Nintendo of America Inc. P.O. Box 957, Redmond, WA 98073-0957 U.S.A.

www.nintendo.com

63728A

PRINTED IN USA

INSTRUCTION BOOKLET
PLEASE CAREFULLY READ THE SEPARATE HEALTH AND SAFETY PRECAUTIONS BOOKLET INCLUDED WITH THIS PRODUCT BEFORE USING YOUR NINTENDO HARDWARE SYSTEM, GAME CARD OR ACCESSORY. THIS BOOKLET CONTAINS IMPORTANT HEALTH AND SAFETY INFORMATION. IMPORTANT SAFETY INFORMATION: READ THE FOLLOWING W ARNINGS BEFORE YOU OR YOUR CHILD PLAY VIDEO GAMES.
WARNING - Repetitive Motion Injuries and Eyestrain
Playing video games can make your muscles, joints, skin or eyes hurt after a few hours. Follow these instructions to avoid problems such as tendinitis, carpal tunnel syndrome, skin irritation or eyestrain: Avoid excessive play. It is recommended that parents monitor their children for appropriate play. Take a 10 to 15 minute break every hour, even if you dont think you need it. When using the stylus, you do not need to grip it tightly or press it hard against the screen. Doing so may cause fatigue or discomfort. If your hands, wrists, arms or eyes become tired or sore while playing, stop and rest them for several hours before playing again. If you continue to have sore hands, wrists, arms or eyes during or after play, stop playing and see a doctor.

WARNING - Seizures

Some people (about 1 in 4000) may have seizures or blackouts triggered by light flashes or patterns, such as while watching TV or playing video games, even if they have never had a seizure before. Anyone who has had a seizure, loss of awareness, or other symptom linked to an epileptic condition should consult a doctor before playing a video game. Parents should watch when their children play video games. Stop playing and consult a doctor if you or your child have any of the following symptoms: Convulsions Eye or muscle twitching Loss of awareness Altered vision Involuntary movements Disorientation To reduce the likelihood of a seizure when playing video games: 1. Sit or stand as far from the screen as possible. 2. Play video games on the smallest available television screen. 3. Do not play if you are tired or need sleep. 4. Play in a well-lit room. 5. Take a 10 to 15 minute break every hour.
WARNING - Battery Leakage
The Nintendo DS contains a rechargeable lithium ion battery pack. Leakage of ingredients contained within the battery pack, or the combustion products of the ingredients, can cause personal injury as well as damage to your Nintendo DS. If battery leakage occurs, avoid contact with skin. If contact occurs, immediately wash thoroughly with soap and water. If liquid leaking from a battery pack comes into contact with your eyes, immediately flush thoroughly with water and see a doctor. To avoid battery leakage: Do not expose battery to excessive physical shock, vibration, or liquids. Do not disassemble, attempt to repair or deform the battery. Do not dispose of battery pack in a fire. Do not touch the terminals of the battery, or cause a short between the terminals with a metal object. Do not peel or damage the battery label.
WARNING - Radio Frequency Interference
The Nintendo DS can emit radio waves that can affect the operation of nearby electronics, including cardiac pacemakers. Do not operate the Nintendo DS within 9 inches of a pacemaker while using the wireless feature. If you have a pacemaker or other implanted medical device, do not use the wireless feature of the Nintendo DS without first consulting your doctor or the manufacturer of your medical device. Observe and follow all regulations and rules regarding use of wireless devices in locations such as hospitals, airports, and on board aircraft. Operation in those locations may interfere with or cause malfunctions of equipment, with resulting injuries to persons or damage to property.
Important Legal Information
This Nintendo game is not designed for use with any unauthorized device. Use of any such device w ill invalidate your Nintendo product warranty. Copying of any Nintendo game is illegal and is strictly prohibited by domestic and international intellectual property laws. Back-up or archival copies are n ot authorized and are not necessary to protect your software. Violators will be prosecuted.

The official seal is your assurance
that this product is licensed or manufactured by Nintendo. Always look for this seal when buying video game systems, accessories, games and related products.
Nintendo does not license the sale or use of products without the Official Nintendo Seal.
THIS GAME CARD WILL WORK ONLY WITH THE NINTENDO DSTM VIDEO GAME SYSTEM.

Contents

Foreword by Dr. Kawashima. . . 5 . Nintendo DS System Controls. . 11 . Getting Started. . . . . . . . . . . . 12 Modes. . . . . . . . . . . . . . . . . . . 13 . Daily Training. . . . . . . . . . . . . . 14 Your First Training Session. . . 14 Measuring Your Current Brain Age.15 Creating a Personal Data File. 17 Brain Age Check Results. . . . . 18 . Training. . . . . . . . . . . . . . . . . . 19 . Brain Age Check. . . . . . . . . . . 29 Brain Age Check Tests. . . . . . 30 Graphs. . . . . . . . . . . . . . . . . . 32 Other Options. . . . . . . . . . . . . 33 Quick Play. . . . . . . . . . . . . . . . . Quick Brain Age Check. . . . . . Quick Training. . . . . . . . . . . . Quick Sudoku. . . . . . . . . . . . . Sudoku. . . . . . . . . . . . . . . . . . . . . Download. . . . . . . . . . . . . . . . . Vs. Picture Drawing. . . . . . . Vs. Word Scramble. . . . . . . Vs. Number Memory. . . . . . Vs. Change Maker. . . . . . . . Sending a Demo. . . . . . . . . . . Using DS Download Play. . . . . Profile. . . . . . . . . . . . . . . . . . . . 41. 47 50
Wireless DS Single-Card Download Play
THIS GAME ALLOWS WIRELESS MULTIPLAYER GAMES DOWNLOADED FROM ONE GAME CARD.
NEED HELP PLAYING A GAME?
Nintendos game pages, at www.nintendo.com/games, feature walkthroughs, frequently-asked questions, and codes for many of our games. If your answer isnt there, check out our forums where you can exchange tips with other gamers online. For more information about our forums, visit www.nintendo.com/community. If you dont have access to the web-site, recorded tips for many titles are available on Nintendos Power Line at (425) 885-7529. This may be a long-distance call, so please ask permission from whoever pays the phone bill.
2005-2007 NINTENDO. 2007 NIKOLI CO., LTD. TM, AND THE NINTENDO DS LOGO ARE TRADEMARKS OF NINTENDO. 2007 NINTENDO. ALL RIGHTS RESERVED. THIS PRODUCT EMPLOYS DECUMA HANDWRITING RECOGNITION ENGINE FROM ZI CORPORATION. DECUMA IS A REGISTERED TRADEMARK OF ZI CORPORATION.
In this Instruction Booklet, the LCD Screen (top screen) is framed in. orange and the Touch Screen is framed in blue.

