Hitachi 2004 Annual Report Download - page 70

66 Hitachi, Ltd. Annual Report 2005
It is a common practice in Japan for companies, in the ordinary course of business, to receive promissory notes in the
settlement of trade accounts receivable and to subsequently discount such notes to banks or to transfer them by
endorsement to suppliers in the settlement of accounts payable.
As of March 31, 2005 and 2004, the Company and subsidiaries were contingently liable for trade notes discounted and
endorsed in the following amounts:
Thousands of
Millions of yen U.S. dollars
2005 2004 2005
Notes discounted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥ 4,853 ¥ 3,839 $ 45,355
Notes endorsed . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,644 15,592 62,094
¥11,497 ¥19,431 $107,449
As of March 31, 2005, certain subsidiaries pledge a portion of their assets as collateral for bank loans, trade payables and
other liabilities as follows:
Thousands of
Millions of yen U.S. dollars
2005 2005
Cash and cash equivalents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ¥ 117 $ 1,093
Short-term investments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 247 2,308
Other current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,833 17,131
Investments and advances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 112 1,047
Land . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7,437 69,505
Buildings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9,053 84,607
Machinery and equipment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,910 55,234
¥24,709 $230,925
The Company and certain subsidiaries are subject to several legal proceedings and claims which have arisen in the
ordinary course of business and have not been finally adjudicated. These actions when ultimately concluded and determined
will not, in the opinion of management, have a material adverse effect on the financial position and results of operations
of the Company.
18. IMPAIRMENT LOSSES FOR LONG-LIVED ASSETS
The Company and certain subsidiaries recognized impairment losses for long-lived assets for the years ended March 31,
2005, 2004 and 2003 in the amount of ¥26,797 million ($250,439 thousand), ¥26,085 million and ¥8,474 million, respectively.
For the year ended March 31, 2005, the majority of the impairment losses were recorded on long-lived property, plant
and equipment located in Japan, which primarily consisted of ¥8,517 million ($79,598 thousand) in the Electronic
Devices division, ¥4,954 million ($46,299 thousand) in the High Functional Materials & Components division and ¥4,453
million ($41,617 thousand) in the Corporate division. These losses were mainly the result of change in the extent or
manner the assets were used and were determined based primarily on discounted future cash flows.
For the year ended March 31, 2004, the majority of the impairment losses were recorded on long-lived property, plant
and equipment located in Japan, which primarily consisted of ¥13,391 million in the Corporate division and ¥8,175 million
in the Information & Telecommunication Systems division. These losses, in part, were the result of change in the manner
the assets were used.
For the year ended March 31, 2003, the majority of the impairment losses were recorded on the Company’s Device
Development Center, which develops semiconductor products, resulted from the Company’s realignment of the
semiconductor operations.