Annual Report 2008 - Toyota Financial Services

Annual Report 

2008 

Toyota Financial Services Czech s.r.o.



Toyota Financial Services Czech s.r.o. 

4 Annual Report 2008


Content 

Introduction 6 

Company 8 

Establishment of the Company and its history 8 

Products and services 10 

Retail 10 

Wholesale 19 

Strategy for the business year 2009 20 

Report of independent auditor and financial statements 22 

Balance sheet 28 

Income statement 29 

Statement of changes in shareholder’s equity 30 

Cash flow statement 31 

General information 32 

Accounting policies 33 

Intangible fixed assets 37 

Tangible fixed assets 38 

Receivables 40 

Provisions 40 

Equity 41 

Payables 41 

Bank loans 42 

Derivative financial instruments 42 

Taxation 43 

Accruals and deferrals 44 

Revenue analysis 44 

Employee analysis 45 

Related party transactions 46 

Commitments 47 

Contingent liabilities 47 

Subsequent events 47 

Cash flow statement 47 

Report on relations among related parties 48 

Annual Report 2008 

5


Dear ladies and gentlemen, dear friends, 

I have the honour of being able to use for the initial assessment of the previous financial year 2008 again the 

expression “good year“. 

Yes, it was a good year indeed, from several aspects. 

Perhaps the most important aspect is the gradual implementation of our consistent effort to create a firm covering 

all imaginable customer needs in the service sector in which we are doing business. Thanks to this approach, this 

year we have prepared or launched two unique product lines. 

The first one is the extension of our offer by operating lease with services. Hence, since 1 April 2008 we have in 

place a product that can address, by its comprehensive nature, small, medium-sized, but also big companies 

planning to operate their car fleets, pay a reasonable monthly tax-deductible instalment which includes other 

services (car repair and maintenance, change and storage of tyres, road assistance, fuel card, etc.). This product 

can be obtained from our Company under the name Toyota Rent Plus (where “Plus“ means precisely added value 

in the form of supplementary services) and thus it loosely builds on the Toyota Rent line (operating lease without 

services). 

The extension of our offer in the area of insurance was another significant step. Our firm, similar to most of our 

competitors, has so far offered and offers insurance related to the operation of the financed vehicle in instalments 

(lease or credit payments). This service is much appreciated by our customers and there is no need to make any 

significant changes to it. However, one aspect that we want to change is our care for clients purchasing their car 

for cash or through financial institutions other than our Company. For this reason, we were the first company to 

develop on the Czech market, in collaboration with Allianz pojišťovna, a.s. (insurance company), the so-called 

branded or co-branded insurance. Hence, Toyota and Lexus clients will have available a number of insurance 

products – all under the name Toyota Pojištění (insurance). Apart from the extended offer in the area of insurance, 

we want to change for our clients the claims adjustment system. We plan to introduce, in addition to the possibility 

of taking out an insurance policy from car dealers, also the possibility of using a web interface (portal), etc. 

Apart from success in launching new products we have also made significant progress in the development of a 

robust web interface (portal) that we have internally labelled as “toyota724“ (toyota 7 days a week, 24 hours a day). 

Although we did not manage, contrary to our expectations, to put the project at least partly into practice, thanks 

to the ongoing fine-tuning of solution analyses and tests of those parts that were subject to testing, we managed 

to finalize the definition of the overall solution framework so as to ensure that its individual parts communicate 

with each other and are customer-friendly (which obviously needs to be confirmed by our customers themselves). 

Nevertheless, already at the end of the financial year 2008 we had in place the new web site and the part intended 

for taking out and calculating Toyota Pojištění had been tested (our partners still work off-line) and after testing 

of functionalities we have finalized the environment labelled as Client Accounts (a tool for displaying the details 

of lease or credit contracts, automated administration of these contracts or on the basis of requests on-line 

communication with our firm). Apart from gradual launch of the individual aforementioned new features at the 

beginning of the new fiscal year, we intend to finalize the so-called Dealer Accounts (similar to Client Accounts) and 

the Leasing Calculator (name for the front-end solution and customer pre-scoring). Although work on this solution 

is very demanding, I believe, that in the introduction to the annual report for the next year, I will present only 

positive outcomes in this respect. 

However, our work is not only about new products and projects. They are a sort of investment in the future and I 

believe that the direction that we have set for ourselves is in line with future market development. 

Every annual report also evaluates the previous financial year from both the financial and business viewpoint. So, 

what were our results last year 

In business terms, our results were not in line with the plan, in particular due to the shortfall in the last quarter of 

our financial year (1-3/2008). This appears to be the impact of the economic reform since most corporate clients 

took advantage of the last opportunity to conclude the lease contract for 36 months in December 2007 (since 

1 January 2008, the minimum lease term for lease contracts in the case of passenger and commercial vehicles is 

5 years, i.e. 60 months). 



Our financial result was very good, we have exceeded the planned target figures. The reason for this outcome was 

our strategy in the treatment of costs and we have also managed to maintain the pricing at the planned target 

levels. 

In organizational terms, we have adjusted our structure not only to reflect the trend of being closer to the customer 

(dealer) but also in view of the future development arising from implementation of the above web interface 

(portal). The change our Company was going through, was the most radical one since the starting of our firm and 

I believe that the future will show, whether this change produces much awaited results of maintaining or even 

increasing the customer satisfaction index. 

We would not have achieved these results without support from our Toyota and Lexus sales (dealer) network, the 

distributor of Toyota and Lexus cars – TOYOTA MOTOR CZECH spol. s r.o. and both cooperating insurers – Allianz 

pojišťovna, a.s. and Kooperativa pojišťovna, a.s., Vienna Insurance Group. On behalf of our Company, I thank all 

these partners for their support and cooperation. 

I would like to sincerely thank also all my colleagues. I appreciate not only their commitment within daily routine 

work, but I also much appreciate their enormous support in work on projects and development of new products. 

And what do we expect from the financial year 2009 First of all, we need to complete work on the web project 

internally labelled as “toyota724“. In connection with the launch of this project, we will revise internal company 

processes and regulations and we will also focus on shaping the offer for our existing clients. 

Your sincerely, 

Ing. Aleš Kamarýt 

Managing Director 

Prague, 27 June 2008 


7


ANNUAL REPORT YEAR ENDED 31 MARCH 2008 

COMPANY 

Basic information: 

Name 


ID No. 65413261 

Registered office Rubín Office Center, Sokolovská 192/79, 186 00 Praha 8 

Date of establishment 30 April 1996 

Legal form 

a limited liability company 

Ownership interest TOYOTA FINANCIAL SERVICES (UK) plc 100% 

Share capital 

Statutory body 

CZK 44,000,000 paid up 

Ing. Aleš Kamarýt – statutory representative 

Toyota Financial Services Czech s.r.o. is a member of the Czech leasing and finance association. 

Establishment of the Company and its history 

Toyota Financial Services Czech s.r.o. was established in 2000 as a successor to the original business of BB-Leasing s.r.o. 

(established in 1996) on the basis of the acquisition of 100% business share of the original company BB-Leasing s.r.o. by the 

new owner – TOYOTA FINANCIAL SERVICES (UK) plc from Great Britain. 

From 1996 to April 2000 – BB-Leasing s.r.o., universal leasing company. 

2 0 0 0 

May 2000 – Establishment of Toyota Financial Services Czech s.r.o. ("TFSCZ") through acquisition of 100% business share of 

BB-Leasing s.r.o., new owner – TOYOTA FINANCIAL SERVICES (UK) plc from Great Britain. 

June 2000 – First lease contract concluded under the name of TFSCZ (Toyota Leasing product). 

2 0 0 1 

March 2001 – Cooperation agreement concluded between TFSCZ and the Toyota car importer – TOYOTA MOTOR CZECH spol. 

s r.o. ("TMCZ"). 

March 2001 – First meeting with all Toyota authorized dealers from the Czech Republic, official launch of Toyota Vario product, 

introduction of the new calculation program. 

April-June 2001 – First joint campaign ("Spring campaign") in cooperation with TMCZ, aimed at support of Yaris, Corolla and 

Avensis models sale, a first sales record was achieved during this campaign. 

September 2001 – Work commenced on implementation and adjusting of the STEP_SQL system (master software serving for 

contracts administration and their accounting). 

October 2001 – Cooperation started with Toyota Material Handling Česká republika a.s. (formerly Kromexim, a.s. Kroměříž) 

– importer of Toyota handling equipment in the Czech Republic, the leasing product Toyota Forklift Leasing 

launched on the market. 

2 0 0 2 

March 2002 – Presentation of the first credit-based product (Toyota Kredit) to the network of Toyota authorized dealers and its 

subsequent launch on the market. 

April 2002 – Work commenced on the new dealer support scheme. 



June 2002 – Historic sales record achieved (in terms of the market share so far unbeaten). 

August 2002 – Registered office of the Company struck by floods, TFSCZ offices moved to spare premises provided by TMCZ. 

October 2002 – Successful return to the registered office of the Company. 

2 0 0 3 

February 2003 – The Company was awarded a prize for the 2nd best result among the companies of the Toyota Financial 

Services Group in Europe and Africa. 

February 2003 – Testing phase of the new dealer support scheme with pilot partners launched. 

April 2003 – First product based on operating lease (Toyota Rent) launched on the market. 

May 2003 – The rest of Toyota’s authorized dealers included in the new dealer support scheme. 

September 2003 – STEP_SQL system put into full operation. 

December 2003 – On-line calculator for authorized dealers put into operation. 

2 0 0 4 

February 2004 – Cooperation with Toyota Material Handling Česká republika a.s. (formerly Kromexim, a.s. Kroměříž) extended 

by the offer of the product based on the operating lease (Toyota Forklift Rent). 

February 2004 – TFSCZ hosted 6th TFS Marketing Conference, at the same time it was awarded a prize for the 1st place (the 

highest market share) among the companies of the Toyota Financial Services Group in Europe and Africa. 

May 2004 – A change in the VAT Act and subsequent dramatic decline in the volume of newly concluded lease contracts. 

August 2004 – Work commenced on the project of starting Toyota Financial Services Slovakia s.r.o. subsidiary establishment. 

September 2004 – First product of the line Toyota Direct (insurance following due expiration of the lease or credit contract). 

December 2004 – Historic sales record in the number of contracts concluded in one month. 

2 0 0 5 

January 2005 – Project finalization and establishment of Toyota Financial Services Slovakia s.r.o. 

