Pioneer 2016 Annual Report Download - page 35

u. New Accounting Pronouncements
Tax Effect Accounting —
On December 28, 2015, the ASBJ issued ASBJ Guid-
ance No. 26, “Guidance on Recoverability of Deferred
Tax Assets,” which included certain revisions of the
previous accounting and auditing guidance issued
by the Japanese Institute of Certified Public Accoun-
tants. While the new guidance continues to follow
the basic framework of the previous guidance, it pro-
vides new guidance for the application of judgment
in assessing the recoverability of deferred tax assets.
The previous guidance provided a basic frame-
work which included certain specific restrictions on
recognizing deferred tax assets depending on the
company’s classification in respect of its profitability,
taxable profit and temporary differences, etc.
The new guidance does not change such basic
framework but, in limited cases, allows companies
to recognize deferred tax assets even for a deduct-
ible temporary difference for which it was specifically
prohibited to recognize a deferred tax asset under
the previous guidance, if the company can justify,
with reasonable grounds, that it is probable that
the deductible temporary difference will be utilized
against future taxable profit in some future period.
The new guidance is effective for the beginning
of annual periods beginning on or after April 1, 2016.
Earlier application is permitted for annual periods
ending on or after March 31, 2016. The new guid-
ance shall not be applied retrospectively and any
adjustments from the application of the new guid-
ance at the beginning of the reporting period shall
be reflected within retained earnings or accumulated
other comprehensive income at the beginning of the
reporting period.
The Company expects to apply the revised
guidance from the beginning of the annual period
beginning on April 1, 2016, and there are no effects
of applying the revised guidance on the income or loss
for the fiscal year ending on or after March 31, 2017.
v. Consolidated Corporate Tax System
The Group files a tax return under the consolidated
corporate tax system, which allows companies to
base tax payments on the combined profits or losses
of the parent company and its wholly owned domestic
subsidiaries.
w. Changes in the Method of Presentation
Consolidated Statement of Income
Prior to April 1, 2015, the “Borrowing fee” was
disclosed separately. Considering the materiality,
“Borrowing fee”, is included in “Others—net” of “Other
Income (Expenses)” from the year ended March 31,
2016. The amount included in “Others—net” of “Other
Income (Expenses)” for the year ended March 31,
2015, was ¥415 million .
Prior to April 1 2015, “Maintenance expense for
idle assets” was included in “Others—net” of “Other
Income (Expenses)”. Considering the materiality,
“Maintenance expense for idle assets” is disclosed
separately from the year ended March 31, 2016. The
amount included in “Others—net” of “Other Income
(Expenses)” for the year ended March 31, 2015, was
¥415 million.
Consolidated Statement of Cash Flows
Prior to April 1 2015, the “(Decrease) increase in
defined retirement benefit plans”, was included in
“Other—net” of “Operating Activities”. Considering
the materiality “(Decrease) increase in defined retire-
ment benefit plans”, is disclosed separately from the
year ended March 31, 2016. The amount included
in “Other—net” of “Operating Activities” for the year
ended March 31, 2015, was ¥3,102 million.
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Pioneer Corporation Annual Report 2016