Governmental Accounting Standards Board of the Financial Accounting Foundation

Transcription

1 IMPLEMENTATION GUIDE Guide to Implementation of GASB Statement 10 on Accounting and Financial Reporting for Risk Financing and Related Insurance Issues Questions and Answers Governmental Accounting Standards Board of the Financial Accounting Foundation

2 GASB IMPLEMENTATION GUIDES Guide to Implementation of GASB Statement 3 on Deposits with Financial Institutions, Investments (including Repurchase Agreements), and Reverse Repurchase Agreements (GQA03) Guide to Implementation of GASB Statement 9 on Reporting Cash Flows of Proprietary and Nonexpendable Trust Funds and Governmental Entities That Use Proprietary Fund Accounting (GQA09) Guide to Implementation of GASB Statement 10 on Accounting and Financial Reporting for Risk Financing and Related Insurance Issues (GQA10) For information on prices and discount rates, please contact: Order Department Governmental Accounting Standards Board 401 Merritt 7 P.O. Box 5116 Norwalk, CT (203) , Ext. 10

3 IMPLEMENTATION GUIDE Guide to Implementation of GASB Statement 10 on Accounting and Financial Reporting for Risk Financing and Related Insurance Issues Questions and Answers Governmental Accounting Standards Board of the Financial Accounting Foundation 401 Merritt 7, P.O. Box 5116, Norwalk, Connecticut

4 Copyright 1993 by Governmental Accounting Standards Board. All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of the Governmental Accounting Standards Board. Library of Congress Catalog Card Number: ISBN

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9 IMPLEMENTATION GUIDE Guide to Implementation of GASB Statement 10 on Accounting and Financial Reporting for Risk Financing and Related Insurance Issues Questions and Answers Contents Page Numbers Foreword... Preface... iii v Question Numbers Questions and Answers Public Entity Risk Pools Definition and Scope Determining What Is a Pool Types of Public Entity Risk Pools Pool Sponsors Unemployment Compensation Recognition and Measurement Revenue Recognition Dividends Premium deficiency Expense and Liability Recognition and Measurement Acquisition costs Claim adjustment expenses IBNR claims Recoveries from subrogation Reinsurance and excess insurance Deductibles and self-insured retentions Discounting Investments Real estate vii

10 Question Numbers Disclosures and Required Supplementary Information Note Disclosures Description of pool and responsibilities Basis for estimating liabilities Anticipated investment income for premium deficiency Reconciliation of unpaid claims Required Supplementary Information SEC requirements Reconciliation with financial statements Unallocated claim adjustment expenses Inclusion of IBNR claims Discounted amounts Policy-year basis Additional disclosures Presentation Source of underlying loss data Reinsurance recoveries Entities Other Than Pools Definition and Scope Fund Classification Employee Benefits Environmental Liabilities Stand-Alone Entities Recognition and Measurement General Fund Internal Service Fund Revenue Colleges and Universities Liability Measurement FASB Statement Discounting IBNR Claims Use of third-party insurer Claims-made policies viii

11 Question Numbers Claims-paid policies Retrospectively rated policies and contracts Deductibles and self-insured retentions Costs related to claims Annuity contracts Participation in Pool without Transfer of Risk Participation in Risk-Sharing Pool Disclosures Liability Reconciliation Component Units Subsequent Events Effective Date and Implementation Page Numbers Glossary Appendix 1: Determining What Is a Public Entity Risk Pool Appendix 2: Calculation of Pool Premium Deficiencies Appendix 3: Illustrative Note Disclosures Appendix 4: Standards Section from GASB Statement No. 10, Accounting and Financial Reporting for Risk Financing and Related Insurance Issues Appendix 5: Topical Index ix

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