KYOCY Kyocera Corporation (PK)

Notes to Financial Statements

December 31, 2016 and 2015

The following description of the Kyocera Retirement Savings and Stock Bonus Plan (the “Plan”) is provided for general information purposes only. Participants should refer to the Plan agreement for a more complete description of the Plan’s provisions. The Plan is subject to the provisions of Employee Retirement Income Security Act of 1974 (“ERISA”).

General

The Plan is a defined contribution plan covering employees of Kyocera International, Inc. (“KII”) and subsidiaries (the “Plan Sponsor”). Each current employee who has attained the age of 21 years is eligible to participate as of the date coincident with or immediately following his employment commencement date.

Plan Administration

Transamerica Retirement Solutions (“Transamerica”) is the executor, record keeper, custodian and a trustee of the Plan. Transamerica maintains and invests Plan assets on behalf of the Plan.

Contributions

Employees may contribute from 1 percent to 100 percent of pre-tax annual compensation, as defined by the Plan, subject to an annual limitation as provided in Internal Revenue Code (“IRC”) Section 415(d). The Plan Sponsor may make discretionary contributions in such amounts as may be determined by the Plan Sponsor’s Board of Directors each plan year. The Plan Sponsor made matching contributions of 50 percent of participant contributions to all investment choices up to 5 percent of the participant eligible compensation in 2016 and 2015.

Employee rollover contributions made for 2016 and 2015 were approximately $226,461 and $279,733, respectively, which are included in participants contributions in the accompanying Statements of Changes in Net Assets Available for Benefits.

Participant Accounts

Each participant’s account is credited with (a) the participant’s contribution, (b) the Plan Sponsor’s contributions, and (c) an allocation of the Plan’s investment income or losses. Allocations of investment income or losses within each fund are based on account balances, as defined in the Plan document. The benefit to which a participant is entitled is the benefit that can be provided from the participant’s vested account.

4

Table of Contents

Kyocera Retirement Savings and Stock Bonus Plan

Notes to Financial Statements

December 31, 2016 and 2015

Notes Receivable from Participants

The Plan provides that participants may obtain loans from their participant account. The minimum loan amount is $1,000 and the maximum is 50 percent of their account balance up to $50,000. The term of the loan is not to exceed 20 years for mortgage loans or five years for nonmortgage loans. The loans are collateralized by the balance in the participant’s account. Loans bear interest at a rate commensurate with local prevailing rates as determined quarterly by the Plan administrator. The range of rates within the loan portfolio was 4.25% to 9.50% during 2016. Principal and interest are paid ratably through payroll deductions.

Notes receivable from participants are measured at their unpaid principal balance plus any accrued but unpaid interest. Delinquent loans are reclassified as distributions based upon the terms of the plan document.

Payment of Benefits

The payment of benefits can be made upon retirement, termination of the Plan, death, termination of employment, or financial hardship. Benefits to which participants are entitled are limited to the vested amount accumulated in each participant’s account.

Distributions from the Plan are based on vested account values as of the earliest valuation date following a participant’s separation from service date. Normal withdrawals can be made after age 59-1/2. Withdrawals before age 59-1/2 can be made for reasons of disability, termination of employment, severe financial hardship or in the event of the employee’s death. Withdrawals other than normal withdrawals are subject to excise taxes, as defined by IRS regulations.

Forfeited Accounts

Forfeited, nonvested account balances are used to reduce the Plan Sponsor’s contributions. Forfeited, nonvested accounts included in Investments in the Statements of Net Assets Available for Benefits totaled $86,219 and $50,734 as of December 31, 2016 and 2015, respectively.

For 2016 and 2015, employer contributions were reduced by $32,641 and $189,904, respectively, from forfeited accounts.

5

Table of Contents

Kyocera Retirement Savings and Stock Bonus Plan

Notes to Financial Statements

December 31, 2016 and 2015

Investments

Upon enrollment in the Plan, a participant may direct their contributions into any of the investment options offered by the Plan in 1 percent increments. The investment options offered by the Plan are as follows:

AllianzGI NFJ Small Cap Value Admin - The AllianzGI NFJ Small Cap Value Admin fund invests primarily in stocks of companies with market capitalization of $3.5 billion or less. Most of the stock selected will be dividend paying. Its objective is long-term capital growth and current income.

