Analysis of Disclosure in “Basic Policy Regarding Selection of

Analysis of Disclosure in
“Basic Policy Regarding Selection of
Accounting Standards”
Tokyo Stock Exchange, Inc.
1
I. Background
 Jun. 24, 2014 Japan Revitalization Strategy (Revised in 2014)
4) Promoting of an increase in the number of companies voluntarily adopting IFRS
Tokyo Stock Exchange will encourage listed companies to explain to investors their basic
views on the selection of accounting standards (for example, whether they are considering
adopting IFRS).
 Nov. 11, 2014 Revision of Guidelines for Financial Results
 Request description on “Basic Policy Regarding Selection of Accounting Standards” in Financial
Results
 ＜Guidelines for Financial Results＞
・Please describe basic policy regarding selection of accounting standards.
・For example, whether you are considering the adoption of IFRS.
（stage of consideration, scheduled adoption date）
 Adoption from Financial Results for FY-ended Mar. 31, 2015 (early adoption possible)
 Jun. 30, 2015 Japan Revitalization Strategy (Revised in 2015)
4) Further promotion of an increase in the number of companies voluntarily adopting IFRS
Listed companies disclose their progress in considering the adoption of IFRS in “Basic Policy
Regarding Selection of Accounting Standards” of the financial results. The government will analyze
this together with Tokyo Stock Exchange and disseminate the state of IFRS adoption to
contribute to efforts among listed companies to consider transitioning to IFRS.
2
II. Scope of Analysis
 Coverage：3,194 companies
 TSE-listed companies that provided description in Basic Policy
Regarding Selection of Accounting Standards (hereinafter ”Basic
Policy”) of financial results：3,193 companies
 FY ended March 2015：2,308 companies
 FY ended April 2015 ~ FY ended December 2015：885 companies
 Other companies that have adopted IFRS (FY ended January 2016
~ FY ended February 2016)：1 company
3
Ⅲ. Content of Analysis of IFRS Adoption
1.
Categories of Companies in Analysis（P.5）
2.
Shift in Number of Companies That Have Adopted IFRS
（P.6）
3.
Number and Market Cap of Companies That
Have Adopted IFRS（P.7～8）
4. IFRS Adoption by Industrial Sector（P.9～13）
5.
IFRS Adoption Date（P.14）
6.
Stage of Progress Among "④ Companies Considering
IFRS Adoption"（P.15）
4
Ⅲ－1. Categories of Companies in Analysis
Categories of companies included in analysis （3,194 companies）
① Companies that have adopted IFRS（74 companies）
Companies that submitted IFRS-based consolidated financial statements or quarterly
consolidated financial statements by Mar. 31, 2016
② Companies that have decided to adopt IFRS（32 companies）
Companies whose executive body has disclosed, by Mar. 31, 2016, its decision
to adopt IFRS
③ Companies planning to adopt IFRS（22 companies）
Companies whose executive body has described plans to adopt IFRS in its Basic Policy,
but yet to decide on IFRS adoption
④ Companies considering IFRS adoption（213 companies）
Companies that described that it is considering IFRS adoption in its Basic Policy
⑤ Other companies（2,853 companies）
For example, the following companies:
 Company that mentioned only the possibility of future adoption of IFRS
 Companies that mentioned only its current accounting standards
5
Ⅲ－2. Shift in Number of Companies That Have
Adopted IFRS
 The combined number of “① Companies that have adopted IFRS”, ”② Companies that
have decided to adopt IFRS”, and “③ Companies planning to adopt IFRS” is 128
companies as of Mar. 31, 2016.
Number of companies
120
112
100
21
73
80
52
60
40
20
42
22
+16 companies since
previous announcement
32
23
③Companies planning to
35
adopt IFRS
14
68
15
27
128
74
②Companies that have
decided to adopt IFRS
38
38
①Companies that have
adopted IFRS
0
Jun 30 2014
Dec 31 2014
Mar 31 2015
Aug 31 2015
Mar 31 2016
6
Ⅲ－3. Number and Market Cap of Companies
That Have Adopted IFRS
 The combined market capitalization of “① Companies that have adopted IFRS” and ”②
Companies that have decided to adopt IFRS” and “③ Companies planning to adopt
IFRS” is JPY 140 trillion (128 companies).
