Sony 2008 Annual Report Download - page 69

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CONTRACTUAL OBLIGATIONS, COMMITMENTS, AND CONTINGENT LIABILITIES
The following table summarizes Sony’s contractual obligations and major commitments as of March 31, 2008. The references to the
Notes below refer to the corresponding note within the Notes to Consolidated Financial Statements.
Yen in millions
Payments due by period
Less than
Total 1 year 1 to 3 years 3 to 5 years After 5 years
Contractual Obligations and Major Commitments:*
Long-term debt (Note 11)
Capital lease obligations (Notes 8 and 11) .........................
51,889 9,328 11,636 6,341 24,584
Other long-term debt (Note 11). ................................. 969,049 282,551 372,314 148,357 165,827
Minimum rental payments required under operating leases (Note 8) ...... 189,313 42,736 57,750 29,095 59,732
Purchase commitments for property, plant and equipment and
other assets (Note 23) .......................................
62,044 61,869 175 — —
Expected cost for the production or purchase of films and
television programming or certain rights (Note 23) ..................
57,258 44,841 11,928 452 37
Partnership program contract with
Fédération Internationale de Football Association (Note 23) ...........
22,944 3,306 7,389 8,166 4,083
Gross unrecognized tax benefits** (Note 20) ........................ 282,098 666 — — —
* The total amount of expected future pension payments is not included in either the above table or the total amount of commitments outstanding at March 31, 2008 dis-
cussed below as such amount is not currently determinable. Sony expects to contribute approximately 34.0 billion yen to Japanese pension plans and approximately 5.0
billion yen to foreign pension plans during the fiscal year ending March 31, 2009 (Note 14).
* The total unused portion of the line of credit extended under loan agreements in the Financial Services segment is not included in either the above table or the amount of
commitments outstanding at March 31, 2008 discussed below as it is not foreseeable how many loans will be executed. The total unused portion of the line of credit
extended under these contracts was 298.8 billion yen as of March 31, 2008 (Note 23).
* The five-year Revolving Credit Agreement with SONY BMG, which matures on August 5, 2009 and initially provided for a base commitment of 300 million U.S. dollars,
which was decreased to 200 million U.S. dollars on August 5, 2007, and additional incremental borrowings of up to 150 million U.S. dollars, are not included either in the
above table or the amount of commitments outstanding at March 31, 2008 discussed below as such amount is not currently determinable. Sony’s outstanding commit-
ment under this Credit Agreement as of March 31, 2008 was 17.5 billion yen (Note 23).
A second Revolving Credit Agreement with SONY BMG, which matures on August 5, 2011 and provides for a base commitment of 138 million U.S. dollars is not
included either in the above table or the amount of commitments outstanding at March 31, 2008 discussed below as such amount is not currently determinable. Sony’s
outstanding commitment under this Credit Agreement as of March 31, 2008 was 13.8 billion yen (Note 23).
** The total amounts represent the liability for gross unrecognized tax benefits in accordance with FIN No. 48. Sony estimates 666 million yen of the liability is expected to be
settled within one year. The settlement period for the remaining portion of the liability, which totaled 281.4 billion yen, cannot be reasonably estimated due to the uncer-
tainty associated with the timing of settlements with the various taxing authorities (Note 20).
The total amount of commitments outstanding at March 31,
2008 was 261.1 billion yen (Note 23). The commitments include
major purchase obligations as shown above.
In the ordinary course of business, Sony makes commitments
for the purchase of property, plant and equipment. As of March
31, 2008, such commitments outstanding were 62.0 billion yen.
Certain subsidiaries in the Pictures segment have entered
into agreements with creative talent for the development and
production of films and television programming as well as
agreements with third parties to acquire completed films, or
certain rights therein. As of March 31, 2008, the total amount
of the expected cost for the production or purchase of films
and television programming or certain rights under the above
commitments was 57.3 billion yen.
Sony Corporation has entered into a partnership program
contract with Fédération Internationale de Football Association
(“FIFA”). Through this program Sony Corporation will be able to
exercise various rights as an official sponsor of FIFA events
from 2007 to 2014. As of March 31, 2008, Sony Corporation
has committed to make payments under such contract of
22.9 billion yen.
In order to fulfill its commitments, Sony will use cash gener-
ated by its operating activities, intra-group loans and borrowings
from subsidiaries with excess funds to subsidiaries that are short
of funds through its finance subsidiaries, and raise funds from
the global capital markets and from banks when necessary.
The following table summarizes Sony’s contingent liabilities as
of March 31, 2008.
................................. Yen in millions
Contingent Liabilities (Note 23):
Loan guarantees to related parties ........ 9,762
Other .............................. 40,043
Total contingent liabilities ................. 49,805