Sharp 2006 Annual Report Download - page 50

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49
8. Contingent Liabilities
Loans guaranteed .........................................................................................................................
Notes discounted ......................................................................................................................... $ 66,233
8,327
$ 74,560
¥ 7,683
966
¥ 8,649
20062006
Yen
(millions) U.S. Dollars
(thousands)
The Japanese Commercial Code provides that at least one-half
of the proceeds from shares issued be included in common stock
and the remaining amount of the proceeds be accounted for as addi-
tional paid-in capital, which is included in capital surplus.
The Code provides that an amount equivalent to at least 10% of
cash dividends paid and other cash outlays shall be appropriated and
set aside as legal reserve until the total amount of legal reserve and
additional paid-in capital equals 25% of the stated capital.
As of March 31, 2006, the total amount of legal reserve and addi-
tional paid-in capital exceeded 25% of the stated capital and, there-
fore, no additional provision is required.
On condition that the total amount of legal reserve and additional
paid-in capital remains being equal to or exceeding 25% of the stated
capital, they are available for distribution by the resolution of the share-
holders’ meeting. Legal reserve is included in retained earnings.
Year end cash dividends are approved by the shareholders after
the end of each fiscal year and semiannual interim cash dividends
are declared by the Board of Directors after the end of each interim
six-month period. Such dividends are payable to shareholders of record
at the end of each fiscal year or interim six-month period. In accor-
dance with the Code, final cash dividends and the related appropri-
ations of retained earnings have not been reflected in the financial
statements at the end of such fiscal year. However, cash dividends
per share shown in the accompanying consolidated statements of
income reflect dividends applicable to the respective period.
On June 22, 2006, the shareholders approved the declaration
of year end cash dividends totaling ¥13,090 million ($112,845 thou-
sand) to shareholders of record as of March 31, 2006, covering the
year then ended.
7. Shareholders’ Equity and Per Share Data
As of March 31, 2006, the Company and its consolidated subsidiaries had contingent liabilities as follows: