SAE Annual Report 2010 - 62

SAE INTERNATIONAL
Notes to the Financial Statements (Continued) Note 12 - In-kind Contributions (Continued) In addition, a substantial number of SAE members have made significant contributions of their time to the Foundation’s various programs. The value of this contributed time is not reflected in the accompanying financial statements since it does not meet the criteria for recognition under accounting principles generally accepted in the United States of America. Note 13 - Self Insurance SAE self-insures the medical and prescription drug benefits provided to all of its current and retired employees and their families. This plan is administered by a third party that processes, adjudicates and pays claims on behalf of SAE. SAE maintains stop-loss coverage based on a $110,000 deductible per participant and an annual aggregate deductible of approximately $2,600,000 to limit its liability for large specific and aggregate losses. SAE has recorded a liability for estimated future costs of incurred claims of approximately $375,000 at December 31, 2010 and $205,000 at December 31, 2009. The liability is included in accrued expenses in the statements of financial position. SAE accrues for its self-insured unemployment compensation based on actual claims outstanding at year end. At December 31, 2010, SAE had accrued approximately $515,000 in claims related to a reduction in workforce. SAE did not recognize any unemployment compensation expense at December 31, 2010. At December 31, 2009, SAE had accrued approximately $740,000 in claims and incurred claims of approximately $1,162,000. Note 14 - Related Party Transactions PRI PRI leases office space from SAE currently on a month-to-month basis. Annual rental income received from PRI approximated $185,000 for the years ended December 31, 2010 and 2009. Employees of PRI are eligible to participate in the defined benefit pension plan sponsored by SAE. In return, PRI reimburses SAE for pension costs associated with its employees. Pension expense reimbursed to SAE approximated $413,788 for the year ended December 31, 2010 and $624,000 for the year ended December 31, 2009. SAE has a consulting and office space agreement with PRI for the services of a consultant to contribute to the successful fulfillment of SAE carrying out standards development and marketing activities with customers in Europe. The agreement extends through November 30, 2011. Costs associated with this agreement approximated $377,043 for the year ended December 31, 2010 and $382,972 for the year ended December 31, 2009.

Page 30

SAE Annual Report 2010

Table of Contents for the Digital Edition of SAE Annual Report 2010