Section 69O-190.059 - Financial and Actuarial Reports for Self-Insurers Funds(1) Each fund shall file with the Office quarterly financial statements on OIR Form BSI-28 or the 1992 National Association of Insurance Commissioners (NAIC) Quarterly Statement, Fire and Casualty Companies Association Edition in its entirety.(2) Each fund shall file with the Office an annual financial statement on OIR Form BSI-29 or the following portions of the 1992 National Association of Insurance Commissioners Annual Statement, Fire and Casualty Companies Association Edition: Jurat Page; Statutory Balance Sheet; Underwriting and Investment Exhibit - Income Statement; Cash Flow; Underwriting and Investment Exhibit Part 1, Part 1A, Part 2, Part 2A, Part 3, Part 3A, and Part 4; Exhibit 1 - Analysis of Assets; Exhibit 2 - Analysis of Non-Admitted Assets; Notes to Financial Statements; Five Year Historical Data (NOTE: funds shall complete this form on a going forward basis); Schedule of Special Deposits; Schedule A Part 1; Schedule B; Schedule BA; Schedule C; Schedule D Part 1, Part 1A, Part 3, Part 4 and Part 5 (NOTE: only 4th quarter transactions need to be reported); Schedule DA Part 1; Schedule F - Part 1A (NOTE: any amounts in dispute must be disclosed); Schedule M; Schedule N; Schedule P, Part 1 Summary, Part 2 Summary, Part 3 Summary, Part 5 Summary, interrogatories; Schedule X; Schedule Y. (a) As part of its annual financial statement each fund shall file with the Office an Estimated Breakdown of Policy Year Expenses on OIR Form BSI-21 within 60 days after the beginning of each policy year. The projection of its anticipated income and expenses, shall also include the comparable, actual results for the immediate preceding year.(3) The quarterly and annual financial statements, required by subsections 69O-190.059(1) and 69O-190.059(2), F.A.C., shall be prepared in accordance with the NAIC's Annual Statement Instructions, Property and Casualty, 1993 edition, and the NAIC's Accounting Practices and Procedures Manual for Property and Casualty Insurance Companies, 1993 edition. The NAIC's Accounting Practices and Procedures Manual for Property and Casualty Insurance Companies applies to the preparation of all statements required by this rule, except that the following shall be admitted assets:(a) Prepaid expenses which have a liquidation value.(b) Equipment, furniture and fixtures depreciated using a 5-year useful life.(c) Deferred taxes when the deferred tax asset is created by timing differences in the treatment of bad debt reserves, unearned premiums, and accrued dividends. Such timing differences shall reverse within two years in order to be eligible, and the fund shall provide to the division a statement from the fund's Certified Public Accountant or Tax Attorney that in the event of the insolvency of the fund, these deferred tax assets will generate a refund of prior years' taxes to the estate of the fund. The fund shall also provide upon request from the division a detailed disclosure of the components of the deferred tax asset deemed by the fund to be an admitted asset. This provision shall become inoperative as of December 31, 1995, and deferred taxes shall be deemed nonadmitted assets for all fiscal years beginning after December 31, 1995.(d) An aggregate write-in on the balance sheet of the annual statement for assets and policy holder's surplus, an entry for future investment income on losses and allocated loss adjustment expense reserves and unallocated loss adjustment expense reserves shall be reflected. Future investment income shall be calculated as follows: A + B + C - D |
A | = | Losses and Allocated Loss Adjustment Expense Reserves. |
B | = | Unallocated Loss Adjustment Expense Reserves. |
C | = | Excess of Statutory Reserves over Statement Reserves. |
D | = | The present value of A + B + C. |
Present value of Unallocated Loss Adjustment Expense Reserves, Present Value of Loss and Allocated Loss Adjustment Expense Reserves, or Present Value of Excess of Statutory Reserves over Statement Reserves means reserves discounted to present value using the most recent United States Internal Revenue Service present value factors.
