Payment terms of payables, such as trade notes and trade  accounts, as well as of corporate tax payables, are less than one year. Bank loans and straight bonds are financing for business opera- tions, capital expenditures and other investments and loans.  Although a part of such bank loans are exposed to market risks  from changes in variable interest rates, those risks are mitigated by  using interest-rate swaps. Derivatives mainly include forward foreign currency contracts,  interest-rate swaps, currency option swaps, interest-rate currency  swaps and commodity swaps. Please see Note 18 for more detail  about derivatives. Credit risk is the risk of economic loss arising from a counterparty’s  failure to repay or service debt according to the contractual terms.  The Group manages its credit risk from receivables on the basis of  internal guidelines, which include monitoring the payment terms  and balances of customers to identify the default risk of customers  at an early stage. Trade conditions are revised or receivables are  preserved as the necessity arises. Debt securities managing cash  surpluses are low risk financial instruments. These investments are  based on the internal fund management guidelines. The Group  monitors such information as the financial positions of the associ- ated companies to whom it lends funds. Please see Note 18 for the  detail about derivatives. Interest-rate swaps are used to manage exposure to market risks  from changes in interest rates of loan payables and bond payables. Marketable and investment securities traded on the stock  market are managed by monitoring market values on a regular  basis and reported to the officers of the Company. Marketable and  investment securities that are not traded on the stock exchange,  mainly equity instruments of the companies that have a business  relationship with the Group, are managed by monitoring their finan- cial positions on a regular basis. Derivative transactions are only traded between high credit  rating financial institutions, and financial and accounting divisions of  consolidated subsidiaries and the Group’s procurement division.  Important derivative transactions are decided and managed by  management, through meeting regulations and internal guidelines  of each consolidated subsidiary. The transaction data has been  reported to the officers of the Company on a monthly basis. Fair values of financial instruments are based on a quoted price in  active markets. If a quoted price is not available, other rational  valuation techniques are used instead. Also please see Note 18 for  the detail of fair value for derivatives. Fair value of financial instruments for which a quoted market  price is not available, is calculated based on certain assumptions  and the fair value might differ if difficult assumptions are used. Notes: a. Allowance for bad debts is deducted from receivables. (a) Fair value of financial instruments (3) Risk Management for Financial Instruments Credit risk management Market risk management (interest rate risk) (4) Fair Values of Financial Instruments JS Group Corporation Annual Report 2010 76 b. Long-term loans include loans to unconsolidated subsidiaries and associated  companies. e. Liabilities recorded due to the derivative transactions are shown as net. ( )  denotes net liabilities. c. Long-term loans include those to be collected within a year. d. Long-term debt include those to be paid within a year. Thousands of U.S. Dollars March 31, 2010 Carrying Amount Fair Value Unrealized  Gain/Loss Cash and cash equivalents $ 959,829 $ 959,829 Notes and accounts receivable 2,449,499 Allowance for doubtful accounts (Note a) (47,256) 2,402,243 2,402,243 Short-term investments and investment securities 568,256 568,134 $ (122) Short-term loans 114,152 114,152 Long-term loans (Notes b and c) 37,448 36,538 (910) Total $4,081,928 $4,080,896 $ (1,032) Short-term bank loans $ 453,355 $ 453,355 Notes and accounts payable 1,473,385 1,473,385 Income taxes payable 75,083 75,083 Long-term debt (Note d) 1,971,135 1,995,501 $24,366 Total $3,972,958 $3,997,324 $24,366 Derivatives (Note e) $ 4,127 $ 4,127 Millions of Yen March 31, 2010 Carrying Amount Fair Value Unrealized  Gain/Loss Cash and cash equivalents ¥ 89,302 ¥ 89,302 Notes and accounts receivable 227,902 Allowance for doubtful accounts (Note a) (4,397) 223,505 223,505 Short-term investments and investment securities 52,871 52,860 ¥ (11) Short-term loans 10,621 10,621 Long-term loans (Notes b and c) 3,484 3,399 (85) Total ¥379,783 ¥379,687 ¥ (96) Short-term bank loans ¥ 42,180 ¥ 42,180 Notes and accounts payable 137,083 137,083 Income taxes payable 6,986 6,986 Long-term debt (Note d) 183,395 185,662 ¥2,267 Total ¥369,644 ¥371,911 ¥2,267 Derivatives (Note e) ¥ 384 ¥ 384