Financial Shenanigans, Third Edition by Schilit Howard M

Author:Schilit, Howard M. [Schilit, Howard M.]
Language: eng
Format: mobi
Publisher: McGraw-Hill
Published: 2010-04-13T16:00:00+00:00

Self-Insurance Reserves

Some companies balk at paying expensive business insurance premiums (for example, for employee health-care or disability insurance), and decide instead to “self-insure” certain risks. Companies that self-insure essentially operate like mini-insurance companies: they create a fund that they believe will be sufficient to pay out insurance claims, and record expenses each period for the amount needed.

How large should the self-insurance liability be, and how much self-insurance expense should be accrued each quarter? Well, of course, the answer is dependent on estimates. With a simple tweak of those estimates or a change in assumptions, management can provide itself with a nice boost to earnings.

Download

Copyright Disclaimer:
This site does not store any files on its server. We only index and link to content provided by other sites. Please contact the content providers to delete copyright contents if any and email us, we'll remove relevant links or contents immediately.