Tax Effect Accounting Associated with the Transition to the Group Tax-Sharing System

「The company and certain domestic consolidated subsidiaries transitioned from the consolidated taxation system to the group-wide tax sharing system beginning with the first-quarter consolidated accounting period. Accordingly, the accounting treatment and disclosure for corporate income taxes, local corporate taxes and tax-effect accounting comply with “Accounting and Disclosure Under the Group-Wide Tax Sharing System” (Accounting Standards Implementation Guidance No. 42, 12 August 2021, hereinafter “Implementation Guidance No. 42”).」

「The company and certain domestic consolidated subsidiaries transitioned from the consolidated taxation system to the group-wide tax sharing system beginning with the current first-quarter consolidated accounting period. Accordingly, the accounting treatment and disclosure for corporate income taxes, local corporate taxes and tax-effect accounting comply with “Accounting and Disclosure Under the Group-Wide Tax Sharing System” (Accounting Standards Implementation Guidance No. 42, 12 August 2021, hereinafter “Implementation Guidance No. 42”). In accordance with paragraph 32(1) of Implementation Guidance No. 42, the company treats the impact of the change in accounting policy arising from the adoption of Implementation Guidance No. 42 as nil.」

「The Company and certain domestic consolidated subsidiaries have applied the treatment under Paragraph 3 of Practical Response Report No. 39, Treatment of Tax Effect Accounting for the Transition from the Consolidated Taxation System to the Group Tax Sharing System, for the transition to the group tax sharing system established by the Act Partially Amending the Income Tax Act and Other Acts (Act No. 8 of 2020). Accordingly, for items involving revisions to the single-entity taxation system accompanying the transition, the provisions of Paragraph 44 of the Implementation Guidance on Tax Effect Accounting have not been applied, and deferred tax assets and liabilities have been measured under the provisions of the tax laws before amendment.」

「The Company and certain domestic consolidated subsidiaries have applied the treatment under Paragraph 3 of Practical Response Report No. 39, Treatment of Tax Effect Accounting for the Transition from the Consolidated Taxation System to the Group Tax Sharing System, for the transition to the group tax sharing system established by the Act Partially Amending the Income Tax Act and Other Acts (Act No. 8 of 2020). Accordingly, for items involving revisions to the single-entity taxation system accompanying the transition, the provisions of Paragraph 44 of the Implementation Guidance on Tax Effect Accounting have not been applied, and deferred tax assets and liabilities have been measured under the provisions of the tax laws before amendment.」

「The Company and certain domestic consolidated subsidiaries have applied the treatment under Paragraph 3 of Practical Response Report No. 39, Treatment of Tax Effect Accounting for the Transition from the Consolidated Taxation System to the Group Tax Sharing System, for the transition to the group tax sharing system established by the Act Partially Amending the Income Tax Act and Other Acts (Act No. 8 of 2020). Accordingly, for items involving revisions to the single-entity taxation system accompanying the transition, the provisions of Paragraph 44 of the Implementation Guidance on Tax Effect Accounting have not been applied, and deferred tax assets and liabilities have been measured under the provisions of the tax laws before amendment.」

「The Company and its domestic consolidated subsidiaries have applied the treatment under Paragraph 3 of the Practical Solution on the Application of Tax Effect Accounting Relating to the Transition from the Consolidated Taxation System to the Group Tax Sharing System (Practical Solution Report No. 39, 31 March 2020) to the transition to the group tax sharing system established under the Act Partially Amending the Income Tax Act and Other Acts (Act No. 8 of 2020), and to items for which the single-entity taxation system was revised in connection with that transition. Accordingly, without applying the provisions of Paragraph 44 of the Guidance on the Application of Tax Effect Accounting (ASBJ Guidance No. 28, 16 February 2018), deferred tax assets and deferred tax liabilities are calculated based on the provisions of the tax laws before amendment.」

「The Company and its domestic consolidated subsidiaries have applied the treatment under Paragraph 3 of the Practical Solution on the Application of Tax Effect Accounting Relating to the Transition from the Consolidated Taxation System to the Group Tax Sharing System (Practical Solution Report No. 39, 31 March 2020) to the transition to the group tax sharing system established under the Act Partially Amending the Income Tax Act and Other Acts (Act No. 8 of 2020), and to items for which the single-entity taxation system was revised in connection with that transition. Accordingly, without applying the provisions of Paragraph 44 of the Guidance on the Application of Tax Effect Accounting (ASBJ Guidance No. 28, 16 February 2018), deferred tax assets and deferred tax liabilities are calculated based on the provisions of the tax laws before amendment.」