August 2005 – Variable credit Toyota Genio launched. 

October 2005 – Completely revised dealer support offer (wholesale) launched. 

2 0 0 6 

March 2006 – New web sites, for the first time with the customer section (off-line) launched. 

October 2006 – TFSCZ is a fully authorized insurance agent on the basis of meeting all mandatory conditions. 

December 2006 – An initial client rating scheme created. 

2 0 0 7 

February 2007 – Joining the Non-bank register of client information (NRKI). 

February 2007 – Winning the biggest tender in the history of TFSCZ for financing of car fleet for the TPCA Kolín employee 

program. 

March 2007 – Modification of corporate identity design in core products. 

June 2007 – Work on web interface (portal) internally labelled as „toyota724“ has been started. 

2 0 0 8 

February 2008 – The first contract within the Toyota Pojištění (insurance) line was concluded. 

March 2008 – Work on the Toyota Rent Plus product line was completed. 


9


Products and services 

At present the business activities of Toyota Financial Services Czech s.r.o. are performed on three basic product levels. 

The first one is the provision of financial services to end customers who have the intention to acquire (fund) Toyota and Lexus 

cars or Toyota forklift trucks. This area of services is termed “retail”. 

The second part of TFSCZ product portfolio, usually called “wholesale”, is designed to support Toyota’s authorised dealers network. 

Above both these basic product levels, which primarily serve to acquire assets, there is a third level – insurance. Insurance 

currently consist of property insurance relating to cars (and handling equipment). 

Retail 

The financial services portfolio that was radically modified at the turn of the business years 2004 and 2005 due to the changes in 

the VAT Act, is currently capable of satisfying a wide range of customer needs and expectations. It includes both lease and credit 

products split as follows: 

Toyota Leasing 

Toyota Financial Services Czech s.r.o. product pillar, offered since 

the commencement of the Company’s operations in the Czech 

Republic, has been based on a finance lease with full amortization, 

which means a finance lease with subsequent purchase of the 

leased asset. Either businessmen or non-businessmen may be the 

lessees. The specific conditions of the lease contract are based on a 

combination of standard parameters as follows: 

❍ an extra instalment accounting for 10% - 60% of the vehicle cost, 

❍ term of the contract is 36, 42, 48, 60 or 72 months for nonbusinessmen, 

60 or 72 months for businessmen, 

❍ fixed motor vehicle liability insurance (a minimum limit of CZK 

50 million/CZK 50 million) throughout the whole lease term is 

part of regular instalments, 

❍ full comprehensive insurance, with a deductible of 5% (a 

minimum of CZK 5,000) or 10% (a minimum of CZK 10,000), is fixed throughout the whole lease term and is part of regular 

instalments, 

❍ it is possible to take out an insurance policy for any Toyota or Lexus brand model, for both new and used cars 

❍ the contract is terminated by settling the repurchase price in the notional amount of CZK 1,190 inclusive of VAT. 

Toyota Kredit 

Our product, offered since 2002 and based on the credit financing 

principle, is intended for customers who want to own the vehicle 

immediately but do not want or may not use their own financial 

means for its purchase. Toyota Kredit is suitable not only for 

businessmen or non-businessmen, but also for contributory 

organizations of self-governing territories, cities (including the 

Capital City of Prague), municipalities and regions. The contract 

structure is very flexible: 

❍ the standard financed amount ranges from 30% to 90% of the 

asset’s cost (i.e. the minimum amount of own financial means for 

covering the purchase is 10%), 

❍ credit contract term is 12, 24, 36, 48 or 60 months, 

❍ fixed motor vehicle liability insurance (a limit of CZK 50 million/ 

CZK 50 million) is part of regular instalments throughout the 

whole credit contract term, 

❍ full comprehensive insurance, with a deductible of 5% (a minimum 

of CZK 5,000) or 10% (a minimum of CZK 10,000) is fixed throughout 

the whole credit contract term and is part of regular instalments, 



❍ the product can be normally used for financing new and used Toyota and Lexus brand cars, 

❍ the contract is terminated by repayment of the total principal (credit); the credit contract may be extended, shortened or 

repaid earlier, subject to agreement with our Company. 

Toyota Vario 

The principle of this modified credit product, which has been 

offered by our Company since 2001 (until 30 April 2004 this 

product was offered on the basis of finance lease with partial 

amortization – net book amount), is the option of the increased 

last instalment (till 30 April 2004 – net book amount). This 

enables the debtor to achieve a very reasonable amount of the 

regular monthly instalment. The product is intended in particular 

for non-businessmen. The following applies for the Toyota Vario 

product: 

❍ own financial means in the amount of 20% - 60% of the vehicle 

cost, 

❍ contract term is 36 or 48 months, 

❍ fixed motor vehicle liability insurance (a limit of CZK 50 

million/CZK 50 million) throughout the whole credit contract 

term is part of regular instalments, 


minimum of CZK 5,000) or 10% (a minimum of CZK 10,000) is 

fixed throughout the whole credit contract term and is part of 

regular instalments, 

❍ the amount of the last increased credit instalment can be 

chosen between 10% and 30%, or 25% of the total vehicle 

value, subject to the contract term and model of the financed vehicle, 

❍ the contract can be concluded for models Aygo, Yaris, Auris, Corolla SDN, Corolla Verso, Avensis and RAV4, 

❍ at the end of the contractual term, it is necessary to choose one of the following options: 

– payment of the last increased instalment, 

– continued financing of the last increased instalment (extension of the credit contract till final repayment), 

– vehicle repurchase at market value (at least in the amount of the last increased instalment) by the dealer, using the 

offer for a very advantageous purchase of a new vehicle, including similarly advantageous financing terms. 

Toyota Genio 

New product for end-customers launched in 2005 based on the 

model of a credit (consumer credit, commercial business credit 

for entrepreneurs, customer groups are the same as for Toyota 

Kredit), with the option of early repayment of the principal 

every 12 months, free of interest. For our customers this product 

is interesting since the advance payment required is lower 

(starting at 10% of own financial means), credit instalments are 

incomparably lower (due to the longer contract term) and the 

amount of insurance premium included in the instalment is very 

reasonable. The customer is informed about the value determined 

for the purposes of the early repayment already in the credit 

contract itself. Specific features of Toyota Genio are as follows: 

❍ amount of own financial means starting at 10% of the vehicle 

(acquisition) cost, 

❍ contract term: 72 months, 


million/CZK 50 million) is included in regular instalments 

throughout the whole loan contract term, 

❍ full comprehensive insurance, with a deductible of 5% (a minimum of CZK 5,000) or 10% (a minimum of CZK 10,000) is fixed 

over the entire loan contract term and is part of regular instalments, 

❍ option of early repayment every 12 months of the contract term 

❍ currently, the contract may be concluded for the whole Toyota model line. 


11


Toyota Rent 

A newcomer in the portfolio, since the financial year 2004, is intended in particular for corporate clients. It is an operating 

lease, which is based on partial amortization of the vehicle according to a specified travelling timetable (length of use and total 

mileage). The key benefit for customers is in particular this product’s very reasonable instalment positively influencing financial 

expenses, with limited administration relating to the vehicle operation. The total rental is based on the following parameters: 

❍ financing of 100% of the vehicle cost, 

❍ contract term is 12 – 48 months, 

❍ maximum number of kilometres driven during the lease term 

is 160,000, 


million/CZK 50 million) throughout the whole lease term is 

always part of regular instalments, 


minimum of CZK 5,000) or 10% (a minimum of CZK 10,000), 

is fixed throughout the whole lease term and is always part of 

regular instalments, 

❍ the rental cost also includes the vehicle registration, payment 

of the road tax and the radio licence fee, 

❍ after the contract expires, the vehicle is returned to our 

Company and, if the vehicle ‘s wear and tear corresponds to 

the contractual terms and conditions, no additional costs are 

charged to the client. 

Toyota Rent Plus 

Toyota Rent Plus is a new product in the portfolio of Toyota Financial Services Czech s.r.o. which has been offered since April 

2008. It is intended in particular for corporate clients and for customers who wish to take advantage of the type of lease 

reflecting actual use of the vehicle with no need to address the issue of how to treat the vehicle when the lease term expires. It 

is an operating lease which is based on partial amortization of the vehicle according to a specified travelling timetable (length 

of use and total mileage). The key benefit for customers from the ranks of businessmen and business companies is in particular 

this product’s very reasonable monthly instalment which is a fully tax-deductible expense and also limited administration 

relating to the vehicle operation and the possibility of regular replacement of the car fleet. This is an extended version of the 

basic Toyota Rent product. The basic features of the product are as follows: 

❍ financing of up to 100% of the vehicle cost, 

❍ standard contract term is 12, 24, 36 or 48 months, however a 

maximum of 60 months, 

❍ maximum number of kilometres driven during the lease term 

is 160,000, 

❍ monthly rental instalments include complete servicing and 

road assistance according to the client’s specific requirements 

(repair and maintenance, change and storage of tyres, road 

assistance, alternate car and fuel card) 

❍ the rental cost also includes the vehicle registration, payment 

of the road tax and the radio licence fee, 

❍ fixed and very favourable motor vehicle liability insurance is 

part of regular instalments throughout the whole lease term, 

❍ full comprehensive insurance, with attractive rates and an 

optional deductible of 5% (a minimum of CZK 5,000) or 10% 

(a minimum of CZK 10,000) is fixed throughout the whole 

lease term and is part of regular instalments, 

❍ after the contract expires, the vehicle is returned to our 

Company and the customer therefore does not have to address 

the issue of either retaining or sale of the vehicle, he can rent a 

new vehicle and thereby optimize the costs of its operation 

❍ if the vehicle‘s wear and tear corresponds to the contractual 

terms and conditions, no additional costs are charged to the 

client upon returning of the vehicle. 



Toyota Forklift Leasing 

Complex financial support of the Toyota brand is also reflected 

in the sale of handling equipment, Toyota forklift trucks and 

BT handling equipment. In cooperation with distributors of 

these brands it is possible to enter into a finance lease with full 

amortization and other standard parameters as follows: 

❍ extraordinary instalment in the amount of 10% - 60% of the 

vehicle cost, 

❍ payment term is 60 or 72 months, 

❍ net book amount 0% (possibly 10%) of the vehicle cost, 

❍ machinery insurance is fixed and is part of instalments 

throughout the whole lease term, with a maximum 

deductible of CZK 10,000, 

❍ third party insurance (a limit of CZK 50 million/CZK 50 

million) is part of regular instalments throughout the whole 

lease term, 

❍ the contract is terminated by settling the repurchase price in 

the notional amount of CZK 1,190 inclusive of VAT or paying 

the net book amount. 