Introduction

Hello! Im Dr. Ryuta Kawashima! Did you know that just like how you lose muscle mass with age, your brain function begins to decrease when you reach maturity? This happens even if you lead a normal, healthy life. Everyone knows you can prevent muscle loss with exercise, and use such activities to improve your body over time. But we now know that the same is true of your brain. If you proactively reinforce daily habits of brain training, you may help to prevent a decrease in brain function. Have you noticed yourself forgetting things lately? Do you have trouble articulating exactly what you want to say? These symptoms may be. alleviated by training your brain. But such training is not just for adults. Children, too, may be able to heighten their creativity and memoryand learn self-controlby training their brains. Ryuta Kawashima, MD

Getting the Most out of Your Prefrontal Cortex
The prefrontal cortex is like the control tower of your brainit determines how you use stored knowledge in practical situations. That means that your practical intelligence, or ability to apply stored knowledge to your everyday reality, depends upon how well your prefrontal cortex functions. So training your prefrontal cortex could actually raise your intelligence! Anterior
Prefrontal Cortex Frontal Lobe Inferior Temporal Gyrus Parietal Lobe Temporal Lobe

Posterior

Angular Gyrus Occipital Lobe
Wernickes Area Visual Cortex

2006 Ryuta Kawashima

A Brief Explanation of The Brain Both hemispheres of the human brain are divided into four parts: the frontal lobe, parietal lobe, temporal lobe, and occipital lobe. The prefrontal region (which makes up a large part of the frontal lobe) is the foundation of creativity, memory, communication, and self-control. Its role could be described as the brain within a brain.
Recent Neurological Research Regarding Brain Training
My research has shown that reading out loud and performing calculations quickly are effective for training your brain. The diagrams below and to the right show functional magnetic resonance imaging (fMRI) of the blood flow in a brain. The red and yellow areas show which parts of the brain are working. Red indicates the hardest working portions of the brain, while yellow displays slightly less activity.
A Brain Performing Simple Math Problems Quickly
Many parts of both hemispheres are working very hard.
A Brain Solving Word Problems Quickly
When solving word problems,. both hemispheres are very active.

A Brain in Idle Thought

The left hemisphere is working, but the right hemisphere is hardly working at all.
A Brain Solving a Difficult Math Problem
Even when solving a hard problem, your brain may not be working very hard.
These diagrams demonstrate that performing simple calculations quickly and solving word problems maybe effective ways to work your brain. Based on these results, I conducted a memory test on a wide range of people, from elementary-school-age children to full-grown adults. My data showed that subjects who performed simple calculations and read aloud did two to three times better in tests of memory ability. Also, patients with cognitive impairment that performed simple calculations and read aloud two to five times per week were able to prevent the worsening of their condition and improve the functioning of their prefrontal cortices more than those who had not done such exercises.

Training Your Brain with Brain Age
The key to training is sticking with it. This software was designed to work your brain with simple activities. It will also be fun so you can continue to use and enjoy it every day! An optimal time to do this training is in the morning, when your brain should be at its peak level of activity. Take a moment from your free time each day to complete your training.
Modern Equipment Shows That Brain Training Works!
An imaging technology called near-infrared spectroscopy (Figure 1) has allowed us to investigate the workings of the prefrontal cortex in a person who is playing brain age. After testing several dozen training programs, we have selected only those that proved effective for activating the brain (Figure 2).

Figure 1 Figure 2

Dont worry! Ill be assisting with your. brain training. Im sure well work well together!
Measuring blood flow. in the brain. Chart 1
A three-dimensional image. produced during the examination.
How Is Ones Brain Age Determined?
I took a sample set of 156 people from age 20 to 70 and broke them down into groups of 20. I then evenly dispersed them by age and adjusted their test results to find the best fit in a distribution curve (Chart 1). This is the curve used to calculate your brains age when you use Brain Age 2.
Nintendo DS System Controls
Please turn your Nintendo DS sideways when playing Brain Age 2.

POWER Switch START

Press during training to return to the. Menu Screen.

Getting Started

Make sure that the DS power is off then, insert the Game Card into the slot. on the back of the system and push until it clicks into place. Turn the power on and the Health and Safety Screen. shown to the right will appear. Once you have read it,. tap the Touch Screen. On the Nintendo DS Menu Screen, touch the Brain Age 2 panel to progress to the Title Screen. If your Nintendo DS system is set to AUTO MODE, you can skip the previous setting process. See the Instruction Booklet for your Nintendo DS system for more details.

Touch Screen

All control is performed via the. Touch Screen. Left-handed users will be asked to turn. the Nintendo DS system around once. the software starts.

Microphone

The microphone is used to detect sound.

LCD Screen

Displays explanations of controls and t raining questions.
In this software you can choose between three different languages: English, French, and Spanish. The language displayed during use of the software is based on this selection.
If you close the DS while the power is on, it will automatically enter a. power-saving Sleep Mode. It will resume normal mode when opened again.
Follow the instructions and advice on the LCD Screen to progress through Brain Age 2.

Language Selection

This icon allows you to select one of the three languages available in this software.

Daily Training

Your First Training Session
First you must create a personal data file to save your daily records. A maximum of four different personal data files can be created. To create a file, touch New Data File and follow the instructions.

Quick Play

This provides light training for friends and family.
Use this mode to check your brain age and do your everyday training.

Confirm the Date

Confirm that the date and time are accurate. If both are correct, touch "Yes." If not, touch "No." To change the date or time, you must first turn the Nintendo DS systems power off. See the Instruction Booklet for your Nintendo DS system for more details.

Sudoku

Play over 100 sudoku puzzles on three difficulty levels.

Download Play

ake part in multiplayer training using T Nintendo DS Wireless Communication. LCD Screen Touch Screen pload the Quick Play version to another U Nintendo DS system.

Writing Hand

Select your writing hand. If you are right-handed,. touch R and proceed to the next step. If you are. left-handed, touch L, then follow the instructions to turn the Nintendo DS system around.

Saving

This software automatically saves important data such as personal data,. settings, your brain age, and training records. Do not turn the power off when switching between screens after training or other activities. See page 33 for details on how to erase personal data.
Measuring Your Current Brain Age
When the doctor is finished explaining his theories about the brain, you will be able to test your current brain age. Parts of this test may require you to speak out loud, so please be sure you are in a quiet place. If you are not in such an area, tap "I Can't Speak" to take the Serial Subtraction test instead of Rock, Paper, Scissors.

ROCK, PAPER, SCISSORS

When the rock, paper, or scissors icon appears on the screen, select the appropriate response to win or lose the game as instructed at the top of the screen. Speak your answer into the Nintendo DS systems microphone. There are three possible responses: rock, paper, or scissors.

Math recall Memorize the number before it is blacked out, then solve the problem by writing the answer on the Touch Screen. If you forget the number, touch Try Again to display a new number.
block count Watch the falling blocks and remember their positions in the shaded area. When all the blocks have fallen, write down the height of one column on the Touch Screen. Remember to include spaces as well as blocks in your count. Memory sprint Follow the progress of the shaded runner as he competes in a footrace, then write down the position in which he finished on the Touch Screen.

Virus Buster

Its a good idea to relax after your training session!

Next Capsule

Capsule Germ
Clock spin Look at the clock on the LCD screen and write down the time on the Touch Screen.
Germ Buster Eradicate the germs by lining up capsules of the same color either horizontally or vertically to make them disappear. When four or more of the same color connect, they will disappear. Touch a capsule to rotate it,. or touch and slide the stylus to move it.

