MARUI CO., LTD.

Millions of yen
Thousands of
U.S. dollars
2003/9 2003/1 2003/9
(a) Present value of the future obligations .......................................................................................... ¥ (6,320) ¥(149,076) $ (56,937)
(b) Pension plan assets........................................................................................................................ 22,317 61,367 201,054
(c) Unfunded obligations of severance and retirement benefits ((a)+(b)) ......................................... 15,997 (87,709) 144,117
(d) Unrecognized actuarial losses ....................................................................................................... 1,560 43,359 14,054
(e) Subtotal ((c)+(d)).......................................................................................................................... 17,557 (44,350) 158,171
(f) Prepaid pension expense............................................................................................................... 18,857 6,041 169,883
(g) Severance and retirement benefits for employees ((e)–(f)) .......................................................... ¥ (1,300) ¥ (50,391) $ (11,712)
Severance and retirement benefit costs included in the consolidated statements of income for the period ended September 30, 2003,
and the year ended January 31, 2003, are comprised of the following:
Thousands of
Millions of yen
U.S. dollars
2003/9 2003/1 2003/9
Service costs ........................................................................................................................................ ¥2,187 ¥ 4,890 $19,702
Interest costs........................................................................................................................................ 1,322 3,826 11,910
Expected return on plan assets............................................................................................................ (573) (1,953) (5,162)
Amortization of actuarial gains and losses .......................................................................................... 1,201 2,041 10,820
Severance and retirement benefit costs for employees........................................................................ ¥4,137 ¥ 8,804 $37,270
Gain on winding up of the non-contributory defined benefit pension plan....................................... ¥(28,564) ¥ – $(257,333)
Loss on partial termination of privately held pension plan and loss on partial termination
of lump-sum severance and retirement payment plan ...................................................................... 396 – 3,568
In addition to the above, the Company and its consolidated subsidiaries recognized special termination benefits paid to employees,
which consist of premium severance pay, etc., amounted to ¥14,901 million ($134,243 thousand) as part of special losses.
The discount rate and the rate of expected return on plan assets used by the Companies are 2.0% and 2.5%, respectively.
The estimated amount of all severance and retirement benefits to be paid in the future is allocated equally to each service year using the
estimated number of total service years.
11. INCOME TAXES
The Companies are subject to a number of income taxes, which, in the aggregate, indicate a statutory rate in Japan of approximately
40.5% for the period ended September 30, 2003, and 42.1% for the years ended January 31, 2003 and 2002.
(a) Significant components of the Companies’ deferred income tax assets and liabilities as of September 30 and January 31, 2003,
were as follows:
Thousands of
Millions of yen
U.S. dollars
2003/9 2003/1 2003/9
Deferred income tax assets:
Retirement benefits.......................................................................................................................... ¥ – ¥13,618 $ –
Depreciation .................................................................................................................................... 4,470 4,447 40,270
Accrued bonuses.............................................................................................................................. 2,644 – 23,820
Unrealized profits for property and equipment transferred among the Companies ....................... 2,515 2,306 22,658
Accrued enterprise tax..................................................................................................................... – 826 –
Tax loss carry forward ..................................................................................................................... 16,354 821 147,333
Allowance for doubtful accounts..................................................................................................... 1,399 1,044 12,604
Other ............................................................................................................................................... 3,762 4,006 33,892
Gross deferred income tax assets................................................................................................. 31,144 27,068 280,577
Valuation allowance..................................................................................................................... (691) (394) (6,225)
Total deferred income tax assets .............................................................................................. 30,453 26,674 274,352
Deferred income tax liabilities:
Deferred gains on sales of property and equipment ........................................................................ (4,763) (4,608) (42,910)
Prepaid pension expense ................................................................................................................. (8,625) – (77,703)
Reserve for special depreciation ...................................................................................................... (2,299) (2,255) (20,712)
Profits on installment sales.............................................................................................................. (259) (712) (2,333)
Other ............................................................................................................................................... (1,117) (19) (10,063)
Total deferred income tax liabilities......................................................................................... (17,063) (7,594) (153,721)
Net deferred income tax assets ............................................................................................ ¥13,390 ¥19,080 $120,631
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