Asian Reinsurance Corporation

Page 1



VISION

To become a leading professional reinsurer capable to meet the reinsurance needs of Asia - Pacific Region.

MISSION “1.

The Corporation shall operate as a professional reinsurer accepting business from the insurance markets in member States as well as other markets of the region and elsewhere, and shall retrocede its surpluses after net retention with priority given to the national insurance and reinsurance markets of the member states.

2.

The Corporation shall invest a sizeable proportion of its funds within the region, provided that such investments meet with the requirements of sound insurance techniques.

3.

The Corporation shall also serve as regional centre for the collection of insurance information and the development of expertise in insurance and reinsurance, to be put at the disposal of the national insurance markets of the member States.

4.

The Corporation shall provide technical assistance to the national insurance markets of the member States.�

ANNUAL REPORT 2011

1


PAGE

• Council of Members • Associate Members • Chairman’s statement • Report of the Management Board • Certificate by Auditors • Statement of Financial positions • Profit and Loss Accounts • Profit and Loss Appropriation Accounts • Statement of changes in shareholders’ equity • Fire Insurance Revenue Accounts • Marine Insurance Revenue Accounts • Miscellaneous Insurance Revenue Accounts • Statement of Cash Flows • Notes to the Financial Statements • Certificate by Management Board • Senior Management

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ASIAN REINSURANCE CORPORATION

3 4 5 7 13 14 16 17 18 19 20 21 22 23 37 38


COUNCIL OF MEMBERS

Mr. Fahad Daud “Momand” Afghanistan Mr. Md. Rezaul Karim Bangladesh

President Afghan National Insurance Co. Managing Director Sadharan Bima Corporation

Mr. Namgyal Lhendup Bhutan

CEO Royal Insurance Corp. of Bhutan

Mr. Zhang Hong

Vice President China Reinsurance (Group) Corporation

China Mr. A.K. Roy India Dr. Abdolnaser Hemmati Iran Mr. Jong Won Park Korea Atty. Emmanuel F. Dooc

Chairman -cum- Managing Director General Insurance Corp. of India Managing Director & CEO Sina Bank Company

CEO Korean Reinsurance Company Insurance Commissioner

Philippines Ms. G.D.C. Ekanayake Sri Lanka Mr. Pravej Ongartsittigul Thailand

Director General Department of National Budget Ministry of Finance and Planning Secretary General Office of Insurance Commission

ANNUAL REPORT 2011

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Associate Members

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ASIAN REINSURANCE CORPORATION


Chairman’s Statement

Dr. Abdolnaser Hemmati CHAIRMAN I am happy to welcome the distinguished members from member-states and representatives of Associate members to the sixth Shareholders’ Assembly of the Asian Reinsurance Corporation. The year 2011 was the most disappointing and difficult one for reinsurers. It will go down as the worst year in terms of natural catastrophe losses. The financial statements, the Auditors’ report and the Management Board Report, which you already have in hand reflect what the industry and your Corporation has gone through. The flood that ravaged Thailand in the latter part of 2011 from runaway water from the Northern and Central Thailand inundated industrial areas, residential areas and farmland. It affected 61 out of 77 provinces causing loss to hundreds of insured properties. The economic loss of this unprecedented flood is estimated at US$45 bn. while the insured loss might be nearly US$18bn. Truly enough this loss is characterized as the largest freshwater loss ever suffered by the insurance industry globally. This loss has rung a warning bell to the reinsurance industry. The methodologies so far adopted for risk assessment and accumulation control were far from adequate. The industry has to rethink ways to assess and mitigate hidden catastrophes in their books. Beginnings were made in this direction through underwriting measures during the renewals following floods.

