JVC 2007 Annual Report Download - page 43

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The Company provided allowance for employees’ severance and retirement benefits as of the balance sheet dates
based on the estimated amounts of projected benefit obligation and the fair value of plan assets at those dates.
The excess of the projected benefit obligation over the total of the fair value of plan assets as of April 1, 2000 and
the liabilities for severance and retirement benefits recorded as of April 1, 2000 (the “net transition obligation”) is rec-
ognized in expenses in equal amounts primarily over 15 years commencing with the year ended March 31, 2001.
Prior service costs are recognized in income or expenses using the straight-line method over 10 years, and
actuarial gains and losses are recognized in expenses using the straight-line method over 10 years commencing
with the succeeding period.
Amounts per share of common stock
The computation of net income per share is based on the weighted average number of shares of common stock
outstanding during each year.
Diluted net income per share assumes dilution that could occur if convertible bonds or similar securities were
converted into common stock resulting in the issuance of common stock. The Company did not have securities
that could potentially dilute net income per share in the year ended March 31, 2006 and 2007, and diluted net
income per share is not disclosed because there was a net loss in the year ended March 31, 2005.
Cash dividends per share represent the actual amount declared as applicable to the respective years.
Impairment of fixed assets
In the fiscal year ended March 31, 2006, the Company and consolidated companies adopted the new accounting
standard for impairment of fixed assets (“Opinion Concerning Establishment of Accounting Standard for
Impairment of Fixed Assets” issued by the Business Accounting Deliberation Council on August 9, 2002) and the
implementation guidance for the accounting standard for impairment of fixed assets (the Financial Accounting
Standard Implementation Guidance No. 6 issued by the Accounting Standards Board of Japan on October 31,
2003).
Accounting Standard for Presentation of Net Assets in the Balance Sheet
Effective from the year ended March 31, 2007, the Company and its consolidated subsidiaries adopted the new
accounting standard, “Accounting Standard for Presentation of Net Assets in the Balance Sheet” (Statement No. 5
issued by the Accounting Standards Board of Japan on December 9, 2005), and the implementation guidance for
the accounting standard for presentation of net assets in the balance sheet (the Financial Accounting Standard
Implementation Guidance No. 8 issued by the Accounting Standards Board of Japan on December 9, 2005), (col-
lectively, the “New Accounting Standards”).
Under the New Accounting Standards, the balance sheet comprises three sections, which are the assets, liabili-
ties and net assets sections. Previously, the balance sheet comprised the assets, liabilities, minority interests, as
applicable, and the shareholders’ equity sections.
The consolidated balance sheet as of March 31, 2006 has been restated to conform to the 2007 presentation.
There were no effects on total assets or total liabilities from applying the New Accounting Standards to the balance
sheet as of March 31, 2006.
The adoption of the New Accounting Standards had no impact on the consolidated statements of income for
the years ended March 31, 2007 and 2006.
Accounting Standard for Statement of Changes in Net Assets
Effective from the year ended March 31, 2007, the Company and its consolidated subsidiaries adopted the new
accounting standard, “Accounting Standard for Statement of Changes in Net Assets” (Statement No. 6 issued by
the Accounting Standards Board of Japan on December 27, 2005), and the implementation guidance for the
accounting standard for statement of changes in net assets (the Financial Accounting Standard Implementation
Guidance No. 9 issued by the Accounting Standards Board of Japan on December 27, 2005), (collectively, the
“Additional New Accounting Standards”).
Accordingly, the Company prepared the statements of changes in net assets for the year ended March 31,
2007 in accordance with the Additional New Accounting Standards. Also, the Company voluntarily prepared the
consolidated statement of changes in net assets for 2006 in accordance with the Additional New Accounting
Standards. Previously, consolidated statements of shareholders’ equity were prepared for the purpose of inclusion
in the consolidated financial statements although such statements were not required under Japanese GAAP.
Reclassification and restatement
Certain prior year amounts have been reclassified to conform to the current year presentation.
Also, the consolidated balance sheet for 2006 has been adapted to conform to new presentation rules of 2007.
Furthermore, the consolidated statements of shareholders’ equity for the years ended March 31, 2006 and 2005 have
been modified to the forms of the consolidated statement of changes in net assets for 2007.