Nikon 2004 Annual Report Download - page 36

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34
Obligations under finance leases at March 31, 2004 and 2003 were as follows:
Due within one year
Due after one year
Total
Thousands of
U.S. Dollars
2004
$21,175
37,041
$58,216
2003
¥2,399
4,366
¥6,765
2004
¥2,238
3,915
¥6,153
Millions of Yen
The amount of obligations under finance leases includes the imputed interest expense portion.
Depreciation expense, which is not reflected in the accompanying consolidated statements of operations, computed by the straight-line
method, was ¥2,519 million ($23,838 thousand) and ¥2,929 million for the fiscal years ended March 31, 2004 and 2003, respectively.
13.DERIVATIVES
The Group enters into derivative contracts, including foreign exchange forward contracts, currency option contracts, foreign currency swap
contracts and interest rate swap contracts to hedge foreign exchange risk and interest rate exposures. The Group does not hold or issue deriv-
atives for trading purposes. Derivatives are subject to market risk and credit risk. Market risk is the exposure created by potential fluctuations in
market conditions, including in changes in interest or foreign exchange rates. Credit risk is the possibility that a loss may result from a counter-
party’s failure to perform according to the terms and conditions of the contract.
Because the counterparties to those derivative contracts are limited to major international financial institutions, the Group does not antici-
pate any losses arising from credit risk.
Derivative transactions entered into by the Group have been made in accordance with internal policies which regulate the authorization
and credit limit amount.
Derivative contracts outstanding at March 31, 2004 and 2003, were as follows:
Foreign exchange forward contracts :
Selling USD
Selling EUR
Buying JPY
Buying USD
Buying EUR
Total
Interest rate swaps :
(fixed rate receipt, floating rate payment)
(fixed rate payment, floating rate receipt)
Total
Net
Unrealized
Gain (Loss)
¥321
699
90
(6)
(117)
987
549
(535)
¥14
Fair Value
¥19,202
19,088
2,673
574
4,539
549
(535)
¥14
Contract or
Notional
Amount
¥19,523
19,787
2,583
580
4,656
¥20,000
10,000
¥30,000
Millions of Yen
2004
Net
Unrealized
Gain (Loss)
$3,040
6,618
852
(58)
(1,106)
9,346
$5,200
(5,063)
$137
Fair Value
$181,682
180,604
25,295
5,426
42,950
$5,200
(5,063)
$137
Contract or
Notional
Amount
$184,722
187,222
24,443
5,484
44,056
$189,233
94,616
$283,849
Thousands of U.S. Dollars
2004