Toyota Forklift Rent 

Together with the exclusive distributor of forklift trucks and 

handling equipment of the Toyota and BT brand, we have 

brought to our customers since February 2004 a unique 

product which provides comprehensive services in the area of 

the operation and care for the vehicle. Toyota Forklift Rent is an 

operating lease with full servicing. The terms and conditions of 

the lease contract, which is concluded with the distributor, are 

based on the combination of the following parameters: 

❍ financing of 100% of the vehicle cost, 

❍ contract term is 12 – 84 months, 

❍ machinery insurance is fixed and is part of instalments 

throughout the whole lease term, with a maximum 

deductible of CZK 10,000, 

❍ third party insurance (a limit of CZK 50 million/CZK 50 

million) is fixed and it is part of regular rental payments, 

❍ the rental cost includes the provision of normal services 

associated with the operation of the vehicle and is 

proportional to the number of hours in operation, 

❍ in excess of normal services, it is possible to arrange also for 

a change of tyres and the fork of the vehicle. 


13


Toyota Pojištění 

The first brand insurance product on the Czech market, offered 

since the 1st quarter of 2008, is intended for customers buying 

Toyota and Lexus cars for cash or via another financial institution 

offered through the network of Toyota and Lexus dealers, web 

interface (portal) or directly via Toyota Financial Services Czech. 

The basic offer includes: 

❍ motor vehicle liability insurance (hereinafter referred to as 

“liability insurance“) 

❍ basic full comprehensive insurance (crash, theft, elementary 

loss, vandalism) 

❍ supplementary full comprehensive insurance (plate glass 

insurance, luggage insurance, alternate car insurance, road 

assistance insurance and personal accident insurance) 

As part of this product the customer acquires in particular: 

❍ first brand insurance product on the Czech market offered 

by our Company and the renowned Allianz pojišťovna, a.s. 

(insurance company) 

❍ certainty of guaranteed and high-quality services, 

❍ special approach towards claims adjustment, 

❍ alternate car for free for a period of 5 days in the case of car 

damage due to the insured event, 

❍ first-class road assistance services both in the Czech Republic and abroad, 

❍ a wide range of supplementary insurance, 

❍ insurance directly upon the purchase of a vehicle from the authorized dealer of the Toyota/Lexus brand with special insurance 

premium rates, 

❍ bonuses for claims-free record for years that you had no accidents. 

Toyota Direct 

Toyota Direct is a new name of the product line, which is focused 

on any user of Toyota and Lexus cars. Currently, it is focused in 

particular on those customers, who have properly terminated 

their credit or lease contracts with Toyota Financial Services 

Czech s.r.o. for a vehicle which they retain or on owners of Toyota 

and Lexus cars, who in the past have not purchased those cars 

through brand financial services or are not even considering 

them. Due to the fact that Toyota Direct is based on customer 

expectations, we also anticipate the ongoing change and 

extension of this product, with respect to which at present it is 

possible to arrange for the following: 

❍ complete full comprehensive insurance in collaboration with 

Allianz pojišťovna, a.s., together with supplementary insurance 

(insurance of the windscreen, an alternate car, luggage 

insurance, accident insurance for passengers) – we guarantee 

the provision of best rates on the market, 

❍ motor vehicle liability insurance in cooperation with Allianz 

pojišťovna, a.s. 



The proportion of individual products (related to handed over contracts in the financial year) is clear from Table No. 1. 

“Financed value” represents the amount of funds lent to customers. “Number of contracts” shows the number of units 

(financed assets) which were financed in a given financial year. The column “Cost (exclusive of VAT)” represents the total cost 

of individual assets at the time of their acquisition again split into individual products. 

Table No. 1 – Contracts handed over in the financial year 2008 (CZK) 

Financed 

Number of 

Cost 

Product value 

Share contracts 

Share (exclusive of VAT) 

Share 

Toyota Leasing 189,802,255 

26.63% 595 

31.37% 268,053,320 

28.27% 

Toyota Kredit 170,151,175 

23.87% 498 

26.25% 297,092,222 

31.33% 

Toyota Vario 7,702,575 

1.08% 19 

1.00% 8,269,493 

0.87% 

Toyota Genio 151,256,902 

21.22% 517 

27.25% 181,247,152 

19.11% 

Toyota Rent 136,663,719 

19.17% 153 

8.07% 136,734,374 14.42% 

Toyota Forklift Leasing 445,883 

0.06% 2 

0.11% 636,976 

0.07% 

Toyota Forklift Rent 56,732,955 

7.96% 113 

5.96% 56,231,690 

5.93% 

Total 712,755,464 

100.00% 1,897 

100.00% 948,265,226 

100.00% 

In this financial year the trend towards a steep increase in the share of credit contracts from previous years has been reversed. If we 

examine the year-on-year comparison, we find out that the share of car credit products declined in the year-on-year terms by 7% 

(number of contracts) and even the financed value dropped by 2%. Two factors contributed to this fact: firstly, businessmen prior 

to the end of the calendar year 2007 accelerated their interest in the finance lease, being afraid of adverse impacts of the new tax 

reform on this product and secondly, at the beginning of the financial year 2008, the key supply of vehicles within the successful 

TFSCZ tender related to the employee program for the Kolín based car factory TPCA was carried out. 

Looking back at the financial year 2008, we see some interesting facts: 

❍ In particular due to the above circumstances, Toyota Leasing (finance lease with full amortization) has maintained its position 

(2008/2007 comparison: 26.63%/26.29% by the financed amount (see Graph No. 2), or 28.27%/27.85% in terms of cost 

and 31.37%/28.20% based on the number of contracts). It is true, that generally, the increased number of contracts in this 

segment was not dramatic and higher number of credit products and products based on operating lease is anticipated again 

in the following years. 

❍ Toyota Kredit, our first credit product historically, due to the increased number of lease products, has shown a year-onyear 

decrease in the product’s percentage share in the portfolio, by 19% in terms of the number of contracts. (2008/2007 

comparison: 26%/31%), however, this fact has been compensated for by the increased number of other credit products. 

❍ Toyota Genio has again confirmed a high demand for a similar product type and the share of this product in the portfolio 

increased by 17% in the year-on-year terms (2008/2007 comparison: 27%/23% by the number of contracts). Also a very 

successful campaign “Yaris for CZK 5,555 per month” focusing on the possibility of making the initial payment of CZK 5,555 

and then paying the monthly instalment in the same amount partly contributed to this increase (the campaign was 

conducted continuously between April and August 2007). 

❍ Simple operating lease, represented by Toyota Rent, reached a similar share in the portfolio as last year and this situation 

shows certain product stagnation caused by its limited offer (excluding services). We expect that changes will happen as a 

result of the prepared implementation of other services aimed at full-service leasing that was completed in March 2008 with 

gradual implementation in 2008 in line with the TMCZ strategy aimed at formation of specialized business centres focused 

on the offer for commercial clients. 

❍ The Toyota Vario product faces, from the very beginning of its launch, a low willingness of dealers to pay more attention to 

this product. Even a minimum effort can lead to the repeated business and the potential of generating good quality used 

cars for the dealer centres as another potential profit centre. Nevertheless, we keep offering the product assuming that its 

frequency will increase as the market evolves. 

❍ Toyota Equipment Leasing which represents our offer for Toyota Group organizations in the Czech Republic is also part of 

statistics. However this product is not actively offered and therefore its share is almost negligible. 

❍ Products intended for financing of the handling equipment showed a year-on-year decline, similar to our market share in 

this segment. This decline stemmed from the completion of major supplies under framework contracts, while at present only 

the existing customer portfolio is being supplemented. Moreover, in 2007 significant changes were made to the structure of 

the company Toyota Material Handling Česká republika a.s. (private distributor) as an exclusive importer of Toyota forklift 

trucks into the Czech Republic and the company BT Česká republika s.r.o. (the company owned by the Toyota Group) as an 

exclusive importer of BT handling equipment into the Czech Republic. The company Toyota Industrial Equipment Europe, in 


15


line with its long-term strategy, terminated the contract on exclusive representation for import of Toyota forklift trucks with 

the private distributor and completely delegated this activity precisely to the company BT Česká republika s.r.o. Currently 

initial steps aimed at shaping a new business strategy for the Czech Republic are under way. 

Graph No.1 – Product share by the number of contracts 

Toyota Forklift 

Leasing 

0% 


8% 

Toyota Forklift Rent 

6% 


32% 


17% 


1% 

Graph No. 2 – Product share by the financed value 


26% 

Toyota Equipment 

Leasing 

0% 


19% 


Leasing 

0% 


Rent 

8% 


27% 

Toyota Equipment 

Leasing 

0% 


21% 


1% 


24% 

In the aggregate, we have recorded a year-on-year decline in trade, in terms of the financed value, by 

CZK 37 million (less than 7%), by 135 contracts (by 6.7%) and in terms of the cost of acquisition, exclusive of VAT, our turnover 

declined by CZK 123 million (less than 12%). The reasons for a decline in the overall realized trade were in particular the 

following circumstances: 

❍ significant outflow of financing customers after 1 January 2008 recorded and confirmed across the car financing market, in 

particular in connection with the amendment to the Income Tax Act. The amendment restricted the preferential tax treatment 

of finance leases, introduced limits on claiming interest on credits and, among other things, also introduced the thin capitalization 

test for companies. In order to document these facts we note that till December 2007 (i.e. for the three quarters of 

the financial year) TFSCZ market penetration for new Toyota and Lexus cars was still at 31.48% in the year-on-year terms and 

showed a deep decline in the months of January – March 2008 to reach the final 27.21% (see Table No. 2), 



❍ TMCZ in the course of autumn 2007 withdrew the licence of two major cooperating partners of TFSCZ, companies Auto Brožovský 

s.r.o. and Area 93 s.r.o. without any replacement, which had an adverse impact on the overall inflow of new contracts, 

❍ during the first three months of 2008 also the share of Toyota cars in the market of passenger and light commercial vehicles 

declined. 

Table No. 2 provides an overview of the total market share of Toyota and Lexus cars in the context of new car sales in the Czech 

Republic along with the share of financing provided by our Company. 

