The Japanese era calendar scheme is a common calendar scheme used in Japan, which identifies a year by the combination of the Japanese era name and the year number within the era. For example, the year 2010 is Heisei 22.

Government offices usually require era names and years for official papers. [ Very confusing for foreigners :( ]

Sometimes an era name is expressed with the first letter of the romanized name. For example, S55 means Shōwa 55 (i.e. AD 1980).

How it is counted?
Traditionally the Japanese have counted years according to the reigning emperor or the family or individual in power. Currently an Imperial era begins when an emperor dies and his heir ascends the throne. The new emperor chooses a name by which both he ans the incoming era wil be known.

The current era is called Heisei chosen by emperor Akihito after his father Horohito's death on Jan 7 , 1989.

To convert a Western Calendar year to Imperial Calendar time, subtract the number of the year prior to the first year of the concurrent Imperial era from the Western Calendar year.

Luckily all Government offices have the conversion charts or atleast the Japanese officials help in converting. :)