Sony 2006 Annual Report Download - page 121

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119
Dollars in millions
Pre-tax Tax Net-of-tax
amount expense amount
For the fiscal year ended March 31, 2006
Unrealized gains on securities—
Unrealized holding gains (losses) arising during the period . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$1,071 $(390) $ 681
Less: Reclassification adjustment included in net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(555) 200 (355)
Unrealized losses on derivative instruments—
Unrealized holding gains (losses) arising during the period . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
127 (60) 67
Less: Reclassification adjustment included in net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(107) 44 (63)
Minimum pension liability adjustment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
760 (331) 429
Foreign currency translation adjustments—
Translation adjustments arising during the period . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1,229 (29) 1,200
Less: Reclassification adjustment included in net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(0) — (0)
Other comprehensive income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$2,525 $(566) $1,959
During the fiscal years ended March 31, 2004 and 2006,
losses of ¥1,232 million and gains of ¥17 million of foreign
currency translation adjustments were transferred respectively
from other comprehensive income to net income as a result of
the liquidation of certain foreign subsidiaries.
As discussed in Note 6, as of August 1, 2004, Sony and
Bertelsmann AG combined their recorded music businesses in a
joint venture. In connection with the establishment of the joint
venture, the minimum pension liability attributable to employees
who were transferred to SONY BMG totaling ¥6,053 million was
transferred from other comprehensive income to the carrying
value of Sony’s investment in SONY BMG.
Presented below is a summary of the activities regarding common stock warrants for the fiscal years shown:
2004 2005 2006
Weighted- Weighted-
Number of average Number of average Number of Weighted-average
shares exercise price shares exercise price shares exercise price
Years ended March 31 Yen Yen Yen Dollars
Outstanding at beginning of the fiscal year . . . . . . . .
3,190,292 ¥8,132 3,190,292 ¥8,132 2,626,300 ¥8,533 $72.93
Expired . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
——(563,992) 6,264 (558,000) 7,167 61.26
Outstanding at end of the fiscal year . . . . . . . . . . . .
3,190,292 ¥8,132 2,626,300 ¥8,533 2,068,300 ¥8,901 $76.08
Exercisable at end of the fiscal year . . . . . . . . . . . . .
2,808,292 ¥8,416 2,626,300 ¥8,533 2,068,300 ¥8,901 $76.08
There were no warrants granted or exercised during the fiscal
years ended March 31, 2004, 2005 and 2006. At March 31,
2006, there were 1,145,900 and 922,400 shares outstanding
under warrants with exercise prices of ¥6,039 and ¥12,457 and
average remaining lives of 1.75 years and 0.58 years, respec-
tively. The weighted average exercise price and remaining life of
outstanding warrants was ¥8,901 and 1.23 years, respectively.
All outstanding warrants were exercisable at March 31, 2006.
17. Stock-based compensation plans
Sony has four types of stock-based compensation plans as
incentive plans for selected directors, corporate executive
officers and employees.
(1) Warrant plan:
Upon issuance of unsecured bonds with detachable warrants
which are described in Note 12, Sony Corporation has pur-
chased all of the detachable warrants and distributed them to
selected directors, corporate executive officers and employees
of Sony. By exercising a warrant, directors, corporate executive
officers and employees can purchase the common stock of
Sony Corporation, the number of which is designated by each
plan. The warrants generally vest ratably over a period of three
years, and are exercisable up to six years from the date of grant.