REPORT OF THE INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS ON THE NON-CONSOLIDATED FINANCIAL STATEMENTS

The Board of Directors
Kawasaki Steel Corporation

We have examined the non-consolidated balance sheets of Kawasaki Steel Corporation as of March 31, 1999 and 1998, and the related non-consolidated statements of operations, stockholders' equity and cash flows for the years then ended, expressed in yen. Our examinations were made in accordance with auditing standards, procedures and practices generally accepted and applied in Japan and, accordingly, included such tests of the accounting records and such other auditing procedures as we considered necessary in the circumstances.

In our opinion, the accompanying non-consolidated financial statements present fairly the financial position of Kawasaki Steel Corporation at March 31, 1999 and 1998, and the results of its operations and cash flows for the years then ended, in conformity with accounting principles and practices generally accepted in Japan consistently applied.

The U.S. dollar amounts in the accompanying non-consolidated financial statements with respect to the year ended March 31, 1999 are presented solely for convenience. Our examination also included the translation of yen amounts into U.S. dollar amounts and, in our opinion, such translation has been made on the basis described in Note 1 to the non-consolidated financial statements.

Osaka, Japan

June 29, 1999