Nintendo 2006 Annual Report Download - page 34

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Nintendo Co., Ltd. and consolidated subsidiaries
The Company is subject to several Japanese taxes based on income, which, in the aggregate, result in a normal statutory tax
rates of approximately 40.6% for the years ended March 31, 2006 and 2005.
Note 9. Income Taxes
Significant components of deferred tax assets and liabilities are summarized as follows:
Deferred tax assets:
Research and development costs
Inventory - write-downs and
elimination of unrealized profit
Other A/P and accrued expenses
Accrued enterprise tax
Land
Unrealized loss on investments in securities
Depreciation
Reserve for employee retirement and severance benefits
Other
Gross deferred tax assets
Valuation allowance
Total deferred tax assets
Deferred tax liabilities:
Unrealized gains on other securities
Undistributed retained earnings of subsidiaries and affiliates
Other
Total deferred tax liabilities
Net deferred tax assets
As of March 31,
¥6,998
7,418
5,428
3,452
2,572
1,962
1,059
1,337
7,277
37,503
(429)
37,074
(4,918)
(1,769)
(717)
(7,404)
¥29,670
¥12,157
8,513
8,083
3,375
2,572
2,050
1,398
1,187
6,583
45,918
(731)
45,187
(7,325)
(2,111)
(1,267)
(10,703)
¥34,484
$103,908
72,761
69,089
28,842
21,981
17,521
11,951
10,147
56,265
392,465
(6,253)
386,212
(62,604)
(18,045)
(10,832)
(91,481)
$294,731
Reconciliations of the statutory tax rate and the effective tax rate for the years ended March 31, 2006 and 2005 are omitted,
since the difference is not more than five one-hundredth of the statutory tax rate.
Japanese Yen in Millions
¥
2006 2005
U.S. Dollars in Thousands (Note 1)
$
2006
Years ended March 31, 2006 and 2005
Notes to Consolidated Financial Statements