Square Enix 2005 Annual Report Download - page 57

55
Annual Report 2005
Reconciliation of beginning and ending balances of
benefit obligations are as follows:
Thousands of
Millions of yen U.S. dollars
2005 2004 2005
Change in benefit obligation:
Benefit obligation at beginning
of year ¥(0,983 ¥(0,199 $(09,161
Service cost 214 227 1,992
Interest cost 16 8147
Benefit obligation transferred from
acquired company —675 —
Prior service costs (101) —(939)
Actuarial gains (104) (94) (965)
Benefits paid (40) (32) (369)
Benefit obligation at end of year ¥(0,968 ¥(0,983 $(09,027
Funded status (968) (983) (9,027)
Unrecognized actuarial loss (180) (76) (1,673)
Unrecognized prior service costs (101) —(939)
Unrecognized FAS87 transition
obligation 21 24 200
Net amount recognized ¥(1,228) ¥(1,035) $(11,439)
Amount recognized in the balance
sheet is:
Accrued pension costs (1,228) (1,035) (11,439)
Net amount recognized ¥(1,228) ¥(1,035) $(11,439)
Accumulated benefit obligation at
end of year ¥(0,845 ¥(0,513 $(07,868
Actuarial assumption:
Discount rate 1.652% 1.611% 1.652%
Assumed rate of increase in
compensation level 4.101% 4.370% 4.101%
The future benefit payments for the plan are expected
as follows:
Thousands of
Years ending March 31 Millions of yen U.S. dollars
2006 ¥077 $0,717
2007 80 753
2008 82 769
2009 81 755
2010 77 721
2011–2015 303 2,828
Retirement Benefit to Directors and Statutory Auditors
In order to prepare for the payment of retirement benefit to
the Company’s directors and statutory auditors in the future,
the Company internally funds a retirement allowance. The
Board of Directors determined the certain formula for
calculation of retirement benefits, pursuant to which, the
benefits are calculated based on a certain fixed amount
multiplied by the number of years of office and the coeffi-
cient predetermined by the Board according to the title of
directors. The JCC requires shareholders’ approval before
it is paid, and the Company accrues retirement allowance
according to such formula until the benefits are approved
by the shareholders for payment. The balances of ¥55 million
and ¥110 million at March 31, 2005 and March 31, 2004,
respectively, are presented as “other long-term liabilities”
in the consolidated balance sheets. Charges to income for
the directors’ and corporate auditors’ retirement plans were
¥121 million, ¥6 million and ¥7 million (unaudited) in 2005,
2004 and 2003, respectively.
14. Income Taxes
Domestic and foreign income (loss) before income taxes
are as follows:
Thousands of
Years ended March 31 Millions of yen U.S. dollars
2005 2004 2003 2005
(Unaudited)
Domestic ¥21,745 ¥4,577 ¥4,290 $202,484
Foreign 2,547 3,031 (45) 23,714
Total ¥24,292 ¥7,608 ¥4,245 $226,198
Income tax expenses are as follows:
Thousands of
Years Ended March 31 Millions of yen U.S. dollars
2005 2004 2003 2005
(Unaudited)
Current: ¥11,267 ¥(3,600 ¥(3,162 $104,917
Domestic 10,350 1,723 3,162 96,386
Foreign 917 1,877 — 8,531
Deferred: ¥ (1,612) ¥(1,168) ¥(1,240) $ (15,013)
Domestic (1,807) (1,234) (1,240) (16,829)
Foreign 195 66 — 1,816
Total ¥09,655 ¥(2,432 ¥(1,922 $089,904
The differences between the provision for income taxes
and the income taxes computed using Japan statutory tax
rate to pretax income as a percentage of pretax income are
as follows:
2005 2004 2003
Years ended March 31 (Unaudited)
Statutory tax rate (%) 40.70% 42.05% 42.05%
Tax rate difference from foreign
consolidated affiliates (1.23) (2.29) —
Effect of tax rate change (0.86) (0.22) 0.57
Accumulated earnings tax —— 1.86
Investment tax credit (0.58) (2.19 ) —
Reversal of valuation allowance on
deferred tax assets —(3.50) —
Others 1.72 (1.88) 0.81
Income tax expense (%) 39.75% 31.97% 45.29%