Ubisoft 2004 Annual Report Download - page 54

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UBISOFT > 2005 FINANCIAL REPORT
Transition to IAS/IFRS
standards
PRELIMINARY REMARKS
Circumstances regarding the preparation of
2004 IFRS financial data
In application of EU regulation 1606/2002 dated July 19,
2002, concerning international standards, the consolidated
financial statements of Ubisoft for the fiscal year ending
March 31, 2006, will be prepared in accordance with
the IAS (International Accounting Standards)/IFRS
(International Financial Reporting Standards) applicable as
of March 31, 2006, as approved by the European Union.
The first consolidated financial statements published in
accordance with the IAS/IFRS will be those for the
2005/2006 fiscal year, with comparative figures for the
2004/2005 fiscal year prepared using the same primary
basis of accounting.
To provide comparative information for the 2005 fiscal
year and in accordance with the recommendation of the
French securities regulator, the “Autorité des Marchés
Financiers” (AMF), regarding the disclosure of financial
information during the transition period, Ubisoft has
prepared financial information for the fiscal year on the
transition to the IAS/IFRS with preliminary data on the
projected quantifiable impact of IFRS adoption on the
balance statement as of the transition date of April 1,
2004; this is when the confirmed impact of the transition
will be recordedin share capital in the publication of the
2005/2006 consolidatedfinancial statements.
This financial information as of April 1, 2004, on the
projectedquantifiable impact of IFRS adoption has been
prepared by applying to the 2004 data the IFRS standards
and interpretations that the Ubisoft group deems applicable
for the preparation of its comparative consolidated
accounts as of March 31, 2005. The basis on which this
financial information was prepared, described in the notes,
therefore derives from the IFRS standards and
interpretations that must be followed as of March 31,
2006, as they are currentlyknown.
This information was presented to the Board of Directors
on June 10, 2005.
Given the remaining uncertainties regarding certain
standards and interpretations that will be applicable on
March 31, 2006, Ubisoft reserves the right to modify
certain accounting options and methods used in the
preparation of this IFRS financial information for
2004/2005 upon final publication of the initial IFRS
financial data.
2.1.5.1 Description of the standards
and interpretations used to
prepare the IFRS financial
information as of April 1, 2004
2.1.5.1.1 Description of the standards useds
The IFRS financial information is prepared on the basis of
the standards and interpretations publishedas of March 31,
2005, and adopted by the European Union, and on the basis
2.1.5 of options adopted by Ubisoft's management in
anticipation of certain standards and interpretations
that have not yet been published or adopted but will be
applicable on March 31, 2006.
Thus, Ubisoft has applied the following to the IFRS
financial information as of April 1, 2004 presented in
this report:
1. all mandatory IFRS/IFRIC standards and interpretations
in force as of April 1, 2004. All of these standards
and interpretations have been adopted by the
European Union.
2. the following standards, by way of anticipation:
lthe IAS 32 and IAS 39 standards concerning financial
instruments;
lthe IFRS 2 standard relating to transactions involving
share-based payment, including incentive plans (i.e.,
options for share purchase or subscription) and share
purchase plans (group savings plans) granted to
employees.
2.1.5.1.2. Description of accounting options
related to the initial adoption of
IFRS standards
The IFRS financial information as of April 1, 2004, has
been prepared in accordance with the provisions of the
IFRS 1 standard, “First-Time Adoption of International
Financial Reporting Standards”. The general restatement
principle is that the accounting principles used to prepare
the provisional IFRS financial information be applied
retrospectively to the opening balance sheet. The impact
of theseadjustments is recorded directly through equity.
The group has adopted certain optional exceptions set
forth in IFRS 1 to the general principle of retrospectively
restating assets and liabilities:
a) Business combinations
Ubisoft has chosen not to apply business combinations
that occurred prior to April 1, 2004, in accordance with
standard IFRS 3.
b) Share-based payment
Ubisoft has decided to apply the provisions of IFRS 2 solely
to equity-based compensation granted after November 7,
2002, for which the rights acquisitions date falls after
March 31, 2004.
For all other IFRS standards, the opening values for assets
and liabilities as of April 1, 2004, have been
retrospectively restated as if these standards had always
been applied.
2.1.5.2 Transition from financial
statements prepared under
French accounting principles to
financial statements prepared
according to the IAS/IFRS
principles