Management Fees and Other Revenues Allowance for Credit Losses Income Taxes from substantially all our tenants throughout the year. We do this to reduce the risk of loss on uncollectible accounts once we  perform the final year end billings for recoverable expenditures. We recognize differences between estimated recoveries and  the final billed amounts in the subsequent year and we believe these differences were not material in any period presented.  We recognize revenues from our gift card program when fees are earned according to the provisions of the card arrangements  and respective terms and conditions. Management fees and other revenues are generally received from our unconsolidated joint ventures Properties as well  as third parties. Management fee revenue is recognized based on a contractual percentage of joint venture property revenue.  Development fee revenue is recognized on a contractual percentage of hard costs to develop a property. Leasing fee revenue  is recognized on a contractual per square foot charge based on the square footage of current year leasing activity.  Insurance premiums written and ceded are recognized on a pro-rata basis over the terms of the policies. Insurance  losses are reflected in property operating expenses in the accompanying statements of operations and comprehensive income  and include estimates for losses incurred but not reported as well as losses pending settlement. Estimates for losses are based  on evaluations by actuaries and management’s best estimates. We record a provision for credit losses based on our judgment of a tenant’s creditworthiness, ability to pay and  probability of collection. In addition, we also consider the retail sector in which the tenant operates and our historical  collection experience in cases of bankruptcy, if applicable. Presented below is the activity in the allowance for credit losses  and includes the activities related to discontinued operations during the following years ended: Simon Property and a subsidiary of the Operating Partnership are taxed as REITs under Sections 856 through 860  of the Code and applicable Treasury regulations relating to REIT qualification. These regulations require us to distribute at  least 90% of our taxable income to shareholders and meet certain other asset and income tests as well as other requirements.  We intend to continue to adhere to these requirements and maintain the REIT status of Simon Property and the REIT  subsidiary. As REITs, these entities will generally not be liable for federal corporate income taxes. Thus, we made no provision  for federal income taxes for these entities in the accompanying financial statements. If either of these entities fails to qualify  as a REIT in any taxable year, that entity will be subject to federal income taxes on its taxable income at regular corporate tax  rates for a four year period following the year the entities fail to qualify as a REIT. That entity may reapply for REIT status  at that point. State income, franchise or other taxes were not significant in any of the periods presented.  We have also elected taxable REIT subsidiary (“TRS”) status for some of our subsidiaries. This enables us to receive  income and provide services that would otherwise be impermissible for REITs. For these entities, deferred tax assets and  liabilities are established for temporary differences between the financial reporting basis and the tax basis of assets and  liabilities at the enacted tax rates expected to be in effect when the temporary differences reverse. A valuation allowance for  deferred tax assets is provided if we believe all or some portion of the deferred tax asset may not be realized. An increase or  decrease in the valuation allowance that results from the change in circumstances that causes a change in our judgment about  the realizability of the related deferred tax asset is included in income. 2003 annual report 55 For the Year Ended December 31,  2003 2002  2001 Balance at Beginning of Year  $ 20,490 $ 24,682 $ 20,108 Consolidation of Management Company  1,700 – – Provision for Credit Losses  14,630 8,972 8,415 Accounts Written Off  (5,347 )  (13,164 )  (3,841 ) Balance at End of Year  $ 31,473  $ 20,490 $ 24,682