Toshiba 2012 Annual Report Download - page 133

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TOSHIBA Annual Report 2012
29. Variable Interest Entities
The Group recognizes entities, in accordance with ASC No.810, as VIEs that have either (a) equity investors whose voting
right is limited and not having an ability to control it effectively or (b) insufficient equity to permit the entity to finance its
activities without additional subordinated financial support. The Group retains variable interests through equity
investments, loans and guarantees. In evaluating whether the Group is the primary beneficiary of the VIE and consolidates
it, the Group assesses if the Group has both (a) the power to direct the activities of the VIE that most significantly impact
the VIE's economic performance and (b) the obligation to absorb losses or the right to receive benefits that could
potentially be significant to the VIE.
Consolidated Variable Interest Entities
VIEs, of which the Group is the primary beneficiary, are involved in Social Infrastructure, and most of those are entities
involved in the Power and Social Infrastructure Systems. The Group has both the power to direct the activities that most
significantly affect those VIEs' economic performance and the obligation to absorb losses or the right to receive benefits
from the VIEs. The Group is also required to contribute capital to each VIE on an as needed basis based on percentage of
ownership interest.
As of March 31, 2012 and 2011, the total assets of VIEs on the consolidated balance sheets were ¥9,544 million ($116,390
thousand) and ¥8,986 million, and the total liabilities of VIEs on the consolidated balance sheets were ¥5,599 million
($68,280 thousand) and ¥2,669 million, respectively. The assets consisted primarily of accounts receivable, and property,
plant and equipment. The liabilities consisted primarily of accounts payable and long-term debt. The assets are restricted
for use only by those VIEs, and are not available for the Group's general operations. In addition, the creditors or beneficial
interest holders of those VIEs do not have recourse to the general credit of the Group.
Unconsolidated Variable Interest Entities
VIEs, of which the Group is not the primary beneficiary but retains significant variable interests, are involved in Electronic
Devices and Social Infrastructure. Unconsolidated VIEs involved in Electronic Devices are joint ventures established with
SanDisk Corporation (“SanDisk”) for the purpose of strengthening the production of NAND flash memories. For those
joint ventures, the Group and SanDisk have an equally sharing power. Unconsolidated VIEs involved in Social
Infrastructure are established for the purpose of supplying stable electric power systems, and providing electric services
and equipments to electric power operators. The Group is not the primary beneficiary of those VIEs because the Group
does not have the power to direct the activities that most significantly affect those VIEs' economic performance. The
Group accounts for those VIEs under the equity method.
As of March 31, 2012 and 2011, the total assets of those VIEs, carrying amounts of assets and liabilities that relate to the
Group's variable interests in the VIEs and the Group's maximum exposures to losses as a result of the Group's involvement
with the VIEs are summarized as follows:
Millions of yen
March 31, 2012 VIEs involved in
Electronic Devices
VIEs involved in
Social Infrastructure
Total assets of VIEs ¥ 439,850 ¥ 91,591
Carrying amounts of assets that relate to the Group's variable interests in the VIEs 176,242 55,283
Carrying amounts of liabilities that relate to the Group's variable interests in the VIEs 24,902 −
Maximum exposures to losses 211,922 55,283