When assessing the realized result, apart from the facts mentioned in the previous paragraph, we need to take into account that 

the resulting 27.21% penetration has been achieved by the active business activity of our Company without support from the 

importer in the form of subsidized joint campaigns as conducted in previous years. For this reason, the result is considered to be 

favourable since penetration at the level of about 50% market share of financing has been maintained despite the fact that there 

have been no joint programs with the distributor and despite objective market circumstances. 50% market share is considered 

to be half of the achievable financing. If we know that 60% of the 100% total of the cars sold are financed somehow then in the 

case of achieving the 27.21% penetration we managed to realize almost the half of car financing business opportunities. In spite 

of that there is still room for expansion and there are unexhausted resources. 

Table No. 2 – The Company’s share in the market of sold new Toyota and Lexus cars (passenger and commercial vehicles) 

Parameter/financial year 2004 

2005 2006 

2007 2008 

Sales of cars in the CR (number) 171,116 158,308 166,278 178,394 199,885 

Sales of Toyota and Lexus brands (number) 4,418 

4,749 4,717 

5,726 6,041 

Toyota’s share in the Czech market 2.58% 

3.00% 2.84% 

3.21% 3.02% 

Number of cars financed by TFSCZ (number) 1,455 

1,336 1,571 

1,676 1,644 

Achieved penetration of TFSCZ 32.93% 

28.13% 33.31% 

29.27% 27.21% 

Graph No. 3 – Development of the number of the financed cars (newly contracted business transactions) and achieved 

penetration 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 


17


As at 31 March 2008 our Company administered 5,798 active contracts, of this number, operating and finance lease contracts 

accounted for 54% and credit contracts accounted for 40%. The total year-on-year increase of contracts was 4.09%, while 

the most marked increase was recorded again within the credit products Toyota Genio (+60.43%) and Toyota Forklift Rent 

(+11.63%). 

The finance lease product Toyota Leasing showed a decline due to the lower increase of contracts, in proportion to regular expiration 

of contracts on this basis. This trend has been reversed neither by the above increased interest in this product before the 

end of 2007, nor by success in the significant tender for TPCA employees. This product ranked among the strongest ones in the 

Company’s history and an increase on such a scale that would compensate for a drop caused by regular (proper) repayment 

of credit contracts, as in previous years, cannot be expected anymore. The launch of credit products and products based on 

operating lease is stable. For more details see Table No. 3. 

Table No. 3 – Number of active contracts per product 

Products / as at 

31. 3. 2004 

31. 3. 2005 31. 3. 2006 

31. 3. 2007 31. 3. 2008 

Year-on-year 

change 

Toyota Leasing 2,849 

2,820 2,651 

2,253 2,063 

(8.43%) 

Toyota Vario (leasing) 486 381 237 

111 39 

(64.86%) 

Toyota Kredit 322 738 991 

1,380 1,430 

3.62% 

Toyota Vario (credit) 0 96 134 148 118 

(20.27%) 

Toyota Genio 0 

0 313 700 1,123 

60.43% 

Toyota Forklift Leasing 46 

39 50 

61 46 

(24.59%) 

Toyota Forklift Rent 19 

313 528 

705 787 

11.63% 

Toyota Rent 60 

140 155 

186 167 

(10.22%) 

Toyota Equipment 0 

1 2 

2 2 

0.00% 

Other (Non Toyota Leasing/Kredit/Rent) * 16 

27 29 

24 23 

(4.17%) 

Taken over portfolio of BB-Leasing s.r.o. 13 

9 0 

0 0 

0.00% 

Total 3,811 4,564 5,090 5,570 5,798 

4.09% 

*) This includes cases of financing of other cars than Toyota or Lexus, in the form of either Toyota Leasing or Toyota Kredit 

Total net book amounts of tangible fixed assets financed under finance and operating lease contracts (after depreciation) 

amounted as at 31 March 2008 to more than CZK 851 million (decrease by less than 11%, compared to the previous year). 

Total balance of financed values amounts as at the same date to CZK 699 million (decrease by 7.64%). The balance of receivables 

from provided consumer credits (principal and outstanding interest) amounted to CZK 567 million (increase by 19.21%). 

Hence, the total financed volume amounted to CZK 1.266 billion and increased in the year-on-year terms by 2.72% – see Table 

No. 4. 

Table No. 4 – Volumes of financing (values denominated in CZK’000) 

Volumes of balances /as at 31. 3. 2004 31. 3. 2005 31. 3. 2006 31. 3. 2007 31. 3. 2008 Year-on-year 

change 

Net book amounts 

of leased assets 862,051 929,172 

1,012,455 954,639 

851,561 (10.80%) 

Balances of financed values 499,415 641,650 

760,879 756,695 

698,847 (7.64%) 

Balance of receivables 

– credit principals 118,167 234,877 318,816 466,174 

555,052 19.07% 

Balance of receivables 

– credit in total 120,375 239,445 

325,651 475,514 

566,861 19.21% 

Total financed volume * 619,790 881,095 

1,086,530 1,232,209 

1,265,708 2.72% 

*) The total financed volume as a sum of the balances of financed values (leasing) and receivables (credits) 



Wholesale 

Our Company, already since 2000, when it started its operations on the Czech market, has been supporting the sale of Toyota 

and Lexus brands also by way of the provision of financial assistance to authorized brand dealers for the purpose of acquiring 

stock inventories of new and used cars, demonstration cars and the provision of special-purpose financial credits. 

In February 2003, we offered to car dealers in response to their needs, a new support scheme that opened up wider possibilities 

and put in place for our Company also more effective securing and monitoring of the support product portfolio. 

The scheme was subsequently modified in October 2005 when new securing arrangements were incorporated into it, the limits 

were restructured and the scheme for the financing of demonstration cars was radically changed. 

The wholesale products offered have their logical names: Toyota New SF – financing of stocks of new cars, Toyota Used SF 

– financing of stocks of used cars, Toyota Demo – financing of stocks of demonstration cars, Toyota Financing I/C – financing in 

the form of investment credits, Toyota Financing W/C – financing of the working capital. In addition, we offer financing under 

finance lease or operating lease contracts, where the parameters of these products are very similar to retail products (Toyota 

Leasing and Toyota Rent), only some details are different. 

The dealer support scheme also includes the plan of participation of our Company in advertising activities of individual dealers 

and the commission scheme. For all of the above products, product limits are set that differ according to the solvency of 

individual partners, their requirements and other parameters affecting them. 

The dealers’ interest in the financial support provided by our Company has been growing in year-on-year terms. In the financial 

year 2004 we have provided the sum of CZK 1,002.5 million in financing. The growth in the financial year 2005 has slightly 

slowed down due to the consolidation of the dealer network, when for 11 dealer centres, that lost at the beginning of May 2004 

their authorization for the sale of the Toyota brand, the financing was immediately suspended. The funds in the amount of CZK 

1,095 million provided in 2005 represented the year-on-year increase by 9%. The following financial year 2006, during which in 

October 2005 we have modified the dealer support scheme, resulted in an additional increase of financing up to the total sum 

of CZK 1.37 billion in provided funds representing the year-on-year increase by 25%. After additional year-on-year increase by 

14% in 2007, compared to 2006, the values of financed amounts became stable (comparison 2008/2007: CZK 1.57 billion / 1.54 

billion) 

Graph No. 4 – Development of funds provided within the dealer support scheme 

 

 

 

 

 

 

 

 

 

 

 

 

 

The above figures were very markedly influenced in particular by the financing of the Toyota New SF product (financing of 

stocks of new cars) thanks to which we have also indirectly speeded up the delivery of vehicles for end-customers between the 

stocks (warehouses) of the distributor of Toyota cars in the Czech Republic - the company TOYOTA MOTOR CZECH spol. s r.o. 

and individual authorized dealers. 

Also the financing of demonstration cars (Toyota Demo) gained in importance. We endeavour to meet 100% of the dealers‘ 

demands for demonstration cars. 


19


STRATEGY FOR THE FINANCIAL YEAR 2009 

Our strategy for the upcoming period is the following: 

1. Launching a portal for dynamic exchange of information (“toyota724“), which will be based on: 

❍ on-line access of end-customers to their “accounts“ (contracts) – “Client accounts“, 

❍ on-line access of authorized dealers to their “accounts“ (contracts) – “Dealer accounts“, 

❍ dealer front-end solution (on-line system for the processing of lease or credit contracts by the dealer – seller), 

❍ customer front-end solution (system for preliminary approval of the contract), 

❍ module for calculation and taking out of an insurance policy (Toyota Pojištění) – “Calculation of insurance“. 

Objective: increase customer satisfaction and co-operating dealers’ satisfaction. 

2. Adjusting internal company processes and regulations to reflect the situation after the launch of “toyota724“ 

Objective: optimize internal company processes, eliminate “deadlocks“. 

3. Creating a new retention scheme for the existing clients or adjusting the current one 

Objective: increase customer satisfaction and increase customer return rate. 




21


INDEPENDENT AUDITOR’S REPORT 

PricewaterhouseCoopers Audit, s.r.o. 

Kateřinská 40/466 

120 00 Prague 2 

Czech Republic 

Telephone +420 251 151 111 

Facsimile +420 251 156 111 

www.pwc.com 


TO THE SHAREHOLDER OF TOYOTA FINANCIAL SERVICES CZECH S.R.O. 

Report on the Annual Report 

We have audited the annual report of Toyota Financial Services Czech s.r.o. (the “Company”) 

for consistency with the financial statements for the year ended 31 March 2008 which are 

included in this Annual Report on pages 28 - 47. The Company’s Director is responsible for the 

accuracy of the annual report. Our responsibility is to express an opinion on the consistency of 

the annual report and the financial statements based on our audit. 

We conducted our audit in accordance with the International Standards on Auditing and 

the related application guidance of the Chamber of Auditors of the Czech Republic. Those 

standards require that the auditor plan and perform the audit to obtain reasonable assurance 

about whether the information included in the annual report describing matters that are also 

presented in the financial statements is, in all material respects, consistent with the relevant 

financial statements. We believe that our audit provides a reasonable basis for our opinion. 

In our opinion, the information included in the annual report of the Company for the year 

ended 31 March 2008 is consistent, in all material respects, with the financial statements 

referred to above. 

The maintenance and integrity of the Company’s website is the responsibility of its Company’s 

Director; the work carried out by the auditors does not involve consideration of these matters 

and, accordingly, the auditors accept no responsibility for any changes that may have occurred 

to the financial statements since they were initially presented on the website. 

