Mitsubishi 2013 Annual Report Download - page 42

MITSUBISHI MOTORS CORPORATION
Annual Report 2013
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Forward foreign exchange contracts related to forecast exports
of finished goods are accounted for using deferral hedge account-
ing. Deferral hedge accounting requires unrealized gains or losses
to be deferred as liabilities or assets.
MMC and its consolidated subsidiaries have also developed a
hedging policy to control various aspects of the derivative transac-
tions including authorization levels and transaction volumes. Based
on this policy, within certain limits, MMC and its consolidated
subsidiaries hedge the risks arising from the changes in foreign cur-
rency exchange rates and interest rates. Forward foreign exchange
contracts are designated to hedge the exposure to variability in
expected future cash flows.
For interest rate swaps accounted for as special hedges, instead
of measuring hedge effectiveness, confirmation of the conditions
for special hedge accounting is carried out.
(n) Accounting Standards issued but not yet effective
“Accounting Standard for Retirement Benefits” (ASBJ Statement
No. 26, issued on May 17, 2012) and “Guidance on Accounting
Standard for Retirement Benefits” (ASBJ Guidance No. 25, issued
on May 17, 2012)
Under the standard and related guidance, actuarial gains and
losses and prior service costs that have yet to be recognized in
profit or loss shall be recognized within net assets (accumulated
other comprehensive income), after adjusting for tax effects, and
the deficit or surplus shall be recognized as a liability (liability for
retirement benefits) or asset (asset for retirement benefits). The new
accounting standard allows a choice for the method of attributing
expected benefits to periods of either the straight-line basis or
plan’s benefit formula basis. In addition, the determination method
of the discount rate was amended.
This standard and related guidance are effective as of the end
of fiscal years beginning on or after April 1, 2013. Except for the
amendments relating to determination of retirement benefit obliga-
tions and current service costs, which are effective as of fiscal years
beginning on or after April 1, 2014. MMC and its consolidated
subsidiaries are currently evaluating the effect these modifications
will have on its consolidated results of operations and financial position
2. U.S. Dollar Amounts
The U.S. dollar amounts in the accompanying consolidated financial
statements are included, solely for convenience, at ¥94.05=
U.S.$1.00, the exchange rate prevailing on March 31, 2013. The
approximate rate of exchange prevailing at May 31, 2013 was
¥101.18= U.S.$1.00. This translation should not be construed as
a representation that the Yen amounts represent or have been, or
could be, converted into U.S. dollars at that or any other rate.
3. Notes and Accounts Receivable – Trade and Notes
and Accounts Payable – Trade
The outstanding balances of trade notes and accounts receivable
sold to others which have been deducted from the respective ac-
counts amounted to ¥7,000 million as of March 31, 2012 and not
applicable as of March 31, 2013.
As March 31, 2013 and 2012 were weekend dates, some receiv-
ables and payables were not able to be settled by financial institu-
tions on those dates. Accordingly, notes and accounts receivable
of ¥3,560 million ($37,858 thousand) and ¥4,837 million, notes
and accounts payable of ¥24,357 million ($258,987 thousand) and
¥33,971 million, which were settled on the first following business
day, were included in the consolidated balance sheets at March 31,
2013 and 2012, respectively.
4. Property, Plant and Equipment
Accumulated depreciation of property, plant and equipment at
March 31, 2013 and 2012 was ¥940,905 million ($10,004,308
thousand) and ¥1,068,361 million, respectively.
Impairment losses were recognized in the following asset groups
for the years ended March 31, 2013 and March 31, 2012:
(In millions
of yen)
(In thousands
of U.S. dollars)
For the year ended March 31, 2013
Location Application Assets Impairment loss amount
Matsuyama,
Ehime and
others (32
sites)
Assets used
in sales
operations
Buildings,
structures,
land and
others ¥606 $6,449
Kawasaki,
Kanagawa
and others
(7sites) Idle assets
Buildings,
tools, furniture
and fixture
and others 180 1,916
Kawasaki,
Kanagawa
and others
(3sites)
Production
facilities
Buildings,
tools, furniture
and fixture
and others 667
¥793 $8,433