Description: The impact of bond default risk on retirement benefit obligations describes how the probability default on a bond is similar to the probability of death for an annuitant. Bonds are used to cash flow match retirement obligations cash flows to funding from bond. Just as the probability of non-payment happens on the liability side, we can do the same with selected bonds. The end result may be an adjustment to the discount rates used.

Description: Discussion of the sensitivity of GAAP reserves to certain assumptions made and methodologies used. Followed by a discussion paper

Description: The report begins with Tan's paper Source-of-Earnings Analysis under FAS97 Universal Life Accounting that defines a procedure for analyzing the sources of profit. This paper extends the analysis to consider the effect of actual experience varying from expected and the effect of those variances on assumptions for the future. Also the paper illustrates examples of the effect of changing future assumptions or unlocking on the magnitude and incidence of profits and amortization. A discussion of the paper follows. From Transactions of Society of Actuaries 1990, Vol. 42.

Description: This panel discussion session explored alternative methods for accounting recognition of the costs of policyholder dividends. The theoretical bases, as well as the impact on anticipated earnings patterns, are discussed. Implementation issues are also discussed. Discussion of participating products in the UK and accounting methods used for them is also included.

Description: This section presents book reviews and summaries of recent publications. Reviews: '1975 Annual Reports of the Board of Trustees of the Federal OASDI Trust Funds...' by the US Congress, 'Providing Adequate Retirement Income' by Schulz, Carrin, Krupp, Peschke, Sclar and Steenberge, 'Ernst & Ernst GAAP - Stock Life Companies' by Posnak, 'Reports of the Quadrennial Advisory Council on Social Security' by US Government, 'Fundamentals of Private Pensions' by McGill. Digests also included.

Description: From an interactive forum session at the 2001 Valuation Actuary Symposium, held in Lake Buena Vista, Florida, November 29-30, 2001 Discussion of the major financial reporting issues and concerns of senior actuaries in life insurance companies. Discussion focused cash flow testing methods and interpretation of results.

Description: This report summarizes the results of a research project undertaken by the Society of Actuaries to study the possible effects of the International Accounting Standards Board’s IASB Discussion Paper describing its Preliminary Views on Insurance Contracts on nine representative U.S. life, health and annuity products.

Description: Various methods of accounting for a block of in-force business acquired at the time of purchase have been proposed and used. This paper describes nine such methods, analyzing each by the use of a very simple model office. Followed by submitted discussions of the article

Description: Examination of how mean reserve factors can best be calculated in light of the new accounting reporting requirements for the earnings of stock life insurance companies. Also examines some methods of expense amortization, including the reserve factor method, and also attempt to show an informative comparison of how reported calendar-year earnings can be expected to emerge with statutory mean reserve factors, natural mean reserve factors, and assorted expense amortization methods. Followed by several submitted discussion papers

Description: Financial Reporting Section March, 2012, newsletter.