Page 124 - NIB Annual Report 12-13 | 13-14

TURKS AND CAICOS ISLANDS NATIONAL INSURANCE BOARD
Notes to Financial Statements, continued Year ended March 31, 2014
6. Contributions and other receivables, continued
(a) Interest receivable – debenture loan, continued
On April 30, 2013 the liquidator of TCI Bank proposed to pay a rate of 8% interest on the debenture compounded every six months from the date of default until August 20, 2012, being the date the liquidator repaid the debenture, less US$300,000 unpaid liquidator’s costs and expenses incurred in relation to the debenture (note 12). The Board of Directors of NIB agreed to the liquidator’s proposal effective June 18, 2013.
The agreement specified the following conditions:
(i) The liquidator of TCI Bank was to pay to NIB the sum of US$822,695 (the “Settlement Amount”) in full and final settlement of NIB’s claim for interest and costs payable under the debenture,
(ii) The Settlement Amount recognised a credit of US$300,000 claimed by the liquidator in respect of the liquidator’s costs in collecting sufficient of the book debt of TCI Bank so as to repay the liability of TCI Bank to NIB under the debenture; and
(iii) On payment of the Settlement Amount:
 TCI Bank and the liquidator were released from all claims and demands by NIB in respect of the debenture;
 NIB was released in respect of any claims and demands by TCI Bank and/or the liquidator in respect of collection of the book debt of the Bank; and
 The legal proceedings were withdrawn by consent with no order as to costs.
At March 31, 2013 the total unpaid interest on the debenture loan was US$1,044,695. This unpaid interest, plus US$78,000 legal fees incurred by NIB, was collected on June 18, 2013, net of the aforementioned US$300,000 liquidator’s cost and expenses of collection.
(b) Surcharges
Surcharges due on late contributions are recorded on a cash basis, which is not in accordance with IFRS which requires that they be recognised on an accruals basis.
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