Nikon 1999 Annual Report Download - page 19

Nikon Corporation and Consolidated Subsidiaries
1. BASIS OF PRESENTING CONSOLIDATED FINANCIAL STATEMENTS
Nikon Corporation ( the “Company” ), its domestic subsidiaries and affiliates maintain their records and prepare their financial statements in
accordance with the provisions set forth in the Japanese Commercial Code ( the “Code” ), the related accounting regulations, and in conformi-
ty with accounting principles and practices generally accepted in Japan. The foreign consolidated subsidiaries maintain and prepare their
financial statements in accordance with accounting principles generally accepted in the countries, where such subsidiaries are established.
The accompanying consolidated financial statements have been prepared in accordance with the provisions set forth in the Securities and
Exchange Law of Japan ( the “Securities Law” ) and its related accounting regulations, and in conformity with accounting principles and prac-
tices generally accepted in Japan, which are different in certain respects as to application and disclosure requirements of International
Accounting Standards. The consolidated financial statements are not intended to present the financial position, results of operations and cash
flows in accordance with accounting principles and practices generally accepted in countries and jurisdictions other than Japan.
Under the Securities Law the consolidated statements of cash flows are not required, but are presented herein as additional information. In
preparing these consolidated financial statements, certain reclassifications and rearrangements have been made to the consolidated financial
statements issued in Japan in order to present them in a form which is more familiar to readers outside Japan. In addition, the notes to the
consolidated financial statements include information which is not required under accounting principles generally accepted in Japan but is
presented herein as additional information.
The consolidated financial statements are stated in Japanese yen, the currency of the country in which the Company is incorporated and
operates. The translations of Japanese yen amounts into U.S. dollar amounts are included solely for the convenience of readers outside Japan
and have been made at the rate of ¥120.55 to U.S.$1, the approximate rate of exchange at March 31, 1999. Such translations should not be
construed as representations that the Japanese yen amounts could be converted into U.S. dollars at that or any other rate.
The Japanese yen amounts presented herewith are rounded down to the nearest millions of yen.
Certain reclassifications have been made in 1998 and 1997 financial statements to conform to classification used in 1999.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(a) Consolidation
The consolidated financial statements include the accounts of Nikon Corporation and of its 33 ( 29 in 1998 and 24 in 1997 ) significant
subsidiaries ( collectively the “ Companies ” ). The remaining 26 ( 31 in 1998 and 33 in 1997 ) unconsolidated subsidiaries would not have a
material effect on the accompanying consolidated financial statements.
All significant intercompany accounts and transactions have been eliminated in consolidation. All material unrealized profit included in
assets resulting from transactions within the Companies have also been eliminated. Investments in 3 unconsolidated subsidiaries are account-
ed for by the equity method. The differences between the cost and underlying net equity of investments in consolidated subsidiaries and
unconsolidated subsidiaries accounted for by the equity method at acquisition ( “Goodwill” ) are amortized on a straight-line basis over five
years or, insignificant in amount, such difference is charged to income when incurred.
Investments in 9 ( 9 in 1998 and 8 in 1997 ) associated companies ( ownership: 20% to 50% ) are stated at cost as they are immaterial to the
accompanying consolidated financial statements.
(b) Cash and Cash Equivalents
For the purposes of the statement of cash flows, cash and cash equivalents include cash, time deposits and marketable securities presented in
current assets.
(c) Marketable Securities and Investments in Securities
Marketable securities and investments in securities are stated principally at cost, cost being determined using the moving-average method.
(d) Inventories
Inventories of the Company and its domestic subsidiaries are stated at cost, cost being determined principally using the average method,
except for work in process which is determined by the specific identification method. Inventories of foreign subsidiaries are stated at the lower
of cost or market, cost being determined principally using the first-in, first-out method.
17
notes to consolidated financial statements
QX33 .nikon second 0 0.5.12 5:35 PM ページ1 7