general liabilities for third-party claims. We recognize insurance recoverables from third-party insurers forincurred expenses at the time the recovery is probable and upon realization for amounts in excess of incurredexpenses. All of our insurance policies are subject to coverage limits, exclusions and deductible levels. Theliabilities associated with crew illnesses and crew and guest injury claims, including all legal costs, are estimatedbased on the specific merits of the individual claims or actuarially estimated based on historical claimsexperience, loss development factors and other assumptions. While we believe our estimated accrued claimsreserves are adequate, the ultimate losses will differ.At November 30, 2014 and 2013, substantially all of our aggregated short-term and long-term insurancerecoverables are for crew, guest and other third-party claims related to the January 2012 ship incident. AtNovember 30, 2014 and 2013, the majority of our aggregated short-term and long-term claims reserves alsorelate to this January 2012 ship incident. At November 30, 2014 and 2013, our long-term insurance recoverablesand long-term claims reserve are included in other assets and other long-term liabilities, respectively, and are notmaterial.14
Selling and Administrative ExpensesSelling expenses include a broad range of advertising, such as marketing and promotional expenses. Advertisingis charged to expense as incurred, except for media production costs. Brochures and media production costs arerecorded as prepaid expenses and charged to expense as consumed or upon the first airing of the advertisement,respectively. Advertising expenses totaled $623 million, $588 million and $527 million in 2014, 2013 and 2012,respectively. Administrative expenses represent the costs of our shoreside ship support, reservations and otheradministrative functions, and includes salaries and related benefits, professional fees and occupancy costs, whichare typically expensed as incurred.Foreign Currency Translations and TransactionsEach business determines its functional currency by reference to its primary economic environment. We translatethe assets and liabilities of our foreign operations that have functional currencies other than the U.S. dollar atexchange rates in effect at the balance sheet date. Revenues and expenses of these foreign operations aretranslated at weighted-average exchange rates for the period. Their equity is translated at historical rates and theresulting foreign currency translation adjustments are included as a component of accumulated othercomprehensive income (“AOCI”), which is a separate component of shareholders’ equity. Therefore, the U.S.dollar value of the non-equity translated items in our consolidated financial statements will fluctuate from periodto period, depending on the changing value of the U.S. dollar versus these currencies.
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Balance Sheet, consolidated financial statements, Carnival Cruise Lines, Holland America Line, Carnival Corporation & PLC, Princess Cruises