CHAPTER XX Schedules and Their Application to Financial Portions of Statement - Method of Checking Details Shown in Schedules with Items in Other Portions of Statement. In my previous talks I outlined briefly the forms which the schedules in the life and the miscellaneous blanks have taken, outlined in a general way the reason for asking for the information therein contained, and indicated that the schedules showed the increased interest which supervising officials were taking in the operations of the companies reporting to them. I desire in a very brief manner to call your attention to certain uses to which the schedules may be put in the way of ascertaining the correctness of the income, the disbursement, the asset and the liability portions of the financial part of the annual statement blank. An observance of these rules will enable companies to prepare their annual statement blanks in such a way as to render unnecessary a great part of the correspondence which now finds its way into the offices of the Insurance Commissioners of the various States. In order that we may have a definite basis upon which to go, I shall refer to the blanks used by the New York Insurance Department for the purpose of having companies report their condition as of December 31, 1910. The total of the "book value" column should agree with item 1 of assets, "book value of real estate." 66 66 The market value" column should be used as a basis for item 22 of assets, "market value of real estate over book value," or part of item 42 of assets, 'book value of ledger assets over market value." Should the market value of the real estate owned be in excess of the book value, the difference will be carried in item 22, while if there be a depreciation the loss will be carried under item 42. The total of the "increase, by adjustment, in book value during 1910 " column, when added to the total in a similar column in part 3 of this schedule, should be the same as item 42(a) of income, "gross increase, by adjustment, in book value of real estate." The total of the "decrease, by adjustment, in book value during 1910 " column, when added to the total in a similar column in part 3 of this schedule, should be the same as item 47(a) of disbursements, gross decrease, by adjustment, in book value of real estate." You will find that this schedule contains an exhibit of the gross rental and expenditure for taxes, repairs and expenses of each parcel for each of the last three years. The total of the "gross rental during 1910 " column, when added to the total of the " gross rental during 1910" column of part 3, should equal item 32 of income, gross rent from company's property." 66 The total of the "expended for taxes, repairs and expenses during 1910" column, when added to the total of the expended for taxes, repairs and expenses " during 1910" column of part 3, should equal items 30 and 31 of disbursements, which are repairs and expenses (other than taxes on real estate)" and "taxes on real estate " respectively. Schedule A- Part 3 66 The total of the "profit on sale" column should agree with item 41(a) of income, gross profit on sale of real estate." The total of the "loss on sale" column should agree with item 46(a) of disbursements, "gross loss on sale of real estate." Schedule B The total of the "amount unpaid December 31st, 1910" column should agree with item 2 of assets, "mortgage loans on real estate." In the "interest" subdivision the total of the "amount past due December 31, 1910 " column should agree with the first part of item 13 of assets, "interest due on mortgages." In the same subdivision the total of the "amount past due December 31, 1910 " column should agree with the second part of item 13 of assets, "interest accrued on mortgages. In the same subdivision the total of "gross amount received during 1910 " column should agree with item 23 of income, gross interest on mortgage loans," although there is no way of verifying the deduction which companies are asked to make in this item for the accrued interest on mortgages acquired during 1910. Your attention is directed to the fact that the present form of Schedule B contains a record of not only the mortgages in the company's possession at the time that the statement was made, but also all acquisitions and sales during the statement year. Schedule C - Part 1 The total of "amount loaned thereon" column should agree with item 3 of assets," loans secured by pledge of bonds, stocks and other collateral." In the interest subdivision the total of "amount past due December 31, 1910" column should agree with the first part of item 15 of assets," interest due on collateral loans." In the same subdivision the total of "amount accrued December 31, 1910" column should agree with the second part of item 15 of assets, "interest accrued on collateral loans." In the same subdivision the total of "amount received during 1910" column should agree with item 24 of income, " gross interest on collateral loans," when increased by the total of the amount of "amount received during 1910" of the interest subdivision in part 3 of this schedule. Schedule D-Part 1 The total of the "book value" column should agree with the first part of item 6 of assets, "book value of bonds." The total of "market value" column when added to the total of the similar column in part 2 of the schedule should form the basis for either the addition under item 23 of assets, "market value of bonds and stocks over book value," or part of item 42 of assets," book value of ledger assets over market value." In the interest subdivision total of "amount due and accrued December 31, 1910" column, should agree with item 14 of assets, "interest due and accrued on bonds." Your attention is directed to the fact that in this schedule the past due interest is not separated from the accrued interest. In the same subdivision the total of "gross amount received during 1910 " column when added to the total of "amount received during 1910" column in the dividend subsection of part 2, and the total of “interest or dividends received during 1910 " column of part 4 should equal item 25 of income, gross interest on bonds and dividends on stocks." 66 The indented figure in item 25 of income, "accrued interest on bonds acquired during 1910" should agree with the total of " paid for accrued interest on bonds acquired during 1910" column in part 3. 66 66 The total of" increase, by adjustment, in book value during 1910" column should agree with item 42(b) of income, gross increase, by adjustment, in book value of bonds," when increased by that portion of the similar column in part 4 of this schedule applying to bonds. The total of "decrease, by adjustment, in book value during 1910" column should agree with item 47(b) of disbursements, gross decrease by adjustment in book value of bonds," when increased by that portion of the similar column in part 4 of this schedule applying to bonds. The total of "increase in amortized value during 1910" column should agree with the indented figures |