Square Enix 2011 Annual Report Download - page 41

D) Allowance for game arcade closings
Same as the year ended March 31, 2010
E) Allowance for employees’ retirement benefits
At the Company and certain consolidated subsidiaries, an
allowance for employees’ and executive officers’ retirement
benefits is provided at the amount incurred during the fiscal year,
based on the estimated present value of the projected benefit
obligation and pension plan assets. Unrecognized actuarial
differences are fully amortized in the year following the year in
which they arise. At certain consolidated subsidiaries, amortization
for each fiscal year is made over a certain period (five years)
using the straight-line method within the average remaining years
of service of the eligible employees when the differences are
recognized, commencing from the year after the year in which they
are incurred. Unrecognized prior service cost is amortized over a
certain period (one year or five years) within the average remaining
service period of the eligible employees.
In addition, at certain of the Company’s domestic consolidated
subsidiaries, a reserve for employees’ retirement benefits
is provided at an amount equal to 100% of the benefits the
subsidiaries would be required to pay under the lump-sum
retirement plan if all eligible employees were to voluntarily
terminate their employment at the balance sheet date.
F) Allowance for directors’ retirement benefits
Same as the year ended March 31, 2010
(5) Translation of foreign currency transactions and accounts:
■ Year ended March 31, 2010
All monetary assets and liabilities of the Company and its overseas
consolidated subsidiaries denominated in foreign currencies are
translated at the balance sheet date at the year end rates. The resulting
translation gains or losses are credited or charged to income. All assets
and liabilities of overseas consolidated subsidiaries are translated as
of the balance sheet date at the year end rates, and all income and
expense accounts are translated at rates for their respective periods.
The resulting translation adjustments are recorded in net assets as
“Foreign currency translation adjustments” and are included in minority
interests in consolidated subsidiaries.
■ Year ended March 31, 2011
Same as the year ended March 31, 2010
(6) Method and period of amortization of goodwill
■ Year ended March 31, 2010
Goodwill is amortized using the straight-line method over a period of
either 10 years or 20 years. However, goodwill considered immaterial is
fully amortized during the fiscal year in which it was incurred.
■ Year ended March 31, 2011
The Company amortizes goodwill over a 10-year period using the
straight-line method. However, goodwill considered immaterial is fully
amortized during the fiscal year in which it was incurred.
(7) Scope of Cash and Cash Equivalents in the Consolidated
Statements of Cash Flows
■ Year ended March 31, 2010
Cash and cash equivalents in the consolidated statements of cash flows
comprises cash on hand, bank deposits which may be withdrawn on
demand and short-term investments with an original maturity of three
months or less and with minimal risk of fluctuations in value.
■ Year ended March 31, 2011
Same as the year ended March 31, 2010
(8) Additional accounting policies used to prepare consolidated
financial statements:
■ Year ended March 31, 2010
Accounting treatment of consumption taxes and local consumption taxes
Income statement items are presented exclusive of consumption taxes
and local consumption taxes.
■ Year ended March 31, 2011
Accounting treatment of consumption taxes and local consumption taxes
Same as the year ended March 31, 2010
5. Valuation of Assets and Liabilities of Consolidated
Subsidiaries
■ Year ended March 31, 2010
All assets and liabilities of consolidated subsidiaries are revalued on
acquisition.
■ Year ended March 31, 2011
Not applicable
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