not exercised

   Fiscal year ended June 30, 2025

   (Thousands of yen) Fiscal year ended June 30, 2026

   Gain on reversal of stock acquisition rights 9,515 46,785

3. Details, scale, and fluctuation status of stock options

   Stock options that existed during the current consolidated fiscal year (ended June 30, 2026) are covered, and the number of stock options is converted into the number of shares.

   The number of shares is restated to reflect a 1000-for-1 stock split that was effective on September 18, 2014, and a 3-for-1 stock split that was effective on September 25, 2019.

   1. Details of stock options

      No.	Grantees	Number of shares of common stock	Date of grant	Exercise period
      10th	130 employees of the Company	353,235 shares	September 29, 2017	From September 29, 2019 to September 28, 2027
      12th	206 employees of the Company	453,450 shares	August 14, 2018	From September 29, 2019 to September 28, 2027
      14th	Two directors of the Company Two directors of subsidiary 192 employees of the Company	937,875 shares	February 5, 2019	From February 5, 2021 to February 4, 2029
      16th	1 director of the Company 2 directors of subsidiary 259 employees of the Company	861,150 shares	April 9, 2019	From April 9, 2021 to April 8, 2029
      18th	2 directors of the Company 1 employee of the Company	390,000 shares	June 1, 2019	From June 1, 2019 to May 31, 2029
      19th	14 employees of the Company	102,900 shares	June 11, 2019	From June 11, 2021 to June 10, 2029
      20th	1 director of the Company 2 directors of subsidiary 68 employees of the Company	370,275 shares	June 30, 2019	From June 30, 2021 to June 29, 2029
      22nd	4 directors of the Company 13 employees of the Company	54,962 shares	October 30, 2020	From October 1, 2022 to October 29, 2028

      Footnotes:

      The grantees are not required to complete any specified period of service in order to exercise stock acquisition rights.

   2. Scale and fluctuation status of stock options

      1. Number of stock options

         Shares

         10th Stock options 12th Stock options 14th Stock options

         Non-vested (Number of shares)

         Outstanding as of June 30, 2025	-	-	-
         Granted	-	-	-
         Forfeited	-	-	-
         Vested	-	-	-
         Outstanding as of June 30, 2026 Vested (Number of shares)	-	-	-
         Outstanding as of June 30, 2025	2,004	27,303	87,489
         Vested	-	-	-
         Exercised	702	25,203	44,388
         Forfeited	-	-	300
         Outstanding as of June 30, 2026	1,302	2,100	42,801

         Shares

         16th Stock options 18th Stock options 19th Stock options

         Non-vested (Number of shares)

         Outstanding as of June 30, 2025	-	-	-
         Granted	-	-	-
         Forfeited	-	-	-
         Vested	-	-	-
         Outstanding as of June 30, 2026	-	-	-
         Vested (Number of shares)
         Outstanding as of June 30, 2025	137,820	90,000	1,800
         Vested	-	-	-
         Exercised	32,304	90,000	-
         Forfeited	300	-	-
         Outstanding as of June 30, 2026	105,216	-	1,800

         Shares

         20th Stock options 22nd Stock options

         Non-vested (Number of shares)

         Outstanding as of June 30, 2025	-	-
         Granted	-	-
         Forfeited	-	-
         Vested	-	-
         Outstanding as of June 30, 2026 Vested (Number of shares)	-	-
         Outstanding as of June 30, 2025	64,506	35,420
         Vested	-	-
         Exercised	4,002	-
         Forfeited	300	12,214
         Outstanding as of June 30, 2026	60,204	23,206

      2. Price information

         10th Stock options 12th Stock options 14th Stock options

         Exercise price (Yen)	1	1	505
         Average stock price at exercise (Yen)	2,291	3,351	3,015
         	Fair value at date of grant (Yen) 338	504	-
         	16th Stock options	18th Stock options	19th Stock options
         	Exercise price (Yen) 505	505	505
         	Average stock price at exercise (Yen) 3,380	2,061	-
         	Fair value at date of grant (Yen) -	-	-
         	20th Stock options	22nd Stock options
         	Exercise price (Yen) 505	8,240
         	Average stock price at exercise (Yen) 3,325	-
         	Fair value at date of grant (Yen) -	3,830

4. Estimation method of fair value of stock options granted From 10th Stock options to 20th Stock options

   As the Company was an unlisted company as of the date of grant of stock options, fair value per unit of the stock option is estimated based on the estimated intrinsic value per unit. The value of the Companyʼs stock serving as the basis for calculating intrinsic value per unit is determined upon the DCF (Discounted Cash Flow) method, etc.

5. Estimation method of number of stock options vested

   Since it is difficult to reasonably estimate the number of stock options that will expire in the future, the number of stock options vested was calculated based solely on historical data for the number of stock options that have actually been forfeited.

6. Total intrinsic value of stock options at the end of the current fiscal year in case of calculating based on the intrinsic value per unit of stock options, and the total intrinsic value at the exercise date of stock options exercised during the current fiscal year

(Thousands of yen) Total intrinsic value of stock options as of the date of the current fiscal year end 319,928

Total intrinsic value of stock options at the date of exercise that were exercised during the current fiscal year

441,640