In relation to the ALSOK Group's business and accounting circumstances, the following items can potentially have significant effects on the judgment of investors.
Future-related information mentioned below was deemed appropriate by the Group as of June 24, 2011, the date on which the 46th Securities Report was filed.

(1) Sales depending on a specific business sector

Sales from the financial institutions sector accounted for as many as 28.2% of the Group's total sales in the year ended March 31, 2011. Consequently, trends in the economic environment surrounding financial institutions, including the possible cancellations of existing security service contracts due to the elimination or consolidation of branch locations, can have a considerable effect on the Group�fs operating performance. Therefore, the Group will continue to aggressively advance sales promotion toward other business sectors and find new clients in order to find new clients as well as maintain and develop the firm relationship with existing clients in financial institutions sector.

(2) Electronic Security Services business

Of the Group's total sales, 49.6% are dependent on the Electronic Security Services business. The effective operation of the Electronic Security Services business requires continuous capital investment for structuring and maintaining operational infrastructures such as the preparation of Guard Centers and depots, vehicles for Electronic Security Services and communication systems, as well as personnel expenses for Guard Center staff and security staff. Should the Group fail to enter into a certain volume of Electronic Security contracts due to any of wide range of factors associated with the Group's Electronic Security business, the Group's operating performance can be affected. Therefore, we have tried to diversify our business so that we can minimize business risks.

(3) Transportation Security Services

The Group supplies its own funds financed through overdrafts as cash to be operated in the CD machines installed by the subsidiaries of financial institutions in their business partners' stores and offices and cash used to deposit advances for Cash Deposit Machine On-line System contracts. Consequently, the Group exchanged the term of charge revision at fundamental contracts with clients, when there is a boost in interest that accompany the requisition of cash for Transportation Security Services business. Still, we affiliate in cash securities transport insurance to damage that occur during transportation and custody.

(4) Dependency on a specific equipment supplier

The Group mostly depends on a particular company for development and provision of the center equipment installed in the Guard Centers. Should any difficulty arise in the provision of such center equipment due to natural disasters or other reasons, the normal operation of the Guard Centers could be affected. As for provision involving the center equipment as well as main equipment used for the offer of Electronic Security Services, the Group enters into a master agreement for commodity purchases to provide for anticipated quantities of items and additionally holds certain levels of spare items for maintenance to allow for emergencies.

(5) Adaptation to changes in the technological environment

The development of security-related equipment and the adoption of state-of-the-art IT technologies are indispensable to the Group's adequate provision of security services, since we need to deal with "increasingly complicated and heinous crimes", "obsolescence of existing facilities due to the sophistication of information communication infrastructures", and "advance in a wide range of operations applying IT technology".
Should our adaption to technological progress fall behind the changes in the technological environment, the Group's operating performance could be negatively affected. Therefore, the ALSOK Group continues to make efforts in the development of security-related equipment and advanced IT technologies principally in the R&D Department of the Group. At the same time, we work to avoid risk by staying abreast of the latest technology trends in communications, devices, and other technologies.

(6) Management of client information

In order to conclude a security service contract with clients, the Group obtains a significant amount of information about them including their names, addresses and phone numbers of related parties, as well as various information about the clients' premises where security services are to be provided, and utilizes that essential information for the execution of security services and business activities. If any problem, whether inevitable or not, should arise, the Group may suffer for unfavorable reputation and legal claim for damages. We, therefore, have managed client information properly through employee education and careful observation on subcontractors. These measures enable us to avoid leaking, losing, and deleting personal information. As a further precaution, the ALSOK Group has carried "Leakage of Personal Information Insurance", which covers all Group companies.

(7) Ensuring human resources

In recent years, Japanese society has been rapidly super aging due to a combination of extended average life expectancy and a plunge in the birthrate. Although it can be anticipated that these trends will lead to a rise in need for ALSOK's security services, it could become more difficult to recruit younger workers in this labor-intensive industry. Should personnel expenses such as wages be increased with the aim of securing good human resources, the Group's operating performance could be affected. We established a new company which re-employs experienced retired workers for the purpose of securing high-quality labor force.

(8) Legal restrictions

In order to provide our clients with various security and other services, the Group is subject to a variety of legal restrictions, including major ones stated in the table below. Should any of these legal restrictions be amended or abolished, or any new legal provisions established, the Group's operating performance could be affected.

(9) Natural and other disasters

The Group has constructed a network in each region, which enabled us to conduct centralized remote monitoring of various information as to security services. One of the major network components is the telecommunications lines that connect client premises, the Guard Centers, and depots. The operation of the telecommunications lines depend on the communications services provided by the contracted type-I carrier. In the event in which unprecedented natural disaster were to occur, normal signal transmission/reception from/to the clients would become unavailable, causing serious difficulties such as the suspension of our security services. In such cases, the resulting claims for damages and the decline in public trust of the Group could affect the operating performance and future business development of the Group. In addition the Group may be compelled to pay huge expenses to recover damaged Guard Centers and other facilities.
The Group has adopted anti-seismic devices and made backups for the Guard Centers, in order that it can reduce risk caused by natural and other disasters, on the premise that such a natural disaster might occur in the area where a Guard Center is established or various types of system malfunctions might happen.

(10) Measures for pandemic

Should pandemic occur, the Group performance and the future business development could be affected. Therefore we work for the construction of measures such as enlightenment activities to employees, distribution of measure kits, secure of stockpiles, formulation of business scheme, and motion planning.

(11) Risk of server operation by the effect of rolling blackouts

In the Group, infrastructure of office work and the operation for the servers such as core systems are assumed to take the effect of rolling blackouts involving the suffer from Fukushima Daiichi Nuclear Power Plant. Although the server room is prepared with power supply by emergency electric power source, it may be forced to stop the system depending on how often or when rolling blackouts are carried out.
The Group first set the priority of the systems, and then conducts trainings in order that the Group can minimize the effect of rolling blackouts. In addition, the Group gradually abolishes systems of low priority, which helps it mitigate risks.

(12) Risk of massive disasters

Should any massive earthquake, flood, wind hazard, and long-lasting blackout occur, infrastructure function networks might come to a halt which prevents us from offering security services. In addition, it is possible that we are forced to fix and exchange damaged alarm equipment that were installed in our clients' property. As such, the Group's performance and financial condition may be influenced by disasters such as devastating earthquakes or floods.
We have adopted many effective disaster prevention measures to mitigate damages and losses from disasters. We compiled manuals, stockpiled necessaries and disaster prevention items, and constructed nation-wide disaster prevention systems as well as conducted periodic trainings.