Brain Age Check

To perform a Brain Age Check,. touch Brain Age Check on the. Stamp/Calendar Screen. You must complete three tests in succession. If you stop before completing all three, the test will. be unsuccessful. Your brain age will be displayed like so. Once you are satisfied, tap More.

Brain Age Check Tests

ROCK, PAPER, SCISSORS This is the same test that can be used when you create a new personal data file. See page 16 for game details. serial subtraction This calculation test can be used when you create a new personal data file. See page 16 for game details. SYMBOL match Look at the numbers and symbols in the key, then write the corresponding symbol on the Touch Screen when its number appears.
This graph charts the progress of your brain age. Once you are satisfied, tap Next. You can check your brain age as many times a day as you like, but only the first result will be saved.
math recall This calculation test is also used for training. See page 25 for game details. number memory Memorize as many of the numbers as you can, then write them on the Touch Screen. You will have two minutes for each portion of this activity. You must touch each numbers position before you write it.

Graphs

Records of your training and brain age score are displayed as easy-to-read graphs.

Arrows

Touch these to change the month.

2 Mos.

HIGH NUMBER Touch the number with the highest value on the Touch Screen.
Switch to a graph showing two months worth of results.

Two Months Graph

Compare
Tap this to compare results from different people. This option appears only when there is more than one save file on your Game Card.

Other Options

Touch Other Options to select Settings, Change. Signature, Stamp Design and Tips. You can also access. the credits by touching the icon in the lower-right corner. Stamp Design and Tips can only be selected after you. have received enough stamps.
CHANGE SIGNATURE Change the signature used to name the personal data file. STAMP DESIGN Design a new stamp to use on the stamp calendar. Touch Stamp Design to make the Stamp Design Screen appear. Draw your new design in the space provided and touch. OK when finished. Creating a new stamp will also turn all existing stamps. into the new original design.
SETTINGS From here you can select the Change hand and. Erase personal data options.
View the advice you receive after completing training.
Once personal data is deleted, it cannot be restored. Be careful!
This option allows you or others to try a simplified version of training programs and the Brain Age Check. You can also play a quick sudoku puzzle.

Quick Training

To begin, tap the button that says Quick Training. The handedness settings screen will appear. Tap R if you are right-handed or L if you are left-handed. You may need to follow on-screen instructions about how to turn your DS. The doctors explanation will appear on the LCD screen. Touch More to read it, and Press here to start to begin. Unscramble the letters on the LCD screen and write the word they form on the Touch Screen.

Quick Brain Age Check

You can start this check without creating a save file. Touch the mode name to start the program. When youre done reading the explanation, touch the start button to begin Rock, Paper, Scissors.
When the test has ended, your brain age will appear. Because this is a simplified version, the age is displayed in increments of decades, not by single years.

Quick Sudoku

Quick Sudoku lets you try your hand at a sudoku puzzle!. To learn how to play, please read the sudoku section starting on page 37.
To solve a sudoku puzzle, you must fill in the squares with a number from. 1 to 9. But you need to follow three rules when writing in numbers! First, each column must contain only one of each number from 1 to 9.
Touch the square you want to fill in to zoom in on it. Write a large number in the enlarged square.

To note a possible answer, write a small number in the square. This is called an Option. Each square can hold up to nine Options. Second, each row must contain only one of each number from 1 to 9. To erase your answer, write a "0" in the square or tap "Erase."
And finally, each 3x3 box must contain only one of each number from 1 to 9.
If you fulfill all three conditions and fill every square, you will clear the puzzle!
If you want to quit a puzzle, tap Save & Quit to save your game so you can come back to it later. If you are playing the Quick Sudoku Demo, tap Quit to stop playing. You will not be able to save your game in this version. Touch the square you want to fill in to zoom in on it. Write a large number in the enlarged square.
When on a zoomed-in square, tap an arrow to move in that direction.
Tap Undo to take back your last answer.
You can choose to be notified when you enter a wrong answer. If you select Yes, you can get up to five wrong answers before you fail the puzzle. If you choose No, you won't know if an answer fits until you get every answer right. But no matter how many wrong answers you input, you won't fail the puzzle.

Download

You can play with others by using the wireless communication function of your Nintendo DS. See pages 47 and 48 for details on DS Download Play. Up to 16 people can participate using a single Game Card. The Nintendo DS. system with the Game Card inserted will act as the parent unit; all other Nintendo DS systems will be child units.

VS. WORDSCRAMBLE

Players compete to guess words. Points are awarded for the speed with which the correct answer is given. The player with the most points at the end of the battle is the winner. See page 25 for game details.

VS. NUMBER MEMORY

Players compete to enter the correct numbers. Once an opponent has entered a number in the right place, you can no longer use that space. See page 31 for game details.
VS. PICTURE DRAWING (for 3 or more players)
All participants draw a picture based on. a theme and then cast their votes for the best effort. The pictures are displayed on the Touch Screen and participants vote by touching the one they like best (excluding their own).

VS. CHANGE MAKER

Players compete to see who can give change the quickest. Points are awarded for the speed with which change is given and the player with the most points at the end of the battle is the winner. See page 26 for game details.

Parent System

Tap Download on the main menu to reach the screen shown to the right. The number of people participating (including the parent unit) will appear on the Touch Screen. Then tap Vs. Training. Once everyone is ready, tap Next to send the game to the other units. When the download has finished, select your writing hand. The Multiplayer Training Menu will then appear. Select the training you want and wait for the countdown.

After the Battle

After finishing, each participants rank will appear. When you are ready to. continue, tap Next. To end Vs. Training, you must turn off the power to your Nintendo DS system.

Child System

Download data from the parent DS. When the download is complete, you will see the handedness settings screen. When everyone has inputted the handedness settings, the countdown will begin!

Communication Error

If the screen on the right is displayed, turn off the power to your Nintendo DS system and try downloading the data again.

Send a Demo

You can upload the Quick Play mode to other DS consoles. The DS with the card inserted will be the parent unit and send the demo. The other unit will be the child unit and receive the demo. Host System Tap Download on the main menu to go to the screen shown on the right, then tap Send Demo. You will see a screen that tells you the DS is looking for a partner. When the child unit chooses to start the download, you will see a message saying Sending to [NAME]. Tap Next and wait for the upload to finish.

Using DS Download Play

(This section explains how to establish a link for DS Download Play.) Necessary Items Nintendo DS systems.. 1 per player Brain Age 2 Game Cards...1 What to Do (For the Parent Unit) 1. Make sure that all DS systems are turned off, then. insert a Brain Age 2 Game Card into your unit. 2. Turn on the power for all systems. The DS Menu Screen. will appear. 3. Touch the Brain Age 2 panel. 4. Follow the instructions on page 43.
Once the download finishes, the title screen will appear. Select quick play. and the three following modes will be displayed: Quick Brain Age Check, Quick Training and Quick Sudoku. You can then choose which one to play. See pages 35 and 36 for more details on these modes. The demo version will remain in memory until you turn the power off.

