Annual Report 2013

3 Changes in Representation Methods(Consolidated Balance Sheet)“Provision for environmental measures” included in “Other” assets of the “Noncurrentliabilities” section of the Consolidated Balance Sheet for FY2011 are stated as a separateaccount item in the Consolidated Balance Sheet for FY2012 due to an increase intheir importance.As a result, the amount of ?22,821 million stated in “Other” of “Noncurrent liabilities”in the Consolidated Balance Sheet for FY2011 is reclassifi ed into “Provision forenvironmental measures” of ?723 million and “Other” of ?22,098 million for theConsolidated Balance Sheet of FY2012.(Consolidated Statements of Cash Flows)The Company fi nds it necessary that “Increase (decrease) in provision for environmentalmeasures,” which were included in “Increase (decrease) in other noncurrent liabilities” of“Net cash provided by (used in) operating activities” in the previous consolidated fi scalyear, should be stated as a separate account item in FY2012 due to the increasedimportance of its fi nancial value of the account item; therefore, in order to refl ect thischange in the representation method in the FY2012, necessary reclassifi cation of thefi nancial statements presented in the previous fi scal year has been made.As a result, the amount of ?1,613 million stated in “Increase (decrease) in othernoncurrent liabilities” of “Net cash provided by (used in) operating activities” in theConsolidated Statements of Cash Flows for FY2011 is reclassifi ed into “Increase (decrease)in provision for environmental measures” of ? -48 million and “Increase (decrease) inother noncurrent liabilities” of ?1,662 million for the Consolidated Statements of CashFlows of FY2011.(Changes in Accounting Estimates)(Change of the Number of Years of Useful Life)Abu Dhabi Oil Co., Ltd., a consolidated subsidiary of the Company, conventionally calculateddeprecation by using the number of years of useful life for the oil wells currently operational,as defi ned by the concession agreements, among buildings and structures included in theaccount item of property, plant and equipment. However, by taking the opportunity of therecent execution of the new concession agreement, a review was conducted about thedurability and other conditions of these assets currently owned. As a result, it was revealedthat they can be used for longer years. Therefore, the number of years of useful life of theoil wells is changed to 30 years, and said change will be effective from consolidated fi scalyear 2012 and be adopted over the years to come. This change decreased depreciationexpenses for FY2012 by ?1,979 million as compared with the conventional method. Andoperating income and ordinary income for FY2012 were increased by ?1,790 million, lossbefore income taxes was reduced by the same amount.(Changes in estimation of provision)The Company recorded estimated expenses for treating a small amount of PCB asenvironmental expenses under extraordinary loss in FY2012, in addition to expenses fortreating the highly-concentrated PCB waste that had been recorded as the provision forenvironmental measures, because it became possible to obtain a reasonable estimate ofthe expenses for treating the waste with a small amount of PCB.This change increased loss before income taxes and minority interests for the FY2012by ?1,797 million as compared with the conventional method.4 Notes to Consolidated Financial Statements(Notes to Consolidated Balance Sheet)The Company guarantees loans obtained by companies and individuals other thanconsolidated subsidiaries from fi nancial institutions, etc.(Millions of yen)FY2011(As of March 31, 2012)FY2012(As of March 31, 2013)1. Accumulated depreciation for property,plant and equipment ?766,731 ?782,7462. Pledged assets1) Plant foundationPledged assets ?329,320 ?324,431Secured liabilities ?99,833 ?71,3102) Assets other than plant foundationPledged assets ?11,701 ?10,963Secured liabilities ?4,171 ?3,2643. ContingenciesGuaranty Liabilities ?11,714 ?10,883