Ubisoft 2003 Annual Report Download - page 36

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FINANCIAL REPORT
2004
36
1.3.10 Transition to IAS/IFRS standards
The presentation of the consolidated financial statements
according to IAS/IFRS standards is planned for the fiscal year
ending March 31, 2006, with a comparative statement for
the fiscal year ending March 31, 2005. Ubisoft adopted a
projected methodology for implementing the new international
accounting standard under which the process is spread out
over four stages:
●Stage 1: devoted to establishing a task force and drawing up
a timetable and action plan.
●Stage 2: an assessment of the financial reporting process
and an analysis of how the two approaches differ.
●Stage 3: functional implementation and the adaptation of
procedures and the information system.
●Stage 4: will consist of implementing the process of
consolidating and restructuring the annual financial
statements in accordance with IAS/IFRS standards.
The task force is progressing in accordance with the established
action plan and is preparing to implement Stage 3 of the process.
In light of the work conducted thus far, we believe that the
following standards could have an impact on our accounts:
●IAS 14: Segment reporting.
●IAS 19: Accounting for employee benefits.
●IAS 36: Depreciation of assets.
●IAS 38: Intangible assets.
(In millions of euros) 2003-2004 2002-2003 2001-2002 2000-2001 1999-2000
Published operating income 1.5 31.6 * 31 7.9 13.7
- Capitalized R&D expenses -79.8 -72.1 -77 -60.7 -45.6
+ Amortization of intangible fixed assets 98.4 67.6 54.7 33.7 37.8
Pro forma operating income 20.1 27.1 8.7 -19.1 5.9
Impact of pro forma presentation on operating income over the last five fiscal years:
Unaudited pro forma presentation
* Restated of exceptional items for €5.5m
(In millions of euros) 2003-2004 2002-2003
Operating income (before amortization of goodwill) 20.1 27.1
Net income (before amortization of goodwill) 8.8 7.5
Net income (after amortization of goodwill) 2.8 2.0
(In euros per share)
Net earnings per share (before amortization of goodwill) 0.50 0.43
Net earnings per share (after amortization of goodwill) 0.16 0.11
According to this Pro forma presentation, the main impact on the 2003-04 accounts can be stated as follows:
Unaudited pro forma presentation
1.3.9 Pro forma accounting
In addition to presenting its consolidated accounts according to French accounting standards, Ubisoft also presents pro forma
accounts in which in-house development costs are stated as expenses, as is the practice of certain American video-game publishers.
Differences between the standards:
●French standards (French GAAP):
- In-house research and development expenses are reported as fixed assets and then amortized.
●Pro forma standards:
- In-house research and development costs are entered in the accounts as charges.