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On August 13 and December 21, 2009, the Globe Group granted five-year loans amounting to P250.00million and P45.00 million, respectively, to BHI at 8.275% interest. The P250.00 million loan is covered bya pledge agreement whereby in the event of default, the Globe Group shall be entitled to offset whateveramount is due to BHI from any unpaid fees of Broadcast Enterprises and Affiliated Media Inc. (BEAM),BHI’s subsidiary, from the Globe Group. The P45.00 million loan is fully secured by a chattel mortgageagreement dated December 21, 2009 between Globe Group and BEAM (see Notes 16.3 and 25.5).12. Accounts Payable and Accrued ExpensesThis account consists of:Notes 2010 2009 2008(In Thousand Pesos)Accrued project costs 25.3 P8,638,119 P8,081,684 P5,258,619Accounts payable 16 5,716,859 5,769,355 5,156,011Accrued expenses 16 5,587,799 4,898,403 4,837,196Traffic settlements - net 2,172,426 1,866,012 1,545,539Output VAT – 172,735 174,472Dividends payable 17.3 – 50,492 60,637P22,115,203 P20,838,681 P17,032,474Traffic settlements payable are presented net of traffic settlements receivable from the same carrier amountingto P2,335.95 million, P1,019.65 million and P4,313.98 million as of December 31, 2010, 2009 and 2008,respectively.As of December 31, 2010, Globe Telecom reported net output VAT amounting to P99.48 million, net of input VATof P359.93 million. As of December 31, 2009, Globe Telecom and EGG Group reported net output VAT amountingto P172.74 million, net of input VAT of P361.59 million. As of December 31, 2008, Globe Telecom reported netoutput VAT amounting to P174.47 million, net of input VAT of P330.34 million.The “Accrued expenses” account includes accruals for general, selling and administrative expenses.13. ProvisionsThe rollforward analysis of this account follows:Notes 2010 2009 2008(In Thousand Pesos)At beginning of year P89,404 P202,514 P219,687Provisions/ reversals 23 138,760 (88,047) (5,031)Adjustments (3,776) (25,063) (12,142)At end of year P224,388 P89,404 P202,514Provisions relate to various pending unresolved claims and assessments over the Globe Group’s mobile andwireline business. The information usually required by PAS 37, Provisions, Contingent Liabilities and ContingentAssets, is not disclosed on the grounds that it can be expected to prejudice the outcome of these claims andassessments. As of February 8, 2011, the remaining pending claims and assessments are still being resolved.The provisions for National Telecommunications Commission (NTC) permit fees amounting to P117.26 millionfor an assessment by the NTC on March 27, 1996 and contested by Innove and other members of theTelecommunications Operators of the Philippines was reversed in 2009 after taking into account all availableevidence including the merits of the ruling of the Court of Appeals (CA) in favor of another telecommunicationsservice provider.139