Sony 1998 Annual Report Download - page 69

Annual Report 1998 Sony Corporation [67]
At March 31, 1998, no deferred income taxes have been provided on undistributed earnings of foreign subsidiar-
ies not expected to be remitted in the foreseeable future totaling ¥295,778 million ($2,240,742 thousand), and on
the gain on a subsidiary’s sale of stock of ¥61,544 million arising from the issuance of common stock of Sony Music
Entertainment (Japan) Inc. in a public offering to third parties in November 1991, as the company does not antici-
pate any significant tax consequences on possible future disposition of its remaining investment based on its tax
planning strategies. The unrecognized deferred tax liabilities as of March 31, 1998 for such temporary differences
amounted to ¥109,827 million ($832,023 thousand).
Operating loss carryforwards for tax purposes of consolidated subsidiaries at March 31, 1998 amounted to approxi-
mately ¥235,319 million ($1,782,720 thousand) and are available as an offset against future taxable income of such
subsidiaries. These carryforwards expire at various dates primarily up to 15 years. Realization is dependent on such
subsidiaries generating sufficient taxable income prior to expiration of the loss carryforwards. Although realization is
not assured, management believes it is more likely than not that all of the deferred tax assets, less valuation allow-
ance, will be realized. The amount of such net deferred tax assets considered realizable, however, could be reduced in
the near term if estimates of future taxable income during the carryforward period are reduced.
15. Stockholders’ equity
Changes in common stock, additional paid-in capital and treasury stock have resulted from the following:
Number of shares Yen in millions
Additional Treasury stock,
Common stock paid-in capital at cost
Balance at March 31, 1995 . . . . . . . . . . . . . . . . . . . . 373,911,490 ¥ 299,589 ¥ 441,241 ¥ (6)
Conversion of convertible debt . . . . . . . . . . . . . . . . . 156,216 296 384 —
Common stock warrants . . . . . . . . . . . . . . . . . . . . . . — — 110 —
Purchase of treasury stock . . . . . . . . . . . . . . . . . . . . — — — (955)
Reissuance of treasury stock . . . . . . . . . . . . . . . . . . . — — — 935
Balance at March 31, 1996 . . . . . . . . . . . . . . . . . . . . 374,067,706 299,885 441,735 (26)
Exercise of stock purchase warrants . . . . . . . . . . . . . . 117,838 336 336 —
Conversion of convertible debt . . . . . . . . . . . . . . . . . 9,999,499 31,816 31,762 —
Common stock warrants . . . . . . . . . . . . . . . . . . . . . . — — 200 —
Purchase of treasury stock . . . . . . . . . . . . . . . . . . . . — — — (3,156)
Reissuance of treasury stock . . . . . . . . . . . . . . . . . . . — — — 3,086
Balance at March 31, 1997 . . . . . . . . . . . . . . . . . . . . 384,185,043 332,037 474,033 (96)
Exercise of stock purchase warrants . . . . . . . . . . . . . . 264,562 861 860 —
Conversion of convertible debt . . . . . . . . . . . . . . . . . 22,745,666 73,298 73,214 —
Common stock warrants . . . . . . . . . . . . . . . . . . . . . . — — 315 —
Purchase of treasury stock . . . . . . . . . . . . . . . . . . . . — — — (7,948)
Reissuance of treasury stock . . . . . . . . . . . . . . . . . . . — — — 5,164
Balance at March 31, 1998 . . . . . . . . . . . . . . . . . . . . 407,195,271 ¥406,196 ¥548,422 ¥(2,880)
Dollars in thousands
Additional paid-in Treasury stock,
Common stock capital at cost
Balance at March 31, 1997 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $2,515,432 $3,591,159 $ (727)
Exercise of stock purchase warrants . . . . . . . . . . . . . . . . . . . . . . . . . 6,522 6,515 —
Conversion of convertible debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . 555,288 554,652 —
Common stock warrants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — 2,386 —
Purchase of treasury stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — (60,212)
Reissuance of treasury stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . — — 39,121
Balance at March 31, 1998 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $3,077,242 $4,154,712 $(21,818)