Having suffered the loss it is our primary responsibility to respond to the loss efficiently and effectively so that the insurance industry is back on track. We are also committed to support the Thailand insurance market in this difficult period to the maximum extent. 2011 would have been yet another year of success for the Corporation but for this unfortunate event. With focus on underwriting profits, many unprofitable contracts were weeded out and rigorous efforts were made to build a quality book of business. This led to marginal fall in gross written premium by 2.1% to US$ 56.34 mn. Whilst growth is of paramount importance, the focus will continue to be on sustainable growth. The potential for such growth in the region has increased due to economic growth and increasing demand for insurance. Consequent on Thai floods, loss ratio for the year skyrocketed to 162%. We could limit the loss ratio at this level due to our policy of reducing retention through various retrocession arrangements. Had we followed a policy of increasing retention for short-term profits, it would have escalated the loss ratio further. By the time of account closing losses were still under development and further deterioration would be certain considering the magnitude of loss. Without floods the loss ratio would have been an exceptionally good at 49.4%. We had succeeded in maintaining acquisition cost at 33.4%. The Management expenses increased to 4.9% from 4.5% mainly on account of appreciation of Bahts. Thus we posted a combined ratio of 200.3% with floods as against an impressive 86.2% without floods.

ANNUAL REPORT 2011

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Chairman’s Statement With our decision to diversify the highly liquid portfolio of assets, the percentage of deposits in various member countries have been reduced from 93.8% in 2010 to 82.7% whilst bonds and equity portfolio have been increased from 6.2% to 17.3%. The investment income for the year increased by 17% to 2.65 mn. with a mean yield of 3.31%. Going forward, investment income will be under stress due to urgent need to payout large amount of flood claims. Management of cash flow through retrocession recoveries and prompt disbursement of claims are the critical concerns of the Corporation.

Purnariksha of Thailand laid down their offices. I commend their contributions to the Corporation during their tenure. I also welcome the new Council Members from Afghanistan , India and Thailand, Mr. Fahad Daud “Momand”, Mr. A .K. Roy, and Mr. Pravej Ongartsittigul respectively . The number of Associate-members of the Corporation increased to ten during the year with the admission of two new members. Associate members will be a source of great support for the Corporation going forward. I convey my deepfelt gratitude to Associate members for their interest in building this institution.

The net operating loss for the year, I regret to report, was US$ 30.35 mn compared to a profit of US$ 2.78 mn. in 2010. Absent the mega floods, operating profits would have been US$ 6.95 mn. After accounting for net loss, the Shareholders’ equity of the Corporation declined from US$ 54.72 mn to US$ 23.48 mn. In view of further loss development it has been decided that there is urgent need to strengthen the Corporation by infusion of fresh capital. It is our considered view that the unique structure of the Corporation as an intergovernmental regional institution should be maintained giving ample room for the private sector to play an active role in the reinsurance sector. It is our fervent wish that even after the infusion of new capital structurally we should continue to maintain the public-private-participation model. I, therefore, call upon all member-countries and Associate members to join force to strengthen the capital of the Corporation so that it could continue to support the regional insurance industry. Being an institution set up with the aim of regional cooperation, indeed it is part of our ethos that calamity in one member-country is a calamity for all of us. I take this opportunity to convey our heartfelt thanks to the Royal Thai Government and the Officers of the United Nations and ESCAP for their continued support. We are also grateful to the Executives of the Office of Insurance Commission for their active interest in strengthening and promoting the Corporation. Three of our Council Members Engr. Ahmad Shah “Alizai” of Afghanistan, Mr. Yogesh Lohiya of India, and Mrs. Chantra

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ASIAN REINSURANCE CORPORATION

My special thanks to the distinguished members of the Council for their valuable contributions. I would also like to thank our valued clients and business partners for the trust reposed in us. Our employees are our foundation. Their dedicated service is the only way forward for the success of the Corporation. I appreciate and greatly value their contributions.

Dr. Abdolnaser Hemmati CHAIRMAN


Report of the Management Board FOR THE YEAR ENDED 31ST DECEMBER 2011 The report for the year 2011 and the 32nd Statement of accounts for the year ended 31 December 2011 are presented below.

