1. PFRS 17 allows and insurer to charge its accounting policies for insurance contract only if, as a result of its financial statements present information that is more relevant. 2. Outward reinsurance is where the premium and commission shall be accounted for in the different accounting period original policy to which the reinsurance relates. 3. Premium deficiency arises when the unearned premium reserve is less than the estimated claimed related expenses.

1. PFRS 17 allows and insurer to charge its accounting policies for insurance contract only if, as a result of its financial statements present information that is more relevant. 2. Outward reinsurance is where the premium and commission shall be accounted for in the different accounting period original policy to which the reinsurance relates. 3. Premium deficiency arises when the unearned premium reserve is less than the estimated claimed related expenses.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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S1: PFRS 17 allows and insurer to change its accounting policies for insurance contract only if, as a result of its financial statements present information that is more relevant. S2: Outward Reinsurance is where the premium and commission shall be accounted for in the different accounting period original policy to which the reinsurance relates. S3: Premiurn deficiency arises when the unearned premium reserve is less than the estimated claims related expenses. a. Only S3 is incorrectb. All statements are correctc. Only S2 is correctd. Only S3 is correcte. Only S1 is incorrectf. Only S2 is incorrectg. All statements are incorrecth. Only S1 is correct
S1: PFRS 17 allows and insurer to change its accounting policies for insurance contract only if, as a result of its financial statements present information that is more relevant. S2: Outward Reinsurance is where the premium and commission shall be accounted for in the different accounting period original policy to which the reinsurance relates. $3: Premium deficiency arises when the unearned premium reserve is less than the estimated claims related expenses. Only S3 is correct O All statements are correct Only S1 is correct Only S1 is incorrect Only S2 is correct Only S3 is incorrect All statements are incorrect Only S2 is incorrect
S1: The straight-line method computes the unearned premiums, policy by policy, on a pro-rata basis in respect of the unexpired periods of the respective insurance policies at the end of each period. 52: PFRS 17 exempts an insurer temporarily from some requirements of other PFRS in selecting accounting policies for insurance contract for liability adequacy test. S3: Insurers shall disclose the following information that identifies and explains the amounts in its financial statements arising from insurance contract which includes its accounting policies for insurance contract and related assets, liabilities, income and expenses. O Only S2 is incorrect O All statements are incorrect O Only S3 is incorrect Only S1 is correct Only S3 is correct O Only S1 is incorrect O Only S2 is correct O All statements are correct
S1: The straight-line method computes the unearned premiums, policy by policy, on a pro-rata basis in respect of the unexpired periods of the respective insurance policies at the end of each period. S2: PFRS 17 exempts an insurer temporarily from some requirements of other PFRS in selecting accounting policies for insurance contract for liability adequacy test. S3: Insurers shall disclose the following information that identifies and explains the amounts in its financial statements arising from insurance contract which includes its accounting policies for insurance contract and related assets, liabilities, income and expenses. a. Only S3 is incorrectb. All statements are correctc. Only S2 is correctd. Only S3 is correcte. Only S1 is incorrectf. Only S2 is incorrectg. All statements are incorrecth. Only S1 is correct
Which statement/s is/are correct? S1 PFRS permits the introduction of an accounting policy that involves remeasuring designated insurance liabilities consistently in each period to reflect current market interest rate. S2 An insurer is not allowed to introduce the following accounting practice which includes using non-uniform accounting policies for the insurance liabilities of subsidiaries. S3 PFRS 17 provides discretionary participation features in the insurance contract recognized separately from the guaranteed elements, where the issuer of such contract shall classify that feature as either a liability or a separate component of equity.
S1: PFRS 17 permits the introduction of an accounting policy that involves remeasuring designated insurance liabilities consistently in each period to reflect current market interest rate. S2: An insurer is not allowed to introduce the following accounting practice which includes using non-uniform accounting policies for the insurance liabilities of subsidiaries. S3: PFRS 17 provides discretionary participation features in the insurance contract recognized separately from the guaranteed elements, where the issuer of such contract shall classify that feature as either a liability or a separate component of equity. Only S1 is incorrect All statements are correct Only S3 is correct Only S1 is correct Only S3 is incorrect All statements are incorrect
S1: PFRS 17 permits the introduction of an accounting policy that involves remeasuring designated insurance liabilities consistently in each period to reflect current market interest rate. S2: An insurer is not allowed to introduce the following accounting practice which includes using non-uniform accounting policies for the insurance liabilities of subsidiaries. S3: PFRS 17 provides discretionary participation features in the insurance contract recognized separately from the guaranteed elements, where the issuer of such contract shall classify that feature as either a liability or a separate component of equity. a. Only S3 is incorrectb. All statements are correctc. Only S2 is correctd. Only S3 is correcte. Only S1 is incorrectf. Only S2 is incorrectg. All statements are incorrect
Which of the following is not one of the groupings of insurance contracts under PFRS 17?A. those that are not onerous at initial recognition but can become onerous in subsequent periodsB. those that pay premiums at initial recognition which are to be measured using the simplified approachC. those that are onerous at initial recognitionD. those that, at initial recognition, have no significant possibility of becoming onerous in subsequent periods
3330 Which of the following actions represents consideration in an insurance contract? a. paying the premium b. filing a claim c. missing the policy d. endorsing a policy
Which of the following is not one of the groupings of insurance contracts under PFRS 17? those that pay premiums at initial recognition which are to be measured using the simplified approach those that, at initial recognition, have no significant possibility of becoming onerous in subsequent periods those that are onerous at initial recognition those that are not onerous at initial recognition but can become onerous in subsequent periods
If an insured fails to pay the premium when due, the insured's heallh policy will remain in force for a specified period of lime under which of lhe following provisions? A.Grace Period B.Waiver of Premium C.Guaranteed Insurability D.Entire Contract
Access the FASB Accounting Standards Codification at the FASB website ( asc.fasb.org ) Required: Determine the specific citation for accounting for each of the following items: 1. If it is only reasonably possible that a contingent loss will occur, the contingent loss should be disclosed. 2. Criteria allowing short-term liabilities expected to be refinanced to be classified as long-term liabilities. 3. Accounting for the revenue from separately priced extended warranty contracts. 4. The criteria to determine if an employer must accrue a liability for vacation pay.