Steps - All systems excluding P1 1. Turn on the power of all the systems. The DS Menu Screen will appear. 2. Touch the DS Download Play panel. The Game List Screen will appear. 3. Touch the Brain Age 2 panel. The Download Confirmation Screen will appear. 4. When the correct software appears, touch Yes. The parent unit will then start the download process. 5. Next, follow the instructions on pages 41-42.

DS Menu Screen

Game List Screen

General Tips

Troubleshooting If you are having trouble with voice recognition, try some of the tips below. Hold the Nintendo DS 8-12 inches from your mouth, and speak in a normal, clear voice. Make sure you are using the DS in a quiet environment. If you get a Try Again message, wait for the message to vanish before repeating your answer or trying a different answer. If you get a Try Again message when you haven't said anything, you should use the. DS in a quieter environment. Try to refrain from saying anything other than your answer when playing. If you are having trouble with handwriting recognition, try some of the tips below. Write neatly. Sloppy handwriting is difficult to recognize. Write one letter at a time, using as much of the space provided as you feel comfortable. Smaller characters are harder for the system to recognize. The system recognizes both lower and upper-case letters. If you have particular trouble with one letter, try writing it in the opposite case. A single vertical line will always be recognized as an L. If you want to make an I, either put a dot on top of the line (i) or add horizontal lines to the top and bottom of the vertical line ( ). Please try to refrain from adding unusually long tails or serifs to your written letters. Please be sure to fully close all letters.

Profile

Dr. Ryuta Kawashima, New Industry Creation Hatchery Center, Tohoku University
Born 1959, Chiba City, Chiba Prefecture, Japan Graduated Tohoku University School of Medicine. Completed course of research at Tohoku University, Graduate School of Medicine. Guest researcher at the Karolinska Institute, Sweden. Associate Professor, Assistant Professor, then Tenured Professor at Tohoku University. Former member of the National Council concerning Language and Culture. Foremost Japanese researcher of brain imaging, focusing on the functionality of different parts of the brain.

Warranty & Service Information
You may need only simple instructions to correct a problem with your product. Try our website at www.nintendo.com or call our Consumer Assistance Hotline at 1-800-255-3700, rather than going to your retailer. Hours of operation are 6 a.m. to 7 p.m., Pacific Time, Monday - Sunday (times subject to change). If the problem cannot be solved with the troubleshooting information available online or over the telephone, you will be offered express factory service through Nintendo. Please do not send any products to Nintendo without contacting us first. HARDWARE WARRANTY Nintendo of America Inc. (Nintendo) warrants to the original purchaser that the hardware product shall be free from defects in material and workmanship for twelve (12) months from the date of purchase. If a defect covered by this warranty occurs during this warranty period, Nintendo will repair or replace the defective hardware product or component, free of charge. The original purchaser is entitled to this warranty only if the date of purchase is registered at point of sale or the consumer can demonstrate, to Nintendos satisfaction, that the product was purchased within the last 12 months. GAME & ACCESSORY WARRANTY Nintendo warrants to the original purchaser that the product (games and accessories) shall be free from defects in material and workmanship for a period of three (3) months from the date of purchase. If a defect covered by this warranty occurs during this three (3) month warranty period, Nintendo will repair or replace the defective product, free of charge. SERVICE AFTER EXPIRATION OF WARRANTY Please try our website at www.nintendo.com or call the Consumer Assistance Hotline at 1-800-255-3700 for troubleshooting information and repair or replacement options and pricing. In some instances, it may be necessary for you to ship the complete product, FREIGHT PREPAID AND INSURED FOR LOSS OR DAMAGE, to Nintendo. Please do not send any products to Nintendo without contacting us first. WARRANTY LIMITATIONS THIS WARRANTY SHALL NOT APPLY IF THIS PRODUCT: (a) IS USED WITH PRODUCTS NOT SOLD OR LICENSED BY NINTENDO (INCLUDING, BUT NOT LIMITED TO, NON-LICENSED GAME ENHANCEMENT AND COPIER DEVICES, ADAPTERS, AND POWER SUPPLIES); (b) IS USED FOR COMMERCIAL PURPOSES (INCLUDING RENTAL); (c) IS MODIFIED OR TAMPERED WITH; (d) IS DAMAGED BY NEGLIGENCE, ACCIDENT, UNREASONABLE USE, OR BY OTHER CAUSES UNRELATED TO DEFECTIVE MATERIALS OR WORKMANSHIP; OR (e) HAS HAD THE SERIAL NUMBER ALTERED, DEFACED OR REMOVED. ANY APPLICABLE IMPLIED WARRANTIES, INCLUDING WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A PARTICULAR PURPOSE, ARE HEREBY LIMITED IN DURATION TO THE WARRANTY PERIODS DESCRIBED ABOVE (12 MONTHS OR 3 MONTHS, AS APPLICABLE). IN NO EVENT SHALL NINTENDO BE LIABLE FOR CONSEQUENTIAL OR INCIDENTAL DAMAGES RESULTING FROM THE BREACH OF ANY IMPLIED OR EXPRESS WARRANTIES. SOME STATES DO NOT ALLOW LIMITATIONS ON HOW LONG AN IMPLIED WARRANTY LASTS OR EXCLUSION OF CONSEQUENTIAL OR INCIDENTAL DAMAGES, SO THE ABOVE LIMITATIONS MAY NOT APPLY TO YOU. This warranty gives you specific legal rights. You may also have other rights which vary from state to state or province to province. Nintendos address is: Nintendo of America Inc., P.O. Box 957, Redmond, WA 98073-0957 U.S.A. This warranty is only valid in the United States and Canada.

All rights, include the copyrights of Game, Scenario, Music and Program reserved by Nintendo.

A nnual Repor t 2006

Message from the President Over the past two decades, the video game industry has grown into a respected entertainment medium, with annual sales rivaling box office receipts for the movie industry. Nintendo continues to create unique software - driven entertainment by e n s u r i n g t h a t o u r h a rd w a re a n d s o f t w a re a re c re a t e d w i t h o n l y o n e g o a l i n m i n d , a n enjoyable playing experience for all. This mindset has enabled Nintendo to create products and characters beloved by people around the world.
The video game industry has grown tremendously, but market expansion efforts have stalled because the development of games that are more complex and graphically intense has been the focus of game companies for too long. Declining game software sales in the North American market last year illustrate that this slowing of game sales is now problematic outside the Japanese market as well.

circumstances

Nintendo

implemented

strategy
encourages people around the world to play video games regardless of their age, gender or cultural background. Our goal is to expand the gaming population.
The first tangible product that comes from this strategic direction is the Nintendo DS, which employs unique features like dual-screens, a touch-screen, wireless communication and voice recognition technology to take gaming in a new direction. On the software front, Nintendo has created dedicated game titles, under the heading Touch!

