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41
TOSHIBA Annual Report 2012
13. ACCRUED PENSION AND SEVERANCE COSTS
All employees who retire or are terminated are usually entitled to lump-sum severance indemnities or pension benefits
determined by reference to service credits allocated to employees each year according to the regulation of retirement
benefit, length of service and conditions under which their employment terminates. The obligation for the severance
indemnity benefit is provided for through accruals and funding of the defined benefit corporate pension plan.
The Company and certain subsidiaries in Japan have amended their pension plan under the agreement between
employees and managements in January 2011, and introduced Cash Balance Plan from April 2011. This plan is designed
that each plan participant has a notional account, which is accumulated based on salary standards, interest rates in
financial markets and others.
The funding policy for the plans is to contribute amounts required to maintain sufficient plan assets to provide for
accrued benefits, subject to the limitation on deductibility imposed by Japanese income tax laws.
The changes in the benefit obligation and plan assets for the years ended March 31, 2012 and 2011 and the funded status
at March 31, 2012 and 2011 are as follows:
Millions of yen
Thousands of
U.S. dollars
March 31 2012 2011 2012
Change in benefit obligation:
Benefit obligation at beginning of year ¥ 1,524,466 ¥ 1,523,910 $ 18,591,049
Service cost 52,940 52,120 645,610
Interest cost 38,265 38,687 466,646
Plan participants' contributions 4,390 4,114 53,536
Plan amendments 649 (18,951) 7,915
Actuarial loss 77,645 28,533 946,890
Benefits paid (79,617) (83,185) (970,939)
Acquisitions and divestitures (10,570) (10,638) (128,902)
Foreign currency exchange impact (1,359) (10,124) (16,573)
Benefit obligation at end of year ¥ 1,606,809 ¥ 1,524,466 $ 19,595,232
Change in plan assets:
Fair value of plan assets at beginning of year ¥ 790,399 ¥ 800,883 $ 9,639,012
Actual return on plan assets 12,207 (7,926) 148,866
Employer contributions 72,769 52,207 887,427
Plan participants' contributions 4,390 4,114 53,536
Benefits paid (53,405) (51,773) (651,280)
Acquisitions and divestitures 3,234 93 39,439
Foreign currency exchange impact (958) (7,199) (11,683)
Fair value of plan assets at end of year ¥ 828,636 ¥ 790,399 $ 10,105,317
Funded status ¥ (778,173) ¥ (734,067) $ (9,489,915)
Amounts recognized in the consolidated balance sheets at March 31, 2012 and 2011 are as follows:
Millions of yen
Thousands of
U.S. dollars
March 31 2012 2011 2012
Other assets ¥ 1,175 ¥ 870 $ 14,329
Other current liabilities (768) (628) (9,366)
Accrued pension and severance costs (778,580) (734,309) (9,494,878)
¥ (778,173) ¥ (734,067) $ (9,489,915)