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26
Notes to Consolidated Financial Statements
Toshiba Corporation and Subsidiaries
March 31, 2011
along with the portion of the change in the fair value of the hedged item that relates to the hedged risk. Changes in fair value of
derivative financial instruments accounted for as cash flow hedges, to the extent they are effective as a hedge, are recorded in
accumulated other comprehensive income (loss), net of tax. Changes in the fair value of derivative financial instruments not qualifying
as a hedge are reported in income.
SALES OF RECEIVABLES
The Group has transferred certain trade notes and accounts receivable under several securitization programs. When a
transfer of financial assets is eligible to be accounted for as a sale under ASC No.860 “Transfers and Servicing” (“ASC
No.860”), these securitization transactions are accounted for as a sale and the receivables sold under these facilities are
excluded from the accompanying consolidated balance sheets.
ASSET RETIREMENT OBLIGATIONS
The Group records asset retirement obligations at fair value in the period incurred. The fair value of the liability is added
to the carrying amount of the associated asset. This additional carrying amount is then depreciated over the life of the
asset. The liability increases due to the passage of time based on the time value of money until the obligation is settled.
Subsequent to the initial recognition, the liability is adjusted for any revisions to the expected amount of the retirement
obligation, and for accretion of the liability due to the passage of time.
RECENT PRONOUNCEMENTS
In October 2009, the FASB issued Accounting Standards Updates (“ASU”) No.2009-13. ASU No.2009-13 amends ASC
No.605, and establishes the requirements for treating multiple elements of revenue arrangements as separate units of
accounting, and permits using a best estimate of the selling price when vendor-specific objective evidence or third-party
evidence of selling price is not available. At the same time, the use of the residual method, which was previously permitted
to use to allocate arrangement consideration, is prohibited. Moreover, additional disclosure such as effects by this
amendment is required. ASU No.2009-13 is effective for fiscal years beginning on or after June 15, 2010, and the
Company will adopt ASU No.2009-13 effective April 1, 2011. The Company is currently evaluating the impact of
adoption of ASU No.2009-13 on the Company’s financial position and results of operations but does not expect it to have
a material impact.
In October 2009, the FASB issued ASU No.2009-14. ASU No.2009-14 amends ASC No.985 “Software” (“ASC
No.985”), and clarifies the scope of ASC No.985 in certain revenue arrangement that include software elements. ASU
No.2009-14 is effective for fiscal years beginning on or after June 15, 2010, and the Company will adopt ASU No.2009-14
effective April 1, 2011. The Company is currently evaluating the impact of adoption of ASU No.2009-14 on the
Company’s financial position and results of operations but does not expect it to have a material impact.
SUBSEQUENT EVENTS
The Group has evaluated subsequent events up to June 22, 2011 in accordance with ASC No.855 “Subsequent Events”.
RECLASSIFICATIONS
Certain reclassifications to the prior year’s consolidated financial statements and related footnote amounts have been made
to conform to the presentation for the current year.
3. U.S. DOLLAR AMOUNTS
U.S. dollar amounts are included solely for convenience of readers. These translations should not be construed as a
representation that the yen could be converted into U.S. dollars at this rate or any other rates. The amounts shown in U.S.
dollars are not intended to be computed in accordance with generally accepted accounting principles in the United States for
the translation of foreign currency amounts. The rate of ¥83=U.S.$1, the approximate current rate of exchange at March 31,
2011, has been used throughout for the purpose of presentation of the U.S. dollar amounts in the accompanying consolidated
financial statements.
4. DISCONTINUED OPERATION
On June 17, 2010, the Company and Fujitsu Limited (“Fujitsu”) signed a Memorandum of Understanding (MOU) to
merge their mobile phone businesses, followed by a definitive contract on July 29, 2010. The purpose of this business
merger was to enhance their handset development capabilities and at the same time to improve business efficiency by
combining their mobile phone development know-how and technological strengths, in the domestic and overseas mobile
phone market in which competition is intensifying. On October 1, 2010, the Company transferred its mobile phone
business to a newly established company (Fujitsu Toshiba Mobile Communications Limited), and sold 80.1% of the