Papa Johns 2001 Annual Report Download - page 54

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50
8. Insurance Reserves
The Company’s insurance programs for workers compensation, general liability, owned and non-owned
automobiles and health insurance coverage provided to our employees are self-insured up to certain
individual and aggregate reinsurance levels. Claims in excess of self-insurance levels are fully insured.
Losses are accrued based on estimates of the aggregate retained liability for claims incurred using certain
actuarial projections and our claims loss experience. The estimated insurance claims losses could be
significantly affected should the frequency or ultimate cost of claims significantly differ from historical
trends. Accrued but unpaid losses for the Company’s insurance programs are included in accrued
expenses in the accompanying consolidated balance sheets.
In addition, beginning in October 2000, the Company’s wholly owned captive insurance subsidiary, RSC
Insurance Services, Ltd., began providing insurance coverage to franchisees who elect to participate. The
insurance provided by the captive insurance subsidiary is principally workers compensation, general
liability, property and owned and non-owned automobile programs.
The Company’s $3.9 million estimated liability for losses associated with the franchise insurance program
are included in other long-term liabilities at December 30, 2001 (none in 2000). Investments of $3.4
million are held by the captive insurance subsidiary to fund these estimated liabilities and are classified as
long-term investments.
9. Accrued Expenses
Accrued expenses consist of the following (in thousands):
2001 2000
Insurance 6,100 3,903
Accrued salaries and benefits 5,462 5,319
Accrued purchases 3,264 1,811
Rent 2,015 1,951
Special charges 1,396 3,912
Utilities 879 516
Marketing 872 1,499
Accrued interest 433 981
Deferred proceeds on sale of restaurants - 1,588
Other 6,352 7,851
Total 26,773$ 29,331$