Highlights The upward trajectory in business growth of past several years and improvement in operating results (but for the financial crisis year 2008) was shattered by the unprecedented floods in Thailand during August to December 2011. What would otherwise have been another year of achievements turned out to be dismal due to the devastating floods. The outstanding loss reserve from the flood is still developing and it will take several months more for the loss numbers to be definitive, considering the enormity of losses and issues involved in assessment.

This catastrophe loss will be a game-changer as far as the regional reinsurance industry is concerned. The way proportional treaty business was structured and transacted would change as the market comes to grip with the losses.

The performance of the Corporation for 2011 in comparison with 2010 were as under:

• Gross written premium marginally decreased by 2.1% from US$ 57.54 mn in 2010 to US$ 56.34 mn.

• Net written premium decreased from US$ 33.50 mn to US$ 32.26 mn .

• Earned premium increased from US$ 32.52 mn to US$ 32.76 mn .

• Loss ratio escalated to 162% on account of floods (which otherwise would have been 49.4%)

as against 60.3% of 2010.

• Net operating loss of US$ 30.35 mn compared to 2010 profit of US$ 2.78 mn. Discounting floods,

operating profit would have been US$6.95 mn.

• Combined ratio of 200.3% as against 98.2% of 2010. Without floods, the ratio would have been 86.2.%

• Investment income increased to US$ 2.65 mn. from US$ 2.27 mn of 2010.

• Shareholders’ funds fell to US$ 23.48 mn from US$ 54.72 mn of 2010 due to the net loss .

• Total assets increased to US$ 123.35 mn from US$ 101.69 mn of 2010.

ANNUAL REPORT 2011

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Report of the Management Board FOR THE YEAR ENDED 31ST DECEMBER 2011 Operations Gross Written Premium Class wise analysis of Gross written premium is as follows:

Class

2010

Portfolio mix 2010

2011

Portfolio mix 2011

In US$ mn Growth in 2011

Fire Marine Motor Engineering Miscellaneous Total • The fall in fire premium was on account of decline in treaty premium from India, Korea and the Philippines and facultative premium from the U.A.E. Pruning of portfolios was done with a view to improve the bottom line. • The Marine portfolio remained stable .

• The significant growth in Motor portfolio was due to increase in quota share premium from Thailand.

• Engineering and Miscellaneous classes registered decline mainly due, again, to fall in premium from India, Korea, and the Philippines.

The facultative portfolio recorded an income of US$ 4.25 mn in 2011 against 6.64 mn (2010) and contributed 7.5% to the overall Gross written premium income. Non-proportional premium accounted for 7.2% of the gross written treaty premium.

One of the fallouts of flood loss is exclusion of nat cat perils in proportional treaties in Thailand and imposition of per event limit in treaties elsewhere. This trend could be seen across the region. There has also been sustained efforts to restrict deductions to reasonable levels with a view to enable reinsurers to recover part of the loss suffered.

Source of premium income:

2010 Host country - Thailand Other member countries Countries in the ESCAP region Other countries Total

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ASIAN REINSURANCE CORPORATION

% of total

2011

% of total

In US$ mn Growth in 2011


Report of the Management Board FOR THE YEAR ENDED 31ST DECEMBER 2011

• Due to our focus on underwriting profits, contracts which produced recurring adverse results were weeded out. • India, and Korea contributed 12.9% each to the premium block of member-countries whilst Philippines contributed 7.5%. Premium fell from these territories due to reduction of line or cancellation of unprofitable contracts. Growth momentum was maintained in other territories. • Indonesia, and Singapore contributed 34.8% & 20.7% respectively to the premium from the ESCAP region where the growth rate was 16.9%. • ‘Other countries’ consists mainly of Middle Eastern countries from where we procure facultative business, and African countries from where we write mainly non-proportional contracts. Results of fac business from the Middle East was adverse and as such we have curtailed our acceptances .

