Fujitsu 2000 Annual Report Download - page 28

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2. Differences with International Accounting Standards
The differences between the accounting principles and practices adopted by the Group and those prescribed by
International Accounting Standards (“IAS”) are summarized as follows.
Noncurrent monetary items denominated in foreign currencies
Had noncurrent monetary items denominated in foreign currencies been translated at the exchange rates in effect at
the balance sheet dates pursuant to IAS No. 21, the differences would not have been significant.
Cumulative translation adjustments
Although IAS No. 21 requires that cumulative translation adjustments be reported as a component of shareholders’
equity, the Group has reported this under assets.
Decrease in cumulative translation adjustments
Under IAS No. 21, upon the liquidation of a foreign subsidiary, the amount of the cumulative translation adjustments
related to the foreign subsidiary should be recognized as income or expenses. The Group records this amount directly
in retained earnings.
Marketable Securities (Note 4)
Although IAS No. 25 requires that marketable securities recorded in investments and long-term loans be stated at the
lower of cost or market on a portfolio basis, the Company determines the value of the marketable securities on an
item-by-item basis in order to state their value of the securities more conservatively. The difference between this
method and IAS was immaterial.
Inventories
IAS No. 2 requires that inventories be valued at the lower of their historical cost or net realizable value. Had IAS
No. 2 been applied, the difference in the aggregate value of the inventories would not have been significant.
Detachable stock purchase warrants (Note 9)
Under IAS No. 32, detachable stock purchase warrants should be recorded as a component of shareholders’ equity.
The Group includes warrants in other current liabilities.
Leases (Note 15)
Before the year ended March 31, 1999, the Company and its consolidated subsidiaries in Japan treated finance leases
in the same way as operating leases under accounting principles generally accepted in Japan, which differ from IAS No.17.
For the year ended March 31, 2000, there is no difference from IAS No. 17, since the Group changed its method of
accounting for finance leases from accounting such leases in the same manner as operating leases to recording lease
receivables and capitalizing them as lease assets.
Scope of consolidation
Fujitsu Leasing Co., Ltd. was excluded from consolidation in the year ended March 31, 1999 in accordance with
accounting principles generally accepted in Japan, and this represents a deviation from the scope of consolidation
prescribed under IAS No. 27.
For the year ended March 31, 2000, there was no difference from IAS No. 27, since Fujitsu Leasing Co., Ltd. was
initially consolidated.
Pension and Severance plans (Note 10)
Accounting standards in Japan for retirement benefits adopted effective April 1, 2000, are analogous to the revised IAS
No. 19, except for the period for amortizing the unrecognized net obligation upon the application of the new
accounting standards. These standards require that severance benefits and pension liabilities and costs be stated by the
projected unit credit method.
The Company and its consolidated subsidiaries in Japan, as of April 1, 2000, initially estimated the unrecognized net
obligation upon application of the new accounting standards, as set forth in Note 10. The unrecognized net obligation
assuming that they had followed the new accounting standards for the year ended March 31, 2000 was not
computed. The estimate of this amount was not readily determinable, because the pension plans were under
reformation.