To the Shareholders and Board of Directors of Kadokawa Holdings, Inc.: We have audited the accompanying consolidated balance sheets of Kadokawa Holdings, Inc. (a Japanese corporation) and subsidiaries as of March 31, 2003 and 2002, and the related consolidated statements of operations, shareholders' equity and cash flows for the years then ended, expressed in Japanese yen. These consolidated financial statements are the responsibility of the company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We conducted our audits in accordance with auditing standards generally accepted in Japan. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial position of Kadokawa Holdings, Inc. and subsidiaries as of March 31, 2003 and 2002, and the consolidated results of their operations and their cash flows for the years then ended, in conformity with accounting principles generally accepted in Japan as described in Note 1 to the consolidated financial statements. Without qualifying our opinion, we draw attention to the following. (1) As discussed in Note 2 (p) to the consolidated financial statements, effective April 1, 2002, Kadokawa Holdings, Inc. and domestic subsidiaries prospectively adopted the new Japanese accounting standards for treasury stock and reversal of statutory reserves. (2) As discussed in Note 2 (q) to the consolidated financial statements, effective April 1, 2002, Kadokawa Holdings, Inc. changed the method of accounting for departmental expenses of Advertising department. The consolidated financial statements as of and for the year ended March 31, 2003 have been translated into United States dollars solely for the convenience of the reader. We have recomputed the translation and, in our opinion, the consolidated financial statements expressed in Japanese yen have been translated into United States dollars on the basis set forth in Note 1 to the consolidated financial statements. Tokyo, Japan June 24, 2003 Kadokawa Collections [Ifigenia] Emiuo Greco 1961 Copyright KADOKAWA HOLDINGS, INC. All rights reserved.