Casio 2009 Annual Report Download - page 33

31
Annual Report 2009
Provision for retirement benefits
Under the terms of the employees’ severance and retirement plan, eligible employees are entitled under most circumstances, upon
mandatory retirement or earlier voluntary severance, to severance payments based on compensation at the time of severance and
years of service.
Employees’ severance and retirement benefits of the Company and some of its consolidated subsidiaries in Japan are covered
by two kinds of pension plans which are defined benefit corporate pension fund plan and tax-qualified pension plan. And those of
the Company and some of its consolidated subsidiaries in Japan are covered by lump-sum indemnities.
The Company and its domestic consolidated subsidiaries received the permission from the Minister of Health, Labor and Welfare,
for release from the obligation of paying benefits for employees’ prior services relating to the substitutional portion of the Welfare
Pension Insurance Scheme. Concurrently, employees’ pension fund plan was changed to defined benefit corporate pension fund plan.
The Company and some of its domestic consolidated subsidiaries provide defined contribution plan. In addition, the Company
has established an employee retirement benefits trust.
The liabilities and expenses for provision for retirement benefits are determined based on the amounts actuarially calculated
using certain assumptions.
The Company and its consolidated subsidiaries in Japan provided liabilities for provision for retirement benefits at March 31,
2001 based on the estimated amounts of projected benefit obligation and the fair value of the plan assets at that date.
The excess of the projected benefit obligation over the total of the fair value of pension assets as of April 1, 2000 and the liabili-
ties for severance and retirement benefits recorded as of April 1, 2000 (the “net transition obligation”) is recognized in expenses in
equal amounts over 10 years commencing with the year ended March 31, 2001.
Provision for directors’ retirement benefits
The annual provision for accrued retirement benefits for directors and corporate auditors of the Company and certain subsidiaries
is calculated to state the liability at the amount that would be required if all directors and corporate auditors had retired at each
balance sheet date. The provisions for the retirement benefits are not funded.
Income taxes
Taxes on income consist of corporation, inhabitants and enterprise taxes.
Deferred income taxes are provided for the items relating to intercompany profit elimination in connection with the calculation
of the consolidated results of operations. In addition, some foreign subsidiaries recognize deferred income taxes in accordance with
accounting practices prevailing in their respective countries of domicile.
The Group recognizes tax effects of temporary differences between the financial statement and the tax basis of assets and
liabilities. The provision for income taxes is computed based on the income before income taxes and minority interests included in
the statements of income of each company of the Group. The asset and liability approach is used to recognize deferred tax assets
and liabilities for the expected future tax consequences of temporary differences.
Appropriations of retained earnings
Appropriations of retained earnings are accounted for and reflected in the accompanying consolidated financial statements when
approved by the shareholders.
Amounts per share of common stock
Net income per share of common stock has been computed based on the weighted average number of shares of common stock
outstanding during each fiscal year (less the treasury stock). Diluted net income per share is calculated based on the assumption
that all dilutive convertible bonds and stock options were converted or exercised at the beginning of year or at the time of issue.
Related interest expense, net of income taxes, is eliminated.
Cash dividends per share represent the actual amount applicable to the respective years.
Reclassifications
Certain reclassifications have been made in the 2008 consolidated financial statements to conform to the 2009 presentation.