Number of
companies
Market capitalization
① Companies that have
adopted IFRS
74 companies
JPY 85 trillion
② Companies that have
decided to adopt IFRS
32 companies
JPY 19 trillion
③ Companies planning to
adopt IFRS
22 companies
JPY 35 trillion
④ Companies considering
IFRS adoption
213 companies
JPY 84 trillion
2,853 companies
JPY 262 trillion
3,194 companies
JPY 486 trillion
⑤ Other companies
Total
JPY 140 trillion
(128 companies)
Note: Market capitalization as of Mar. 31, 2016.
7
Ⅲ－3. Number and Market Cap of Companies
That Have Adopted IFRS
 The combined market capitalization of “① Companies that have adopted IFRS” and
”② Companies that have decided to adopt IFRS” and “③ Companies planning to adopt IFRS”
is JPY 140 trillion, 27% of the entire listed market capitalization (JPY 518 trillion).
All TSE-listed companies
JPY 518 trillion
(3,494 companies)
①～③ JPY 140 trillion
(128 companies)：27%
① Companies that ⇒ ＋3% since previous
announcement
have adopted IFRS
JPY 85 trillion
(74 companies)
：16%
Not included
in analysis
JPY 32 trillion
(300 companies)：6%
② Companies that have
decided to adopt IFRS
JPY 19 trillion
(32 companies)：4%
⑤ Other companies
JPY 262 trillion
(2,853 companies)：51%
④ Companies
considering IFRS
adoption
JPY 84 trillion
(213 companies)
：16%
Note: Market capitalization as of Mar. 31, 2016.
③ Companies planning
to adopt IFRS
JPY 35 trillion
(22 companies)：7%
8
Ⅲ－4. IFRS Adoption by Industrial Sector
 By industrial sector, "① Companies that have adopted IFRS“, "② Companies that have decided to
adopt IFRS“, and "③ Companies planning to adopt IFRS" are found in 23 of the 33 industrial sectors.
⇒ ＋1 industrial sector since previous announcement
 Industrial sectors that have a significant number of "① Companies that have adopted IFRS" and "②
Companies that have decided to adopt IFRS" and "③ Companies planning to adopt IFRS" are:
Electric Appliances (20), Pharmaceutical (13), Information & Communication (12), Transportation
Equipment (11), Services (11), and Wholesale Trade (10).
Note:
(1) Market capitalization as of Mar 31, 2016.
(2) Numbers to the left of company names indicate the order of their market capitalization within the industrial sector.
Rubber Products
(4/19)
Pharmaceutical
(13/65)
Information & Communication
(12/376)
Wholesale Trade
(10/319)
(2) Sumitomo Rubber
Industries
(5) Sumitomo Riko
(1) Takeda Pharmaceutical
(2) Astellas Pharma
(3) ONO PHARMACEUTICAL
(5) Eisai
(6) CHUGAI PHARMACEUTICAL
(8) DAIICHI SANKYO
(9) Mitsubishi Tanabe Pharma
(12) SANTEN PHARMACEUTICAL
(18) Sosei Group
(42) GNI Group
(2) KDDI
(4) SoftBank
(5) Yahoo Japan
(8) NEXON
(15) KONAMI
(24) ITOCHU Techno-Solutions
(115) Infoteria
(204) Fusion Partners
(235) Hotto Link
(1) Mitsubishi
(2) MITSUI
(3) ITOCHU
(4) SUMITOMO
(5) Marubeni
