JVC 2004 Annual Report Download - page 47

Annual Report 2004 45.
will be disclosed more appropriately under the new presentation
method. As a result of the change, net sales, selling, general and
administrative expenses and operating income increased by
¥7,356 million, ¥4,066 million and ¥3,290 million, respectively,
and other income decreased by ¥3,290 million compared with
what would have been reported under the former accounting
policies. Income before income taxes and minority interests was
unaffected by this change.
Details of the impact on segment information are described in
Note 14.
4. RELATIONSHIP WITH MATSUSHITA ELECTRIC INDUSTRIAL
CO., LTD.
The Company is a subsidiary of Matsushita Electric Industrial Co.,
Ltd. (“Matsushita”). At March 31, 2004, Matsushita held 133,227
thousand shares of common stock of the Company, 52.40% of
the total outstanding shares.
Transactions between the Company and Matsushita for the
years ended March 31, 2004, 2003 and 2002, and the account
balances between the two companies at March 31, 2004 and
2003 are not material.
5. INVENTORIES
Inventories at March 31, 2004 and 2003 are as follows:
Thousands of
Millions of yen U.S. dollars
2004 2003 2004
Finished goods ¥ 98,506 ¥ 77,378 $ 929,302
Work in process 11,231 10,391 105,953
Raw materials and supplies 20,175 23,487 190,330
¥129,912 ¥111,256 $1,225,585
6. SECURITIES
The following tables summarize acquisition costs, and book values of
securities with available fair values as of March 31, 2004 and 2003:
(1) Available-for-sale securities
Millions of yen
Acquisition
cost Book value Difference
2004:
Securities with available fair
values exceeding
acquisition costs
Equity securities ¥4,071 ¥12,040 ¥7,969
Securities with available fair
values not exceeding
acquisition costs
Equity securities ¥ 51 ¥ 49 ¥ (2)
Total ¥4,122 ¥12,089 ¥7,967
Millions of yen
Acquisition
cost Book value Difference
2003:
Securities with available fair
values exceeding
acquisition costs
Equity securities ¥ 406 ¥1,474 ¥1,068
Securities with available fair
values not exceeding
acquisition costs
Equity securities ¥4,212 ¥4,018 ¥ (194)
Total ¥4,618 ¥5,492 ¥ 874
Thousands of U.S. dollars
Acquisition
cost Book value Difference
2004:
Securities with available fair
values exceeding
acquisition costs
Equity securities $38,406 $113,585 $75,179
Securities with available fair
values not exceeding
acquisition costs
Equity securities $ 481 $ 462 $ (19)
Total $38,887 $114,047 $75,160
The following tables summarize book values as of March 31, 2004
and 2003 of securities with no available fair values.
(2) Available-for-sale securities
Thousands of
Millions of yen U.S. dollars
2004 2003 2004
Book value Book value Book value
Unlisted equity securities ¥1,627 ¥2,008 $15,349
Unlisted foreign debt
securities 8276
Subsidiaries and affiliated
companies 2,144 916 20,226
Total ¥3,779 ¥2,926 $35,651
(3) Available-for-sale securities sold in the years ended March 31,
2004, 2003 and 2002 are as follows:
Thousands of
Millions of yen U.S. dollars
2004 2003 2002 2004
Sales ¥886 ¥6,247 ¥19,640 $8,358
Gains 280 318 763 2,642
Losses 615 358 57
7. INCOME TAXES
Income taxes in Japan consist of corporation, enterprise and
inhabitants’ taxes. The Company and consolidated domestic
subsidiaries are subject to income taxes referred to above, which
in the aggregate, result in the statutory tax rate of approximately
42.0%. Consolidated overseas subsidiaries are subject to income
taxes of the countries in which they domicile. The following table
summarizes the significant differences between the statutory tax
rate and the Companies’ effective tax rate for financial statement
purposes for the year ended March 31, 2004 and 2003. Informa-
tion for 2002 was not prepared as the Companies incurred a net
loss in the year ended March 31, 2002.
2004 2003
Statutory tax rate 42.0 % 42.0 %
Lower tax rates of overseas subsidiaries (8.7)% (10.3)%
Expenses not deductible for tax purposes 4.9 % 7.9 %
Effect of changes in valuation allowance
for deferred tax assets (47.1)% (71.9)%
Effect of change in tax rates 4.1 % 10.2 %
Other (8.9)% 57.5 %
Effective tax rate (13.7)% 35.4 %