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40 Nikon Annual Report 2008
8. Retirement and Pension Plans
The liability for employees’ retirement benefits at March 31, 2008 and 2007 consisted of the following:
Thousands of
Millions of Yen U.S. Dollars
2008 2007 2008
Projected benefit obligation ¥ 105,542 ¥ 104,086 $ 1,053,414
Fair value of plan assets (93,664) (107,783) (934,864)
Unrecognized actuarial gain and loss (11,163) 4,555 (111,420)
Unrecognized prior service cost 11,746 13,670 117,240
12,461 14,528 124,370
Prepayment of service cost 563 636 5,620
Net liability ¥ 13,024 ¥ 15,164 $ 129,990
The projected benefit obligation includes retirement allowance for officers of ¥171 million ($1,707 thousand) and ¥189
million at March 31, 2008 and 2007, respectively.
The components of net periodic benefit costs for the fiscal years ended March 31, 2008 and 2007 were as follows:
Thousands of
Millions of Yen U.S. Dollars
2008 2007 2008
Service cost ¥ 3,660 ¥ 3,282 $ 36,530
Interest cost 2,871 2,791 28,651
Expected return on plan assets (2,652) (2,512) (26,473)
Recognized actuarial loss 1,288 1,224 12,852
Amortization of prior service cost (1,861) (1,793) (18,565)
Net periodic retirement benefit costs ¥ 3,306 ¥ 2,992 $ 32,995
In addition to the above, the Company and certain of its overseas subsidiaries charged ¥1,056 million (¥10,551 thousand)
and ¥990 million to income for the fiscal years ended March 31, 2008 and 2007, respectively.
Assumptions used for the fiscal years ended March 31, 2008 and 2007 were principally as set forth below:
2008 2007
Discount rate 2.50% 2.50%
Expected rate of return on plans assets 2.00% 2.00%
Recognition period of actuarial gain (loss) 10 years 10 years
Amortization period of prior service cost 10 years 10 years
The Company has a defined benefit corporate pension plan (cash balance plan) and a defined contribution pension plan,
and its consolidated domestic subsidiaries have non-contributory funded pension plans. Certain foreign subsidiaries also
have contributory pension plans.
The Group accounted for the liability for retirement benefits based on the projected benefit obligations and plan assets
at the balance sheet date. Retirement allowances for officers are recorded to state the liability at the amount that would be
required if all officers retired at each balance sheet date.
Certain foreign subsidiaries, including the United States, etc. record unrecognized actuarial gains and losses, which are
not charged to income, in the balance sheet.