34. Reporting results

Question 1

Accounting concepts

Answer 1

Matching
Consistency

Going concern
Accrual
Materiality
Entity (business)
Realisation

Cost
Aspect (dual)
Money management
Prudence

Question 2

Things to pay attention to when analysing accounts

Answer 2

• Regulation, guidance and practice in the country
• Changes in accounting practice
• Valuation basis for assets
• Exceptional events

Question 3

Types of reports

Answer 3

• Chairperson & CEOs statements
• Investment
• Strategic
• Risk
• Remuneration
• Corporate governance

Question 4

Insurance analysis ratios

Answer 4

• Expense ratio
• Operating ratio
• Commission ratio
• Ratio of outward reinsurance premiums to gross premium income

Question 5

Benefit scheme reporting

Answer 5

• No profit/loss
• Valuation leads to surplus/deficit
• May be legislative disclosure requirements for a scheme’s financial position

Question 6

Aims of benefit scheme reporting standards

Answer 6

• Realistic cost of accruing benefits is recognised
• Avoid distortions from fluctuations in employer contributions
• Disclosure
• Consistency

Question 7

Differences in benefit scheme reporting standards relate to:

Answer 7

• Relative emphasis on balance sheet and profit/loss account
• Actuarial method
• Flexibility in setting the assumptions
• Smoothing of year on year fluctuations
• Amount of information to be disclosed

Question 8

Possible disclosure requirements

Answer 8

• Assumptions
• Actuarial method
• Value of liabilities accruing over year
• Surplus/deficit
• Change in surplus/deficit
• Investment returns
• Increases in past service liabilities at start of year
• Benefit cost over the year in terms of directors