Fujitsu 2007 Annual Report Download - page 69

Download and view the complete annual report

Please find page 69 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

The Group defers gain or loss on changes in the fair market values of the derivative financial instru-
ments on the balance sheet until gain or loss on the hedged items are recognized.
2. Differences with International Financial Reporting Standards
A brief description of the material differences between IFRS and Japanese GAAP relevant to the Group
is set out below. The Group has not completed the assessment to identify or quantify the impact of all
such differences. The description below is therefore prepared based on the Group’s current assessment
and consideration at March 31, 2007. Additionally, the Group has not made any attempts to identify or
quantify any differences between IFRS and Japanese GAAP, which may result from changes in both or
either accounting principles and practices in the future.
This note is out of scope of the audit.
Inventories
Under IAS 2, inventories should be stated at the lower of their historical cost or net realizable value. The
Group evaluates inventories mainly at cost as indicated in Note 1. (g) Inventories. The effects on the
aggregate value of inventories based on IAS 2 are not calculated. However, the Group takes into consid-
eration the recoverability of inventories based on future business environments.
Goodwill
Under IFRS 3 “Business Combinations,” goodwill should not be amortized and IAS 36 “Impairment of
Assets” should be applied. The Group amortizes goodwill by the straight-line method over periods not
exceeding 20 years as indicated in Note 1. (i) Intangible assets.
Retirement benefits
Under IAS 19, the unrecognized net obligation upon the application of new accounting principles and
practices should be recognized immediately. The accounting principles and practices for this obligation
are indicated in Note 10.
Scope of consolidation
Under IAS 27 and its interpretations SIC 12, Special Purpose Entities (SPEs) should be consolidated
when the substance of the relationship between an entity and an SPE indicates that the entity controls
the SPE.
The Company and its consolidated subsidiaries in Japan have not consolidated certain qualifying
SPEs in conformity with Japanese GAAP.
Uniformity of accounting policies
Under IAS 27, unification of accounting policies for consolidated accounts is required. Under IAS 28,
uniformity of accounting policies for affiliates is required as well.
Under Japanese GAAP, uniformity of accounting policies is required for similar transactions and
events under similar circumstances, in principle. However, it is permitted to use financial statements
prepared in accordance with local GAAP of foreign subsidiaries, unless the difference in accounting
principles and practices will lead to unreasonable consequences. The consolidated subsidiaries within the
Group outside Japan have adopted the accounting principles and practices in their respective countries as
Annual Report 2007 67