Tax Effect Accounting Related to the Transition from the Consolidated Taxation System to the Group Tax-Sharing System

「The company and certain domestic consolidated subsidiaries transitioned from the consolidated taxation system to the group tax sharing system beginning with the first quarter of the current consolidated fiscal year. Accordingly, the accounting treatment and disclosures for corporate income taxes, local corporate taxes and tax effect accounting comply with Practical Response Report No. 42, “Accounting Treatment and Disclosure When Applying the Group Tax Sharing System” (12 August 2021; hereinafter, “Practical Response Report No. 42”). In accordance with Paragraph 32(1) of Practical Response Report No. 42, the impact of the change in accounting policy associated with applying Practical Response Report No. 42 is deemed to be zero.」

「The company and certain domestic consolidated subsidiaries have transitioned from the consolidated taxation system to the group tax sharing system beginning with the first quarter of the current consolidated fiscal year. Accordingly, the accounting treatment and disclosures for corporate income taxes, local corporate taxes and tax effect accounting comply with Practical Response Report No. 42, “Accounting Treatment and Disclosure When Applying the Group Tax Sharing System” (12 August 2021; hereinafter, “Practical Response Report No. 42”).」

「The company and certain domestic consolidated subsidiaries apply the treatment under Paragraph 3 of the Practical Response Report No. 39, “Accounting Treatment for the Application of Tax Effect Accounting in Connection with the Transition from the Consolidated Taxation System to the Group Tax Sharing System” (31 March 2020). Accordingly, for items established by the Act Partially Amending the Income Tax Act and Other Acts (Act No. 8 of 2020) in connection with the transition to the group tax sharing system and the associated revisions to the single-entity taxation system, Paragraph 44 of the Implementation Guidance on Tax Effect Accounting (ASBJ Guidance No. 28, 16 February 2018) is not applied, and deferred tax assets and deferred tax liabilities are measured based on the provisions of the tax laws before the amendments.」

「The company and certain domestic consolidated subsidiaries apply the treatment under Paragraph 3 of the Practical Response Report No. 39, “Accounting Treatment for the Application of Tax Effect Accounting in Connection with the Transition from the Consolidated Taxation System to the Group Tax Sharing System” (31 March 2020). Accordingly, for items established by the Act Partially Amending the Income Tax Act and Other Acts (Act No. 8 of 2020) in connection with the transition to the group tax sharing system and the associated revisions to the single-entity taxation system, Paragraph 44 of the Implementation Guidance on Tax Effect Accounting (ASBJ Guidance No. 28, 16 February 2018) is not applied, and deferred tax assets and deferred tax liabilities are measured based on the provisions of the tax laws before the amendments.」

「The company and certain domestic consolidated subsidiaries apply the treatment under Paragraph 3 of the Practical Response Report No. 39, “Accounting Treatment for the Application of Tax Effect Accounting in Connection with the Transition from the Consolidated Taxation System to the Group Tax Sharing System” (31 March 2020). Accordingly, for items established by the Act Partially Amending the Income Tax Act and Other Acts (Act No. 8 of 2020) in connection with the transition to the group tax sharing system and the associated revisions to the single-entity taxation system, Paragraph 44 of the Implementation Guidance on Tax Effect Accounting (ASBJ Guidance No. 28, 16 February 2018) is not applied, and deferred tax assets and deferred tax liabilities are measured based on the provisions of the tax laws before the amendments.」

「The company and certain domestic consolidated subsidiaries apply the treatment under Paragraph 3 of the Practical Response Report No. 39, “Accounting Treatment for the Application of Tax Effect Accounting in Connection with the Transition from the Consolidated Taxation System to the Group Tax Sharing System” (31 March 2020). Accordingly, for items established by the Act Partially Amending the Income Tax Act and Other Acts (Act No. 8 of 2020) in connection with the transition to the group tax sharing system and the associated revisions to the single-entity taxation system, Paragraph 44 of the Implementation Guidance on Tax Effect Accounting (ASBJ Guidance No. 28, 16 February 2018) is not applied, and deferred tax assets and deferred tax liabilities are measured based on the provisions of the tax laws before the amendments.」

「The company and certain domestic consolidated subsidiaries apply the treatment under Paragraph 3 of the Practical Response Report No. 39, “Accounting Treatment for the Application of Tax Effect Accounting in Connection with the Transition from the Consolidated Taxation System to the Group Tax Sharing System” (31 March 2020). Accordingly, for items established by the Act Partially Amending the Income Tax Act and Other Acts (Act No. 8 of 2020) in connection with the transition to the group tax sharing system and the associated revisions to the single-entity taxation system, Paragraph 44 of the Implementation Guidance on Tax Effect Accounting (ASBJ Guidance No. 28, 16 February 2018) is not applied, and deferred tax assets and deferred tax liabilities are measured based on the provisions of the tax laws before the amendments.」

「The company and certain domestic consolidated subsidiaries apply the treatment under Paragraph 3 of the Practical Response Report No. 39, “Accounting Treatment for the Application of Tax Effect Accounting in Connection with the Transition from the Consolidated Taxation System to the Group Tax Sharing System” (31 March 2020). Accordingly, for items established by the Act Partially Amending the Income Tax Act and Other Acts (Act No. 8 of 2020) in connection with the transition to the group tax sharing system and the associated revisions to the single-entity taxation system, Paragraph 44 of the Implementation Guidance on Tax Effect Accounting (ASBJ Guidance No. 28, 16 February 2018) is not applied, and deferred tax assets and deferred tax liabilities are measured based on the provisions of the tax laws before the amendments.」