Nikon 2000 Annual Report Download - page 19

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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 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 practices 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.
In preparing these consolidated financial statements, certain reclassifications and rearrangements have been made to the consolidated
financial statements issued domestically in order to present them in a form which is more familiar to readers outside Japan.
Effective April 1, 1999, consolidated statements of cash flows are required to be prepared under Japanese accounting standards, and those
for the years, ended March 31, 2000 and 1999 are presented herein.
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 ¥106.15 to U.S.$1, the rate of exchange at March 31, 2000. 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.
Certain reclassifications have been made in 1999 financial statements to conform to classification used in 2000.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(a) Consolidation
The consolidated financial statements as of March 31, 2000, include the accounts of the Company and its 33 (33 in 1999) significant sub-
sidiaries (collectively the “companies”). Investments in 3 (3 in 1999) unconsolidated subsidiaries and 1 associated company are accounted for
by the equity method.
The differences between the cost and the underlying net equity of investments in consolidated subsidiaries, unconsolidated subsidiaries
and an associated company accounted for by the equity method at acquisition (“Goodwill”) are insignificant and are charged to income when
incurred.
Investments in the remaining unconsolidated subsidiaries and associated companies are stated at cost as they are immaterial to the con-
solidated financial statements.
In the ophthalmic lenses business, the Company entered into a joint venture agreement with Essilor International S.A. on October 29, 1999,
and started a joint venture company named “Nikon-Essilor Co., Ltd.” in January, 2000.
All significant intercompany balances and transactions have been eliminated in consolidations. All material unrealized profit included in
assets resulting from transactions within the companies is eliminated.
(b) Cash and Cash Equivalents
Cash equivalents are short-term investments that are readily convertible into cash and that are exposed to insignificant risk of changes in value.
Cash equivalents include time deposits, certificate of deposits, commercial paper and mutual funds investing in bonds that represent
short-term investments, all of the date of acquisition.
The scope of cash and cash equivalents at beginning and end of year 1999 were changed from ¥40,142 million and ¥42,596 million to
¥19,460 million and ¥23,419 million, respectively, to conform with the presentation in 2000.
(c) Marketable Securities and Investments in Securities
Marketable securities and investments in securities are stated principally at cost as determined using the moving-average method.
See Note 3 for reclassification in 2000.
(d) Inventories
Inventories of the Company and its domestic subsidiaries are stated at cost as 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 as determined principally using the first-in, first-out method.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Nikon Corporation and Consolidated Subsidiaries
Years ended March 31, 2000 and 1999