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Year Amount
1990 $288,736.75
1991 72,533.90
1992 15,092.64
1993 6,027.50
Brunswick paid total fees of $26,000 to Arthur Andersen for
services related to Saba and Otrabanda.
C. Total Expenses
As of October 3, 1990, Brunswick had established a reserve
for expenses attributable to Saba and Otrabanda of $10,600,000 as
part of Brunswick's Accrued Disposition Costs account. Brunswick
established the Accrued Disposition Costs account to accrue
expenses that would be netted against the gains that Brunswick
expected to realize on the sale of its Technical businesses and
Nireco stock.
Arthur Andersen served as Brunswick's independent accountant
from 1980 through 1993. In an interoffice memorandum dated
October 16, 1990, authored by Michael P. Abrahamson (Abrahamson)
and circulated to Arthur Andersen representatives in New York and
Chicago, Abrahamson discussed Brunswick's accounting for its
investment in Saba. The memorandum states that the accounting
treatment for the transaction had been discussed with Arthur
Andersen prior to Brunswick’s recording the transaction. The
memorandum further states in pertinent part:
Any transaction costs (i.e., formation of the
partnership) to be borne by Brunswick were charged
against a gain on sale (i.e., below the line) recorded
by Brunswick in connection with the disposition of
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