Report on review of the Report on Relations 

In addition we have also reviewed the accompanying report on relations between the Company 

and its controlling party and between the Company and the other persons controlled by the 

same controlling party for the year ended 31 March 2008 (the “Report”). The completeness 

and accuracy of the Report is the responsibility of the Company’s Director of the Company. Our 

responsibility is to review the accuracy of information included in the Report. 

PricewaterhouseCoopers Audit, s.r.o., registered seat Kateřinská 40/466, 120 00 Prague 2, Czech Republic, Identification Number: 

40765521, registered with the Commercial Register kept by the Municipal Court in Prague, Section C, Insert 3637, and in the Register of 

Audit Companies with the Chamber of Auditors of the Czech Republic under Licence No 021. 

© 2007 PricewaterhouseCoopers Audit, s.r.o.. All rights reserved. „PricewaterhouseCoopers“ refers to the Czech firm of 

PricewaterhouseCoopers Audit, s.r.o. or, as the context requires, the network of member firms of PricewaterhouseCoopers International 

Limited, each of which is a separate and independent legal entity. 






Report on review of the Report on Relations (continued) 

We conducted our review in accordance with the International Standard on Review 

Engagements 2400 and related application guidance of the Chamber of Auditors of the Czech 

Republic for review of the report on relations. These standards require that we plan and 

perform the review to obtain moderate assurance as to whether the Report is free of material 

misstatement. A review is limited primarily to inquiries of Company personnel, analytical 

procedures and examination, on a test basis, of factual accuracy of data. 

A review therefore provides less assurance than an audit. We have not performed an audit and, 

accordingly, we do not express an audit opinion. 

Based on our review, nothing has come to our attention that causes us to believe that 

the accompanying Report has not been properly prepared, in all material respects, in 

accordance with the requirements of Article 66a of the Commercial Code. 

22 August 2008 


represented by 

Paul Inman 

Kristina Vančurová 

Director Auditor, Licence No. 2085 

Translation note 

This version of our report and accompanying documents is a translation from the original, which was prepared in Czech language. 

All possible care has been taken to ensure that the translation is an accurate representation of the original. However, in all matters of 

interpretation of information, views or opinions, the original language version of our report takes precedence over this translation. 


23




Kateřinská 40/466 

120 00 Prague 2 


Telephone +420 251 151 111 

Facsimile +420 251 156 111 

www.pwc.com 



We have audited the accompanying financial statements of Toyota Financial Services Czech 

s.r.o. (the “Company”), which comprise the balance sheet as at 31 March 2008, the income 

statement, statement of changes in equity and cash flow statement for the year then ended 

and notes, including a summary of significant accounting policies (the “financial statements”). 

Details of the Company are disclosed in note 1 to these financial statements. 

The accompanying financial statements are not intended to present the assets, liabilities and 

equity, the results of operation and cash flows, in accordance with accounting principles and 

practices generally accepted in countries and jurisdictions other than the Czech Republic. 

Accordingly the accompanying balance sheet, the related income statement and notes, 

including the statement of cash flows, are not designed for those who are not informed about 

Czech accounting principles, procedures and practices. 

Statutory Director’s Responsibility for the Financial Statements 

Statutory Director is responsible for the preparation and fair presentation of the financial 

statements in accordance with Czech accounting legislation. This responsibility includes: 

designing, implementing and maintaining internal control relevant to the preparation and 

fair presentation of financial statements that are free from material misstatement, whether 

due to fraud or error; selecting and applying appropriate accounting policies; and making 

accounting estimates that are reasonable in the circumstances. 

Auditor’s Responsibility 

Our responsibility is to express an opinion on these financial statements based on our audit. We 

conducted our audit in accordance with the Act on Auditors of the Czech Republic, International 

Standards on Auditing and the related application guidance of the Chamber of Auditors of the 

Czech Republic. Those standards require that we comply with ethical requirements and plan 

and perform the audit to obtain reasonable assurance whether the financial statements are free 

from material misstatement. 

PricewaterhouseCoopers Audit, s.r.o., registered seat Kateřinská 40/466, 120 00 Prague 2, Czech Republic, Identification Number: 

40765521, registered with the Commercial Register kept by the Municipal Court in Prague, Section C, Insert 3637, and in the Register of 

Audit Companies with the Chamber of Auditors of the Czech Republic under Licence No 021. 

© 2007 PricewaterhouseCoopers Audit, s.r.o.. All rights reserved. „PricewaterhouseCoopers“ refers to the Czech firm of 

PricewaterhouseCoopers Audit, s.r.o. or, as the context requires, the network of member firms of PricewaterhouseCoopers International 

Limited, each of which is a separate and independent legal entity. 






Auditor’s Responsibility (continued) 

An audit involves performing procedures to obtain audit evidence about the amounts and 

disclosures in the financial statements. The procedures selected depend on the auditor’s 

judgment, including the assessment of the risks of material misstatement of the financial 

statements, whether due to fraud or error. In making those risk assessments, the auditor 

considers internal control relevant to the Company’s preparation and fair presentation 

of the financial statements in order to design audit procedures that are appropriate in the 

circumstances, but not for the purpose of expressing an opinion on the effectiveness 

of the Company’s internal control. An audit also includes evaluating the appropriateness 

of accounting policies used and the reasonableness of accounting estimates made 

by management, as well as evaluating the overall presentation of the financial statements. 

We believe that the audit evidence we have obtained is sufficient and appropriate to provide 

a basis for our audit opinion. 

Opinion 

In our opinion, the financial statements give a true and fair view of the financial position of the 

Company as of 31 March 2008, its financial performance and its cash flows for the year then 

ended in accordance with Czech accounting legislation. 

27 June 2008 


represented by 

Paul Inman 

Kristina Vančurová 

Director Auditor, Licence No. 2085 

Translation note 

This version of our report and accompanying documents is a translation from the original, which was prepared in Czech language. 

All possible care has been taken to ensure that the translation is an accurate representation of the original. However, in all matters of 

interpretation of information, views or opinions, the original language version of our report takes precedence over this translation. 


25




FINANCIAL STATEMENTS 

Company name: 


Residence: Rubín Office Center, Sokolovská 192/79, Praha 8 

Identification number: 65413261 

Legal form: 

limited liability company 

Primary business: 

financial and operating lease, consumer credits 

Balance sheet date: 31 March 2008 

Date of preparation of the financial statements: 27 June 2008 

BALANCE SHEET AS AT 31 MARCH 2008 

31 March 2008 31 March 2007 

Gross 

Net 

Net 

Note amount Provision amount 

amount 

CZK’000 CZK’000 CZK’000 

CZK’000 

ASSETS 

B. Fixed assets 1,728,736 (872,559) 856,177 

953,541 

B. I. Intangible fixed assets 3 7,103 (3,163) 3,940 

543 

B. II. Tangible fixed assets 4 1,721,633 (869,396) 852,237 

952,998 

C. Current assets 834,038 (16,482) 817,556 

730,636 

C. I. Inventories 748 – 748 

636 

C. II. Long-term receivables 5 407,712 (1,519) 406,193 

329,202 

C. III. Short-term receivables 5 413,433 (14,963) 398,470 

360,875 

C. IV. Financial assets 18 12,145 – 12,145 

39,923 

D. I. Accruals and deferrals 2,417 – 2,417 

2,303 

TOTAL ASSETS 2,565,191 (889,041) 1,676,150 

1,686,480 

LIABILITIES AND EQUITY 

A. Equity 6 148,928 

114,350 

A. I. Share capital 44,000 

44,000 

A. II. Capital contributions 28,000 

28,000 

A. III. Statutory reserve fund 4,400 

3,441 

A. IV. Retained earnings 37,950 

13,436 

A. V. Profit for the current period 34,578 

25,473 

B. Liabilities 1,368,661 

1,375,834 

B. I. Provisions 2,557 

3,083 

B. II. Long-term liabilities 7 160,155 

153,377 

B. III. Short-term liabilities 7 204,950 

213,265 

B. IV. Bank loans & overdrafts 8 1,000,999 

1,006,109 

C. I. Accruals and deferrals 11 158,561 

196,296 

TOTAL LIABILITIES AND EQUITY 1,676,150 

1,686,480 



INCOME STATEMENT FOR THE YEAR ENDED 31 MARCH 2008 

Note 

Year ended 31 March 


2007 

CZK’000 

CZK’000 

I. Sales of goods 12 940 

784 

A. Cost of goods sold 940 784 

+ Gross profit – 

– 

II. Sales of production 12 641,346 667,982 

B. Cost of sales 37,732 46,638 

+ Added value 603,614 621,344 

C. Staff costs 13 16,556 14,220 

D. Taxes and charges 996 

735 

E. Depreciation of long-term assets 3, 4 474,390 

507,119 

III. Sale of long-term assets 12 92,514 

63,156 

F. Net book amount of long-term assets sold 93,113 

63,063 

G. Change in provisions for operating liabilities and charges 1,411 

(11,114) 

IV. Other operating income 12 24,151 

29,576 

H. Other operating charges 62,220 

75,717 

* Operating result 71,593 

64,336 

IX. Gain on revaluation of derivatives 9 10,712 

2,445 

L. Loss on revaluation of derivatives 9 3,237 

2,828 

X. Interest income 10,832 8,937 

N. Interest expense 49,087 41,594 

XI. Other financial income 8,997 

2,389 

O. Other financial expense 2,984 

976 

* Financial result (24,767) 

(31,627) 

Q. Tax on profit or loss on ordinary activities 10 12,248 

7,236 

** Profit or loss on ordinary activities after taxation 34,578 25,473 

*** Net profit for the financial period 34,578 25,473 

*** Net profit before taxation 46,826 32,709 


29


STATEMENT OF CHANGES IN SHAREHOLDER’S EQUITY 

Statutory 

Share Share reserve Retained 

Note 

capital premium 

fund earnings 

Total 

CZK’000 CZK’000 

CZK’000 CZK’000 

CZK’000 

At 1 April 2006 44,000 98,985 

2,160 (56,268) 

88,877 

Net profit for the current period 6 

– – 

– 25,473 

25,473 

Settlement of accumulated losses 6 

– (70,985) 

– 70,985 

– 

Contribution to reserve fund – 

– 1,281 

(1,281) – 

At 31 March 2007 44,000 28,000 

3,441 38,909 

114,350 

Contribution to reserve fund – – 

959 (959) – 

Net profit for the current period 6 

– – 

– 34,578 34,578 

At 31 March 2008 44,000 28,000 

4,400 72,528 

148,928 



CASH FLOW STATEMENT 


2007 

CZK’000 

CZK’000 

Cash flows from operating activities 

Net profit on ordinary activities before tax 46,826 

32,709 

A.1 Adjustments for non-cash movements: 

