Nikon 2000 Annual Report Download - page 24

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6. SHAREHOLDERS’ EQUITY
The Code requires at least 50% of the issue price of new shares, with a minimum of the par value thereof, to be designated as stated capital as
determined by resolution of the Board of Directors. Proceeds in excess of amounts designated as stated capital are credited to additional
paid-in capital.
The Code also requires companies to appropriate from retained earnings to legal reserve an amount equal to at least 10% of all cash
payments which are made as an appropriation of retained earnings until such reserve equals 25% of stated capital.
The Company may transfer portions of additional paid-in capital and legal reserve to stated capital by resolution of the Board of Directors.
The Company may also transfer portions of unappropriated retained earnings, available for dividends, to stated capital by resolution of the
shareholders.
Under the Code, the Company may issue new shares of common stock to existing shareholders without consideration as a stock split
pursuant to resolution of the Board of Directors. The Company may make such a stock split to the extent that the aggregate par value of the
shares outstanding after the stock split does not exceed the stated capital. However, the amount calculated by dividing the total amount of
shareholders’ equity by the number of outstanding shares after the stock split shall not be less than ¥ 50.
Dividends are approved by the shareholders at a meeting held subsequent to the fiscal year to which the dividends are applicable. Interim
dividends may also be paid upon resolution of the Board of Directors, subject to certain limitations imposed by the Code.
Under the Code, the Company may resolve to repurchase its treasury stock for retirement and related reduction of retained earnings
pursuant to resolution of the Board of Directors, subject to approval by the shareholders.
At the general shareholders’ meeting held on June 29, 1999, the Company’s shareholders approved that the Company is authorized to
repurchase, at management’s discretion, up to 35 million shares of Company’s stock for the purpose of canceling the shares by charging
repurchased amounts to retained earnings.
Under the Code, the amount available for dividends is based on retained earnings as recorded on the Company’s books. At March 31, 2000,
retained earnings as recorded on the Company’s books were ¥55,850 million ($526,142 thousand), which is available for future dividends
subject to the approval of the shareholders and legal reserve requirements.
7. INCOME TAXES
The Company and its domestic subsidiaries are subject to Japanese national and local income taxes which, in the aggregate, resulted in a nor-
mal effective statutory tax rates of approximately 42% and 48% for the years ended March 31, 2000, and 1999, respectively.
The tax effects of significant temporary differences and loss carryforwards which result in deferred tax assets and liabilities at March 31,
2000 and 1999 were as follows:
Thousands of
Millions of Yen U.S. Dollars
2000 1999 2000
Deferred tax assets:
Devaluation of inventories ¥ 4,649 ¥ 5,082 $ 43,800
Allowance for doubtful receivables 3,256 515 30,669
Depreciation and amortization 6,118 5,117 57,637
Tax loss carryforwards 249 5,759 2,346
Other 4,882 2,346 45,996
¥19,154 ¥ 18,819 $180,448
Valuation allowance of ¥3,451 million ($32,518 thousand) in 2000 and ¥4,000 million in 1999 were deducted from the amounts calculated
above.
Deferred tax liabilities :
Deferred profits on sales of property to be replaced 2,141 2,073 20,167
Other 494 952 4,660
¥ 2,635 3,025 $ 24,827
Net deferred tax assets ¥16,519 15,794 $155,621