Income taxes (Tables)

12 Months Ended

Mar. 31, 2016

Income taxes

Components of income tax expense

	Millions of yen
	Year ended March 31
	2014		2015		2016
Current:
Domestic	¥	21,558	¥	80,760	¥	72,272
Foreign		6,546		13,531		9,183
Subtotal		28,104		94,291		81,455
Deferred:
Domestic		109,037		23,309		(66,176	)
Foreign		8,024		3,180		7,317
Subtotal		117,061		26,489		(58,859	)
Total	¥	145,165	¥	120,780	¥	22,596

Effective income tax rate reflected in consolidated statements of income

	Year ended March 31
	2014			2015			2016
Nomura’s effective statutory tax rate		38.0	%		36.0	%		33.0	%
Impact of:
Changes in deferred tax valuation allowance		(9.8	)		5.1			36.1
Additional taxable revenues		0.4			0.3			0.3
Non-deductible expenses		7.7			5.9			7.8
Non-taxable revenue		(8.0	)		(4.7	)		(7.2	)
Dividends from foreign subsidiaries		—			0.0			0.0
Tax effect of undistributed earnings of foreign subsidiaries		3.5			0.0			0.1
Different tax rate applicable to income (loss) of foreign subsidiaries		6.3			(1.4	)		1.1
Effect of changes in domestic tax laws		0.6			(1.4	)		(0.9	)
Expiration of loss carryforwards		0.7			0.0			—
Tax benefit recognized on the devaluation of investment in subsidiaries and affiliates		1.4			—			(54.8	)
Other		(0.7	)		(5.0	)		(1.8	)
Effective tax rate		40.1	%		34.8	%		13.7	%

Details of deferred tax assets and liabilities

	Millions of yen
	March 31
	2015			2016
Deferred tax assets
Depreciation, amortization and valuation of fixed assets	¥	14,692		¥	16,862
Investments in subsidiaries and affiliates		33,553			112,030
Valuation of financial instruments		56,566			60,776
Accrued pension and severance costs		10,335			16,190
Other accrued expenses and provisions		123,567			96,202
Operating losses		466,531			435,122
Other		4,356			5,644
Gross deferred tax assets		709,600			742,826
Less—Valuation allowance		(565,103	)		(543,489	)
Total deferred tax assets		144,497			199,337
Deferred tax liabilities
Investments in subsidiaries and affiliates		109,087			121,874
Valuation of financial instruments		56,808			49,873
Undistributed earnings of foreign subsidiaries		735			711
Valuation of fixed assets		20,644			19,165
Other		8,670			6,822
Total deferred tax liabilities		195,944			198,445
Net deferred tax assets (liabilities)	¥	(51,447	)	¥	892

Changes in valuation allowance for deferred tax assets

	Millions of yen
	Year ended March 31
	2014			2015			2016
Balance at beginning of year	¥	522,220		¥	490,603		¥	565,103
Net change during the year		(31,617	)(1)		74,500	(2)		(21,614	)(3)
Balance at end of year		490,603			565,103			543,489

(1) Primarily includes ¥29,134 million of additional full valuation allowances established by certain foreign subsidiaries against additional operating loss carryforwards generated during the period as a result of additional taxable losses being incurred by such subsidiaries, offset by a reduction of ¥47,263 million of valuation allowances related to the liquidation of certain foreign subsidiaries and a reduction of ¥13,488 million of valuation allowances established by the Company and domestic subsidiaries because of changes in the expected realization of deferred tax assets other than those related to operating loss carryforwards. In total, ¥31,617 million of allowances decreased for the year ended March 31, 2014.

(2) Primarily includes ¥85,403 million of additional full valuation allowances established by certain foreign subsidiaries against additional operating loss carryforwards generated during the period as a result of additional taxable losses being incurred by such subsidiaries, offset by a reduction of ¥2,921 million of valuation allowances of certain foreign subsidiaries and a reduction of ¥7,982 million related to Japanese subsidiaries and the Company because of decrease in valuation allowances related to operating loss carryforwards due to the effect of changes in domestic tax laws. In total, ¥74,500 million of allowances increased for the year ended March 31, 2015.

(3) Primarily includes ¥7,003 million of additional full valuation allowances established by certain foreign subsidiaries against additional operating loss carryforwards generated during the period as a result of additional taxable losses being incurred by such subsidiaries, offset by a reduction of ¥27,757 million of valuation allowances of certain foreign subsidiaries and a reduction of ¥860 million related to Japanese subsidiaries and the Company because of decrease in valuation allowances related to operating loss carryforwards due to the effect of changes in domestic tax laws. In total, ¥21,614 million of allowances decreased for the year ended March 31, 2016.

Summarizes major jurisdictions subject to examination

Jurisdiction	Year
Japan		2011	(1)
United Kingdom		2014
United States		2013

(1) The earliest year in which Nomura remains subject to examination for transfer pricing issues is 2010.