Employee Retirement and Severance Benefits (Tables)

12 Months Ended

Dec. 31, 2011

Benefit Obligations and Fair Value of Plan Assets

Reconciliations of beginning and ending balances of the benefit obligations and the fair value of the plan assets are as follows:

	Japanese plans						Foreign plans
	December 31						December 31
	2011			2010			2011			2010
	(Millions of yen)
Change in benefit obligations:
Benefit obligations at beginning of year	¥	593,274		¥	551,320		¥	261,130		¥	94,170
Service cost		25,875			23,331			5,756			5,660
Interest cost		12,354			12,636			12,748			11,792
Plan participants’ contributions		—			—			2,680			2,460
Amendments		(1,913	)		(423	)		—			(149	)
Actuarial (gain) loss		14,845			22,290			3,872			(5,946	)
Benefits paid		(17,511	)		(15,880	)		(8,234	)		(7,458	)
Acquisition		—			—			—			198,754
Foreign currency exchange rate changes		—			—			(15,822	)		(38,153	)
Benefit obligations at end of year		626,924			593,274			262,130			261,130
Change in plan assets:
Fair value of plan assets at beginning of year		460,090			457,208			197,835			75,058
Actual return on plan assets		(17,285	)		4,533			2,335			19,307
Employer contributions		22,282			13,283			8,228			8,152
Plan participants’ contributions		—			—			2,680			2,460
Benefits paid		(16,351	)		(14,934	)		(8,201	)		(7,413	)
Acquisition		—			—			—			128,043
Foreign currency exchange rate changes		—			—			(10,844	)		(27,772	)
Fair value of plan assets at end of year		448,736			460,090			192,033			197,835
Funded status at end of year	¥	(178,188	)	¥	(133,184	)	¥	(70,097	)	¥	(63,295	)

Amounts Recognized in Consolidated Balance Sheets

Amounts recognized in the consolidated balance sheets at December 31, 2011 and 2010 are as follows:

	Japanese plans						Foreign plans
	December 31						December 31
	2011			2010			2011			2010
	(Millions of yen)
Other assets	¥	54		¥	345		¥	1,397		¥	1,318
Accrued expenses		—			—			(132	)		(533	)
Accrued pension and severance cost		(178,242	)		(133,529	)		(71,362	)		(64,080	)
	¥	(178,188	)	¥	(133,184	)	¥	(70,097	)	¥	(63,295	)

Recognized Accumulated Other Comprehensive Income (Loss) Before Income Taxes

Amounts recognized in accumulated other comprehensive income (loss) at December 31, 2011 and 2010 before the effect of income taxes are as follows:

	Japanese plans						Foreign plans
	December 31						December 31
	2011			2010			2011			2010
	(Millions of yen)
Actuarial loss	¥	291,778		¥	257,625		¥	16,095		¥	3,538
Prior service credit		(130,712	)		(142,473	)		(345	)		(486	)
Net transition obligation		—			722			—			—
	¥	161,066		¥	115,874		¥	15,750		¥	3,052

Accumulated Benefit Obligation for All Defined Benefit Plans

The accumulated benefit obligation for all defined benefit plans was as follows:

	Japanese plans				Foreign plans
	December 31				December 31
	2011		2010		2011		2010
	(Millions of yen)
Accumulated benefit obligation	¥	595,689	¥	565,406	¥	238,675	¥	216,239

Plans with Projected Benefit Obligations in Excess of Plan Assets and Plans with Accumulated Benefit Obligations in Excess of Plan Assets

The projected benefit obligations and the fair value of plan assets for the pension plans with projected benefit obligations in excess of plan assets, and the accumulated benefit obligations and the fair value of plan assets for the pension plans with accumulated benefit obligations in excess of plan assets are as follows:

