Papa Johns 2009 Annual Report Download - page 92

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85
10. Insurance Reserves (continued)
From October 2000 through September 2004, our franchisee insurance program, which provides
insurance to our franchisees, was self-insured up to certain coverage limits. Beginning in October 2004, a
third-party commercial insurance company began providing fully-insured coverage to franchisees
participating in the franchise insurance program. Accordingly, the 2004 agreement eliminates our risk of
loss for franchise insurance coverage written after September 2004. Our operating income will still be
subject to potential adjustments for changes in estimated insurance reserves for policies written from the
inception of the captive insurance company in October 2000 to September 2004. Such adjustments, if
any, will be determined in part based upon periodic actuarial valuations.
Our estimated liabilities for claims loss reserves associated with the franchise insurance program are $1.8
million at December 27, 2009 and $2.9 million at December 28, 2008, and are included in other long-
term liabilities in the accompanying consolidated balance sheets. Investments of $1.4 million and
$530,000 as of December 27, 2009 and December 28, 2008, respectively, are held by the captive
insurance subsidiary to fund these estimated liabilities and are classified as long-term investments in the
accompanying consolidated balance sheets.
We are a party to standby letters of credit with off-balance sheet risk associated with our insurance
programs. The total amount committed under letters of credit for these programs was $20.9 million at
December 27, 2009.
11. Accrued Expenses
Accrued expenses consisted of the following (in thousands):
2009 2008
Self-insurance reserves 18,551$ 18,777$
Salaries, benefits and bonuses 13,101 13,676
Purchases 7,078 3,200
Rent 5,641 5,348
Consulting and professional fees 1,791 1,779
Marketing 1,309 4,215
Utilities 1,169 1,001
Interest 409 296
Other 5,192 5,928
Total 54,241$ 54,220$