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The impact of this change to the segment information is set forth in Note 18. The details of “loss on revaluation
of inventories at the beginning of period” are set forth in Note 17.
(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 by the straight-line-method over the estimated useful lives, reflected by the likely
period over which the value of the asset can be realized under actual business conditions.
Certain property, plant and equipment are impaired based on consideration of their future usefulness. Accumu-
lated impairment loss is subtracted directly from each asset.
<Changes in accounting principles and practices for the year ended March 31, 2008>
For the year ended March 31, 2008, the Company and its consolidated subsidiaries in Japan changed the depreciation
method, the useful lives and the residual values.
The amounts in the consolidated financial statements prior to and for the year ended March 31, 2007, have not
been restated.
In prior periods, the Company and its consolidated subsidiaries in Japan depreciated property, plant and equip-
ment with the declining-balance method, while consolidated overseas subsidiaries most often adopted the
straight-line depreciation method. From the year ended March 31, 2008, the Group uniformly adopted straight-line
depreciation over the estimated useful life of the assets, which would be determined in accordance with what was
judged to be the likely period over which the value of the asset could be realized under actual business conditions,
and with the residual value of the asset deemed to be the actual residual value.
As a result of these changes and revisions, compared to the previous method of accounting, operating income
increased by ¥11,408 million ($114,080 thousand) and income before income taxes and minority interests increased
by ¥11,765 million ($117,650 thousand). These amounts include an increase in depreciation expense of ¥7,222 mil-
lion ($72,220 thousand) as a result of restarting depreciation of facilities over a five-year period with a residual value
of zero for those facilities that had already been depreciated to 5% of the acquisition cost at March 31, 2007. The
impact of this change to segment information is set forth in Note 18.
(i) Intangible assets
Goodwill is amortized by the straight-line method over periods not exceeding 20 years. In the consolidated financial
statements, the Group consistently amortizes goodwill acquired by consolidated subsidiaries 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.
095
ANNUAL REPORT 2008FUJITSU LIMITED
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS