Consolidated Statements of Cash Flows 28 The accompanying Notes to Consolidated Financial Statements are an integral part of these statements. ( )This is referred to as “free cash flow” in “Management’s Discussion and Analysis of Operations.” U.S. Dollars Yen (thousands) (millions) (Note 3) Years ended March 31 1998 1999 2000 2000 Cash flows from operating activities (A): Income before income taxes and minority interests ¥123,855 ¥ 49,625 ¥ 74,857 $ 706,198 Adjustments to reconcile income before income taxes and  minority interests to net cash provided by operating activities: Depreciation and amortization 353,715 371,195 359,808 3,394,415 Goodwill amortization 33,909 21,754 27,621 260,575 Accrual for severance benefits, less payments 10,443 14,235 13,883 130,972 Provision for loss on repurchase of computers 53,124 48,638 45,736 431,472 Reversal of provision for loss on repurchase of computers (53,313) (53,124) (48,489) (457,443) Interest charges 56,615 58,240 49,505 467,028 Interest and dividend income (12,760) (12,499) (12,583) (118,708) Equity in earnings of affiliates, net (18,964) (22,475) (17,025) (160,613) Disposal of property, plant and equipment 16,695 38,378 27,726 261,566 Decrease (increase) in receivables, trade (96,607) 29,874 72,396 682,981 Decrease (increase) in inventories (62,704) 40,321 20,998 198,094 (Increase) decrease in other current assets 1,646 (61,775) (41,764) (394,000) Increase in payables, trade 68,166 48,769 35,665 336,462 (Decrease) increase in other current liabilities 4,260 (3,704) 15,535 146,557 Other, net 40,278 (30,519) (53,282) (502,660) Cash generated from operations 518,358 536,933 570,587 5,382,896 Interest paid (57,462) (60,395) (50,617) (477,519) Interest received 8,964 5,257 12,387 116,859 Dividends received 976 6,329 4,264 40,226 Income taxes paid (102,920) (88,413) (59,579) (562,066) Net cash provided by operating activities 367,916 399,711 477,042 4,500,396 Cash flows from investing activities (B): Purchases of property, plant and equipment (448,869) (279,226) (322,794) (3,045,227) Proceeds from sales of property, plant and equipment 17,432 25,325 30,921 291,708 Purchases of intangible assets (60,696) (61,848) (68,256) (643,924) (Increase) in investments and long-term loans (907) (102,595) (42,117) (397,330) (Increase) decrease in short-term investments 33,385 (20,452) 34,322 323,792 Acquisition of Amdahl Corporation, net of cash acquired (97,403) — — — Other, net 10,704 30,057 19,636 185,245 Net cash used in investing activities (546,354) (408,739) (348,288) (3,285,736) A+B ( ) (178,438) (9,028) 128,754 1,214,660 Cash flows from financing activities: Proceeds from long-term debt 466,540 204,899 107,807 1,017,047 Repayment of long-term debt (279,700) (185,031) (133,934) (1,263,528) Increase (decrease) in short-term borrowings (23,630) 42,682 (329,348) (3,107,057) Increase (decrease) in minority interests (4,483) 11,513 17,056 160,906 Dividends paid (18,508) (18,686) (19,112) (180,302) Other, net 14,389 13,822 86,284 814,000 Net cash provided by (used in) financing activities 154,608 69,199 (271,247) (2,558,934) Effect of exchange rate changes on cash and cash equivalents 2,120 (2,851) 9,159 86,406 Net increase (decrease) in cash and cash equivalents (21,710) 57,320 (133,334) (1,257,868) Cash and cash equivalents at beginning of year 413,900 392,190 449,510 4,240,660 Cash and cash equivalents at end of year ¥392,190 ¥449,510 ¥316,176 $2,982,792 Noncash financing activities: Conversion of bonds into common stock and capital surplus ¥ 4,252 ¥ 361 ¥ 20,790 $ 196,132