Okay, so I was doing this problem today and I was SHOCKED by how they calculated the UEPR. In the answer they calculate UEPR using the sum of columns 1 and 2 of U&IE Part 1A. I was so thrown off because I was SURE that in Part 1A in the 5th column it's called "Total Reserve for Unearned premium" and is the sum of columns 1-4!
So then on the balance sheet I looked, and on the liability side the unearned premium reserve matches to row 38 in the U&IE part1A, which undoes the effects of column 3 and 4. WTH?
Okay, so what the heck is column 5 in part 1A used for? It is definitely used in Part 1 which is the premium earning exhibit. So what's going on? Earned premium uses a different unearned premium reserve than the balance sheet does? So confused about this. As well as with a lot of other things. :(
So then on the balance sheet I looked, and on the liability side the unearned premium reserve matches to row 38 in the U&IE part1A, which undoes the effects of column 3 and 4. WTH?
Okay, so what the heck is column 5 in part 1A used for? It is definitely used in Part 1 which is the premium earning exhibit. So what's going on? Earned premium uses a different unearned premium reserve than the balance sheet does? So confused about this. As well as with a lot of other things. :(
Spring 2014 #14
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