Fujitsu 2007 Annual Report Download - page 67

Download and view the complete annual report

Please find page 67 of the 2007 Fujitsu annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 98

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98

(g) Inventories
Finished goods are mainly stated at cost determined by the moving average method.
Work in process is mainly stated at cost determined by the specific identification method or the
average cost method.
Raw materials are mainly stated at cost determined by the moving average method or the most recent
purchase price method.
(h) Property, plant and equipment and depreciation
Property, plant and equipment, including renewals and additions, are carried at cost. Maintenance and
repairs, including minor renewals and improvements, are charged to income as incurred.
Depreciation is computed principally by the declining balance method at rates based on the estimated
useful lives of the respective assets, which vary according to their general classification, type of construc-
tion and function.
Certain property, plant and equipment are impaired based on consideration of their future useful-
ness. Accumulated impairment loss is subtracted directly from each asset.
<Changes in accounting principles and practices for the year ended March 31, 2006>
In Japan, the Group has adopted a new accounting standard, effective April 1, 2005, for impairment of
non-current assets. The adoption of this standard, however, did not have a material impact on net income
for the year ended March 31, 2006.
(i) Intangible assets
Goodwill is amortized by the straight-line method over periods not exceeding 20 years. In the consoli-
dated financial statements, the Group consistently amortizes goodwill acquired by consolidated subsid-
iaries outside Japan where goodwill is not amortized in accordance with the accounting principles and
practices in their respective countries.
Computer software for sale is amortized based on the current year sales units to the projected total
products’ sales units. Computer software for internal use is amortized by the straight-line method over
the estimated useful lives.
Other intangible assets are amortized by the straight-line method at the rates based on the estimated
useful lives of the respective assets.
(j) Leases
Assets acquired by lessees in finance lease transactions are recorded in the corresponding asset accounts.
(k) Provision for product warranties
Provision for product warranties is provided at the time of sales of the products at an amount which
represents the estimated cost, based on past experience, to repair or exchange certain products within the
warranty period.
<Changes in accounting principles and practices for the year ended March 31, 2006>
For the year ended March 31, 2006, the Group has started to provide for product warranties as noted
above in connection with increased sales of products under warranty and the increase in warranty
related costs. Prior to and for the year ended March 31, 2005, the Group had charged costs for repair
or exchange under warranty to selling, general and administrative expenses at the time the warranty
Annual Report 2007 65