Nikon 2016 Annual Report Download - page 59

57
NIKON REPORT 2016
(g) Long-Lived Assets
The Group reviews its long-lived assets for impairment whenever
events or changes in circumstances indicate that the carrying amount
of an asset or asset group may not be recoverable. An impairment loss
would be recognized if the carrying amount of an asset or asset group
exceeds the sum of the undiscounted future cash ows expected to
result from the continued use and eventual disposition of the asset or
asset group.
The impairment loss would be measured as the amount by which
the carrying amount of the asset exceeds its recoverable amount,
which is the higher of the discounted cash ows from the continued
use and eventual disposition of the asset or the net selling price at
disposition.
(h) Investment Securities
Investment securities are classied and accounted for, depending on
management’s intent, as follows:
(i) Held-to-maturity debt securities, which are expected to be held
to maturity with the positive intent and ability to hold to maturity,
are reported at amortized cost; and
(ii) Marketable available-for-sale securities, which are not classied
as held-to-maturity securities, are reported at fair value, with
unrealized gains and losses, net of applicable taxes, reported in
a separate component of equity.
Nonmarketable available-for-sale securities are stated at cost deter-
mined by the moving average method.
For other-than-temporary declines in fair value, investment securi-
ties are reduced to net realizable value by a charge to income.
The Company records investments in limited liability investment
partnerships (deemed “investment securities” under the provisions set
forth in Article 2, Item 2 of the Japanese Financial Instruments and
Exchange Law) using the amount of interest in such partnerships cal-
culated based on ownership percentage and the most recent nancial
statements on the report date stipulated in the partnership agreement.
(i) Retirement and Pension Plans
The Company has a dened benet corporate pension plan (cash bal-
ance plan) and a dened contribution pension plan, and its consoli-
dated domestic subsidiaries have a dened benet corporate pension
plan and unfunded retirement benet plans. Certain domestic subsid-
iaries have a smaller enterprise retirement allowance mutual aid
system. Certain foreign subsidiaries also have a dened benet plan
and a dened contribution pension plan.
Effective April 1, 2000, the Group adopted a new Accounting
Standard for Retirement Benets and accounted for the liability for
retirement benets based on the projected benet obligations and
plan assets at the balance sheet date. Past service costs and actuarial
gains or losses are mostly being amortized over 10 years.
In May 2012, the ASBJ issued ASBJ Statement No. 26,
“Accounting Standard for Retirement Benets” and ASBJ Guidance
No. 25, “Guidance on Accounting Standard for Retirement Benets,”
which replaced the accounting standard for retirement benets that
had been issued by the Business Accounting Council in 1998 with an
effective date of April 1, 2000, and the other related practical guid-
ance, and were followed by partial amendments from time to time
through 2009.
(i) Under the revised accounting standard, actuarial gains and
losses and past service costs that are yet to be recognized in
prot or loss are recognized within equity (accumulated other
comprehensive income), after adjusting for tax effects, and any
resulting decit or surplus is recognized as a liability (liability for
retirement benets) or asset (asset for retirement benets).
(ii) The revised accounting standard does not change how to rec-
ognize actuarial gains and losses and past service costs in prot
or loss. Those amounts are recognized in prot or loss over a
certain period no longer than the expected average remaining
service period of the employees. However, actuarial gains and
losses and past service costs that arose in the current period
and have not yet been recognized in prot or loss are included
in other comprehensive income, and actuarial gains and losses
and past service costs that were recognized in other compre-
hensive income in prior periods and then recognized in prot or
loss in the current period shall be treated as reclassication
adjustments.
(iii) The revised accounting standard also made certain amend-
ments relating to the method of attributing expected benet to
periods and relating to the discount rate and expected future
salary increases.
This accounting standard and the guidance for (i) and (ii) above are
effective for the end of annual periods beginning on or after April 1,
2013, and for (iii) above are effective for the beginning of annual peri-
ods beginning on or after April 1, 2014, or for the beginning of annual
periods beginning on or after April 1, 2015, subject to certain disclosure
in March 2015, both with earlier application being permitted from the
beginning of annual periods beginning on or after April 1, 2013.
However, no retrospective application of this accounting standard to con-
solidated nancial statements in prior periods is required.
The Company applied the revised accounting standard and guid-
ance for retirement benets for (i) and (ii) above, effective March 31,
2014, and for (iii) above, effective April 1, 2014.
With respect to (iii) above, the Company changed the method of
attributing the expected benet to periods from a straight-line basis to
a benet formula basis, while the method of determining discount
rates has been changed from the method where the period for bonds,
which forms the basis for determining the discount rate, is determined
based on the approximate number of years of the average remaining
service period of employees, to the method using a single weighted
average discount rate reecting the period up to the expected timing
of retirement benets payment, as well as the amount of retirement
benets payment for each such period.
Notes to Consolidated Financial Statements
FINANCIAL AND CORPORATE DATA