Sony 2015 Annual Report Download - page 161

SONY CORPORATION AND CONSOLIDATED SUBSIDIARIES
will be effective for Sony as of April 1, 2017 and early adoption is permitted as of the beginning of an interim or
annual reporting period. The ASU may be adopted either prospectively or retrospectively. Sony is currently
assessing the method of adoption and the impact that this ASU may have on Sony’s financial position and
disclosures.
Recognition and measurement of financial assets and financial liabilities -
In January 2016, the FASB issued ASU 2016-01 amending the existing requirements for the recognition and
measurement of financial assets and financial liabilities. The changes primarily relate to (i) the requirement to
measure equity investments in unconsolidated subsidiaries, other than those accounted for under the equity
method of accounting, at fair value with changes in fair value recognized in earnings, (ii) an alternative approach
for the measurement of equity investments that do not have a readily determinable fair value, (iii) the elimination
of the other-than-temporary impairment model for equity investments and its replacement with a requirement to
perform a qualitative assessment to identify impairment, and a requirement to recognize impairment losses in
earnings based on the difference between fair value and the carrying value of the equity investment, (iv) the
elimination of the requirement to disclose the methods and significant assumptions used to estimate the fair value
of financial instruments measured at amortized cost, (v) the addition of a requirement to use the exit price
concept when measuring the fair value of financial instruments for disclosure purposes, and (vi) the addition of a
requirement to present financial assets and financial liabilities to be presented separately in the notes to the
financial statements, grouped by measurement category (e.g., fair value, amortized cost, lower of cost or market)
and form of financial asset (e.g., loans, securities). This ASU will be effective for Sony as of April 1, 2018. The
effect of this ASU is being evaluated for the impact it will have on Sony’s results of operations and financial
position.
Leases -
In February 2016, the FASB issued ASU 2016-02, which amends current leasing guidance. The ASU
requires substantially all leases to be recognized on the balance sheet. The guidance is to be applied using a
modified retrospective approach from the earliest period presented and includes optional practical expedients.
This ASU will be effective for Sony as of the fiscal year beginning April 1, 2019, and early adoption is
permitted. The effect of this ASU is being evaluated for the impact it will have on Sony’s results of operations
and financial position.
(4) Reclassifications
Certain reclassifications of the financial statements and accompanying footnotes for the fiscal years ended
March 31, 2014 and 2015 have been made to conform to the presentation for the fiscal year ended March 31,
2016.
(5) Out-of-period adjustments
For the fiscal year ended March 31, 2015, Sony recorded an out-of-period adjustment to correct an error in
the amounts of revenue and certain capitalizable assets being recorded at a subsidiary. The error began in the
fiscal year ended March 31, 2012 and continued until it was identified by Sony during the fiscal year ended
March 31, 2015. The adjustment, which related entirely to All Other, impacted net sales, cost of sales, and
selling, general and administrative expenses, and decreased income before income taxes in the consolidated
statements of income by 5,104 million yen in the aggregate for the fiscal year ended March 31, 2015. Sony
determined that the adjustment was not material to the consolidated financial statements for the year ended
March 31, 2015 or any prior periods.
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