Square Enix 2005 Annual Report Download - page 28

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Notes to Consolidated Financial Statements
(JPNGAAP)
SQUARE ENIX CO., LTD. and Consolidated Subsidiaries
26 SQUARE ENIX CO., LTD.
Summary of Significant Accounting
Policies Used in the Preparation of
Consolidated Financial Statements
1. Scope of Consolidation
• FY2003 (April 1, 2003 to March 31, 2004)
(1) Number of consolidated subsidiaries:
10 and one partnership
DIGITAL ENTERTAINMENT ACADEMY CO., LTD.
COMMUNITY ENGINE INC.
THE GAME DESIGNERS STUDIO, INC.
SQUARE ENIX U.S.A., INC.
SQUARE L.L.C.
SQUARE PICTURES, INC.
SQUARE ENIX EUROPE LTD.
SQUARE ENIX WEBSTAR NETWORK TECHNOLOGY
(BEIJING) CO., LTD.
COMMUNITY ENGINE NETWORK SOFTWARE
(BEIJING) CO., LTD.
UIEVOLUTION, INC.
FF·FILM PARTNERS (partnership)
COMMUNITY ENGINE NETWORK SOFTWARE (BEIJING)
CO., LTD., and UIEVOLUTION, INC., were newly acquired
during FY2004.
Due to the increasing importance of their business
activities, COMMUNITY ENGINE INC. and SQUARE ENIX
WEBSTAR NETWORK TECHNOLOGY (BEIJING) CO., LTD.,
have been included in the Company’s scope of consolidation
from this fiscal year. THE GAME DESIGNERS STUDIO, INC.,
SQUARE L.L.C., SQUARE PICTURES, INC., SQUARE ENIX
EUROPE LTD. and FF FILM PARTNERS (partnership) have
been included in the Company’s scope of consolidation
from this fiscal year due to the merger with SQUARE CO.,
LTD.
In addition, proceedings to liquidate ENIX AMERICA
INC. were completed during this fiscal year.
(2) Non-consolidated subsidiaries
BMF CORPORATION
SPORTS BB CORPORATION
SOLID CO., LTD.
Proceedings are currently in progress to liquidate SPORTS
BB CORP. following a resolution at the annual general
meeting of stockholders held on March 15, 2004.
(Rationale for the exclusion of subsidiary companies from the
scope of consolidation)
Non-consolidated subsidiaries conduct operations that are
relatively small in scale. The total of non-consolidated
subsidiaries’ assets, sales, equity in net income (loss), and
equity in retained earnings (deficit) are deemed to have an
immaterial effect on the Company’s financial performance
and consolidated financial statements.
• FY2004 (April 1, 2004 to March 31, 2005)
(1) Number of consolidated subsidiaries:
11 and one partnership
DIGITAL ENTERTAINMENT ACADEMY CO., LTD.
COMMUNITY ENGINE INC.
THE GAME DESIGNERS STUDIO, INC.
SQUARE ENIX, INC.
SQUARE L.L.C.
SQUARE PICTURES, INC.
SQUARE ENIX LTD.
SQUARE ENIX (China) CO., LTD.
SQUARE ENIX WEBSTAR NETWORK TECHNOLOGY
(BEIJING) CO., LTD.
COMMUNITY ENGINE NETWORK SOFTWARE
(BEIJING) CO., LTD.
UIEVOLUTION, INC.
FF FILM PARTNERS (partnership)
SQUARE ENIX (China) CO., LTD., was established in January
2005 and has been included in the Company’s scope of
consolidation from this fiscal year.
(2) Non-consolidated subsidiaries
BMF CORPORATION
SOLID CO., LTD.
SPORTS BB CORPORATION was liquidated during this
fiscal year.
(Rationale for the exclusion of subsidiary companies from
the scope of consolidation)
Same as FY2003
2. Application of the Equity Method of
Accounting
• FY2003 (April 1, 2003 to March 31, 2004)
Number of equity-method non-consolidated subsidiaries: 1
DIGICUBE CO., LTD.
On November 26, 2003, the Company’s affiliate, DIGICUBE
CO., LTD., filed for bankruptcy with the Tokyo District
Court. As a result of the declaration of bankruptcy, the firm
was delisted from the Hercules Nippon New Market of the
Osaka Securities Exchange on December 13, 2003.