## Short-Term Investments 

Short-term investments consist of debt securities issued by quoted companies and time deposits other than cash equivalents. 

## Allowance for Doubtful Accounts 

The allowance for doubtful accounts is stated in amounts considered to be appropriate based on the companies’ past credit loss experience and an evaluation of potential losses in the receiv- ables outstanding. 

## Inventories 

Inventories of the Company and its consolidated domestic subsidiaries are stated at cost, deter- mined by the average method. Inventories of consolidated foreign subsidiaries are principally stated at the lower of cost, determined by the average method, or market. 

## Property, Plant and Equipment 

Property, plant and equipment are stated at cost. Depreciation of property, plant and equipment of the Company and its consolidated domestic subsidiaries is computed by the declining-balance method, while the straight-line method is applied to buildings acquired after April 1, 1998, at rates based on the estimated useful lives of the assets. Depreciation of property, plant and equipment of consolidated foreign subsidiaries is principally computed by the straight-line method at rates based on the estimated useful lives of the assets. 

The range of useful lives is 15 to 50 years for buildings and structures, 5 to 15 years for machinery and equipment and 2 to 10 years for furniture and fixtures. 

## Leases 

All leases are accounted for as operating leases. Under Japanese accounting standards for leas- es, finance leases that are deemed to transfer ownership of the leased property to the lessee are to be capitalized, while other finance leases are permitted to be accounted for as operating lease transactions if certain “as if capitalized” information is disclosed in the notes to the lessee’s financial statements. 

## Investment Securities 

Prior to April 1, 2000, publicly traded securities were carried at the lower of cost, determined by the moving-average method, or market. Effective April 1, 2000, the Group adopted a new accounting standard for financial instruments. Under this standard, all marketable securities held by the Group are classified as available-for-sale securities and are reported at fair value, with unrealized gains and losses, net of applicable taxes, reported in a separate component of share- holders’ equity. The cost of securities sold is determined based on the moving-average method. 

The effect of this change was to increase income before income taxes and minority interests by ¥1,761 million for the year ended March 31, 2001. Marketable securities classified as cur- rent assets decreased by ¥1,195 million and investment securities increased by the same amount as of April 1, 2000. 

Non-marketable available-for-sale securities are stated at cost determined by the moving- average method. 

For other than temporary declines in fair value, available-for-sale securities are reduced to net realizable value by charging such losses to income. 

## Employees’ Retirement Benefits 

The Company has a non-contributory funded pension plan covering substantially all of its employ- ees. Prior to April 1, 2000, the amounts contributed to the fund, including past service costs amortized over eight years, were charged to income when paid. Effective April 1, 2000, the Company adopted a new accounting standard for employees’ retirement benefits and accounted for the liability for retirement benefits based on projected benefit obligations and plan assets at the balance sheet date. The transitional obligation of ¥25,249 million at the beginning of the year ended March 31, 2001 is being amortized over seven years, and the annual amortization is presented within selling, general and administrative expenses in the consolidated statements of 