Generations,

give veteran game
players fresh gaming experiences while
allowing those who have never played video games to easily enjoy the experience.
As a result, one of these titles, Nintendogs, has sold 6.65 million copies globally in the last fiscal year. Also, the total sales of the two Brain Age (Brain Training) titles and Big Brain Academy are 5.1 million units in the Japanese market alone. These software are being enjoyed by older demographics and female audiences, as well as traditional game players. Simultaneously, Nintendo created a free, safe and easy-tou s e w i re l e s s g a m i n g s e r v i c e e x c l u s i v e l y f o r N i n t e n d o D S c a l l e d , N i n t e n d o W i - F i Connection. The rapidly expanding popularity of our service is also contributing to the expansion of the gaming population. Nintendo will continue to leverage our exceptional strength, which is deri ved from t h e c o m b i n a t i o n o f o u r w o r l d - c l a s s h a rd w a re d e s i g n a n d o u r u n r i v a l l e d i n t e r n a l software development teams, to accelerate market expansion by creating software for an ever-expanding audience, and intuitive hardware like the Nintendo DS and the upgraded Nintendo DS Lite. In the home console market, Nintendo will launch Wii and establish a new standard in game control using the unprecedented Wii Remote, which will make game control intuitive for all. Wii also features WiiConnect24, which allows Wii to maintain a wireless connection, with extremely low power consumption, even when the Wii system is not in active use. Nintendo will encourage Wii users to tur n their system on every day by delivering a new experience each time the system is used. This will be yet another method to help Nintendo expand the video game population. From Wii to DS Lite, Brain Age to Mario, Nintendo is committed to providing video gaming e x p e r i e n c e s t h a t a r e e n j o y a b l e f o r e v e r y b o d y i n t h e h o u s e h o l d.

Satoru Iwata

Pres ident Nintendo Co., Ltd.

Nintendo DS

mil illion pcs.

2005 Nintendo.

2005-2006 Toshio Iwai/Nintendo.
The numbers shown above are consolidated sales in units (* show sales in units in Japan) for the fiscal year ended in March, 2006. 6.65 million pcs. represent the combined total of the entire Nintendogs series.

Nintendo DS Lite

2005-2006 Nintendo. 2006 NIKOLI CO., Ltd.

2004 Nintendo.

2005-2006 Nintendo. In collaboration with the Phoenix Country Club (PHOENIX SEAGAIA RESORT).
2006 Nintendo. 2006 Plato.

2005-2006 Nintendo.

Tetris & ~2006 Elorg, a Tetris Holding Company. Licensed to The Tetris Company. Game Design by Alexey Pajitnov. Logo Design by Roger Dean. All Rights Reserved. Certain new game elements developed by Nintendo, and any characters, sounds and video games originally owned by Nintendo: 2006 Nintendo.
Titles and package images shown above are for the U.S. market. (Except for

Nintendo GameCube

2005 Nintendo. 2005 HUDSON SOFT.
2005 Nintendo. 2005 NAMCO.
2005 Pokmon. 1995-2005 Nintendo / Creatures Inc. / GAME FREAK inc. Developed by Genius Sonority Inc.
2005 Nintendo / INTELLIGENT SYSTEMS.

2005 KONAMI/Nintendo.

2004-2005 Nintendo. 2004-2005 NAMCO.
The numbers shown above are consolidated sales in units for the fiscal year ended in March, 2006.

Game Boy micro

Game Boy Advance SP
2005 Pokmon. 1995-2005 Nintendo/Creatures Inc. /GAME FREAK inc.
2004-2005 Nintendo /INTELLIGENT SYSTEMS.
2004-2005 Nintendo. Co-developed by INTELLIGENT SYSTEMS.
1996-2005 Nintendo. Game by Rare.

2004-2005 Nintendo.

2005 Nintendo/CAMELOT.

2005 Nintendo/Paon.

2005-2006 Nintendo/GAME FREAK inc.
Dr. Mario: 2005 Nintendo. Puzzle League: 2005 Nintendo/INTELLIGENT SYSTEMS.
Titles and package images shown above are for the U.S. market.

2006 release

History of Nintendo
Fusajiro Yamauchi, great-grandfather of Hiroshi Yamauchi (the former President and current executive adviser), began manufacturing and selling Japanese playing cards, Hanafuda (flower cards), in Kyoto, Japan.
Established a wholly owned subsidiary, Nintendo of America Inc. in New York. Developed and started selling GAME & WATCH product line, the first portable LCD video games with a microprocessor.
Started manufacturing and selling the first western-style playing cards in Japan.
Developed and began distribution of the coin-operated video game Donkey Kong.
Established Marufuku Co., Ltd.
Established Nintendo of America Inc. in Seattle, Washington and merged the New York subsidiary into it.
Hiroshi Yamauchi took office as President.
Started selling the home video game console Family Computer System employing a custom CPU (Central Processing Unit) and PPU (Picture Processing Unit). Listed stock on the first section of the Tokyo Stock Exchange.

GBA GC DS 4.7 4.7 20.5
Hardware NES Game Boy SNES Nintendo 64

61.9 118.7 49.1 32.9

G a m e B o y A d v a n c e h a rd w a re s h o w s t h e c o m b i n e d t o t a l o f G a m e B o y A d v a n c e , G a m e B o y A d v a n c e S P a n d G a m e B o y m i c ro. N i n t e n d o D S h a rd w a re s h o w s t h e c o m b i n e d t o t a l o f N i n t e n d o D S a n d N i n t e n d o D S L i t e.

Software

327.7 189.1 60.4
GBA GC DS 20.8 121. 6 182.6
GBA GC DS 27. 0 25.3 69.8

GBA GC DS 14.3 40.5 75.3

Software NES Game Boy SNES Nintendo 64

500.0 501.1 379.1 225.0

Financial Review
Five-Year Summary / Common Stock Information Analysis of Operations and Financial Review Report of Independent Auditor Consolidated Balance Sheets Consolidated Statements of Income Consolidated Statements of Shareholders' Equity Consolidated Statements of Cash Flows Notes to Consolidated Financial Statements 24 25

Five-Year Summary

Japanese Yen in Millions
U.S. Dollars in Thousands (Note 1)

Years ended March 31,

For the period Net sales Operating income Net income At the period-end Total assets Property, plant and equipment - net Shareholders equity

508,91,98,37 8

514,988 113,458 87,416

514,409 110,223 33,194

503,748 100,252 67,267

554,413 119,607 106,445

$4,348,951 779,682 840,842

1,160,55,974,09 1

1,132,492 54,420 921,467

1,010,031 55,085 890,248

1,085,519 59,369 890,370

1,156,716 66,681 935,075

9,920,540 478,370 8,325,568

Japanese Yen

U.S. Dollars (Note1)
Per share information Net income A Cash dividends B

762.390

662.96 270

246.93 140

482.15 140

751.39 140

$6.52 3.33
A : The computations of net income per share of common stock are based on the weighted average number of shares outstanding (excluding treasury stock) during each fiscal year. B : Cash dividends per share represent the amounts applicable to the respective fiscal years including dividends to be paid after the end of each fiscal year.