(4) Each fund shall file with the Office an annual audited financial statement prepared in accordance with the NAIC's Accounting Practices and Procedures Manual for Property and Casualty Insurance Companies, 1993 edition.(a) Annual audited financial statements shall disclose audited premiums based on the audit of the payrolls of fund members who represent at least 90 percent of the fund's annual normal premium. The type of payroll audit is set forth in Rule 69O-190.073, F.A.C. Nothing in this rule prohibits a fund from doing interim payroll audits, as allowed in Rule 69O-190.073, F.A.C., when the fund determines it must do so to comply with this rule.(b) The annual audited financial statement shall include the following: 1. Report of an independent certified public accountant. If the report is qualified by the independent certified public accountant the Office shall require the fund to provide a plan to correct the deficiencies noted in the report.2. Balance sheet reporting admitted assets, liabilities, capital and surplus.3. Statement of operations.4. Statement of cash flows.5. Statement of changes in capital and surplus.6. The notes to financial statements shall be those required by the NAIC's Annual Statement Instructions, Property and Casualty, 1992 edition, and any other notes required by generally accepted accounting principles. The notes shall also include a reconciliation of differences, if any, between the annual audited financial statement required by subsection 69O-190.059(4), F.A.C., and the annual financial statement required by subsection 69O-190.059(2), F.A.C., with a written description of the nature of these differences.7. The annual audited financial statement required by subsection 69O-190.059(4), F.A.C., shall be prepared in a form and using substantially the same language and groupings substantially the same as the relevant sections of the annual financial statement of the fund required by subsection 69O-190.059(2), F.A.C. The annual audited financial statement shall be comparative, presenting the amounts as of the end of the current fiscal year and the amounts as of the immediately preceding fiscal year. However, in the first year in which a fund is required to file an annual audited financial statement, the comparative data may be omitted. The fund may submit an audited form BSI-29 if it so chooses, providing the independent certified public accountant report is provided as an addendum to the form.8. The annual audited financial statement shall reflect, at a minimum, the reserves which have been deemed appropriate by the funds actuaries in the actuarial certification. If the certified public accountant discovers information which may alter the reserves determined by the actuary, they shall notify both the Office and the actuary. If the Office and the actuary concur that this information will materially alter the reserves as determined by the actuary and the report cannot be timely filed, the Office may waive the requirements in subsection 69O-190.038(3), F.A.C., for filing a request for extension. In no event shall the extension be granted for more than 30 days.9. OIR Form BSI 30, report on Preferred Payment Plans.10. A copy of the management letter as prepared by the certified public accountant in conjunction with the audit of the fund.11. A list of the current trustees of the fund along with their business affiliation, the business address, and business phone number.(5) Each fund shall file with the Division at the same time as the fund's annual audited financial statement an actuarial report prepared by a qualified actuary. The actuarial report shall evaluate the loss development of the fund and estimate the loss reserve including allocated and unallocated loss adjustment expenses and incurred but not reported reserves.(a) A completed OIR Form BSI-26, Checklist for the Submission of Loss Reserve Reports, shall accompany each actuarial report submitted pursuant to this rule. Actuarial reports shall contain, at a minimum, summaries of the computations and methodologies used to estimate the fund's loss reserves. These reports shall include loss development triangles for all funds with 5 or more years experience. These loss triangles shall include, paid losses, incurred losses, and number of open claims.(b) Loss reserves in the actuarial report:1. Shall be calculated in accordance with Sections 625.091, except that 625.091(2)(a), F.S., the discount factor shall be 0%.2. Shall not contain subrogation awards except for those amounts which have been awarded in a court of law.(6) Quarterly or annual financial statements or actuarial reports shall contain loss reserves which have not been adjusted to reflect recoveries from the Special Disability Trust Fund (SDTF) except for: (a) Those recoveries which have been approved by the Special Disability Trust Fund, awarded by a Judge of Compensation Claims, or awarded by a ruling of the First District Court of Appeals.(b) The prohibition and limitations in this rule against adjustment of loss reserves for anticipated SDTF recoveries does not preclude the use of historical data pertaining to the fund's actual recoveries by actuaries in computations and methodologies implicitly used to develop ultimate reserves.(7) Any fund whose financial condition is shown to be deficient in the financial statements required by this rule shall be allowed to file a corrective action plan to correct any deficiency. Such corrective action plan shall disclose what specific areas of the fund operations will be addressed, and the time table for taking such actions. If the corrective action plan encompasses more than one reporting (calendar or fiscal) year, the Office shall require that the corrective action plan be revised at the end of each fiscal year if the actual performance of the fund for that reporting year varies more than 10% from the corrective action plan. Such corrective action plan shall be submitted within sixty days of the receipt of notification from the Office. Extensions shall be granted for good cause.(8) Each fund shall make a copy of its quarterly financial statement, annual financial statement, annual audited financial statement, and actuarial report available to members of the fund upon request. This requirement may be satisfied by making available annually to new and renewal members an extract of the statements or report; the form of such extract shall be approved by the Office in advance of distribution. Such approval shall be given if the Office determines that the extracted information fairly and accurately represents the financial condition of the fund, and discloses any material footnote information disclosed in the filings with the Office. In lieu of Office approval, the fund's certified public accountant and qualified actuary from whose reports the extracts are derived, may file a statement with the Office that they have reviewed the extract and have no objections to it. Such a statement shall contain a copy of the extract for the Office's file.(9) Due date of quarterly, annual and audited financial statements. Each fund shall submit four (4) quarterly statements which shall be due 45 days after the end of the fund's fiscal quarter. The annual statement and audited annual report shall be due on or before the last day of the sixth month after the end of the fund's fiscal year.(10) Effective Date. All funds shall comply with this rule for fiscal years beginning after December 31, 1993, and each year thereafter.(11) Requests for an extension of time to file quarterly, annual, and audited financial statements must be received in writing at least 15 days before the date the report is due. The request must include the reason the extension is requested. Any request received 14 days or less before the date the report is due will be denied except for, but not limited to, death of key management personnel, destruction of records or facilities by fire, flood, hurricane, or some other natural disaster, or act not under control of the management.Fla. Admin. Code Ann. R. 69O-190.059
Rulemaking Authority 440.5705, 440.591, 624.4621 FS. Law Implemented 624.316, 624.424, 624.4621 FS.
New 10-1-82, Amended 12-25-84, 12-17-85, Formerly 38F-5.59, Amended 3-11-87, 3-11-90, 12-19-93, Formerly 38F-5.059, 4-190.059.New 10-1-82, Amended 12-25-84, 12-17-85, Formerly 38F-5.59, Amended 3-11-87, 3-11-90, 12-19-93, Formerly 38F-5.059, 4-190.059.