Square Enix 2004 Annual Report Download - page 16

14 SQUARE ENIX 2004
Intangible Assets (Millions of yen)
Former Former SimpleTotal for Fiscal 2004 Change
ENIX SQUARE Fiscal 2003
Intangible 119 1,037 1,156 7,550 6,394
Assets
In March 2004, the Company acquired UIEVOLUTION INC. in the
United States, and made it a consolidated subsidiary in order to incorpo-
rate its wireless communications technologies, which are fundamental to
promote network-related businesses, into product and service planning. In
conjunction with this acquisition, the Company recorded goodwill of
US$57 million, which will be amortized evenly over five years from the fis-
cal year ending March 31, 2005. In this Fiscal Year, the Company recorded
the consolidated adjustment account due to the addition of SQUARE
ENIX WEBSTAR NETWORK TECHNOLOGY (BEIJING) CO.,
LTD. to the scope of consolidation. The consolidated adjustment account
will be amortized evenly over three years. In this Fiscal Year, the Company
recorded ¥145 million in amortization of the consolidated adjustment
account. As a result, intangible assets increased ¥6,394 million to ¥7,550
million as of March 31, 2004.
Investment Securities (Millions of yen)
Former Former SimpleTotal for Fiscal 2004 Change
ENIX SQUARE Fiscal 2003
Investment 3,674 1,860 5,534 3,516 (2,018)
Securities
Investment securities declined by approximately ¥2,018 million to ¥3,516
million compared with the Simple Total, owing primarily to the bankrupt-
cy of DIGICUBE CO., LTD., an equity method affiliate, and the sale of
shares.
Total Liabilities (Millions of yen)
Former Former SimpleTotal for Fiscal 2004 Change
ENIX SQUARE Fiscal 2003
Total Liabilities 7,665 15,389 23,044 13,338 (9,706)
As of March 31, 2004, total liabilities were ¥13,338 million, a decrease of
¥9,706 million from the Simple Total of ¥23,044 million.
Current Liabilities (Millions of yen)
Former Former SimpleTotal for Fiscal 2004 Change
ENIX SQUARE Fiscal 2003
Current 7,418 15,029 22,447 12,185 (10,262)
Liabilities
As with current assets, current liabilities are affected by the release of titles
by the end of the fiscal year. Notes and accounts payable decreased ¥543
million. Short-term borrowings of ¥1,000 million held by the former
SQUARE at the end of the previous fiscal year were repaid in full during
this Fiscal Year. The former SQUARE had recorded ¥4,153 million in
accrued cash distribution in lieu of dividend to retiring shareholders and
¥1,074 million in allowance for relocation expenses under current liabilities
as of March 31, 2003. In addition, accrued taxes declined ¥1,887 million
from the previous fiscal year. Current liabilities as of March 31, 2004
declined ¥10,262 million to ¥12,185 million, compared with the Simple
Total.
Non-current Liabilities (Millions of yen)
Former Former SimpleTotal for Fiscal 2004 Change
ENIX SQUARE Fiscal 2003
Non-current 236 359 595 1,152 557
Liabilities
Non-current liabilities amounted to ¥1,152 million, an increase of ¥557
million from the end of the previous fiscal year, reflecting a change in
accounting method for allowance for retirement benefits from the simple
method to the method based on actuarial valuation.
Minority Interests in Consolidated Subsidiaries (Millions of yen)
Former Former SimpleTotal for Fiscal 2004 Change
ENIX SQUARE Fiscal 2003
Minority 162 1,237 1,399 594 (805)
Interests in
Consolidated
Subsidiaries
Minority interests in consolidated subsidiaries decreased due mainly to
changes in the scope of consolidation.
The first change was the dissolution of the joint venture between the
former SQUARE and ELECTRONIC ARTS INC. in the United States,
for a decline of approximately ¥1,000 million in minority interests. The
second change was the addition of SQUARE ENIX WEBSTAR NET-
WORK TECHNOLOGY (BEIJING) CO., LTD. to the scope of consoli-
dation by the Company’s strategic intent. As a result, minority interests in
consolidated subsidiaries fell ¥805 million to ¥594 million as of March 31,
2004.
Shareholders’ Equity
Shareholders’ equity increased ¥9,326 million to ¥96,700 million compared
with the Simple Total. The Company used the pooling of interests method
of accounting in the merger, and takes over the equity structure from the
former SQUARE. Net income was ¥10,993 million in this Fiscal Year.
Breakdown of Shareholders’ Equity (Millions of yen)
Former ENIX Former SQUARE March 31, 2004
Common stock 6,940 11,945 7,154
Capital Surplus Reserve 9,383 14,847 36,393
Retained earnings 33,341 10,659 53,931
Unrealized Gain on
Revaluation of Securities 23 223 363
Foreign Currency
Translation Adjustments 43 60 (898)
Treasury Stock (84) (8) (245)
Total Shareholders’ Equity 49,647 37,727 96,700