Nikon 2005 Annual Report Download - page 38

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36
9. SELLING, GENERAL AND ADMINISTRATIVE EXPENSES
Selling, general and administrative expenses for the fiscal years ended March 31, 2005 and 2004 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
2005
$ 396,230
49,402
260,384
30,317
111,051
312,514
2004
¥ 30,823
4,005
27,502
5,295
11,801
30,165
2005
¥ 42,551
5,305
27,963
3,256
11,926
33,561
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
2005
$ 133,574
17,349
91,531
132,459
8,513
33,410
55,141
$ 471,977
68,798
45,372
25,064
5,589
$ 144,823
$ 327,154
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
2005
¥ 14,345
1,863
9,830
14,225
914
3,588
5,921
¥ 50,686
7,388
4,872
2,693
600
¥ 15,553
¥ 35,133
Millions of Yen
Year ended March 31,
A valuation allowance of ¥3,012 million ($28,051 thousand) in 2005 and ¥3,228 million in 2004 were deducted from the amounts
calculated above, respectively.
A reconciliation between the normal effective statutory tax rate for the fiscal years ended March 31, 2005 and 2004, and the actual
effective tax rates reflected in the consolidated statements of income were as follows:
Normal statutory tax rate
Tax credit for research and development costs
Consolidated adjustment on unrealizable profits in inventories
Dividends from foreign subsidiaries not applicable to foreign tax credits
Increase in valuation allowance
Effect on tax levied based on paid-in capital
Other-net
Actual effective tax rate
2004
42%
10.3
6.1
5.3
5.2
5.5
74.4%
2005
40.6%
(5.7)
(11.1)
5.2
3.0
(4.2)
27.8%
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
normal effective statutory tax rate of approximately 40.6% for the fiscal year ended March 31, 2005 due to the new local tax law, and 42%
for the fiscal year ended March 31, 2004.
The tax effects of significant temporary differences and loss carry-forwards which result in deferred tax assets and liabilities at March 31,
2005 and 2004, were as follows: