Toyota 2006 Annual Report Download - page 100

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98
Unrealized losses continuously over a 12 month period or
more in the aggregate were not material at March 31, 2005
and 2006.
At March 31, 2005 and 2006, debt securities classified as
available-for-sale mainly consist of government bonds and
corporate debt securities with maturities from 1 to 10 years.
Proceeds from sales of available-for-sale securities were
¥183,808 million, ¥121,369 million and ¥157,707 million
($1,342 million) for the years ended March 31, 2004, 2005
and 2006, respectively. On those sales, gross realized gains
were ¥8,780 million, ¥14,551 million and ¥2,104 million ($18
million) and gross realized losses were ¥139 million, ¥231 mil-
lion and ¥1,207 million ($10 million), respectively.
During the year ended March 31, 2006, in accordance with
EITF Issue No. 91-5, Nonmonetary Exchange of Cost-Method
Investments, Toyota reclassified ¥143,366 million ($1,220 mil-
lion) of gain from Unrealized gains on securities included in
the “Accumulated other comprehensive income” on the con-
solidated balance sheet to Other income included in the
“Other income, net” on the consolidated statement of
income. The gain was recognized based on the merger
between UFJ Holdings, Inc. and Mitsubishi Tokyo Financial
Group, Inc. on October 1, 2005, and determined as the
amount between the cost of the pre-merger entity, UFJ
Holdings, Inc. common shares which Toyota had continuously
held and the fair market value of the post-merger entity,
Mitsubishi UFJ Financial Group, Inc. common shares which
Toyota received in exchange for UFJ Holdings, Inc. common
shares. The gain was non-cash gain and included in the cost
of the available-for-sale equity securities as of March 31,
2006.
During the years ended March 31, 2004, 2005 and 2006,
Toyota recognized impairment losses on available-for-sale
securities of ¥3,063 million, ¥2,324 million, and ¥4,163 mil-
lion ($35 million), respectively, which are included in “Other
income, net” in the accompanying consolidated statements of
income.
In the ordinary course of business, Toyota maintains long-
term investment securities, included in “Marketable securities
and other securities investments” and issued by a number of
non-public companies which are recorded at cost, as their fair
values were not readily determinable. Management employs a
systematic methodology to assess the recoverability of such
investments by reviewing the financial viability of the underly-
ing companies and the prevailing market conditions in which
these companies operate to determine if Toyota’s investment
in each individual company is impaired and whether the
impairment is other-than-temporary. Toyota performs this
impairment test semi-annually for significant investments
recorded at cost. If the impairment is determined to be other-
than-temporary, the cost of the investment is written-down by
the impaired amount and the losses are recognized currently
in operations.
7. Finance receivables:
Finance receivables consist of the following:
U.S. dollars
Yen in millions in millions
March 31, March 31,
2005 2006 2006
Retail .................................................................................................................................. ¥ 4,716,961 ¥ 5,930,822 $ 50,488
Finance leases ..................................................................................................................... 756,732 741,280 6,310
Wholesale and other dealer loans ........................................................................................ 1,773,440 1,998,814 17,016
7,247,133 8,670,916 73,814
Deferred origination costs ................................................................................................... 65,189 92,798 790
Unearned income................................................................................................................ (233,417) (334,796) (2,850)
Allowance for credit losses .................................................................................................. (91,829) (101,383) (863)
Total finance receivables, net....................................................................................... 6,987,076 8,327,535 70,891
Less—Current portion ......................................................................................................... (3,010,135) (3,497,319) (29,772)
Noncurrent finance receivables, net ............................................................................. ¥ 3,976,941 ¥ 4,830,216 $ 41,119