Brother International 2014 Annual Report Download - page 45

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44
Brother Industries, Ltd. and Consolidated Subsidiaries
Year ended March 31, 2014 10. Asset Retirement Obligations
(a) Outline of Asset Retirement Obligations
The Group’s asset retirement obligations are primarily the result of legal obligations for the removal of leasehold improvements, the restoration of premises to the
original condition, and the removal of LCD monitor in karaoke machines upon the termination of the lease of karaoke houses.
(b) Method applied to computation of the asset retirement obligations
The estimated periods until the asset retirement obligations are settled are two to 30 years from the acquisition. The discounted rates used for computation of the
asset retirement obligations are 0.09% to 3.48%.
The changes in asset retirement obligations for the years ended March 31, 2014 and 2013 were as follows:
Millions of Yen
Thousands of
U.S. Dollars
2014 2013 2014
Balance at beginning of year ¥ 1,039 ¥ 973 $ 10,087
Additional provisions associated with purchases of property, plant and equipment 87 127 845
Reconciliation associated with passage of time 13 14 126
Reduction associated with settlement of asset retirement obligations (109) (81) (1,058)
Other 18 6175
Balance at end of year ¥ 1,048 ¥ 1,039 $ 10,175
Asset retirement obligations above were included in both of the “Other current liabilities” among the “CURRENT LIABILITIES” section and the “Other long-term liabilities”
among the “LONG-TERM LIABILITIES” section in the accompanying consolidated balance sheet.
11. Equity
Japanese companies are subject to the Companies Act. The significant provisions in the Companies Act that affect financial and accounting matters are summarized below:
(a) Dividends
Under the Companies Act, companies can pay dividends at any time during the fiscal year in addition to the year-end dividend upon resolution at the shareholders’ meet-
ing. For companies that meet certain criteria including (1) having a Board of Directors, (2) having independent auditors, (3) having an Audit & Supervisory Board, and (4) the
term of service of the directors is prescribed as one year rather than two years of normal term by its articles of incorporation, the Board of Directors may declare dividends
(except for dividends-in-kind) at any time during the fiscal year if the company has prescribed so in its articles of incorporation. The Company meets all the above criteria.
The Companies Act permits companies to distribute dividends-in-kind (noncash assets) to shareholders subject to a certain limitation and additional requirements.
Semiannual interim dividends may also be paid once a year upon resolution by the Board of Directors if the articles of incorporation of the company so stipulate. The
Companies Act provides certain limitations on the amounts available for dividends or the purchase of treasury stock. The limitation is defined as the amount available for
distribution to the shareholders, but the amount of net assets after dividends must be maintained at no less than ¥3 million.
Notes to Consolidated Financial Statements