	Japanese plans				Foreign plans
	December 31				December 31
	2011		2010		2011		2010
	(Millions of yen)
Plans with projected benefit obligations in excess of plan assets:
Projected benefit obligations	¥	622,645	¥	589,391	¥	259,517	¥	258,326
Fair value of plan assets		444,403		455,862		188,023		193,713
Plans with accumulated benefit obligations in excess of plan assets:
Accumulated benefit obligations	¥	591,830	¥	559,468	¥	160,941	¥	144,225
Fair value of plan assets		444,403		453,342		111,527		122,590

Net Periodic Benefit Cost for Employee Retirement and Severance Defined Benefit Plans

Net periodic benefit cost for Canon’s employee retirement and severance defined benefit plans for the years ended December 31, 2011, 2010 and 2009 consisted of the following components:

	Japanese plans									Foreign plans
	Years ended December 31									Years ended December 31
	2011			2010			2009			2011			2010			2009
	(Millions of yen)
Service cost	¥	25,875		¥	23,331		¥	21,759		¥	5,756		¥	5,660		¥	2,426
Interest cost		12,354			12,636			12,535			12,748			11,792			4,251
Expected return on plan assets		(16,485	)		(16,591	)		(15,808	)		(12,112	)		(10,540	)		(4,211	)
Amortization of net transition obligation		722			722			722			—			—			—
Amortization of prior service credit		(13,674	)		(13,878	)		(13,650	)		(93	)		(116	)		(98	)
Amortization of actuarial loss		14,462			14,545			13,923			621			1,050			1,014
	¥	23,254		¥	20,765		¥	19,481		¥	6,920		¥	7,846		¥	3,382

Other Changes in Plan Assets and Benefit Obligations Recognized in Other Comprehensive Income (Loss)

Other changes in plan assets and benefit obligations recognized in other comprehensive income (loss) for the years ended December 31, 2011 and 2010 are summarized as follows:

	Japanese plans						Foreign plans
	Years ended December 31						Years ended December 31
	2011			2010			2011			2010
	(Millions of yen)
Current year actuarial (gain) loss		¥48,615			¥34,348			¥13,649		¥	(14,713	)
Amortization of actuarial loss		(14,462	)		(14,545	)		(621	)		(1,050	)
Prior service credit due to amendments		(1,913	)		(423	)		—			(149	)
Amortization of prior service credit		13,674			13,878			93			116
Amortization of net transition obligation		(722	)		(722	)		—			—
		¥45,192			¥32,536			¥13,121		¥	(15,796	)

Summary of Estimated Defined Benefit Pension Plans Amortized from Acumulated Other Comprehensive Income (Loss) into Next Year Benefit Cost

The estimated prior service credit and actuarial loss for the defined benefit pension plans that will be amortized from accumulated other comprehensive income (loss) into net periodic benefit cost over the next year are summarized as follows:

	Japanese plans			Foreign plans
	(Millions of yen)
Prior service credit	¥	(13,137	)	¥	(130	)
Actuarial loss		16,708			986

Weighted-Average Assumptions Used to Determine Benefit Obligations

Weighted-average assumptions used to determine benefit obligations are as follows:

	Japanese plans				Foreign plans
	December 31				December 31
	2011		2010		2011		2010
Discount rate		1.9%		2.1%		4.6%		4.9%
Assumed rate of increase in future compensation levels		3.0%		3.0%		2.4%		2.9%

Weighted-Average Assumptions Used to Determine Net Periodic Benefit Cost

Weighted-average assumptions used to determine net periodic benefit cost are as follows:

	Japanese plans									Foreign plans
	Years ended December 31									Years ended December 31
	2011			2010			2009			2011			2010			2009
Discount rate		2.1	%		2.3	%		2.4	%		4.9	%		4.9	%		5.3	%
Assumed rate of increase in future compensation levels		3.0	%		3.0	%		3.0	%		2.9	%		2.8	%		3.1	%
Expected long-term rate of return on plan assets		3.6	%		3.6	%		3.7	%		5.7	%		6.1	%		6.2	%

Fair Values of Company's Pension Plans Assets

The fair values of Canon’s pension plan assets at December 31, 2011 and 2010, by asset category, are as follows:

