A) measured at net market value, with any changes being treated as an adjustment to equity through reserves.
B) measured at current replacement cost and depreciated so that the expense of the period is matched against premium revenue.
C) measured at net market value, with any changes treated as a revenue or expense of the period.
D) measured at the lower of cost and recoverable amount, with any amounts written off treated as an expense of the period.
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A) they are levied on the insurer and incorporated into the insurance premium.
B) they are imposed on the insured party by the government.
C) the insurer is acting simply as a collector of levies and charges imposed by the government.
D) they are levied on the insurer and incorporated into the insurance premium and the insurer is acting simply as a collector of levies and charges imposed by the government.
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A
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A) its requirement to recognise short-term changes in the net market value of investments in the statement of comprehensive income regardless of whether or not management intends to hold the investments long term.
B) the failure to net reinsurance reimbursements from claims so that a higher level of claims is reflected in the statement of comprehensive income despite the fact that management has mitigated against this.
C) the failure to recognise the value of intangible assets such as client lists that contribute to a steady flow of income for an insurer.
D) the failure to net reinsurance reimbursements from claims so that a higher level of claims is reflected in the statement of comprehensive income despite the fact that management has mitigated against this and the failure to recognise the value of intangible assets such as client lists that contribute to a steady flow of income for an insurer.
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A) $12 500 in January, February and March; $1389 each other month
B) $3720 per month
C) $12 121 in January, February and March; $1515 each other month
D) $4167 per month
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C
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A) direct claims expense
B) reinsurance claims expense
C) deferred acquisition costs
D) direct claims expense and reinsurance claims expense
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A) Increased volatility is associated with unreliable service and may lead potential policy holders to choose another company.
B) It makes it more difficult for management to plan how to manage its profit levels.
C) Volatile earnings make it more difficult for employees to argue for pay increases.
D) Insurers may be put into technical default on contractual clauses relating to things such as debt covenants.
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A) Phase I of the IASB Insurance Project will see these replaced by one standard.
B) Three standards are required to deal with complex issues such as the HIH collapse.
C) These standards cover life insurance, general insurance and motor vehicle insurance.
D) These standards reissued in July 2004 have been significantly altered based on recommendations from the HIH Royal Commission.
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D
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A) The difference must be recorded as an asset under AASB 1023.
B) A further liability should be recorded to 'make up' the deficiency.
C) An expense should be recorded by initially writing down any related intangible assets.
D) A further liability should be recorded to 'make up' the deficiency and an expense should be recorded by initially writing down any related intangible assets and related deferred acquisition costs.
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A) depreciated historical cost.
B) net replacement cost.
C) recoverable amount.
D) None of the given answers are correct.
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AASB 1023 outlines the rationale for sel...View Answer
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The current version of AASB 1023, which ...View Answer
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A) Accounting standards which were unclear were primarily responsible for the collapse of HIH.
B) The inclusion of more non-accounting experience on the AASB could assist in the standard setting process.
C) That the true and fair view was no longer applicable to accounting reports.
D) Accounting standards which were unclear were primarily responsible for the collapse of HIH and that the true and fair view was no longer applicable to accounting reports.
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