43
NOTES ON THE ACCOUNTS
13 RESERVES
Capital reserve
Balance at 1st January
Less: Expenses on issue of shares
Balance at 31st December
1989
HK$'000
1988 HK$'000
2,412
3,066
654
2,412
2,412
General reserve
Balance at 1st January and 31st December
17,601
17,601
Profit and loss account
442,896
371,268
462,909
391,281
14 CONTINGENCY PROVISION
INSURANCE
1989
1988
HK$'000
HK$'000
Balance at 1st January
(Written back//charged during year
Transfer to claims payable
Balance at 31st December
159.257
106,154
(39,134)
58,156
(13,023)
(5,053)
107,100
159,257
This provision represents amounts set aside annually by the Company to meet possible future liabilities which may arise from third party claims in connection with the Company's bus operations and to cover potential losses which may be caused by fire damage to the fleet. Based on professional advice received from an actuary, an amount of HK$39,134,000 representing insurance provisions no longer required has been written back in the accounts for the year.