Omron 2002 Annual Report Download - page 36

designated and effective as hedges of firm commitments were deferred and recognized in income upon maturity of
the hedged transaction. Amounts receivable or payable under derivative financial instruments used to manage
interest rate risks arising from financial assets and liabilities were recognized as a component of the interest income
or expense of such related underlying assets or liabilities.
Cash Dividends
Cash dividends are reflected in the consolidated financial statements at proposed amounts in the year to which
they are applicable, even though payment is not approved by shareholders until the annual general meeting of
shareholders held early in the following fiscal year. Resulting dividends payable are included in Other current liabili-
ties in the consolidated balance sheets.
Comprehensive Income (Loss)
Comprehensive income (loss) consists of net income (loss), foreign currency translation adjustments, minimum
pension liability adjustments, unrealized gains and losses on available-for-sale securities and net gains and losses
on derivative instruments, and is presented in the consolidated statements of comprehensive income (loss).
Revenue Recognition
The Companies recognize revenue when persuasive evidence of an arrangement including title transfer exists,
delivery has occurred, the sales price is fixed or determinable, and collectibility is probable. These criteria are met
when products are shipped or services are performed.
New Accounting Standards
On July 20, 2001, the Financial Accounting Standards Board (“FASB”) issued SFAS No. 141, “Business
Combinations,” and SFAS No. 142, “Goodwill and Other Intangible Assets.” The statements will change the account-
ing for business combinations and goodwill in two significant ways. SFAS No. 141 requires that the purchase method
of accounting be used for all business combinations initiated after June 30, 2001. Use of the pooling-of-interests
method will be prohibited. SFAS No. 142 changes the accounting for goodwill from an amortization method to an
impairment-only approach. Thus, amortization of goodwill, including goodwill recorded in past business combinations,
will cease upon adoption of that statement, which for the Companies, will be April 1, 2002. The Companies expect that
the adoption of SFAS No. 142 will not be material.
On August 16, 2001, the FASB issued SFAS No. 143, “Accounting for Asset Retirement Obligation,” which is effec-
tive for financial statements issued for fiscal years beginning after June 15, 2002. The pronouncement addresses the
recognition and remeasurement of obligations associated with the retirement of a tangible long-lived asset. On
October 3, 2001, the FASB issued SFAS No. 144, “Accounting for the Impairment or Disposal of Long-Lived Assets,”
which is effective for financial statements issued for fiscal years beginning after December 15, 2001. SFAS No. 144
applies to all long-lived assets (including discontinued operations) and it develops one accounting model for long-lived
assets that are to be disposed of by sale. The Companies are currently reviewing these statements to determine their
impact on future financial statements.
The consolidated financial statements 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 convenience of the readers and have been made at the rate of ¥133 to $1, the approximate free
rate of exchange at March 31, 2002. Such translations should not be construed as representations that the
Japanese yen amounts could be converted into U.S. dollars at the above or any other rate.
Inventories at March 31 consisted of:
Thousands of
Millions of yen U.S. dollars
2002 2001 2002
Finished products............................................................................................ ¥39,772 ¥52,188 $299,038
Work-in-process.............................................................................................. 14,923 15,114 112,203
Materials and supplies..................................................................................... 19,922 24,291 149,789
Total............................................................................................................. ¥74,617 ¥91,593 $561,030
34 Omron Corporation
2. Translation into
United States
Dollars
3. Inventories