Note 1-29

(29) Previously, allowances required at the end of a business term, such as reserves for retirement allowances and pension contributions, were booked as expenses. However, under the new system, retirement benefits, such as retirement allowances and corporate pensions, are integrally recognized as liabilities and future financial burdens are to be booked as expenses. As a result of the introduction of the retirement benefit accounting system, many corporations found that their retirement reserves are not fully funded. Incidentally, if their investment returns on reserved assets fall due to further declines in interest rates and stock prices, or if the discount rate used for calculating retirement benefit liabilities is lowered, the corporations will incur additional costs.