A.1.1 Depreciation of fixed assets 474,390 

507,119 

A.1.2 Change in provisions 1,411 

(11,114) 

A.1.3 Profit / (loss) from disposal of fixed assets 599 

(27) 

A.1.5 Net interest expense 38,255 32,657 

A.* 

Net cash flow from ordinary activities before tax, 

changes in working capital and extraordinary items 561,481 561,344 

A.2 Working capital changes: 

A.2.1 Increase in receivables and prepayments (114,701) 

(154,899) 

A.2.2 Decrease in short-term payables and accruals (52,153) 

(62,888) 

A.2.3 Increase in inventories (112) 

(636) 

A.** 

Net cash flow from ordinary activities before tax 

and extraordinary items 394,515 342,921 

A.3 Interest paid (48,038) (40,193) 

A.4 Interest received 10,832 

8,937 

A *** Net cash flow from ordinary activities 357,309 

311,665 

Cash flows from investing activities 

B.1 Acquisition of fixed assets (479,270) 

(517,649) 

B.2 Proceeds from sale of fixed assets 92,514 

63,090 

B*** Net cash flow from investing activities (386,756) 

(454,559) 

Cash flows from financing activities 

C.1 Change in long and short-term liabilities 1,669 

142,894 

C*** Net cash flow from financing activity 1,669 

142,894 

Net (decrease)/increase in cash and cash equivalents (27,778) 

7,299 

Cash and cash equivalents at the beginning of the year 39,923 32,624 

Cash and cash equivalents at the end of the year 12,145 39,923 


31


1. GENERAL INFORMATION 

Toyota Financial Services Czech s.r.o. (“the Company”) was incorporated on 30 April 1996. The Company has its registered 

office in the building Rubín Office Center, Sokolovská 192/79, 186 00 Praha 8 – Karlín. 

The Company’s business activities are: 

❍ Leasing; 

❍ Purchase of goods for sale and resale; 

❍ Lease of manufactured goods; 

❍ Advisory activities in the area of business and services; 

❍ Intermediation activities in the area of business and services; 

❍ Provision of loans. 

The sole partner of the Company is: 

TOYOTA FINANCIAL SERVICES (UK) plc 

Yew Tree Bottom Road, Great Burgh, Burgh Heath 

Epsom, Surrey KT18 5UZ 

United Kingdom of Great Britain and Northern Ireland 

Contribution in the total amount of CZK 44,000,000 (100% of the share capital) was fully paid up. 

Ing. Aleš Kamarýt is the Company’s statutory representative. 

The business year of the Company always begins on 1 April and ends on 31 March of the following calendar year. Therefore 

the financial statements as at 31 March 2008 include a period of twelve months, i.e. from 1 April 2007 to 31 March 2008 

(“2007/08”). 



2. ACCOUNTING POLICIES 

(a) 

Basis of preparation 

The financial statements have been prepared in accordance with Generally Accepted Accounting Principles in the Czech 

Republic and Czech Accounting Standards. The financial statements have been prepared under the historical cost 

convention. 

Derivatives are shown at fair value. 

The amounts disclosed in the financial statements including notes are rounded to thousands of Czech Crowns (CZK´000) 

unless stated otherwise. 

This version of the financial statements is a translation from the original, which was prepared in Czech language. All 

possible care has been taken to ensure that the translation is an accurate representation of the original. However, in 

all matters of interpretation of information, views or opinions, the original language version takes precedence over this 

translation. 

(b) 

Intangible fixed assets 

Purchased intangible assets are recorded at cost. 

The Company applies the following annual depreciation rates for the intangible fixed assets purchased until 2005: 

In the first year of depreciation 

In the subsequent years For increased initial cost 

Software 14.20% 

28.60% 25.00% 

Since 1 January 2006 the Company applies monthly depreciation in the amount of the purchase price share and the term 

agreed in the contract with respect to software to which the Company has the right of usage for a definite period of time. 

In other cases, the Company depreciates software for 36 months. Depreciations are determined with an entire month’s 

accuracy, beginning the following month after the day when the depreciation conditions were met, i.e. software was 

booked in the assets of the accounting entity and it was put in use. 

Intangible fixed assets with a unit cost less than CZK 60,000 are expensed upon acquisition. 

A provision for impairment is established when the carrying value of an asset is greater than its estimated recoverable 

amount. 

(c) 

Tangible fixed assets 

Acquired tangible fixed assets are recorded at cost, which includes costs incurred in bringing the assets to their present 

location and condition. 

Tangible fixed assets are depreciated applying the straight-line method over the their estimated useful lives. 

The Company applies these annual depreciation rates for non-leasing assets: 

In the first year of depreciation 

In subsequent years For increased initial cost 

Furniture and fittings 11.00% 

22.25% 20.00% 

Machinery and equipment 20.00% 

40.00% 33.30% 

Passenger vehicles 14.20% 

28.60% 25.00% 


33


2. ACCOUNTING POLICIES (continued) 

(c) 

Tangible fixed assets (continued) 

Repairs and maintenance expenditures relating to tangible assets are expensed as incurred. Property enhancements (i.e. 

extending the life or improving the productivity of the asset) exceeding CZK 40,000 per item per year are capitalised. 

Tangible fixed assets with a unit cost less than CZK 40,000 are treated as inventory and are expensed upon consumption. 

Tangible fixed assets leased under the finance lease contracts acquired after 31 March 2005, are depreciated on a daily 

basis by the accounting entity, starting from the day when the conditions for depreciation were met, i.e. the assets 

were recorded in the fixed asset register of the accounting entity and the leased asset was handed over to the lessee 

in compliance with the finance lease contract with subsequent purchase of the leased asset or in a condition fit for the 

agreed or customary use. 

The accounting unit depreciates fixed assets leased under finance leases, acquired up to 31 March 2005, on a monthly 

basis, starting with the month following the month in which the conditions for depreciation were met. 

Depreciation of financial leasing assets is calculated on linear basis from the purchase price up to the amount of the 

residual value agreed in the leasing contract over the term of the leasing contract. 

Accounting depreciation of tangible fixed assets leased under operational lease contracts is determined on a straight-line 

basis on a daily basis according to the duration of the operational lease contract. The depreciation commences on a day 

when the conditions for depreciation were met, i.e. the assets were recorded in the fixed asset register of the accounting 

entity and the leased asset was handed over to the lessee in compliance with the finance lease contract with subsequent 

purchase of the leased asset or in a condition fit for the agreed or customary use. 

Depreciation of operating leasing assets is calculated on linear basis from the purchase price up to the amount of the 

residual value agreed in the leasing contract over the term of the leasing contract. 

A provision for impairment is established when the carrying value of an asset is greater than its estimated recoverable 

amount. 

(d) 

Inventories 

Inventories contain mainly repossessed cars from early terminated consumer loan contracts. Inventories are carried at 

a market value assigned by the expert during stocking process. Value of assets is decreased in case of a decrease in its 

market value. 

(e) 

Receivables 

Receivables are stated at the nominal value less a provision for doubtful amounts. Irrecoverable receivables are generally 

written-off upon completion of bankruptcy or administration or legal proceedings against the customer. A provision for 

bad debts and its amount is created on the basis of maturity analysis, the customers´ solvency, recovery of debts and the 

results of legal enforcement. 

(f) 

Foreign currency translation 

The accounting unit translates foreign currency to Czech crowns using a fixed annual exchange rate set on the basis of 

exchange rate announced by the Czech National Bank on the first working day of the accounting period. 

All monetary assets and liabilities denominated in foreign currencies have been translated at the period-end exchange 

rate as published by the Czech National Bank. All foreign exchange gains and losses from translation of receivables and 

payables are recognized in the profit and loss account. 




(g) 

Derivative financial instruments 

Derivative financial instruments, including interest rate swaps, are initially recognised on the balance sheet at cost and 

subsequently are re-measured at their fair value. The Company acquires these derivatives for the purpose of covering its 

interest rate risk. Because these derivatives do not qualify for hedge accounting they are classified as trading derivatives. 

Fair values are obtained from quoted market prices and from discounted cash-flow models. 

All derivatives are presented in other receivables or in other payables when their fair value is positive or negative, 

respectively. Changes in the fair value of derivatives are recognised as financial expense or financial income. 

(h) 

Revenue recognition 

Sales are recognised upon the performance of services and are stated including discounts and net of the Value Added 

Tax. Lease income from the finance and operating leases is recognised evenly over the life of the relevant lease contracts. 

Income interest on consumer loans is recorded on an accrual basis. 

Commission income for insurance intermediary services concluded as part of leasing contracts, consumer credit contracts 

or separate contracts is recognized in the income statement over the duration of the contract on the maturity dates of the 

time-limit insurance. 

(i) 

Consumer credits 

Receivables from consumer credits are stated at the nominal value less a provision for doubtful amounts. 

(j) 

Provisions 

Provisions are recognised when the Company has a present obligation, it is probable that an outflow of resources will be 

required to settle the obligation, and a reliable estimate of the amount can be made. 

(k) 

Pension plan 

The Company does not operate any pension plan. Regular contributions are made to the state to fund the national 

pension plan. 

(l) 

Interest costs 

Interest costs on borrowings to finance the acquisition of tangible and intangible fixed assets are capitalised during the 

period of completion and preparation of the asset for its intended use. Other borrowing costs are expensed. 

(m) Deferred tax 

Deferred tax is recognised on all temporary differences between the carrying amount of an asset or liability in balance 

sheet and its tax base. Deferred tax assets are recognised if it is probable that sufficient future taxable profit will be 

available against which the assets can be utilised. 

(n) 

Recognition of revenues and expenses related to leasing 

In accordance with the accounting principles valid in the Czech Republic, the leasing sales, depreciations, costs and 

insurance revenues from the leased assets are shown within the operating result, while the interest costs for leasing assets 

financing are shown as part of the financial result. As the result of this, both operating and financial result do not reflect a 

mutual matching of these revenues and costs. 


35



(o) 

Related parties 

The Company’s related parties are considered to be the following: 

❍ Group companies; 

❍ Sole partner, of which the Company is a subsidiary or an associate, directly or indirectly, and subsidiaries and associates 

of the partner; 

❍ Members of the Company’s statutory and supervisory bodies and management and parties close to such members, 

including the subsidiaries and associates of the members and their close parties; 

❍ Companies with the same member of management. 

