Wacom 2009 Annual Report Download - page 29

Notes to Consolidated Financial Statements
Wacom Co., Ltd. and Its Subsidiaries
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1. Basis of presenting consolidated financial
statements:
The accompanying consolidated financial statements
have been prepared from the consolidated financial
statements of Wacom Co., Ltd. (the “Company”) and its
subsidiaries filed with the Director of the Kanto Local
Finance Bureau in accordance with the Financial
Instruments and Exchange Law of Japan and its related
accounting regulations, and in conformity with account-
ing principles and practices generally accepted in Japan,
which are different in certain respects from the applica-
tion and disclosure requirements of International Finan-
cial Reporting Standards.
The consolidated financial statements are stated in
Japanese yen, the currency of the country in which the
Company is incorporated and principally operates. The
translation of Japanese yen amounts into U.S. dollar
amounts is included solely for the convenience of the
readers outside Japan and has been calculated at the
rate of JP¥98.23 = U.S.$1.00, the approximate rate of
exchange on March 31, 2009. Such translations should
not be construed as representations that the Japanese
yen amounts could have been or could be converted into
U.S. dollars at that or any other rate.
2. Summary of significant accounting policies:
(1) Principles of consolidation -
The consolidated financial statements include the
accounts of the Company and all of its majority-owned
subsidiaries (8 Companies). Majority-owned subsidiaries
are as follows;
● Wacom Europe GmbH
● Wacom Technology Corporation
● Wacom China Corporation
● Wacom Korea Co., Ltd.
● Wacom Australia Pty. Ltd.
● Wacom Hong Kong Ltd.
● Wacom Singapore Pte. Ltd.
● Wacom Taiwan Information Co., Ltd.
In May 2007, the Company acquired 100% of the issued
shares of Touchscreen Konnection Oasis, Inc.
(TouchKO). The consolidated financial statements of the
Company include TouchKO for the fiscal year ended
March 31, 2008.
The Company established Wacom Taiwan Information
Co., Ltd. in 2008, it is included in the consolidated
financial statements for the fiscal year ended
March 31, 2009.
Wacom Components Europe Ltd. was liquidated in 2008.
It is excluded from the consolidated financial statements
for the fiscal year ended March 31, 2009.
Wacom Digital Solutions Co., Ltd. changed its
company’s title name to Wacom Korea Co., Ltd in April
2008.
There are no unconsolidated subsidiaries or affiliates
accounted for by the equity method in the previous fiscal
years for consolidations.
The fiscal year end of Wacom China Corporation is
December 31. However, for consolidation purposes, the
provisional settlement of accounts as of March 31 is
utilized.
(2) Valuation methods for major assets -
(a) Securities:
Securities held by the Company and its subsidiaries are
classified as follows:
Held-to-maturity debt securities are stated at cost after
accounting for any premium or discount at acquisition,
which is amortized over the period to maturity.
Other securities for which market price or quotations are
not available are stated at cost based on the moving-
average method.
(b) Derivatives:
All derivatives are stated at fair value, with changes in fair
value included in net profit or loss in the period in which
they arise.
(c) Inventories:
Inventories held by the Company are stated at the lower
of cost or realizable value, cost is mainly determined by
the gross average method.
(Accounting changes)
“Accounting Standard for Measurement of Inventories”
(Accounting Standards Board of Japan Statement No. 9,
issued on July 5, 2006) has been adopted effective for
the fiscal year ended March 31, 2009. As a result,
operating profit , ordinary income and income before
income taxes decreased by ¥40,330 thousand ($411
thousand) compared with what would have been
reported under the previous accounting policy that
inventories held by the Company had been stated at
cost. The impact on segment information is explained in
Note 20.
(3) Depreciation and amortization of major assets -
(a) Property, plant and equipment:
The Company adopted the declining-balance method at
rates based on the estimated useful lives of the assets.
However, depreciation of buildings acquired by the
domestic company after April 1, 1998 is computed using
the straight-line method.
Depreciation of the foreign consolidated subsidiaries is
computed in the straight-line method over estimated
useful lives.
Useful lives of major classes of property, plant and
equipment are as follows:
Buildings and structures 3 to 65 years
Machinery, equipment and vehicles 3 to 7 years
Tools, furniture and fixtures 2 to 20 years