(9) Hitachi High-Technologies
(13) Sojitz
(29) ITOCHU ENEX
(44) KANEMATSU
(1) JAPAN TOBACCO
(2) Asahi Group Holdings
(3) Suntory Beverage &
Food
(13) NH Foods
(1) BRIDGESTONE
(3) Yokohama Rubber
(4) Otsuka Holdings
(10) Kyowa Hakko Kirin
(19) SAWAI PHARMACEUTICAL
(1) NTT DOCOMO
(3) NIPPON TELEGRAPH AND
TELEPHONE
(6) NTT DATA
(19) AUTOBACS SEVEN
(4) Ajinomoto
(5) Kirin Holdings
①Adopted
②Decided to
adopt
③Planning to
adopt
Foods
(6/125)
Market
capitalization
（A）
JPY 4.3 trillion
JPY 21.6 trillion
JPY 37.5 trillion
JPY 11.1 trillion
JPY 12.9 trillion
Total market
cap of
industrial
sector（B）
JPY 4.9 trillion
JPY 28.5 trillion
JPY 52.5 trillion
JPY 21.1 trillion
JPY 24.9trillion
（A/B）
87%
76%
71%
53%
52%
9
Ⅲ－4. IFRS Adoption by Industrial Sector
Oil & Coal Products
(1/13)
(1) JX Holdings
Precision Instruments
(4/51)
Chemicals
(8/209)
Transportation Equipment
(11/97)
(1) HOYA
(21) Noritsu Koki
(6) Hitachi
(7) Panasonic
(11) SYSMEX
(14) TOSHIBA
(15) FUJITSU
(16) RICOH
(20) SEIKO EPSON
(26) KONICA MINOLTA
(30) BROTHER INDUSTRIES
(41) ADVANTEST
(47) Hitachi Kokusai Electric
(53) TOSHIBA TEC
(59) CLARION
(63) ANRITSU
(142) SUMIDA
(147) NIHON DEMPA KOGYO
(160) TEAC
(208) NISHISHIBA ELECTRIC
(1) Kao
(5) NITTO DENKO
(8) Mitsubishi Chemical Holdings
(17) TAIYO NIPPON SANSO
(19) Hitachi Chemical
(64) The Nippon Synthetic
Chemical Industry
(66) KUREHA
(2) HONDA MOTOR
(4) DENSO
(22) TS TECH
(26) KEIHIN
(29) F.C.C.
(30) NISSIN KOGYO
(32) KYB
(35) SHOWA
(54) YUTAKA GIKEN
(59) Yachiyo Industry
(4) NIKON
(15) NIKKISO
(9) NIDEC
(19) NEC
(10) NIPPON PAINT HOLDINGS
(10) Mazda Motor
①Adopted
②Decided to
adopt
③Planning to
adopt
Electric Appliances
(20/262)
Market
capitalization
（A）
JPY 1.1 trillion
JPY 2.5 trillion
JPY 14.5 trillion
JPY 6.8 trillion
JPY 11.4 trillion
Total market
cap of industrial
sector（B）
JPY 2.4 trillion
JPY 8.1 trillion
JPY 54.6 trillion
JPY 30.3 trillion
JPY 53.3 trillion
（A/B）
45%
31%
27%
23%
21%
10
Ⅲ－4. IFRS Adoption by Industrial Sector
Metal Products
(2/85)
(1) LIXIL Group
(4) DENTSU
(5) Rakuten
(7) M3
(16) DeNA
(23) COOKPAD
(26) NEXT
(35) TechnoPro Holdings
(41) BELLSYSTEM24 HOLDINGS
(46) SEPTENI HOLDINGS
(51) OUTSOURCING
(12) G-TEKT
(117) Metaps
①Adopted
②Decided to
adopt
③Planning to
adopt
Services
(11/379)
Glass & Ceramics Products
(2/58)
(1) Asahi Glass
(10) Nippon Sheet Glass
Other Financing Business
(3/29)
(2) Japan Exchange Group
(8) Hitachi Capital
(14) J Trust
Retail Trade
(5/338)
(2) FAST RETAILING
(26) SKYLARK
(51) COLOWIDE
(64) Toridoll
(79) OHSHO FOOD SERVICE
Market
capitalization
（A）
JPY 0.8 trillion
JPY 5.1 trillion
JPY 0.8 trillion
JPY 1.4 trillion
JPY 4.4 trillion
Total market
cap of
industrial
sector（B）
JPY 3.7 trillion
JPY 25.3 trillion
JPY 4.2 trillion
JPY 7.8 trillion
JPY 33.0 trillion
（A/B）
21%
20%
19%
17%
