Ricoh 1998 Annual Report Download - page 47

45
Actuarial present value of benefit obligations:
Vested benefit obligation
Accumulated benefit obligation
Projected benefit obligation
Plan assets at fair value
Projected benefit obligation in excess of plan assets
Unrecognized net loss
Unrecognized net asset at transition, net of amortization
Additional minimum pension liability
Accrued pension cost included in estimated retirement allowances
The funded status of the plans referred to above as of March 31, 1997 and 1998 are as follows:
Thousands of
U.S. dollars
1998
Millions of yen
1998
¥214,823
232,925
284,825
202,005
(82,820)
85,875
(4,730)
(27,301)
¥ 28,976
1997
¥ 186,457
201,446
249,894
180,534
(69,360)
72,332
(5,442)
(17,584)
¥ 20,054
$1,627,447
1,764,583
2,157,765
1,530,341
(627,424)
650,568
(35,833)
(206,826)
$ 219,515
The actuarial assumptions used in the accounting for the plans as of
March 31, 1996, 1997 and 1998 are: periodic pension cost. Since there is no unrecognized prior service cost,
this excess is reported as a separate component of shareholders’
investment, at net of tax benefits. The net changes in pension liability ad-
justment for the years ended March 31, 1997 and 1998 were both increas-
es of ¥2,473 million and ¥5,746 million ($43,530 thousand), respectively.
Employees of certain subsidiaries not covered by the EPF plan and
directors of Ricoh are primarily covered by unfunded retirement
allowances plans.
Under the unfunded plans described in the preceding paragraph, the
amounts required if all employees and directors had voluntarily terminat-
ed their employment at each balance sheet date are fully accrued. The
payments to directors are subject to shareholders’ approval. The total
provisions charged to income under these plans in fiscal 1996, 1997 and
1998 were ¥4,486 million, ¥4,498 million and ¥2,942 million ($22,288
thousand), respectively.
Discount rate
Rate of increase in
compensation levels
Expected long-term rate of
return on plan assets
1998
3.75~7.75%
3.7~5.5%
3.75~8.5%
4.0~8.0%
3.7~6.0%
3.75~8.5%
In accordance with the provisions of SFAS No. 87, the Company was
required to record an additional minimum pension liability at March 31,
1997 and 1998. This amount represents the excess of the accumulated
benefit obligations over the fair value of plan assets. This excess is primar-
ily attributable to a substantial reduction in the discount rate used in pen-
sion calculation and represents a net loss not yet recognized as net
1996
4.5~9.0%
3.7~6.5%
4.0~9.0%
1997
12. SHAREHOLDERS’ INVESTMENT
The Japanese Commercial Code provides that an amount equivalent to
at least 10% of cash dividends paid and other cash outlays resulting from
appropriation of retained earnings with respect to each fiscal or interim
six-month period be appropriated as a legal reserve until such reserve
equals 25% of the stated capital. This reserve and additional paid-in capi-
tal are not available for dividends but may be used to reduce a deficit by
resolution of the shareholders or may be capitalized by resolution of the
Board of Directors.
Semiannual cash dividends are approved by the shareholders after the
end of each fiscal period or are declared by the Board of Directors after
the end of each interim six-month period. Such dividends are payable to
shareholders of record at the end of each such fiscal or interim six-month
period. At the general meeting held on June 26, 1998, the shareholders
approved the declaration of a cash dividend on the common stock
totaling ¥3,803 million ($28,811 thousand), which will be paid to
shareholders of record as of March 31, 1998, and the related
appropriation of retained earnings totaling ¥395 million ($2,992
thousand) by a transfer to the legal reserve. In accordance with the
Japanese Commercial Code, the declaration of this dividend and the
related transfer of retained earnings to the legal reserve have not been re-
flected in the consolidated financial statements as of March 31, 1998.
The Japanese Commercial Code provides that at least one-half of the
proceeds from shares issued at a price in excess of par value be included
in common stock. In conformity therewith, the Company has divided the
principal amount of bonds converted into common stock equally between
common stock and additional paid-in capital.