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40 Nikon Annual Report 2009
As is customary in Japan, the Company maintains substantial deposit balances with banks with which it has borrowings. Such deposit
balances are not legally or contractually restricted as to withdrawal.
General agreements with respective banks provide, as is customary in Japan, that additional collateral must be provided under certain
circumstances if requested by such banks and that certain banks have the right to offset cash deposited with them against any long-term
or short-term debt or obligation that becomes due and, in case of default and certain other specified events, against all other debts payable
to the banks. The Group has never been requested to provide any additional collateral.
7. RETIREMENT AND PENSION PLANS
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.
As stated in 2 (b), the Company adjusted the amortization of actuarial gain or loss of pensions that has been directly recorded in the equity
by foreign subsidiaries including the United States, etc., in the consolidation process so that net income is accounted for in accordance with
Japanese GAAP.
The liability for employees’ retirement benefits at March 31, 2009 and 2008 consisted of the following:
Millions of Yen
Thousands of
U.S. Dollars
2009 2008 2009
Projected benefit obligation ¥108,026 ¥105,542 $1,099,724
Fair value of plan assets (72,919) (93,664) (742,326)
Unrecognized actuarial gain and loss (30,575) (11,163) (311,261)
Unrecognized prior service cost 8,794 11,746 89,525
13,326 12,461 135,662
Prepayment of service cost 696 563 7,090
Net liability ¥ 14,022 ¥ 13,024 $ 142,752
The projected benefit obligation includes retirement allowance for officers of ¥176 million ($1,794 thousand) and ¥171 million at
March 31, 2009 and 2008, respectively.
The components of net periodic benefit costs for the fiscal years ended March 31, 2009 and 2008 were as follows:
Millions of Yen
Thousands of
U.S. Dollars
2009 2008 2009
Service cost ¥3,569 ¥3,660 $36,335
Interest cost 2,940 2,871 29,931
Expected return on plan assets (2,400) (2,652) (24,427)
Recognized actuarial loss 2,718 1,288 27,670
Amortization of prior service cost (1,851) (1,861) (18,853)
Net periodic retirement benefit costs ¥4,976 ¥3,306 $50,656
In addition to the above, the Company and certain of its overseas subsidiaries charged ¥1,703 million ($17,345 thousand) and ¥1,056
million to income for the fiscal years ended March 31, 2009 and 2008, respectively.
Assumptions used for the fiscal years ended March 31, 2009 and 2008 were principally as set forth below:
2009 2008
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