Trend Micro 2009 Annual Report Download - page 24

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26
(2) Depreciation or Amortization method for fixed assets
Property and equipment (excluding lease assets)
Mainly, depreciation is computed by declining-balance method in parent company
and is computed by a straight-line method in consolidated subsidiaries. Useful lives
of the main property and equipment are as follows:
Office furniture and equipment: mainly 2 – 10 years
Intangibles
<Software for sale>
Straight-line method over the estimated useful lives (12 months).
<Software for internal use>
Straight-line method over the estimated useful lives (mainly 5 years).
<Other intangibles>
Straight-line method over the estimated useful lives
<Lease assets>
Lease assets arising from non-ownership-transfer finance leases
The Company has applied a Straight-line method, which assumes that a useful life
is equal to the lease period and that an estimated residual value is zero. There are
no lease assets applicable to the straight-line method in the consolidated fiscal term.
The conventional accounting treatment still applies to non-ownership-transfer
finance leases that commenced before the starting day in order to apply the new
revised accounting standard for lease transactions.
(3) Accounting policies for allowances
Allowance for bad debt
In order to reserve future losses from default of notes and account receivable, bad
debt provision is provided. The amount is determined using the percentage based on
actual doubtful account loss against total of debts. As for high-risk receivables,
expected unrecoverable amount is considered individually.
Allowance for bonuses
Bonuses for employees are provided at an estimate of the amount.
Allowance for sales return
In order to reserve future losses from sales return subsequent to the fiscal year end,
allowance for sales return is provided based on the past experience in the sales
return.
Allowance for retirement benefits
In order to reserve future employees retirement benefits, allowance for retirement
benefits is provided based on retirement benefit liabilities and pension assets
projected at the end of the period.
Actuarial difference is expensed in the following accounting period on a pro rata
basis for certain years not exceeding the average remaining services years (1 to 25