1964_INSURANCE_COMPANIES_ORDINANCE — Page 55

CAP. 411

Insurance Companies

[1988 Ed.

"management expenses" means expenses incurred in the administration of an insurer or its business which are not commission payable and, in the case of general business, are not included in claims paid, claims outstanding, expenses for settling claims and expenses for settling claims outstanding;

“premiums" includes the consideration for the granting of an annuity;

"profit and loss account", in relation to an insurer not trading for profit, means an income and expenditure account;

"provision" means any amount written off or retained by way of providing for depreciation, amortization, renewals or diminution in value of assets or retained by way of providing for any known liability, including liabilities in respect of expenditure contracted for and all disputed or contingent liabilities, the amount of which cannot be determined with substantial accuracy; “receivable”, in relation to income during a financial year, means, unless otherwise specified, such amounts as become due to the insurer, whether or not received by the insurer during that year, including (where appropriate) income which has accrued;

"reinsurance" and "reinsurer" include retrocession and retrocessionaire, respectively; "reinsurance premiums payable"----

(a) means the premiums recorded in an insurer's books during a financial year as due by it to reinsurers in respect of reinsurance contracts commencing in that year or reinsurance contracts commencing in earlier financial years but not accounted for in the insurer's revenue account prior to that financial year, whether or not paid by the insurer during that financial year, after deducting discounts, refunds and rebates of premiums as recorded in the same period, and for the purpose of determining whether a premium is due no account shall be taken of any credit arrangements made in respect thereof; and

(b) in the case of general business, includes, unless otherwise specified, unearned premium portfolios and outstanding claims portfolios payable by the insurer under reinsurance contracts ceded by the insurer, after deduction of any premium portfolios or loss portfolios refunded to the insurer by reinsurers;

“reserve” includes any amount written off or retained other than by way of provision;

"unearned premiums" means the amount set aside by an insurer at the end of its financial year out of premiums in respect of risks to be borne by the insurer after the end of the financial year under contracts of insurance entered into before the end of that year.

(2)

2. All accounts and statements shall be produced in the English language or, if not so produced, be accompanied by a complete English translation.

3. The information to be submitted under this Schedule shall be submitted in respect of the total business of the insurer.

4. (1) The accounts and statements to be submitted under Parts 3, 4 and 5 of this Schedule shall be audited by the appointed auditor who shall annex to the accounts and statements a certificate stating the relevant premium income of, and the relevant amount applicable to, the insurer (within the meaning of section 10 of this Ordinance) and whether in the auditor's opinion the value of the assets of the insurer exceeds its liabilities by that relevant amount, whether proper records have been maintained in accordance with section 16 of this Ordinance and whether the insurer's balance sheet, revenue account and profit and loss account and (if it is a holding company submitting group accounts) the group accounts have been properly prepared in accordance with the provisions of this Ordinance and whether in his opinion a true and fair view is given-

(a) in the case of the balance sheet, of the state of the insurer's affairs as at the end of its financial year;

(b) in the case of the revenue account and profit and loss account (if it is not framed as a consolidated revenue account and profit and loss account), of the insurer's profit or loss for its financial year;

(c) in the case of group accounts submitted by an insurer which is a holding company, of the insurer's interest therein,

but his opinion as to whether a true and fair view is so given may, where the valuation of any asset or liability or the treatment of any income or expenditure of the insurer is in accordance with any statutory provision which, in the case of that insurer, applied to the preparation of the accounts and statements so submitted, be qualified in such respects as he may specify, indicating the items affected by such valuation or treatment and the statutory provisions in question.

(2) If he considers it necessary the appointed auditor shall add to the certificate such qualification, amplification or explanation as is appropriate.

(3) Any information required to be submitted under this Schedule may be submitted in the form of notes if, but only if, the information submitted can readily be interpreted as a whole and the appointed auditor's certificate is attached.

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