Toshiba 2006 Annual Report Download - page 82

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Thousands of U.S. dollars
2006
Carrying Estimated
March 31 amount fair value
Nonderivatives:
Liabilities:
Long-term debt, including current portion $(6,334,206) $ (6,781,795)
Derivative financial instruments:
Forward exchange contracts (8,453) (8,453)
Interest rate swap agreements (9,923) (9,923)
Currency swap agreements 1,308 1,308
Currency options (6,923) (6,923)
The above table excludes the financial instruments for which fair values approximate their carrying amounts and those relat-
ed to leasing activities. The table also excludes marketable securities and other investments which are disclosed in Note 4.
In assessing the fair value of these financial instruments, the Company uses a variety of methods and assumptions, which
are based on estimates of market conditions and risks existing at that time. For certain instruments, including cash and cash
equivalents, notes and accounts receivable-trade, short-term borrowings, notes payable-trade, accounts payable-trade and
accounts payable-other and accrued expenses, it is assumed that the carrying amount approximated fair value for the majority
of these instruments because of their short maturities. Quoted market prices are used for a part of marketable securities and
other investments. For long-term debt, fair value is estimated using market quotes, or where market quotes are not available,
using estimated discounted future cash flows. Other techniques, such as estimated discounted value of future cash flows, and
replacement cost, are used to determine fair value for the remaining financial instruments. These estimated fair values are not
necessarily indicative of the amounts that could be realized in a current market exchange.
20. LEASES
LESSEE
The Company leases manufacturing equipment, office and warehouse space, and certain other assets under operating leases.
Rent expenses under such leases for the years ended March 31, 2006 and 2005 were ¥84,047 million ($718,350 thousand)
and ¥82,174 million, respectively.
The Company also leases certain machinery and equipment which are accounted for as capital leases from TFC and
Toshiba Medical Finance Co., Ltd., affiliates of the Company. The costs under capital leases as of March 31, 2006 and 2005
were approximately ¥70,700 million ($604,274 thousand) and ¥91,000 million, respectively. Accumulated amortization of
the machinery and equipment under capital leases as of March 31, 2006 and 2005 were approximately ¥36,800 million
($314,530 thousand) and ¥45,000 million, respectively.
Minimum lease payments for the Company’s capital and non-cancelable operating leases as of March 31, 2006 are as follows:
Millions of yen Thousands of U.S. dollars
Year ending March 31 Capital leases Operating leases Capital leases Operating leases
2007 ¥ 14,992 ¥ 24,536 $ 128,137 $ 209,709
2008 9,947 17,742 85,017 151,641
2009 6,674 14,979 57,043 128,026
2010 3,822 10,340 32,667 88,376
2011 1,507 2,148 12,880 18,359
Thereafter 366 4,603 3,128 39,342
Total minimum lease payments 37,308 ¥ 74,348 318,872 $ 635,453
Executory costs (1,698) (14,513)
Amounts representing interest (1,724) (14,735)
Present value of net minimum lease payments 33,886 289,624
Less—current portion (13,361) (114,197)
¥ 20,525 $ 175,427
Notes to Consolidated Financial Statements
Toshiba Corporation and Subsidiaries
March 31, 2006