Notes to Consolidated Interim Financial Statements
|1. Scope of Consolidation|
|(1)||Number of consolidated subsidiaries: 74
|(2)||Number of nonconsolidated subsidiaries: 2
Shiseido's 2 nonconsolidated subsidiaries are not engaged in full-scale operations. Since the combined assets of these companies are minimal and deemed to have no measurable effect on the Company's consolidated financial statements, they are excluded from the scope of consolidation.
|(3)||Number of affiliated companies: 2 (including Pierre Fabre Japon Co., Ltd.)
The equity method applies to both of these affiliated companies.
|2.||Notes on Accounting Standards
Methods of calculating depreciation of depreciable assets.
Previously, tax-effect accounting was applied for one-time discrepancies arising as a result of consolidation procedures. From the interim period under review, however, the parent company and its domestic consolidated subsidiaries have adopted tax-effect accounting, in line with Article 4 of the ministerial ordinance for the partial revision of regulations covering terms, styles, and preparation laws concerning financial statements. The result of this revision is the addition of deferred tax assets amounting to 19,659 million yen (6,554 million yen in current assets and 13,105 million yen in investments and other assets), and minority interests amounting to 768 million yen, as well as a reduction in investments in securities amounting to 48 million yen. In addition, interim net income grew by 1,218 million yen, and the consolidated term-end retained earnings balance grew by 18,842 million yen, compared with the previous method.