Reconciliation between the projected pension and severance obligation and accrued for pension and severance liability as of March 31, 2003 and 2002 was as follows: Notes: 1. The above amounts included the government pension plan funded by social security taxes paid by employees and employer. 2. Certain insignificant consolidated subsidiaries calculated the liability using the simplified method. 3. In addition to the above plan assets, there were plan assets for the multi-employer pension plan amounted to ¥17,560 million (US$146,090 thousand) and ¥18,001 million for the years ended March 31, 2003 and 2002, respectively. The plan assets for the multi-employer pension plan could not be allocated to each specific participating employer and were allocated based on the number of participants. Periodic pension and severance costs for the years ended March 31, 2003 and 2002 consisted of the following: Notes: 1. The above amounts did not include the social security taxes paid by employees. 2. Service costs of consolidated subsidiaries using the simplified method were included in service cost above. 3. Service costs above included service cost for the multi-employer pension plan amounted to ¥907 million (US$7,546 thousand) and ¥846 million for the years ended March 31, 2003 and 2002, respectively, in which plan assets could not be allocated to each specific participating employer. 4. Service costs above included contributions for the defined contribution plans of foreign subsidiaries amounted to ¥1,579 million (US$13,136 thousand) and ¥1,286 million for the years ended March 31, 2003 and 2002, respectively. 5. In addition to the pension and severance cost above, additional retirement payments amounted to ¥137 million (US$ 1,140 thousand) and ¥56 million for the years ended March 31, 2003 and 2002, respectively, were included in general and administrative expenses. Millions Millions Millions Thousands of of yen of yen of yen U.S. dollars 2003 2002 2001 2003 a. Service cost ¥10,004 ¥ 9,099 ¥ 8,405 $ 83,228 b. Interest cost 3,047 3,284 3,187 25,349 c. Expected return on plan asset (1,262) (1,856) (1,886) (10,499) d. Amortization of transition liability — — 44,519 — e. Amortization of actuarial gain/loss 770 422 — 6,406 f. Amortization of prior service cost 296 — — 2,463 g. Pension and severance cost ¥12,855 ¥10,949 ¥54,225 $106,947 Millions Millions Thousands of of yen of yen U.S. dollars 2003 2002 2003 a. Projected pension and severance obligation ¥130,994 ¥129,766 $1,089,800 b. Plan assets (44,873) (49,856) (373,319) c. Unfunded pension and severance obligations 86,121 79,910 716,481 d. Unamortized actuarial gain/loss (21,137) (13,779) (175,849) e. Unamortized prior service cost (3,841) (4,137) (31,955) f. Net amount recorded in balance sheet 61,143 61,994 508,677 g. Prepaid pension cost (27) (19) (225) h. Accrued pension and severance liability ¥ 61,170 ¥ 62,013 $ 508,902 44 FUJI HEAVY INDUSTRIES LTD.