Omron 2009 Annual Report Download - page 89

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87
Investment Securities
Investment securities mainly consist of listed stocks.
These are classified as Level 1.Because the fair value of
the investment securities is valued using a quoted market
price in active markets for identical assets and can be
observed.
Derivatives
Derivatives consist of foreign exchange forward contracts,
foreign currency swaps and interest rate swaps. These
are classified as Level 2. Because the fair value is valued
using the observable market data such as foreign
exchange rates or interest rates.
Assets and Liabilities Measured at Fair Value on a
Nonrecurring Basis
Non-marketable investment securities with a carrying
amount of ¥496 million ($5,061 thousand) were written
down to their fair value of ¥153 million ($1,561 thousand),
resulting in an other-than-temporary impairment charge
of ¥343 million ($3,500 thousand), which was included in
earnings for the fiscal year ended March 31,2009.
These investments were classified as Level 3. Because
these fair values were valued using unobservable inputs.
23. Business Structure Reform
The Companies established a new division, the “Emergency
Measures and Structual Reform Headquarters,” headed by
Hisao Sakuta, President & CEO, in January 2009 in
response to the rapid worsening of the business environ-
ment. Since February 2009, the Companies have been
implementing “emergency measures” to generate profit,
including cost cutting and the consolidation of unprofitable
businesses, as well as “structural reform” aimed at
strengthening the revenue base in the medium term
through the reorganization of core businesses and clo-
sure/consolidation of sites. Major business structure
reforms on March 31, 2009 are as follows;
[1] Electronic Components Business
The Companies decided to pull out of the large-size back-
light business, which encompasses the development,
manufacture and sales of large-size LCD backlights, dis-
solving three subsidiaries. According to this decision, the
Companies recognized impairment losses on long-lived
assets and other losses for the fiscal year ended March
31, 2009. The subsidiaries are planned to be liquidated
by the end of March 2011. The Companies decided to
reorganize semiconductor production sites and close a
part of them in Japan. According to this decision, the
Companies recognized impairment losses on long-lived
assets for the fiscal year ended March 31, 2009. The clo-
sure of the site is planned to be completed by the end
of March 2010.
[2] Automotive Electronic Component Business
The Companies decided to reorganize automotive elec-
tronic component production sites and dissolve the man-
ufacturing subsidiary in the United Kingdom. According
to this decision, the Companies recognized impairment
losses on long-lived assets and other losses for the fis-
cal year ended March 31, 2009. The subsidiary is planned
to be liquidated by the end of March 2011.
24. Subsequent Events
No significant event took place.
Assets and Liabilities Measured at Fair Value on a Recurring Basis
The following table presents assets and liabilities that are measured at fair value on a recurring basis at March 31, 2009.
Thousands of U.S. dollarsMillions of yen
Assets
Investment securities
Derivative
Liabilities
Derivative
Level 3
$ —
—
—
Total
$ 269,653
8,929
17,398
Level 2
$ —
8,929
17,398
Level 1
$ 269,653
—
—
Total
¥ 26,426
875
1,705
Level 3
¥ —
—
—
Level 2
¥ —
875
1,705
Level 1
Items
¥ 26,426
—
—