13%
11
Ⅲ－4. IFRS Adoption by Industrial Sector
Iron and Steel
(1/46)
(3) Hitachi Metals
Real Estate
(3/113)
(5) Iida Group Holdings
(32) TOSEI
Securities & Commodity
Futures
(2/42)
(3) SBI Holdings
(11) Monex Group
①Adopted
②Decided to
adopt
③Planning to
adopt
Machinery
(6/230)
(8) NSK
(11) Hitachi Construction
Machinery
(21) MIURA
(29) DMG MORI SEIKI
(40) Hitachi Koki
(54) TSUBAKI NAKASHIMA
Nonferrous Metals
(1/34)
(14) Asahi Holdings
(10) NTT URBAN DEVELOPMENT
Market
capitalization
（A）
JPY 0.5 trillion
JPY 1.0 trillion
JPY 0.3 trillion
JPY 1.5 trillion
JPY 0.05 trillion
Total market
cap of
industrial
sector（B）
JPY 5.6 trillion
JPY 14.1 trillion
JPY 5.1 trillion
JPY 22.7 trillion
JPY 3.5 trillion
（A/B）
9%
7%
7%
7%
2%
12
Ⅲ－4. IFRS Adoption by Industrial Sector
Land Transportation
(1/58)
①Adopted
②Decided to
adopt
Construction
(1/167)
Other Products
(1/108)
(21) Hitachi Transport System
③Planning to
adopt
(33) DUNLOP SPORTS
(26) TOSHIBA PLANT
SYSTEMS & SERVICES
Market
capitalization
（A）
JPY 0.2 trillion
JPY 0.1 trillion
JPY 0.03 trillion
Total market
cap of industrial
sector（B）
JPY 21.5 trillion
JPY 15.2 trillion
JPY 8.3 trillion
（A/B）
1%
1%
0.4%
10 industrial sectors with no company transitioning to IFRS and
size of industrial sector
( unit: companies )
Air
Transportation
5
Mining
Fishery,
Agriculture &
Forestry
7
11
Insurance
Marine
Transportation
Electric
Power & Gas
12
14
23
Pulp & Paper
Warehousing
& Harbor
Transportation
Services
Textiles &
Apparels
Banks
24
36
53
86
13
Ⅲ－5. IFRS Adoption Date
 The scheduled adoption dates (including targeted) that "③ Companies planning to
adopt IFRS (22 companies)" have described in their Basic Policy are as follows.
Adoption/Scheduled
adoption date
(including quarters
within the range)
Companies
that have
adopted IFRS
Companies
that have
decided to
adopt IFRS
Companies
planning to
adopt IFRS
Total
～ March 2015
62
－
－
62
April 2015 ～ March 2016
10
9
－
19
April 2016 ～ March 2017
2
16
8
26
April 2017 ～ March 2018
－
3
4
7
April 2018 ～ March 2019
－
1
5
6
April 2019 ～
－
－
1
1
TBD
－
3
4
7
Total
74
32
22
128
14
Ⅲ－6. Stage of Progress Among
"④ Companies Considering IFRS Adoption"
 Of the 213 companies that were “considering IFRS adoption”, 158 companies described
concrete matters in its Basic Policy. Many described "Preparation of manual and guidance“.
58
Preparation of manual and guidance
50
Impact studies/analysis
42
Analysis of differences in accounting standards
38
Acquisition of knowledge on accounting standards
34
Collecting information
13
Development of accounting policies
10
Establishment of internal structure
5
Consideration of transitioning process
2
Unification of closing dates
7
Others
0
10
20
Note: Total exceeds 158 due to descriptions falling under multiple categories.
30
40
50
60
15