Estimated fair value of financial instruments
within 1 year Due after 1 year
21. Retirement Benefits
Outline of the retirement benefit plans adopted
(1) Defined benefit corporate pension scheme: From March 1, 2009, the Company adopted a defined benefit corporate pension scheme as part of its retirement benefit plan.
(2) Defined contribution pension scheme: From March 1, 2009, the Company adopted a defined contribution pension scheme as part of its retirement benefit plan.
(3) Employees’ pension fund: Since April 1, 1980, the Company has used an multiemployer contributory funded pension plan as a supplement to its existing retirement benefit scheme.
The funded status of the multiemployer contributory funded pension plans as at March 31, 2013, to which contributions are recorded as net periodic retirement benefit costs by the Company is summarized as follows:
In case securities whose fair values at the year-end are less than 50% of the acquisition costs, or are more than 50% but less than 70% and deemed to be unre-coverable, the impairment losses are recognized.
Millions of Yen Thousands of
U.S.dollars ( Note 5 )
2014 2013 2014
Other securities, marketable – ¥4 –
Non-marketable equity securities – 1 –
Investments in subsidiaries and ailiates – 238 –
The components of accrued retirement benefits to employees as at March 31, 2013 are as follows:
The components of retirement benefit expenses for the year ended March 31, 2013 are as follows:
The assumptions used for calculation of retirement benefits for the year ended March 31, 2013 are as follows:
*This shows the Companies’ portion of the total estimated annual contribution to the plans, which is not necessary equal to the actual percentage of the Companies’ portion against the funded status in the table above.
* Contribution paid to defined contribution pension scheme.
Millions of Yen 2013
Fair value of plan assets ¥53,360
Benefit obligation in the calculation of pension financing 70,990
Difference (17,630)
Companies' contribution percentage for multiemployer
contributory funded pension plans* 21.8%
Millions of Yen 2013
Projected benefit obligation ¥11,360
Plan assets (7,713)
Unfunded benefit obligation 3,647
Unrecognized actuarial difference (1,054)
Unrecognized prior service cost 21
Prepaid pension cost 57
Accrued retirement benefits to employees ¥2,670
Millions of Yen 2013
Service cost ¥663
Interest cost 161
Expected return on plan assets (164)
Amortization of unrecognized prior service cost (3)
Amortization of unrecognized actuarial loss 211
Contribution to the multi-employer pension plan 523
Other* 319
Net retirement benefit expenses ¥1,711
Millions of Yen 2013 Method of attribution of estimated retirement benefits to
periods of employee service Straight-line method
Discount rate 1.5%
Expected return on plan assets 2.5%
Amortization period for unrecognized prior service cost 10 years Amortization period for unrecognized actuarial diference 10 years
In addition, certain subsidiaries have lump-sum payment plans and defined benefit corporate pension plan. They calculate the retirement benefit expenses, assets and liabilities for retirement benefits by means of a simplified method.
The changes in the retirement benefit obligation during the year ended March 31, 2014 are as follows:
Millions of Yen Thousands of U.S.dollars ( Note 5 )
2014 2014
Retirement benefit obligation at April 1, 2013 ¥11,091 $107,680
Service cost 626 6,078
Interest cost 174 1,689
Actuarial loss 489 4,748
Retirement benefit paid (567) (5,505)
Prior service cost (12) (117)
Other 32 311
Retirement benefit obligation at March 31, 2014 ¥11,834 $114,893
Millions of Yen Thousands of U.S.dollars ( Note 5 )
2014 2014
Plan assets at April 1, 2013 ¥7,586 $73,650
Expected return on plan assets 189 1,835
Acturial loss 80 777
Contributions by the Company 541 5,252
Retirement benefits paid (524) (5,087)
Other 2 19
Plan assets at March 31, 2014 ¥7,876 $76,466
The changes in plan assets during the year ended March 31, 2014 are as follows:
The following table sets forth the funded status of the plans and the amounts recognized in the consolidated balance sheet as of March 31, 2014 for the Company’s and the consolidated subsidiaries’ defined benefits plans:
Millions of Yen Thousands of U.S.dollars ( Note 5 )
2014 2014
Funded retirement benefit obligation ¥11,716 $113,748
Plan assets at fair value (7,876) (76,466)
3,839 37,272
Unfunded retirement benefit obligation 118 1,146
Net liability for retirement benefits in the balance sheet 3,958 38,427
Liability for retirement benefits 3,958 38,427
Asset for retirement benefits – –
Net liability for retirement benefits in the balance sheet ¥3,958 $38,427 The components of retirement benefit expense for the year ended March 31, 2014 are as follows:
Millions of Yen Thousands of U.S.dollars ( Note 5 )
2014 2014
Service cost ¥626 $6,078
Interest cost 174 1,689
Expected return on plan assets (189) (1,835)
Amortization of actuarial loss 184 1,786
Amortization of prior service cost (16) (155)
Retirement benefit expense ¥780 $7,573
Unrecognized prior service cost and unrecognized actuarial loss included in accumulated other comprehensive income(before tax effect) as of March 31, 2014 are as follows:
Millions of Yen Thousands of U.S.dollars ( Note 5 )
2014 2014
Unrecognized prior service cost ¥17 $165
Unrecognized actuarial loss (1,278) (12,408)
Total (¥1,261) ($12,243)
The fair value of plan assets, by major category, as a percentage of total plan assets as of March 31, 2014 are as follows:
2014
General accounts 9%
Bonds 77%
Stocks 12%
Other 2%
Total 100%
The expected return on assets has been estimated based on the anticipated allocation to each asset class and the expected long-term returns on assets held in each category.
The assumptions used in accounting for the above plans were as follows:*
*They are calculated by the weighted average method.
2014
Discount rate 1.6%
Expected long-term rates of return on plan assets 2.5%
In defined benefit plans of applying the simplified method, the changes in the retirement benefit obligation during the year ended March 31, 2014 are as follows:
Millions of Yen Thousands of U.S.dollars ( Note 5 )
2014 2014
Liability for retirement benefit at April 1, 2013 ¥142 $1,379
Retirement benefit expense 21 204
Retirement benefit paid (14) (136)
Contributions to plan (22) (214)
Other 0 0
Liability for retirement benefit at March 31, 2014 ¥126 $1,223
The following table sets forth the funded status of the plans and the amounts recognized in the consolidated balance sheet as of March 31, 2014 for the Company’s and the consolidated subsidiaries’ defined benefits plans:
Millions of Yen Thousands of U.S.dollars ( Note 5 )
2014 2014
Funded retirement benefit obligation ¥137 $1,330
Plan assets at fair value (166) (1,612)
(28) (272)
Unfunded retirement benefit obligation 155 1,505
Net liability for retirement benefits in the balance sheet 126 1,223
Liability for retirement benefits 200 1,942
Asset for retirement benefits (73) (709)
net liability for retirement benefits in the balance sheet 126 1,223
Retirement benefit expenses, which are calculated in simplified method during the year ended March 31, 2014 are as follows:
Millions of Yen Thousands of U.S.dollars ( Note 5 )
2014 2014
Retirement benefit expense ¥21 $204
Contributions to defined contribution plans of the Company and its consolidated subsidiaries during the year ended March 31, 2014 are as
follows:
Millions of Yen Thousands of U.S.dollars ( Note 5 )
2014 2014
Contributions to defined contribution plans ¥335 $3252