American Beacon Mid Cap Value Inv - A multi-manager fund seeking long-term capital appreciation and current income primarily through investments in mid-market capitalization U.S. stocks.

American Funds EuroPacific Growth R6 - The American Funds EuroPacific Growth R6 fund invests in stocks of non-U.S. companies which appear to offer above-average growth potential. Its objective is long-term growth of capital.

American Funds Fundamental Investor R6 - The American Funds Fundamental Investor R6 fund invests primarily in stocks of well-managed growth companies. Its objective is to have consistent capital appreciation over the long-term.

BlackRock Equity Dividend I - The BlackRock Equity Dividend I fund invests primarily in stocks of companies with large capitalizations. Securities are selected on the basis of fundamental value. Its objective is growth of capital; income is secondary.

Brown Capital Management Small Company Inv - The Brown Capital Management Small Company Inv fund invests in common stocks issued by companies with revenues of $250 million or less. Its objective is long-term capital growth; income is secondary.

Invesco Stable Value Fund - Invesco Stable Value Fund invests in a diversified portfolio of investment contracts with insurance companies, banks and other financial institutions. Its primary objective is to preserve principal while seeking a high level of current income.

JPMorgan Large Cap Growth A - The JPMorgan Large Cap Growth A invests in common stock of large, well-established companies. Its objective is long-term capital appreciation and growth of income.

Kyocera ADR Stock - Contributions to the Kyocera American Depository Receipts (“ADR”) Stock are invested in ADR’s of Kyocera International, Inc.’s parent company, Kyocera Corporation.

MassMutual Select Mid Cap Gr Eq II R5 - The MassMutual Select Mid Cap Gr Eq II R5 Fund invests primarily in equity securities of mid-capitalization companies that the fund’s subadvisors believe offer the potential for long-term growth.

6

Table of Contents

Kyocera Retirement Savings and Stock Bonus Plan

Notes to Financial Statements

December 31, 2016 and 2015

Money Market - This fund temporarily holds contributions prior to allocation to the respective funds. Funds are invested in U.S. Government securities, certificates of deposit, bankers’ acceptances, commercial paper, corporate master notes, and other appropriate money market investments.

Oakmark Equity  & Income I - The Oakmark Equity & Income I fund invests in a diversified portfolio of stocks and bonds. Its objective is to provide regular income, conservation of principal and an opportunity for long-term growth of principal and income.

PIMCO Total Return D - PIMCO Total Return D invests primarily in investment grade debt. Its objective is total return consistent with capital preservation.

Vanguard Institutional Index - The Vanguard Institutional Index fund invests in large capitalization stocks. Its objective is to provide income and growth equal to or greater than the Standard & Poor’s 500 stock index.

Vanguard Mid Cap Index Instl - The Vanguard Mid Cap Index Instl fund primarily invests in equity securities of mid-size US companies. It seeks to track the performance of the MSCI US Mid Cap 450 Index, a broadly diversified index of stocks of mid-size US companies.

Vanguard Small Cap Index Adm - The Vanguard Small Cap Index Adm fund invests primarily invests in equity securities of smaller US companies. It seeks to track the performance of the MSCI US Small Cap 1750 Index, a broadly diversified index of stocks of smaller US companies.

In addition to the investment options noted above, the participants may invest in four Pooled Investment Choices (“PIC”) which consist of a specific investment mix of the investment funds noted above. The Oakmark Equity & Income I Fund and all of the Vanguard index funds are not included in the investment mix of the PIC. Each PIC is based on an investment strategy predetermined by the Plan Administrator, as follows:

Current Income – This option strives for growth with little risk through investments mostly in conservative mutual funds and fixed income securities.

Growth Income – This option emphasizes growth in stock values but also expects current income.

Long-Term Growth – This option is aimed at capital appreciation through long-term growth in stock value.

Preservation of Capital – This option seeks to achieve low risk with a conservative return on investments.

All investments in the Pooled Investment Choices noted above are reflected in the accompanying financial statements and supplemental schedule in the respective underlying mutual funds.