Revenue and Expenses

In the handheld game business, Nintendo DS and its new model Nintendo DS Lite sold a total of more than 16 million units on a worldwide basis in just over sixteen months since launch. Nintendo DS is selling at a faster rate than any other gaming device, especially in Japan. Nintendo DS software has also enjoyed a boost in sales as the Touch! Generations titles, aimed at expanding the user base, have sold exceptionally well. Among these titles, Nintendogs, which allows the player to interact with virtual puppies on the screen, sold 6.65 million units worldwide. Also from the lineup, a new brain training genre, Brain Age: Train Your Brain in Minutes a Day, coupled with its sequel version, Big Brain Academy, released only in Japan, brought total unit sales of these three Touch! Generations titles during the period to 5.10 million. In addition, Nintendo Wi-Fi Connection compatible titles such as Mario Kart DS, (an action racing game that lets the player compete against other players from around the world) sold 4.22 million units. Also, Animal Crossing: Wild World, (a game that lets you communicate with friends) sold 3.56 million units. In the console business, software titles for the Nintendo GameCube such as Mario Party 7 (a get-together game that lets up to eight players play simultaneously) and the role playing game Pokmon XD: Gale of Darkness each sold more than a million units, however, overall console hardware and software sales declined. As a result, consolidated net sales in Fiscal 2006 were 508.8 billion ($4,349 million). Gross margin was 215.0 billion ($1,838 million). The gross margin ratio stayed at 42% compared with the previous fiscal year. Selling, general and administrative expenses amounted to 123.8 billion ($1,058 million). Operating income was 91.2 billion ($780 million). The operating income ratio decreased by 4% compared with the previous fiscal year to 18%. Interest income was 22.5 billion ($192 million), while foreign exchange gain was 45.5 billion ($389 million) due to Japanese yen depreciation. As a result, net income for Fiscal 2006 was 98.4 billion ($841 million). The net income ratio increased by 2% compared with the previous fiscal year to 19%.

Cash Flow

At March 31, 2006, Nintendos cash and cash equivalents were 617.1 billion ($5,275 million). Net cash provided by operating activities was 46.4 billion ($396 million) despite reductions in cash due to a foreign exchange gain resulting from revaluation of cash and cash equivalents in foreign currencies, payment of 74.9 billion ($640 million) for income taxes and also due to a decrease in notes and trade accounts payable. Net cash used in investing activities was 208.8 billion ($1,785 million) as payments into time deposits exceeded withdrawals. Net cash used in financing activities was 60.2 billion ($514 million) due to dividend payments and payments for acquiring treasury stocks.

Investments and Other Assets Investments in securities (Note 4) Long-term deposits Deferred income taxes (Note 9) Other assets Total investments and other assets Total 60,213 11,747 10,315 3,728 86,003 1,160,703 73,393 10,84,180 1,132,492 514,644 100,402 88,158 31,867 735,071 $9,920,540
See notes to consolidated financial statements.
Liabilities and Shareholders Equity
Current Liabilities Notes and trade accounts payable Accrued income taxes Other current liabilities Total current liabilities Non-current Liabilities Non-current accounts payable Reserve for employee retirement and severance benefits (Note 7) Reserve for directors retirement and severance benefits Total non-current liabilities Minority Interests 862 3,299 4,462 3,075 1,816 5,7,368 28,198 35,566 1,504 99,022 53,040 30,213 182,275 128,430 51,952 25,068 205,450 $846,334 453,335 258,233 1,557,902
Shareholders Equity Common stock Authorized - 400,000,000 shares Issued and outstanding - 141,669,000 shares Additional paid-in capital Retained earnings Unrealized gains on other securities (Note 4) Translation adjustments Total Treasury stock, at cost 13,754,896 shares in 2006 and 11,591,611 shares in 2005 Total shareholders equity Total
10,065 11,585 1,096,074 10,1,129,204 (155,113) 974,091 1,160,703
10,065 11,584 1,032,835 7,195 (10,315) 1,051,364 (129,897) 921,467 1,132,492
86,029 99,018 9,368,152 91,601 6,515 9,651,315 (1,325,747) 8,325,568 $9,920,540
Consolidated Statements of Income
U.S. Dollars in Thousands (Note1)
Net sales Cost of sales (Notes 6 and 8) Gross margin Selling, general and administrative expenses (Note 8) Operating income Other income (expenses) Interest income Foreign exchange gain - net Reversal of unrealized loss on investments in securities (Note 4) Gain on sales of investments in securities - net (Note 4) Reversal of reserve for directors retirement and severance benefits Unrealized loss on investments in securities (Note 4) Other - net Income before income taxes and minority interests Income taxes (Note 9) Current Deferred Total income taxes Minority interests Net income
508,827 293,804 215,023 123,800 91,223
514,988 297,612 217,376 103,918 113,458
$4,348,951 2,511,145 1,837,806 1,058,124 779,682
22,498 45,516 1,409 3,420 1,237 (1,383) 2,551 166,471

98,378 3,592 (511) (43) (6,292) (46,577) (1,409) (3,420) 1,383 9,141 21,554 (28,679) (423) (313) 46,381 (533,903) 322,996 (4,140) 92 (9,173) 13,940 (42) 1,423 (208,807) (25,227) (34,943) 3 (60,167)
87,416 2,931 (1,226) (975) 4,196 (27,570) 1,612 (21,063) (17,735) 48,688 40,116,572 (96,391) 112,938 (2,061) 13 (24,712) 2,524 (7,251) 1,072 2,152 (11,716) (42,996) (18,455) 4 (61,447)
$840,842 30,698 (4,369) (367) (53,780) (398,098) (12,040) (29,230) 11,825 78,128 184,226 (245,123) (3,614) (2,668) 396,430 (4,563,275) 2,760,647 (35,382) 783 (78,401) 119,146 (361) 12,166 (1,784,677) (215,619) (298,659) 32 (514,246)
Effect of exchange rate changes on cash and cash equivalents Net increase (decrease) of cash and cash equivalents Cash and cash equivalents at beginning of year Cash and cash equivalents at end of year
47,004 (175,589) 792,728 617,139
29,205 72,614 720,114 792,728
401,741 (1,500,752) 6,775,448 $5,274,696
Additional Cash Flow Information Interest paid Income taxes paid

1 74,854

0 13,485

$9 639,776

Notes to Consolidated Financial Statements
Note 1. Basis of Presenting Consolidated Financial Statements
The accompanying consolidated financial statements are prepared from the consolidated financial statements issued in Japan for domestic reporting purposes. Nintendo Co., Ltd. (the Company) and its subsidiaries in Japan maintain their accounts and records in accordance with the provisions set forth in the Japanese Commercial Code and the Securities and Exchange Law, and in conformity with generally accepted accounting principles and practices in Japan, which are different in certain respects from the application and disclosure requirements of International Financial Reporting Standards. Its overseas consolidated subsidiaries maintain their accounts in conformity with the generally accepted accounting principles and practices prevailing in the respective countries of domicile and no adjustment has been made to their financial statements in consolidation to the extent that significant differences do not occur, as allowed under the generally accepted accounting principles and practices in Japan. The consolidated financial statements are not intended to present the consolidated financial position, results of operations and cash flows in accordance with accounting principles and practices generally accepted in countries and jurisdictions other than Japan. In preparing the accompanying consolidated financial statements, certain reclassifications have been made to the consolidated financial statements issued domestically in order to present them in a form which is more familiar to readers outside Japan. The consolidated financial statements presented herein are stated in Japanese yen, the currency of the country in which the Company is incorporated and operates. The translations of Japanese yen amounts into U.S. dollar amounts are included solely for the convenience of readers outside Japan and have been made at the rate of 117 to US$1, the approximate rate of exchange at March 31, 2006. These translations should not be construed as representations that the Japanese yen amounts have been, could have been or could in the future be, converted into U.S. dollars at this or any other rate of exchange.