	December 31, 2011
	Japanese plans								Foreign plans
	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
	(Millions of yen)
Equity securities:
Japanese companies (a)	¥	37,875	¥	—	¥	—	¥	37,875	¥	—	¥	—	¥	—	¥	—
Foreign companies		4,804		—		—		4,804		3,779		—		—		3,779
Pooled funds (b)		—		82,380		—		82,380		—		47,779		—		47,779
Debt securities:
Government bonds (c)		17,951		—		—		17,951		2,326		—		—		2,326
Municipal bonds		—		864		—		864		—		19		—		19
Corporate bonds		—		8,170		—		8,170		—		—		—		—
Pooled funds (d)		—		190,832		—		190,832		—		92,653		—		92,653
Mortgage backed securities (and other asset backed securities)		—		4,842		—		4,842		—		2,726		—		2,726
Life insurance company general accounts		—		92,700		—		92,700		—		—		—		—
Other assets		—		7,171		1,147		8,318		—		42,751		—		42,751
	¥	60,630	¥	386,959	¥	1,147	¥	448,736	¥	6,105	¥	185,928	¥	—	¥	192,033

	December 31, 2010
	Japanese plans								Foreign plans
	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
	(Millions of yen)
Equity securities:
Japanese companies (e)	¥	50,177	¥	—	¥	—	¥	50,177	¥	—	¥	—	¥	—	¥	—
Foreign companies		5,352		—		—		5,352		3,474		—		—		3,474
Pooled funds (f)		—		90,597		—		90,597		—		80,666		—		80,666
Debt securities:
Government bonds (g)		9,687		—		—		9,687		2,074		—		—		2,074
Municipal bonds		—		323		—		323		—		—		—		—
Corporate bonds		—		6,518		—		6,518		—		—		—		—
Pooled funds (h)		—		194,286		—		194,286		—		104,650		—		104,650
Mortgage backed securities (and other asset backed securities)		—		1,980		—		1,980		—		232		—		232
Life insurance company general accounts		—		91,610		—		91,610		—		—		—		—
Other assets		—		8,521		1,039		9,560		—		6,739		—		6,739
	¥	65,216	¥	393,835	¥	1,039	¥	460,090	¥	5,548	¥	192,287	¥	—	¥	197,835

(a) The plan’s equity securities include common stock of the Company and certain of its subsidiaries in the amounts of ¥1,129 million.

(b) These funds invest in listed equity securities consisting of approximately 50% Japanese companies and 50% foreign companies for Japanese plans, and mainly foreign companies for foreign plans.

(c) This class includes approximately 30% Japanese government bonds and 70% foreign government bonds.

(d) These funds invest in approximately 75% Japanese government bonds, 15% foreign government bonds, 5% Japanese municipal bonds, and 5% corporate bonds for Japanese plans. These funds invest in approximately 40% foreign government bonds and 60% corporate bonds for foreign plans.

(e) The plan’s equity securities include common stock of the Company and certain of its subsidiaries in the amounts of ¥1,044 million.

(f) These funds invest in listed equity securities consisting of approximately 50% Japanese companies and 50% foreign companies for Japanese plans, and mainly foreign companies for foreign plans.

(g) This class includes approximately 50% Japanese government bonds and 50% foreign government bonds.

(h) These funds invest in approximately 60% Japanese government bonds, 20% foreign government bonds, 10% Japanese municipal bonds, and 10% corporate bonds for Japanese plans. These funds invest in approximately 40% foreign government bonds and 60% corporate bonds for foreign plans

Benefit Payments, Reflect Expected Future Service

The following benefit payments, which reflect expected future service, as appropriate, are expected to be paid:

	Japanese plans		Foreign plans
	(Millions of yen)
Year ending December 31:
2012	¥	15,100	¥	8,750
2013		16,137		8,542
2014		17,301		8,763
2015		19,160		9,228
2016		20,893		9,993
2017 – 2021		130,449		60,255