Material transactions and outstanding balances with related parties are disclosed in Notes 13 and 14. 

(p) 

Subsequent events 

The effects of events, which occurred between the balance sheet date and the date of preparation of the financial 

statements, are recognised in the financial statements in the case that these events provide further evidence of conditions 

that existed at the balance sheet date. 

Where significant events occur subsequent to the balance sheet date but prior to the preparation of the financial 

statements, which are indicative of conditions that arose subsequent to the balance sheet date, the effects of these events 

are disclosed, but are not themselves recognised in the financial statements. 



3. INTANGIBLE FIXED ASSETS 

Cost 

1 April 2007 Additions Disposal 

31 March 2008 

CZK’000 

CZK’000 CZK’000 

CZK’000 

Software 3,122 

478 – 

3,600 

Incomplete investments 240 

3,741 478 

3,503 

Total 3,362 

4,219 478 

7,103 

Accumulated amortisation 



CZK’000 

CZK’000 CZK’000 

CZK’000 

Software 2,819 344 – 

3,163 

Total 2,819 344 – 

3,163 

Net book amount 543 

3,940 

Cost 


31 March 2007 

CZK’000 

CZK’000 CZK’000 

CZK’000 


498 251 

3,122 

Other intangible fixed assets 21 

– 21 

– 

Incomplete investments – 

240 – 

240 

Total 2,896 

738 272 

3,362 

Accumulated amortisation 


31 March 2007 

CZK’000 

CZK’000 CZK’000 

CZK’000 


286 251 

2,819 

Other intangible fixed assets 21 

– 21 

– 

Total 2,805 

286 272 

2,819 

Net book amount 91 

543 


37


4. TANGIBLE FIXED ASSETS 

Cost 

1 April 2007 Additions Disposals 


CZK’000 

CZK’000 CZK’000 

CZK’000 

Machinery and equipment 2,801 

302 – 

3,103 

Passenger cars 4,097 3,643 3,617 

4,123 

Furniture and fittings 2,317 

184 37 

2,464 

Finance lease – cars 1,202,196 268,054 414,997 1,055,253 

Finance lease – machinery 40,111 

637 10,788 

29,960 

Operating lease – cars 138,217 136,898 106,228 

168,887 

Operating lease – machinery 421,430 

56,835 20,422 

457,843 

Total 1,811,169 

466,553 556,089 

1,721,633 

Accumulated depreciation 



CZK’000 

CZK’000 CZK’000 

CZK’000 


364 0 

2,579 

Passenger cars 1,754 2,723 3,617 

860 


382 37 

2,453 

Finance lease – cars 669,882 357,867 414,997 

612,752 


11,238 10,788 

21,475 


38,436 


88,839 20,422 

187,719 

Provisions for assets 4,779 

325 1,982 

3,122 

Total 858,171 

569,296 558,071 

869,396 

Net book amount 952,998 

852,237 

Additions to accumulated depreciation also include the net book amount of the sold assets of CZK 93,113,000 

(2006/07: CZK 63,063,000) from terminated lease contracts and net book amount of the stolen or destroyed assets of 

CZK 1,812,000 (2006/07: CZK 7,073,000). 



4. TANGIBLE FIXED ASSETS (continued) 

Cost 


31 March 2007 

CZK’000 

CZK’000 CZK’000 

CZK’000 


582 808 

2,801 

Passenger cars 4,595 

0 498 

4,097 


28 0 

2,317 

Finance lease - cars 1,367,228 298,514 463,546 1,202,196 

Finance lease - machinery 32,404 

13,185 5,478 

40,111 

Operating lease - cars 102,359 96,661 60,803 

138,217 

Operating lease - machinery 317,445 

108,255 4,270 

421,430 

Total 1,829,347 

517,225 535,403 

1,811,169 

Accumulated depreciation 


31 March 2007 

CZK’000 

CZK’000 CZK’000 

CZK’000 


496 808 

2,215 

Passenger cars 653 1,599 498 

1,754 


443 0 

2,108 

Finance lease – cars 714,078 419,350 463,546 

669,882 


12,595 5,478 

21,025 


37,106 


68,021 4,270 

119,302 

Provisions for assets 16,534 4,779 16,534 

4,779 

Total 828,359 

581,749 551,937 

858,171 

Net book amount 1,000,988 

952,998 

The Company did not acquired in the financial year 2007/08 any low value intangible fixed assets which were expensed as 

incurred (2006/07: CZK 60,000) and low value tangible fixed assets expensed in the same way in the amount of 

CZK 316,000 (2006/07:CZK 718,000). 


39


5. RECEIVABLES 


CZK’000 

CZK’000 

Trade receivables - current 216,892 

190,330 

- overdue 14,042 

18,274 

230,934 

208,604 

Other receivables - current 181,253 

163,100 

181,253 

163,100 

Short-term advances provided 1,246 

1,145 

413,433 

372,849 

Provisions for short-term doubtful receivables (14,963) 

(11,974) 

Net short-term receivables 398,470 

360,875 

Long-term trade receivables 362,283 

295,638 

Other long-term receivables 45,429 

34,478 

407,712 

330,116 

Provisions for long-term doubtful receivables (1,519) 

(914) 

Net long-term receivables 406,193 

329,202 

Net total receivables 804,663 

690,077 

Trade receivables include mainly receivables from customer credit contracts. For these contracts the Company enters into 

the agreement on securing an obligation by the transfer of ownership title. At 31 March 2008 these receivables amounted to 

CZK 555,052,000 (31 March 2007: CZK 466,174,000). 

Other short and long-term receivables include receivables from funding the dealers network. 

For securing receivables from contracts on investment loan provided to Toyota dealers the Company uses the right of lien over 

the property owned by them. At 31 March 2008 these receivables amounted to: CZK 61,013,000 

(at 31 March 2007: CZK 42,591,000). 

Provisions 

The change in the provision for doubtful receivables may be analysed as follows: 


CZK’000 

CZK’000 

Opening balance 12,888 

12,865 

Charge for the year 11,633 

9,039 

Utilized during the year (63) 

(1,167) 

Released during the year (7,976) 

(7,849) 

Closing balance 16,482 

12,888 

In 2007/08 the Company wrote-off irrevocable receivables in the amount of CZK 63,000 (2006/07: CZK 1,167,000). 



6. EQUITY 

In accordance with the respective provisions of the commercial code, the Company supplemented its mandatory reserve fund 

by CZK 959,000 from the net profit achieved in 2006/07. The mandatory reserve fund may not be distributed among the 

shareholders but it can be used solely to cover the losses. 

The net profit of CZK 25,473,000 for 2006/07 was approved and allocated by the General meeting of the shareholder on 

30 September 2007 (see Statement of changes in shareholder’s equity). 

7. PAYABLES 


31 March 2007 

CZK’000 

CZK’000 

Short-term trade payables 31,931 

41,737 

Short-term advances received 362 

7,715 

Short-term portion of long-term loan (see Note 14) 150,000 

150,000 

Negative fair value of derivatives (see note 9) – 

2,378 

182,293 

201,830 

Other short-term payables 22,657 

11,435 

Total short-term payables 204,950 

213,265 

Long-term advances received 8 

424 

Long-term loan (see note 14) 150,000 

150,000 

Deferred tax liability (see note 10) 10,147 

2,953 

Total long-term liabilities 160,155 

153,377 

Total short- and long-term liabilities 365,105 

366,642 

Advances received are recognised as revenue on a straight-line basis over the lease term along with related lease instalments in 

accordance with the individual payment calendar. 

Trade and other payables have not been secured over any assets of the Company. Total overdue payables as at 31 March 2008 

amounted to CZK 1,663,000 (at 31 March 2007: CZK 5,500,000). 

TOYOTA Motor Finance (Netherlands) B.V. provided to the Company a long-term loan (credit) of CZK 300 million, with its 

two CZK 150 million tranches falling due on 12 August 2008 and 13 August 2010, respectively. Interest on the loan is based on 

variable interest rates. 

The Company entered into agreements on interest rate swaps (see note 9) in order to fix the interest rate on loans bearing a 

variable interest rate. 


41


8. BANK LOANS 


CZK’000 

CZK’000 

Loans due within 1 year 620,000 

895,000 

Long-term loans – a portion payable within 1 year 20,411 

21,590 

Long-term loans due between 1 – 5 years 360,588 

89,519 

Total bank loans and overdrafts 1,000,999 

1,006,109 

Total short-term bank loans 640,411 

916,590 

Total bank loans 360,588 

89,519 

Short-term loans were provided by domestic banks. 

HSBC Bank provided a long-term loan of EUR 1,923,000, which is due by 30 June 2011 in regular monthly payments in 

accordance with a payment calendar. The loan bears fixed interest of 4.65% p.a. for the whole repayment term. 

In 2005/06 HSBC Bank provided to the Company a long-term loan (credit) of EUR 2,115,000 which is payable in regular 

monthly instalments in accordance with the repayment schedule to 30 March 2012 in two tranches amounting to EUR 

1,050,000 and EUR 1,065,000. In 2006/07, the Company drew down on a provided long-term credit within the second tranche 

in the amount of EUR 795,000 up to the final agreed loan of EUR 1,860,000. In the course of the drawdown of the funding, the 

interest charged on the loan is variable. After the complete drawdown of the funding, the interest on the loan is fixed over the 

entire duration (term) of the loan contract, namely for the first tranche at 4.00% p.a and for the second tranche at 3.95% p.a. 

In financial year 2007/08 a bank Citibank provided a middle-term loan of CZK 300,000,000 which is due on 30 November 2009. 

The interest charged on the loan is based on variable interest rate. 

9. DERIVATIVE FINANCIAL INSTRUMENTS 

The Company recognises finance derivatives as trading derivatives. 

The fair value of derivatives is presented in “Other receivables”, if positive or in “Other payables”, if negative. The derivatives 

can be analysed as follows: 

Trading agreements Fixed 

Fair Notional 

(interest rate swap) interest rate 

value amount 

% 

CZK’000 CZK’000 

At 31 March 2008 2.38 – 4.19 

6,077 1,115,000 

At 31 March 2007 2.38 – 3.98 

(2,378) 1,035,000 

The year-to-year change in a positive fair value of the above derivatives amounting to CZK 8,455,000 (in 2006/07 negative 

change in fair value of CZK 383,000) was recognized as a loss from revaluation of derivatives of CZK 210,000 (2006/07: CZK 

2,828,000) and as a gain from revaluation of derivatives of CZK 8,655,000 (2006/07: CZK 2,445,000). Realized gains in amount 

of CZK 2,047,000 and realized losses in amount of CZK 3,027,000 are recognized in gains and losses from derivatives. 



