Epson 2015 Annual Report Download - page 58

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57
Notes to Consolidated Financial Statements
1. Reporting Entity
Seiko Epson Corporation (the “Company”) is a stock corporation domiciled in Japan. The addresses of the
Company’s registered head office and principal business offices are available on the Company’s website
(http://www.epson.jp). The details of businesses and principal business activities of the Company and its affiliates
(“Epson”) are stated in “7. Segment Information.”
2. Basis of Preparation
(1) Compliance with IFRS
Epson’ s consolidated financial statements are prepared in accordance with International Financial Reporting
Standards (hereinafter referred to as “IFRS”) as issued by the International Accounting Standards Board which are
applied based on the provision of Article 93 of the Ordinance on Terminology, Forms and Preparation Methods of
Consolidated Financial Statements, as Epson meets the criteria of a “Specified company” defined under Article 1-2,
Paragraph 1, Item 2 of the Ordinance on Terminology, Forms and Preparation Methods of Consolidated Financial
Statements.
(2) Basis of Measurement
Except for the financial instruments stated in “3. Significant Accounting Policies,” Epson’ s consolidated financial
statements are prepared on the cost basis.
(3) Functional Currency and Presentation Currency
Epson’ s consolidated financial statements are presented in Japanese yen (hereinafter referred to as “yen” or “¥”),
which is the functional currency of the Company. The units are in millions of yen unless otherwise noted, and
figures less than one million yen are rounded down.
The translations of Japanese yen amounts into U.S. dollar amounts are included solely for the convenience of
readers outside Japan and have been made at the rate of ¥120.17 to U.S. $1 as of March 31, 2015.
(4) Reporting Period of Subsidiaries
The fiscal year end date of certain overseas subsidiaries is December 31, and Epson consolidates financial results
of those subsidiaries in conformity with the provisional settlement of accounts as of the consolidated fiscal year
end.
3. Significant Accounting Policies
(1) Basis of Consolidation
The consolidated financial statements include financial statements of Epson, and interests in investments in
associates and joint ventures.
(A) Subsidiaries
A subsidiary is an entity that is controlled by Epson. Epson has control over the entity if it is exposed, or has rights,
to variable returns from its involvement with the investee and has the ability to affect those returns through its
power over the investee. The acquisition date of a subsidiary is the date on which Epson obtains control of the
subsidiary, and the subsidiary is included in the consolidation from the date of acquisition until the date on which
Epson loses control.
All intergroup balances, transactions, unrealised profit or loss arising from intercompany transaction are eliminated
on consolidation. Comprehensive income for subsidiaries is attributed to owners of the parent company and
non-controlling interests even if this results in the non-controlling interests having a deficit balance.
(B) Associates
An associate is an entity over which Epson has significant influence, including the power to participate in the
financial and operating policy decisions of the investee. Investments in associates are accounted for using the
equity method from the date on which Epson has the significant influence until the date on which it ceases to have
the significant influence.