Isuzu 2007 Annual Report Download - page 34

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Isuzu Motors Limited Annual Report 2007
Financial Section
Thousands of
Millions of yen U.S. dollars
Net Income
Less: Components not pertaining to
common shareholders;
Preferred dividend as distribution of profits
Net income pertaining to common stock
Average outstanding shares:
Common stock (share):
Class IV preferred stock (share):
Thousands of
Millions of yen U.S. dollars
Cash and time deposits
on the consolidated balance sheets
Time deposits with maturities
exceeding three months
Bonds with maturities
within three months
Cash and cash equivalents on the
statement of cash flows
$ 1,136,269
-5,007
57,758
$ 1,189,019
¥ 134,136
-591
6,818
¥ 140,363
$782,670
2,986
$779,683
¥ 92,394
352
¥ 92,041
1,371,125,102
48,661,800
Actuarial gains or losses are amortized in the year following the year
using the straight-lined method over the average of the remaining
service lives of mainly 10 years commencing with the following peri-
ods, which are shorter than the average remaining years of service of
the eligible employees.
(Additional Information)
On July 1, 2006, pension funds of several consolidated subsidiaries
received permission from the Minister of Health, Labor and Welfare
to be exempt from the benefits related to past employee service un-
der the substitutional portion. Gain on this transition, ¥2,531 millions
($21,448 thousands), is included under Extraordinary Items.
Several consolidated subsidiaries have adopted the defined contri-
bution pension plan for parts of the unfunded lump-sum benefit plans
in July and October 2006. These adoptions were accounted for in ac-
cordance with the "Guidance on Accounting for Transfer between
Retirement Benefit Plans" (Accounting Standards Board of Japan
Guidance No. 1). Gains and losses on these transitions, ¥157 millions
($1,330 thousands) gain and ¥192 millions ($1,629 thousands) loss, are
included under Extraordinary Items, respectively.
i) Income Taxes
Income taxes are accounted for on an accrual basis. Deferred tax as-
sets and liabilities are recognized for the future tax consequences at-
tributable to differences between the financial statement carrying
amounts of existing assets and liabilities and their respective tax bas-
es. Deferred tax assets and liabilities are measured using enacted tax
rates expected to apply to taxable income in the years in which those
temporary differences are expected to be recovered or settled. The
effect of deferred tax assets and liabilities of a change in tax rate are
recognized in income in the period that includes the enacted date.
j) Net Income per Share
Net income per share of common stock is calculated based upon the
weighted average number of shares of common stock outstanding
during each year.
Basis for the calculation of net income per share at the year ended
March 31, 2007 is as follows:
k) Appropriation of Retained Earnings
The appropriation of retained earnings is recorded in the fiscal year
in which such appropriation is approved by the Board of Directors or
Shareholders.
l) Cash and Cash Equivalents
For the purpose of the consolidated statements of cash flows, the
Company considers all highly liquid investments with a maturity of
three months or less to be cash equivalents.
Reconciliation for cash and cash equivalents at end of the year on
the consolidated statements of cash flows for the years ended March
31, 2007 is as follows:
m) Accounting Changes
Accounting Policy for Foreign Currency Translation of Principal Balance
Sheets Accounts
The Company has translated balance sheets accounts and revenue
and expense accounts of foreign consolidated subsidiaries into yen
at the exchange rate prevailing on the date of the balance sheets of
each of those subsidiaries. The Company has included translation ad-
justments in the foreign currency translation adjustment accounts of
shareholders’ equity and minority interest. While the Company contin-
ues to translate balance sheets accounts of foreign consolidated sub-
sidiaries into yen using the exchange rate prevailing at the date of the
balance sheet of each of those subsidiaries, it has translated, begin-
ning this fiscal year, statement of income using the average exchange
rate during the statement of income period. Translation adjustments
are included in the foreign currency translation adjustments account
and minority interest of shareholders’ equity. The Company has ad-
opted this new accounting policy, aiming to increase the accuracy of
its foreign subsidiaries’ financial results in the consolidated financial
statements and to decrease the risks of short-term movements in for-
eign currencies. This adoption has decreased consolidated net sales by
¥53,641 millions ($454,392 thousands), operating income by ¥2,543
millions ($21,545 thousands), income before extraordinary items by
¥3,287 millions ($27,847 thousands), income before income taxes and
minority interests by ¥3,379 millions ($28,624 thousands), and net in-
come by ¥1,932 millions ($16,368 thousands), compared with the fig-
ures calculated using the exchange rate of the balance sheets date.
Accounting Standard for Presentation of Net Assets in the Balance
Sheets
The Company and its domestic consolidated subsidiaries has adopted
”Accounting Standards for Presentation of Net Assets in the Balance
Sheet“ (ASBJ Statement No. 5 issued on December 9, 2005) and
”Guidance on Accounting Standards for Presentation of Net Assets
in the Balance Sheet“ (ASBJ Guidance No. 8 issued on December
9, 2005) beginning this fiscal year. The total amount equivalent to
the formerly presented shareholders’ equity is ¥342,003 millions