|
 |
Financial Information:
Annual Report 2003
| Notes
to Consolidated Financial Statements |
NSK Ltd. and Subsidiaries
For the year ended March 31, 2003
| 4. Inventories |
 |
Inventories at March 31, 2003 and 2002 were as follows:
| Millions
of yen |
Thousands
of
U.S. dollars |
| As
of March 31 |
2003 |
2002 |
2003 |
| Finished products |
¥46,096 |
¥54,968 |
$384,133 |
| Work in process |
20,972 |
26,520 |
174,767 |
| Raw materials and supplies |
16,418 |
15,970 |
136,817 |
|
| |
¥83,487 |
¥97,459 |
$695,725 |
|
| 5. Depreciation |
|
Depreciation of property, plant and equipment for the years
ended March 31, 2003 and 2002 amounted to ¥28,580 million
($238,167 thousand) and ¥27,371 million, respectively.
| 6. Short-Term
Debt |
|
At March 31, 2003 and 2002, short-term debt consisted of
the following:
| Millions
of yen |
Thousands
of
U.S. dollars |
| As
of March 31 |
2003 |
2002 |
2003 |
| Bank loans |
¥87,265 |
¥93,120 |
$727,208 |
|
| |
¥87,265 |
¥93,120 |
$727,208 |
|
Short-term bank loans are principally unsecured and consist
of notes maturing generally within one year. The interest rates
applicable to the loans at March 31, 2003 and 2002 ranged principally
from 0.40 percent to 26.14 percent and from 0.40 percent to 16.70
percent, respectively.
| 7. Income
Taxes |
|
Income taxes applicable to the Company and its domestic subsidiaries
comprise corporation tax, inhabitants‘ taxes and enterprise
tax which, in the aggregate, resulted in a statutory tax rate
of 42.0 percent for 2003 and 2002. Income taxes of the foreign
subsidiaries are based generally on the tax rates applicable in
their countries of incorporation.
The effective tax rates reflected in the consolidated statement
of operations for the years ended March 31, 2003 and 2002 differ
from the statutory tax rate for the following reasons:
| For
the years ended March 31 |
2003 |
2002 |
| Statutory tax rate |
(42.0)% |
42.0% |
| Effect of: |
|
|
| Net loss carryforward |
122.6 |
35.9 |
| Effect of tax rate change |
(6.9) |
- |
| Expenses not deductible for income tax purposes |
63.9 |
40.6 |
| Dividends and other income deductible for
income tax purposes |
(15.8) |
(2.9) |
| Different tax rates applied to income of foreign
subsidiaries |
31.7 |
(0.6) |
| Changes in valuation allowance |
(197.0) |
51.4 |
| Unrealized profit on inventories in consolidation |
74.8 |
- |
| Other, net |
14.3 |
(12.9) |
|
| Effective tax rates |
45.6% |
69.5% |
|
The significant components of deferred tax assets and liabilities
as of March 31, 2003 and 2002 were as follows:
| Millions
of yen |
Thousands
of
U.S. dollars |
| As
of March 31 |
2003 |
2002 |
2003 |
| Deferred tax assets: |
|
|
|
| Accrued retirement benefits |
¥13,284 |
¥14,549 |
$110,700 |
| Property, plant and equipment |
2,531 |
3,036 |
21,092 |
| Accrued payroll expenses |
2,277 |
2,157 |
18,975 |
| Accrued bonuses |
2,684 |
1,591 |
22,367 |
| Net loss carryforward |
24,046 |
12,605 |
200,383 |
| Inventories |
1,179 |
2,745 |
9,825 |
| Loss on devaluation of investment securities |
852 |
5,830 |
7,100 |
| Other |
3,698 |
2,676 |
30,817 |
| Valuation allowance |
(15,046) |
(18,856) |
(125,383) |
|
| Total deferred tax assets |
35,506 |
26,336 |
295,883 |
|
| |
|
|
|
| Deferred tax liabilities: |
|
|
|
| Depreciation |
5,678 |
5,551 |
47,317 |
| Unrealized holding gains on securities |
3,459 |
7,436 |
28,825 |
Gain on contribution of securities to employees’
retirement benefit trust |
13,513 |
8,903 |
112,608 |
| Other |
4,483 |
4,588 |
37,358 |
|
| Total deferred tax liabilities |
27,135 |
26,480 |
226,125 |
|
| Net deferred tax assets (liabilities) |
¥8,371 |
¥(143) |
$69,758 |
|
New legislation was enacted in March 2003 which will change
the aggregate statutory tax rate from 42% to 40% effective the
fiscal year beginning after March 31, 2004. The effect of this
tax rate change was to increase net deferred assets by ¥322
million ($2,683 thousand) at March 31, 2003 and to decrease income
tax expense by ¥146 million ($1,217 thousand) for the year
ended March 31, 2003.
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