D. Financial Instruments

Derivatives All derivatives are stated at fair value, with changes in fair value included in net profit or loss for the period in which they arise. Securities Held-to-maturity debt securities are stated at cost after accounting for premium or discount on acquisition, which is amortized over the period to maturity. Equity securities of non-consolidated subsidiary and affiliated company with equity method non-applied are stated at cost. Other securities for which market quotations are available are stated at fair value. Unrealized gains on other securities are reported as Unrealized gains on other securities in Shareholders Equity at a net-of-tax amount, while unrealized losses on other securities are included in net profit or loss for the period. Other securities for which market quotations are unavailable are stated at cost, determined by the moving average method except as stated in the paragraph below. In case where the fair value of held-to-maturity debt securities, equity securities issued by non-consolidated subsidiary and affiliate, or other securities has declined significantly and such impairment of the value is not deemed temporary, those securities are written down to the fair value and the resulting losses are included in net profit or loss for the period. Under the Japanese accounting standard, trading securities and debt securities due within one year are presented as current and all the other securities are presented as non-current.

E. Inventories

Inventories are stated at the lower of cost, determined by the moving average method, or market.
F. Property, Plant and Equipment
Property, plant and equipment are stated at cost. The Company and its consolidated subsidiaries in Japan compute depreciation by the declining balance method over the estimated useful lives. The straight-line method of depreciation is used for buildings, except for structures, acquired on or after April 1, 1998. Overseas consolidated subsidiaries compute depreciation of assets by applying the straight-line method over the period of estimated useful lives. Estimated useful lives of the principal assets are as follows: Buildings and structures: 3 to 60 years

G. Income Taxes

Deferred income taxes are recorded to reflect the impact of temporary differences between assets and liabilities recognized for financial reporting purposes and such amounts recognized for tax purposes. These deferred taxes are measured by applying currently enacted tax laws to the temporary differences. The enterprise taxes levied in proportion to added value and capital were recognized as Selling, general and administrative expenses effective as of the year ended March 31, 2005
H. Retirement and Severance Benefits and Pension Plan

Note 3. Supplemental Information on Cash and Cash Equivalents
The balance of Cash and cash equivalents includes loans on repurchase agreement secured by marketable securities with a market value of 15,939 million ($136,232 thousand) as of March 31, 2006.
Note 4. Short-term Investments and Investments in Securities
Other securities with market value included in Investments in securities as of March 31, 2006 and 2005 were as follows:
Japanese Yen in Millions Acquisition cost Book value Difference
U.S. Dollars in Thousands (Note 1) Acquisition cost Book value Difference

As of March, 2006

Securities whose book value on the accompanying consolidated balance sheet exceed their acquisition cost Equity securities Debt securities Sub-total Securities whose book value on the accompanying consolidated balance sheet do not exceed their acquisition cost Equity securities Sub-total Total 6,6,36,6,530 6,530 54,205 (389) (389) 17,652 $59,132 59,132 $312,415 $55,810 55,810 $463,290 $(3,322) (3,322) $150,875 2,26,29,18,726 28,949 47,675 15,961 2,080 18,041 $23,635 229,648 $253,283 $160,054 247,426 $407,480 $136,419 17,778 $154,197

As of March, 2005

Securities whose book value on the accompanying consolidated balance sheet exceed their acquisition cost Equity securities Debt securities Sub-total Securities whose book value on the accompanying consolidated balance sheet do not exceed their acquisition cost Equity securities Debt securities Sub-total Total 6,24,30,52,5,743 23,515 29,258 62,602 (1,011) (663) (1,674) 10,438 12,8,21,24,913 8,431 33,344 11,12,112
Book value of non-marketable securities in Short-term investments and Investments in securities as of March 31, 2006 and 2005 were summarized as follows:
(1) Held-to-maturity debt securities Commercial paper (2) Other securities Preferred subscription certificate Unlisted bonds

46,982

11,933

$401,552

10,000 6,874

11,000 -

85,470 58,748
The aggregate maturities of Held-to-maturity debt securities in Short-term investments and Investments in securities as of March 31, 2006 and 2005 were as follows:
Due within one year Due after one year through five years

64,287 18,517

20,485 24,394

$549,462 158,263

Proceeds from sales of other securities with market value were 13,940 million ($119,146 thousand) for the year ended March 31, 2006. Gross realized gains and losses on those sales were 3,654 million ($31,229 thousand) and 234 million ($2,000 thousand) for the year ended March 31, 2006. Investments in unconsolidated subsidiaries and affiliates were 6,264 million ($53,536 thousand) and 5,485 million as of March 31, 2006 and 2005, respectively.

Note 5. Derivatives

The Company and certain consolidated subsidiaries enter into foreign exchange forward contracts and currency option contracts. It is the Companys policy to enter into derivative transactions within the limits of foreign currency deposits, and not for speculative purposes. The Company has foreign exchange forward contracts to reduce risk of exchange rate fluctuations and currency option contracts to reduce risk of exchange rate fluctuations and yield improvement of short-term financial assets. Foreign exchange forward contracts and currency option contracts bear risks resulting from exchange rate fluctuations. Counterparties to derivative transactions are limited to high confidence level financial institutions. The Company does not anticipate any risk due to default. Derivative transactions entered into by the Company and certain consolidated subsidiaries are made by the treasury department or the department in charge of financial matters. They are to be approved by the president and the director in charge of those transactions of the Company. Subject consolidated subsidiaries are to report transaction status on a regular basis to the director in charge. The Company had no derivative contracts outstanding at March 31, 2006. Derivative contracts the Company had at March 31, 2005 were as follows:
Japanese Yen in Millions Contract amount Fair value Unrealized gain(loss)

As of March 31, 2005

Purchased put options: U.S. dollars Euros Written call options: U.S. dollars Euros

23,963 14,177

259 55

(8) (8)

71,890 14,177

442 39

(174) 24

Note 6. Inventories

Losses incurred from the application of the lower of cost or market valuation of inventories have been charged to Cost of sales in the accompanying consolidated statements of income. These losses amounted to 6,840 million ($58,458 thousand) and 5,116 million for the years ended March 31, 2006 and 2005, respectively.
Note 7. Retirement and Severance Benefits and Pension Plan
The Company has a tax approved pension scheme and lump-sum severance payments plan which is a defined benefit plan. Certain consolidated subsidiaries have defined contribution plans as well as defined benefit plans. The Company and certain consolidated subsidiaries may also pay extra retirement allowance to employees who have distinguished services.
Retirement benefit obligations as of March 31, 2006 and 2005 were as follows:
a. Retirement benefit obligation b. Plan assets c. d. e. f.

Deferred tax liabilities: Unrealized gains on other securities Undistributed retained earnings of subsidiaries and affiliates Other Total deferred tax liabilities Net deferred tax assets (7,325) (2,111) (1,267) (10,703) 34,484 (4,918) (1,769) (717) (7,404) 29,670 (62,604) (18,045) (10,832) (91,481) $294,731
Reconciliations of the statutory tax rate and the effective tax rate for the years ended March 31, 2006 and 2005 are omitted, since the difference is not more than five one-hundredth of the statutory tax rate.