10. TAXATION 

The income tax expense is comprised of the following: 

2007/08 

2006/07 

CZK’000 

CZK’000 

Deferred tax expense 7,194 

7,236 

Current tax expense 5,054 

– 

Total income tax expense 12,248 

7,236 

Current tax can be analysed as follows: 

2006/07 

2005/06 

CZK’000 

CZK’000 

Net profit before taxation 46,826 

32,709 

Adjustments for tax purposes: 

Non taxable income (22,096) 

(23,772) 

Non-tax deductible costs 33,449 

22,440 

Diference between tax and accounting depreciation of fixed assets (20,843) 

(23,562) 

Net taxable profit 37,336 

7,815 

Tax losses carried forward (13,269) 

(7,815) 

Corporate taxation at 21% (2006/07: 24%) 5,054 

– 

The deferred tax liability is calculated at 21% (the tax rate enacted for period of expected realisation of deferred tax; 2006/07: 

24%) from the net taxable profit and can be analysed as follows: 


CZK’000 

CZK’000 

Deferred tax liability/asset: 

Difference between accounting and tax depreciation rate (12,779) 

(10,492) 

Other provisions 2,661 

4,770 

Other temporary differences (29) 

(58) 

Tax losses carried forward – 

2,827 

Net deferred tax liability (see Note 7) (10,147) 

(2,953) 


43


11. ACCRUALS AND DEFERRALS 


31 March 2007 

CZK’000 

CZK’000 

Accrued expenses 3,497 

2,446 

Accrued revenues on related party grants (subsidies) 

(see Note 14) 1,636 

3,686 

Accrued revenues from other subsidies 446 

96 

Accrued extraordinary lease instalments 152,350 

190,068 

Other accrued revenues 632 

– 

Total accruals and deferrals 158,561 

196,296 

In connection with legislative adjustments in the Value Added Tax after 1 May 2004 and the relating change in contractual 

conditions the down payments settled by lessees at the commencement of the lease contract are considered to be extraordinary 

payments and are recognised on the accrued basis. 

Down payments in contracts concluded prior to this date were recognised in advances received (note 7). 

12. REVENUE ANALYSIS 

Revenue from ordinary activities has been generated as follows: 

2007/08 

2006/07 

CZK’000 

CZK’000 

Sales of services provided (finance lease) 440,885 

506,722 

Sales of services provided (operating lease) 147,586 

118,943 

Interest received from customer credits provided to clients 52,757 

42,197 

Proceeds from sale of fixed assets 92,514 

63,156 

Other revenues 25,209 

30,480 

Total revenues from ordinary activities 758,951 

761,498 

Other revenues are recognised in the income statement mainly in other operating income. 

All revenues have been derived only from domestic activities. 



13. EMPLOYEE ANALYSIS 

Employee numbers 31 March 2008 

31 March 2007 

Average number of members of management 4 

4 

Average number of staff 14 

13 

Total 18 

17 

The Company’s management comprises the statutory representative (in the employment relation as a Company director) and 

employees at managerial positions directly reporting to him. 

In the year 2007/08 company cars were made available for use by the senior staff members with the total cost of CZK 3,048,000 

(in 2006/07: CZK 4,097,000). 

In the business year 2007/08 no remuneration was paid to the Company’s statutory representative acting as the statutory body. 

No loans have been provided to senior staff members. 

Management 

Other Total 

CZK’000 

CZK’000 CZK’000 


Wages and salaries 5,400 

5,399 10,799 

Emoluments 633 

415 1,048 

Social security costs 2,147 

2,046 4,193 

Other social costs 169 

347 516 

Total staff costs 8,349 

8,207 16,556 

31 March 2007 

Wages and salaries 4,762 

4,409 9,171 

Emoluments 614 

412 1,026 

Social security costs 1,886 

1,691 3,577 

Other social costs 161 

285 446 

Total staff costs 7,423 

6,797 14,220 


45


14. RELATED PARTY TRANSACTIONS 

The Company was involved in the following related party transactions: 


CZK’000 

CZK’000 

Short-term trade receivable 

TOYOTA MOTOR CZECH spol. s r.o. 1,463 

1,087 

Short-term trade payables 

Toyota Motor Europe NV/SA – 

191 


5,051 

Toyota Peugeot Citroën Automobile Czech, s.r.o. – 

130 

Anticipated payables 

Toyota Kreditbank GmbH 61 

110 

TOYOTA FINANCIAL SERVICES (UK) plc 994 

765 

Toyota Financial Services Corporation 26 

– 

Other payables 

Toyota Motor Finance (Netherlands) B.V. (Note 7) 300,000 

300,000 

Accrued expenses from subventions 

TOYOTA MOTOR CZECH spol. s r.o. (Note 11) 1,636 

3,686 

Accrued expenses 

Toyota Motor Finance (Netherlands) B.V. 1,653 

1,108 

307,219 

311,041 

Income from subventions 


3,452 

Purchase of services 

Toyota Kreditbank GmbH 155 

569 

TOYOTA FINANCIAL SERVICES (UK) plc 1,965 

2,517 

Toyota Financial Services France – 

14 

Toyota Financial Services Corporation 29 

11 

Toyota Motor Europe NV/SA – 

165 

TOYOTA MOTOR CZECH spol. s r.o. (51) 

5 

2,098 

3,281 

Interest expense 

Toyota Motor Finance (Netherlands) B.V. 10,463 

7,759 

12,561 

11,040 



14. RELATED PARTY TRANSACTIONS (continued) 

The Company does not create provisions to receivables from related parties. 

Besides the above stated remuneration and benefits, there was no other consideration provided to the Company’s statutory 

representative and members of the Company’s management in 2007/08 and 2006/07. 

15. COMMITMENTS 

The Company had no significant capital commitments as at 31 March 2008. 

16. CONTINGENT LIABILITIES 

ABN AMRO bank N.V. provided the Company with a bank guarantee of CZK 411,000 for the office space rent payment. 

The management of the Company is not aware of any other significant unrecorded contingent liabilities as at 31 March 2008. 

17. SUBSEQUENT EVENTS 

No events have occurred subsequent to year-end that would have a material impact on the financial statements as at 

31 March 2008. 

18. CASH FLOW STATEMENT 

The Company has prepared a cash flow statement following the indirect method. Cash equivalents represent short-term liquid 

investments, which are readily convertible for a known amount of cash. Cash and cash equivalents disclosed in the cash flow 

statement can be analysed as follows: 


CZK’000 

CZK’000 

Cash on hand and in transit 177 

107 

Cash in banks 11,968 

39,816 

Cash and cash equivalents 12,145 

39,923 

STATUTORY APPROVALS 

These financial statements have been approved for submission to the sole partner of the Company by the Company’s statutory 

representative. 



Statutory Representative 


47


Report 

on relations among related parties 

pursuant to the provisions of Section 66a) of Act No. 513/1991 Coll., the Commercial Code, 

as amended (hereinafter “CC”) 

of the statutory representative of 


1. Controlled Entity 


Rubín Office Center 

Sokolovská 192/79, 186 00 Praha 8 - Karlín 

ID No.: 65413261 

Kept by the Registration Court in Prague, Section C, Inset 44764 

(hereinafter the “Company”) 

2. Relevant Period 

This report describes relations among related parties pursuant to Section 66a of Act No. 513/1991 for the last accounting period, 

i.e. for the period from 1 April 2007 to 31 March 2008 (hereinafter the “Relevant period”). 

3. Structure of the Group 

Controlling entity: 


Great Burgh, Burgh Heath, Epsom, Surrey KT18 5UZ 


TOYOTA FINANCIAL SERVICES (UK) plc is controlled by Toyota Financial Services Corporation, which is directly controlled by 

Toyota Motor Corporation. 

Related parties, with whom Toyota Financial Services Czech s.r.o. has contractual relations: 

Toyota Financial Services Corporation 

Mitsui Sumitomo Bank Nagoya Bld. 10 F 18-19 

Nishiki 2-Chome, Naka-ku, Nagoya 

Japan 




Toyota Kreditbank GmbH 

Toyota-Allee 5, Köln-Marsdorf 

Federal Republic of Germany 

Toyota Kreditbank GmbH International Division 



Toyota Motor Finance (Netherlands) B.V. 

DeBoelelaan 7, 1083HJ, Amsterdam 

The Netherlands 



Toyota Financial Services Slovakia s.r.o. 

Gagarinova 7/C, 821 03 Bratislava 

Slovak Republic 

TOYOTA MOTOR CZECH spol. s r.o. 

Šafránkova 1238, 150 00 Praha 5 


Toyota Motor Europe NV/SA 

Avenue du Bourget 60, Bourgetlaan 60, Brusel 

Belgie 

Toyota Peugeot Citroën Automobile Czech, s.r.o. 

Průmyslová zóna, Ovčáry 280, 280 02 Kolín 


Toyota Financial Services France 

36, boulevard de la République, 92423 Vaucresson 

France 

4. Relations among related parties 

4.1 List of all contracts with related parties concluded in the Relevant period and fulfilments provided among the related 

parties realised in the Relevant period 

The Company did not conclude any new contracts with the related parties within the Relevant period. 

The details of individual transactions can be found in the note 14 “Related party transactions” in the notes to the financial statements, 

which are a part of this annual report. 

4.2 Other legal operations in favour of the Related parties 

No other legal operations have been performed in favour of or on requirement of the related parties. 

4.3 Other (unrealised) actions in favour of or on requirement of the related parties 

There are no other measures that have been taken (but not realised) in favour of or on requirement of the related parties. 

4.4 1.1.Assessment of adequacy of consideration and fulfilment in return from realised legal operations and detriments 

from (unrealised) measures in favour of or on requirement of the Related Parties 

None of the legal operations realised with the related parties or in favour of and on requirement of the related parties have 

been detrimental to the Company. 



Statutory Representative 


49


Rubín Office Center 

Sokolovská 192/79 

186 00 Praha 8-Karlín 


Tel.: +420 296 579 500, +420 296 579 506-7 

Fax: +420 296 579 524 

toyotafinance@toyotafinance.cz 

www.toyotafinance.cz

Annual Report 2008 - Toyota Financial Services

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