Nikon 2004 Annual Report Download - page 34

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32
based on the amount recorded in the Company’s general books of account. In addition to the provision that requires an appropriation for
a legal reserve in connection with the cash payment, the Code imposes certain limitations on the amount of retained earnings available
for dividends.
Dividends are approved by the shareholders at a meeting held subsequent to the fiscal year to which the dividends are applicable.
Semiannual interim dividends may also be paid upon resolution of the Board of Directors, subject to certain limitations imposed by the Code.
9. SELLING, GENERAL AND ADMINISTRATIVE EXPENSES
Selling, general and administrative expenses for the fiscal years ended March 31, 2004 and 2003 principally consisted of the following:
Advertising expenses
Provision of warranty costs
Employees’ salaries
Employees’ retirement benefit plan
Employees’ bonuses and others
Research and development costs
Thousands of
U.S. Dollars
2004
$291,638
37,898
260,209
50,096
111,655
285,413
2003
¥33,064
4,992
28,361
4,751
12,222
27,506
2004
¥30,823
4,005
27,502
5,295
11,801
30,165
Millions of Yen
Deferred tax assets :
Write-down of inventories
Warranty reserve
Liability for employees’ retirement benefits
Depreciation and amortization
Net operating loss carryforwards
Accrued bonus
Other
Total
Deferred tax liabilities :
Deferred gains on sales of property to be replaced
Unrealized gain on available-for-sale securities
Undistributed earnings of foreign subsidiaries
Other
Total
Net deferred tax assets
Thousands of
U.S. Dollars
2004
$99,252
13,014
100,036
114,179
23,596
27,704
33,769
$411,550
68,049
38,426
22,637
6,739
$135,851
$275,699
2003
¥9,823
1,496
9,410
10,589
8,325
2,506
8,672
¥50,821
5,742
2,310
2,030
¥10,082
¥40,739
2004
¥10,490
1,375
10,573
12,068
2,494
2,928
3,569
¥43,497
7,192
4,061
2,392
713
¥14,358
¥29,139
Millions of Yen
The tax effects of significant temporary differences and loss carry forwards which resulted in deferred tax assets and liabilities, at March
31, 2004 and 2003, were as follows:
10. 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 rate of approximately 42% for the respective years.
On March 31 2003, a new local tax was enacted and become effective for fiscal years beginning on or after April 1, 2004. The new local
tax law decreased the local tax rate and introduced a new tax levied based on paid-in capital. As a result, the statutory effective tax rate
applied on or after April 1, 2004 to the deferred income taxes and liabilities has been decreased from 42.0% to 40.6%.