Note 10. Leases

The Company and certain consolidated subsidiaries lease computer equipment and other assets. Total lease payments under finance leases not deemed to transfer ownership of the leased assets to the lessee for the years ended March 31, 2006 and 2005 were 209 million ($1,787 thousand) and 261 million, respectively.
Pro forma information of leased assets under finance leases that do not transfer ownership of the leased assets to the lessee on an as if capitalized basis as of March 31, 2006 and 2005 was as follows:
Acquisition cost Accumulated depreciation Net leased assets

$5,443 2,652 $2,791

Pro forma amounts of obligations under finance leases that do not transfer ownership of the leased assets to the lessee on an as if capitalized basis as of March 31, 2006 and 2005 were as follows:
Due within one year Due after one year Total

$1,437 1,354 $2,791

The minimum rental commitments under noncancelable operating leases at March 31, 2006 and 2005 were as follows:

576 3,363 3,939

573 3,404 3,977

$4,928 28,741 $33,669

Depreciation expenses which are not reflected in the accompanying consolidated statement of income, computed by the straight-line method were 209 million ($1,787 thousand) and 261 million for the years ended March 31, 2006 and 2005, respectively.

Note 11. Litigation

The Commission of the European Communities announced to impose a fine of EUR149 million on October 30, 2002 referring that Nintendos past trade practices in Europe until 1998 fell upon limitation of competition within the EU common market which is prohibited by Article 81 in the EU treaty. The Company and its consolidated subsidiary found this fine to be unjustly high and appealed to the Court of First Instance of the European Communities on January 16, 2003. The legal procedure is now under way.

Note 12. Subsequent Events
At the annual general meeting held on June 29, 2006, shareholders of the Company approved the year-end cash dividends and directors bonuses proposed by the Board of Directors of the Company as follows:
Year-end cash dividends, 320 ($2.74) per share Directors bonuses

40,933 180

$349,851 1,538
Note 13. Segment Information
A. Segment Information by Business Categories
Because the Company and its consolidated subsidiaries operate predominantly in one industry segment which accounts for over 90% of total net sales, operating income and assets, this information is not required.
B. Segment Information by Sellers Location
Japanese Yen in Millions Japan The Americas Europe Other Total Eliminations or unallocated assets Consolidated
Net sales and operating income Net sales Sales to third parties Inter segment sales Total net sales Cost of sales and selling, general and administrative expenses Operating income Assets 161,508 249,751 411,259 329,771 81,488 975,312 210,494 1,997 212,491 211,151 1,340 145,475 129,129,878 128,522 1,356 68,729 6,7,034 6,3,151 508,827 251,835 760,662 676,366 84,296 1,192,667 (251,835) (251,835) (258,762) 6,927 508,827 508,827 417,604 91,223

(31,964) 1,160,703

Net sales and operating income Net sales Sales to third parties Inter segment sales Total net sales Cost of sales and selling, general and administrative expenses Operating income Assets 130,798 311,845 442,643 342,940 99,703 970,681 256,119 1,881 258,000 248,959 9,041 152,764 121,121,364 117,778 3,586 72,591 6,6,817 6,862 (45) 3,966 514,988 313,836 828,824 716,539 112,285 1,200,002 (313,836) (313,836) (315,009) 1,173 514,988 514,988 401,530 113,458

(67,510) 1,132,492

U.S. Dollars in Thousands (Note 1) Japan The Americas Europe Other Total Eliminations or unallocated assets Consolidated
Net sales and operating income Net sales Sales to third parties Inter segment sales Total net sales Cost of sales and selling, general and administrative expenses Operating income Assets $1,380,411 2,134,621 3,515,032 2,818,555 $696,477 $8,336,002 $1,799,093 17,066 1,816,159 1,804,707 $11,452 $1,243,369 $1,109,1,110,072 1,098,479 $11,593 $587,429 $59,60,118 59,162 $956 $4,348,951 $4,348,951 4,348,951 3,569,269 $779,682 2,152,430 $(2,152,430) 6,501,381 5,780,903 $720,478 (2,152,430) (2,211,634) $59,204

$26,934 $10,193,734

$(273,194) $9,920,540
C. Sales to Overseas Customers
Japanese Yen in Millions The Americas Europe Other Total
Sales to overseas customers Consolidated net sales

211,195

129,885

11,531

352,611 508,827

256,969

121,372

388,224 514,988

U.S. Dollars in Thousands (Note 1) The Americas Europe Other Total

$1,805,086

Ape inc.

Offices and Distribution Center
Tokyo Branch Office Osaka Branch Office Nagoya Office Okayama Office Sapporo Office Tokyo Distribution Center
Nintendo of Europe GmbH, UK Branch
Mansour House, 188 Bath Road, Slough Berkshire SL1 3GA, U.K. Tel : 44-1753-472-777
Principal consolidated subsidiaries [Overseas]

Nintendo of America Inc.

4820 150th Avenue N.E. Redmond, WA 98052 U.S.A. Tel : 1-425-882-2040
Nintendo of Europe GmbH, Italy Branch
Via Pelizza da Volpedo no. 51/53 Cinisello Balsamo, 20092 Milano Italy Tel : 39-02-61117-100
Shareholder and Investor Information
Nintendo Co., Ltd. 11-1, Kamitoba hokotate-cho, Minami-ku, Kyoto 601-8501, Japan Tel : 81-75-662-9600
Nintendo Co., Ltd. Common Stock
Nintendo Co., Ltd. common stock is listed on the Osaka Securities Exchange, Section 1 and the Tokyo Stock Exchange, Section 1.

Public Relations

Mr. Reginald Fils-Aime
President and Chief Operating Officer

Mr. George Harrison

Senior Vice President, Marketing & Corporate Communications Nintendo of America Inc. 4820 150th Avenue N.E. Redmond, WA 98052 U.S.A. Tel : 1-425-882-2040

Annual Meeting

The Annual Meeting of Shareholders for fiscal year ended March 31, 2006 was held on Thursday, June 29, 2006 at Nintendo Co., Ltd. Kyoto, Japan.
Corporate Communication Department
Nintendo Co., Ltd. 11-1, Kamitoba hokotate-cho, Minami-ku, Kyoto 601-8501, Japan Tel : 81-75-662-9600 Fax : 81-75-662-9540

Investor Relations

Securities analysts, institutional investors, and other members of the financial community requesting information about Nintendo Co., Ltd. should contact:

Mr. Yoshihiro Mori

Senior Managing Director General Manager, Corporate Analysis & Administration Division Nintendo Co., Ltd. 11-1, Kamitoba hokotate-cho, Minami-ku, Kyoto 601-8501, Japan Tel : 81-75-662-9614 Fax : 81-75-662-9544 E-mail: IR@nintendo.co.jp

Independent Auditor

ChuoAoyama PricewaterhouseCoopers Kyoto, Japan
Visit Nintendo on the Internet at http://www.nintendo.com