Brother International 2014 Annual Report Download - page 49

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48
13. Income Taxes
The Company and its domestic subsidiaries are subject to Japanese national and local income taxes which, in the aggregate, resulted in a normal effective statutory tax rate
of approximately 38% for the years ended March 31, 2014 and 2013.
The tax effects of significant temporary differences and tax loss carryforwards which resulted in deferred tax assets and liabilities at March 31, 2014 and 2013, were as follows:
Millions of Yen
Thousands of
U.S. Dollars
2014 2013 2014
Deferred Tax Assets:
Inventories ¥ 11,404 ¥ 9,563 $ 110,718
Liability for retirement benefits 4,620 —44,854
Employees’ retirement benefits — 1,235 —
Depreciation 4,052 3,150 39,340
Write-down of investment securities 3,982 4,171 38,660
Accrued bonuses 2,444 2,227 23,728
Accrued expenses 1,890 1,880 18,350
Warranty reserve 1,144 807 11,107
Allowance for doubtful accounts 912 6,516 8,854
Tax loss carryforwards 12,728 13,161 123,573
Other 5,663 4,766 54,981
Less valuation allowance (27,592) (26,350) (267,883)
Total deferred tax assets ¥ 21,247 ¥ 21,126 $ 206,282
Deferred Tax Liabilities:
Undistributed earnings of foreign subsidiaries ¥ (5,584) ¥ (4,308) $ (54,214)
Asset for retirement benefits (3,604) —(34,990)
Prepaid pension cost — (3,852) —
Securities withdrawn from retirement benefit trust (2,845) (2,845) (27,621)
Differences between book and tax bases of property, plant and equipment (1,614) (1,750) (15,670)
Unrealized gain on available-for-sale securities (1,397) (1,517) (13,563)
Other (1,389) (1,331) (13,485)
Total deferred tax liabilities ¥ (16,433) ¥ (15,603) $ (159,543)
Net deferred tax assets ¥ 4,814 ¥ 5,523 $ 46,739
Brother Industries, Ltd. and Consolidated Subsidiaries
Year ended March 31, 2014
Notes to Consolidated Financial Statements