7

Table of Contents

Kyocera Retirement Savings and Stock Bonus Plan

Notes to Financial Statements

December 31, 2016 and 2015

Plan Termination

Although it has not expressed any intent to do so, the Plans Sponsor has the right under the Plan to discontinue its contributions at any time and to terminate the Plan subject to the provisions of ERISA. Upon termination, the entire adjusted amount of each participant’s account value, including that portion attributable to the Plan Sponsor’s matching contributions which would not otherwise be vested, becomes fully vested.

Risks and Uncertainties

The Plan provides for various investment options in any combination of stocks, bonds, mutual funds and other investment securities. Investment securities are exposed to various risks, such as interest rate, market and credit risks. Due to the level of risk associated with certain investment securities and the level of uncertainty related to changes in the value of investment securities, it is at least reasonably possible that changes in risks in the near term could materially affect participants’ account balances and the amounts reported in the Statements of Net Assets Available for Benefits and the Statements of Changes in Net Assets Available for Benefits.

Basis of Accounting

The Plan uses the accrual basis of accounting and the financial statements are prepared in accordance with accounting principles generally accepted in the United States of America.

Valuation of Investments

The Plan’s investments are reported at fair value. Fair value is the price that would be received to sell an asset in an orderly transaction between market participants at the measurement date. Purchases and sales of investments are recorded on a trade-date basis. See Note 3 for discussion of fair value measurements.

Income Recognition

Interest income is earned on an accrual basis and dividend income is recorded on the ex-dividend date.

The Plan presents in the Statements of Changes in Net Assets Available for Benefits the net appreciation or depreciation in the fair value of its investments, which consists of the realized gains or losses and the unrealized appreciation on those investments.

Payment of Benefits

Benefits are recorded when paid. There were no benefits payable to participants who had elected to withdraw from the Plan but had not yet been paid as of December 31, 2016 and 2015.

Administrative Expenses

Certain expenses of maintaining the Plan are paid directly by the Plan Sponsor and are excluded from the Plan’s financial statements. Recordkeeping, custodial and other expenses relating to Plan administration are paid by the Plan and are included in administrative expenses in the accompanying Statements of Changes in Net Assets Available for Benefits. Investment related expenses are included in net appreciation (depreciation) in fair value of investments in the accompanying Statements of Changes in Net Assets Available for Benefits.

8

Table of Contents

Kyocera Retirement Savings and Stock Bonus Plan

Notes to Financial Statements

December 31, 2016 and 2015

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires Plan management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expense during the reporting period. Actual results could differ from estimates.

New Accounting Pronouncements

In May 2015, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU” or “Update”) 2015-07 — Fair Value Measurement (Topic 820): Disclosure for Investments in Certain Entities that Calculate Net Asset Value per Share (or its Equivalent) , which exempts investments measured using net asset value (“NAV”) practical expedient in Topic 820 Fair Value Measurement, from categorization within the fair value hierarchy. This guidance requires retrospective application and is effective for public entities for fiscal years, and interim periods within those years, beginning after December 15, 2015 with early adoption permitted. The Plan elected to early adopt the provisions of this Update for the 2015 Plan year end and applied the amendment retrospectively. The impact of adopting this amendment is reflected in the financial statements.

In July 2015, the FASB issued ASU 2015-12 — Plan Accounting: Defined Benefit Pension Plans (Topic 960); Defined Contribution Plans (Topic 962); and Health and Welfare Benefit Plans (Topic 965): Part (I)  Fully Benefit-Responsive Investment Contracts; Part (II)  Plan Investment Disclosures; and Part (III)  Measurement Date Practical Expedient . The purpose of this Update was to simplify Plan accounting, presentation and disclosures. The provisions are as follows:

9

Table of Contents

Kyocera Retirement Savings and Stock Bonus Plan

Notes to Financial Statements

December 31, 2016 and 2015

The Update may be adopted in whole or by part (I, II, and III), as applicable. The amendments in this Update are effective for fiscal years beginning after December 15, 2015 with early adoption permitted. Upon adoption, the amendments in Parts I and II shall be applied retrospectively to all periods presented; the amendments in Part III shall be applied prospectively. The Plan adopted amendments in Part II of this Update for the 2015 plan year, and the amendments in Part II were retrospectively applied. The amendments in Parts I and II of this Update are not applicable to the Plan.

