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41Hitachi, Ltd. Annual Report 2005
In March 2004, the EITF reached a consensus in Issue No. 03-1, “The Meaning of Other-Than-Temporary Impairment
and Its Application to Certain Investments,” which provides guidance for the determination of other-than-temporary
impairment and disclosure of debt and equity securities accounted for in accordance with SFAS No. 115 “Accounting for
Certain Investments in Debt and Equity Securities,” and cost method investments. In September 2004, the FASB issued
FASB Staff Position No. 03-1-1, “Effective Date of Paragraphs 10-20 of EITF Issue No. 03-1” which delayed the effective
date for the recognition and measurement guidance of EITF Issue No. 03-1. The delay remains in effect until the FASB
issues further implementation guidance. The disclosure requirements of the consensus remain of effect.
(y) Presentation of Receivables from Financing Services in Consolidated Statements of Cash Flows
Certain financing subsidiaries provide the financing services related to products which the Company and its subsidiaries
manufacture under lease agreements. In the prior years, such transactions were reflected as an operating cash inflow and
an investing cash outflow in the consolidated statements of cash flows when a lease agreement was commenced even
though there was no cash flow on a consolidated basis. After considering the concern raised by the SEC in public, the
Company has decided to reflect the fact there was no cash received by the consolidated entity at the inception of the lease,
resulting in the elimination of the effects of the intercompany transaction, and to properly classify cash receipts from lease
receivables related to the products manufactured by the Company and its subsidiaries as operating activities. The
reclassification has also been made to the presentation of the prior year’s statements of cash flows and the effects of this
reclassification for the years ended March 31, 2004 and 2003 are as follows:
Millions of yen
2004 2003
Net cash provided by operating activities, as previously reported . . . . . . . . . . . . . . . . ¥ 606,543 ¥ 646,518
Reclassification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (3,140) 11,041
Revised net cash provided by operating activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥ 603,403 ¥ 657,559
Net cash used in investing activities, as previously reported . . . . . . . . . . . . . . . . . . . . . ¥(270,553) ¥(619,285)
Reclassification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,140 (11,041)
Revised net cash used in investing activities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥(267,413) ¥(630,326)
(z) Reclassifications
Certain reclassifications have been made to prior year balances in order to conform to the current year presentations.
3. BASIS OF FINANCIAL STATEMENT TRANSLATION
The accompanying consolidated financial statements are expressed in yen and, solely for the convenience of the reader,
have been translated into United States dollars at the rate of ¥107=U.S.$1, the approximate exchange rate prevailing on
the Tokyo Foreign Exchange Market as of March 31, 2005. This translation should not be construed as a representation
that all amounts shown could be converted into U.S. dollars.