Consolidated Financial Statements
19. OPERATING EXPENSES REDUCTION
a) NCC reached an agreement on certain amendments to charter party agreements with a charterer with retrospective application. This resulted in a reduction of operating expenses. Total reduction in operating expenses was determined at SR 14.71 million for the period from January 1, 2008 to December 31, 2008 and SR 16.43 million for the period January 1, 2009 to December 31, 2009. These amounts related to 2008 and 2009 were reversed against the operating expenses for the year ended December 31, 2009.
b) NCC provided a provision for contingent liability in 2007 and 2008 for SR 13.5 million and SR 17.0 million, respectively, related to potential Time Charter Hire Performance claims. During 2009 total claim amount for the years 2006 through 2008 was mutually agreed with the charterer for SR 2.3 million resulting in excess provision of SR 28.2 million which was credited against operating expenses during the year ended December 31, 2009.
20. GENERAL AND ADMINISTRATIVE EXPENSES
General and administrative expenses for the year ended December 31 comprises the following:
2009
2008
Employees’ costs
73,525 15,651
82,042 19,335
Other general and administrative expenses
Depreciation
1,948 3,896
1,298 3,043
Boards of Directors expenses for the Company and its subsidiaries
95,020
105,718
In Thousands Saudi Riyals
21. OTHER INCOME (EXPENSE), NET
Other income (expense), net for the year ended December 31 comprises the following:
2009
2008
Income from Murabaha and short-term deposits
10,552
27,976
Income (losses) from investments, net*
6,912
(32,629)
Bank commissions and amortization of government bonds’ premium
22
902
Gains on sale of fixed assets
30,489 12,050
70 ---
Reversal of excess zakat and withholding tax provision (Note 14)
Foreign currency exchange differences
997
(1,850)
Others
1,976
1,239
62,998
(4,292)
In Thousands Saudi Riyals
* In 2008 losses from investments available for sale include SR 43 million representing an impairment loss in the value of the investment portfolio.
62
Annual Report 2009 The National Shipping Company of Saudi Arabia
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