Accounting guidance has been issued that establishes a framework for measuring fair value. Such framework provides a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The three levels of the fair value hierarchy are described below:

Level 1 – Inputs to the valuation methodology are unadjusted quoted prices for identical assets or liabilities in active markets that the plan has the ability to access.

Level 2 – Inputs to the valuation methodology include: quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities in inactive markets; inputs other than quoted prices that are observable for the asset or liability; and inputs that are derived principally from or corroborated by observable market data by correlation or other means. If the asset or liability has a specified (contractual) term, the Level 2 input must be observable for substantially the full term of the asset or liability.

Level 3 – Inputs to the valuation methodology are unobservable and significant to the fair value measurement.

Classification within the hierarchy is determined based on the lower level input that is significant to the fair value measurement.

Following is a description of the valuation methodologies used for assets measured at fair value. There have been no changes in the methodologies used at December 31, 2016 and 2015:

10

Table of Contents

Kyocera Retirement Savings and Stock Bonus Plan

Notes to Financial Statements

December 31, 2016 and 2015

The following tables set forth by level, within the fair value hierarchy, the Plan’s investments at fair value, on a recurring basis.

There were no transfers between levels of the fair value hierarchy during 2016 or 2015.

11

Table of Contents

Kyocera Retirement Savings and Stock Bonus Plan

Notes to Financial Statements

December 31, 2016 and 2015

Investments recorded at Net Asset Value per Share

The following table summarizes investments measured at net asset value per share as of December 31, 2016 and 2015.

The Plan obtained its latest determination letter on August 18, 2003 in which the Internal Revenue Service stated that the Plan was in compliance with the applicable requirements of the Internal Revenue Code (“IRC”). On October 1, 2009, the Plan adopted a Transamerica (formerly known as Diversified) nonstandardized prototype plan agreement. The Plan Sponsor has obtained a copy of the IRS opinion letter which was issued to Transamerica for the nonstandardized prototype plan.

GAAP requires Plan management to evaluate tax positions taken by the plan and recognize a tax liability (or asset) if the organization has taken an uncertain position that more likely than not would not be sustained upon examination by the IRS. The Plan Administrator has analyzed the tax positions taken by the Plan, and has concluded that as of December 31, 2016, there are no uncertain positions taken or expected to be taken that would require recognition of the liability (or asset) or disclosure in the financial statements. The Plan is subject to routine audits by taxing jurisdictions and the Plan could be subject to income tax if certain issues were found by the IRS that could result in the disqualification of the Plan’s tax-exempt status; however, there are currently no audits for any tax periods in progress. The Plan’s income tax returns remain open for examination by applicable authorities, generally 3 years for federal and 4 years for state.

Certain expenses of the Plan are paid for by the Plan Sponsor. The most significant of these costs paid by the Plan Sponsor are the salaries for the employees responsible for Plan administration. Fees paid to Transamerica by the Plan for administrative expenses amounted to $86,636 and $91,676 for the years ended December 31, 2016 and 2015, respectively. Plan investments include Kyocera Corporation common stock which is the stock of the Plan Sponsor’s parent and qualifies as party-in-interest transactions. Loans made to employees of the Plan Sponsor also qualify as party-in-interest transactions.

12

Table of Contents

Kyocera Retirement Savings and Stock Bonus Plan

Notes to Financial Statements

December 31, 2016 and 2015

Employees of the Plan Sponsor serve as the Trustees and Plan’s administrator and are participants in the Plan. These transactions qualify as party-in-interest transactions.

No reconciling items were noted between net assets available for benefits, as reported in the financial statements, and amounts reported in the Form 5500 as of and for the years ended December 31, 2016 and 2015.

In accordance with FASB Accounting Standards Codification (“ASC”) 855-10, Subsequent Events , subsequent events have been evaluated by management through the day these financial statements were available to be filed with the Securities and Exchange Commission.

13

Table of Contents