Re: Statement of Opinion Question

Mary Frances Miller ( Mary_Frances_Miller@sedgus.com )
Tue, 7 Apr 1998 17:23:12 -0500

Aaron, I think you can opine that the reserve estimate is reasonable.
I would feel called upon to do more than just indicate that the IRIS
tests fail, though. I would include a paragraph acknowledging
explicitely that the company's reported assets are insufficient to
cover the liabilities. That's how we handled a similar situation this
year.

Mary Frances Miller

______________________________ Reply Separator _________________________________
Subject: Statement of Opinion Question
Author: "Aaron Newhoff" <aaronn19@IDT.NET> at _internet
Date: 4/7/98 10:08 AM

I've been asked to opine on the reserves of a captive insurer. While I
believe their reserves to be reasonable, they show a negative surplus.
Obviously, they flunk IRIS 9,10, and 11, but in the statement of opinion
guidelines I've looked through, I don't see any indication that this would
necessitate issuing an adverse or even qualified opinion. As far as I can
tell, all I need to do is note the exceptional IRIS values and leave it at
that. Is this really the extent of my responsibility in this case? I
suppose this makes sense if all I'm really opining on is the reserve
number, but I'd never encountered this situation before so I thought I'd
seek a little guidance. Thanks for any info.

Aaron



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