Discussion thread for Exam 2005: Question 42

[Avi]

Question Posted Below; what reading is this from again ?

a) Something like: GAAP is supposed to deal with the company on a going-concern basis for investors. The more correct valuation for reserves is the discounted one as the investment income will accrue over time to cover the liabilities.

b) Something like: It is almost impossible to pick the correct yield-curve or interest rates and payout patterns to apply. As such, there is no good answer as to whatthe discounted reserves actually are.

c) If the state insurance commissioner allows it.