Source of premium 2011

Gross and net premium (US$ mn)

1.6% 13.9%

70.00 Host country - Thailand 51.3%

Other member countries Countries in the ESCAP region

60.00 52.98

50.00

20.00

56.34

45.72

40.00 30.00

57.54

32.65

33.50

32.26

31.05 26.78 19.16

10.00 Other countries

2007

33.2%

2008

Gross premium

2009

2010

2011

Retained premium

Net retained and earned premium Net retained premium declined from 58.2% in 2010 to 57.3% due to additional cost incurred towards excess of loss consequent on flood loss. There has been a 0.7% increase in earned premium due to reserve release.

Acquisition costs We have maintained the ratio of commission and charges to net premium at 33.4% for the last 3 consecutive years. Considering the present market trend the cost will get reduced going forward.

Management expenses The Management expenses increased from 4.5% to 4.9% mainly due to appreciation of the Thai Baht.

Incurred losses The net earned loss ratio deteriorated to 162% from 60.3% of last year. The large scale floods which was one of its kind as far as the history of insured losses in Thailand is concerned, took a heavy toll on us. Without Thai floods our loss ratio would have been only 49.4%.

ANNUAL REPORT 2011

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Report of the Management Board FOR THE YEAR ENDED 31ST DECEMBER 2011 Combined ratio The combined ratio increased to 200.3% from 98.2% of 2010. Excluding floods, our combined ratio showed a marked improvement to 86.2% The comparative figures for the net account by class of business were as follows:

2011

2010

In US$ mn CHANGE

Fire Gross premium Net premium Claims incurred to earned premium Commission & other charges Marine Gross premium Net premium Claims incurred to earned premium Commission & other charges Miscellaneous Gross premium Net premium Claims incurred to earned premium Commission & other charges Investment Income By following a policy of diversification of investments, we could achieve a growth in investment income of 16.7% from US$ 2.27 mn in 2010 to US$ 2.65 mn in 2011. By the end of 2011, invesments in bonds, stocks and mutual funds increased from 6.2% to 17.3% of investable funds. The balance was placed with banks of member countries. The yield on investment increased from 2.9% to 3.3%.

Exchange gain Due to the weakening of the dollar, an exchange loss of US$ 0.31mn was recorded as against a net gain of US$ 0.35 mn booked in 2010.

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ASIAN REINSURANCE CORPORATION


Report of the Management Board FOR THE YEAR ENDED 31ST DECEMBER 2011 Technical reserves The outstanding claims provision on account of Thailand floods increased the technical reserves drastically to US$ 89.10 mn as against US$ 34.86 mn as at end 2010. This amounted to 276.2% of the net written premium for 2011.

Underwriting Results Fire (32,794.6) Marine 930.3 Miscellaneous 781.5 Expenses of Management Underwriting profit / (loss) Investment and other income Net profit before tax and other charges (307.8) Exchange gain (23.3) Income tax 14.6 Provision for doubtful debts Net Total operating profit / (loss)

In US$ ‘000 (31,082.8) 1,592.2 (32,675.0) 2,646.4 (30,028.6)

(316.5) (30,345.1)

The net operating loss was mitigated slightly due to our investment & other income of US$ 2.65 mn. After deducting expenses, we posted an operational loss of US$ 30.35 mn.

Assets grew by 21.3% in 2011 and stood at US$ 123.35 mn as at 31st December 2011. The shareholders funds which stood at US$ 54.7 mn at end 2010 dropped to US $ 23.48 mn at end 2011. We are pursuing various strategies to strengthen the Corporation by raising additional capital .

Auditors The Council of Members appointed BDO Limited as Auditors for 2011, both for annual and quarterly audits.

ANNUAL REPORT 2011

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Report of the Management Board FOR THE YEAR ENDED 31ST DECEMBER 2011

Membership With the admission of two new Associate members, membership of the Corporation as at end 2011 stands at 20 - ten Regular members and ten Associate members. Ceylinco Insurance Company Plc., Sri Lanka, the largest private sector insurer, and the New India Assurance Co.,Ltd., the largest public sector insurer in India joined the Corporation as Associate-members in 2011.

Regular Members – constitute the Council of Members of the Corporation wherein each government nominates one representative. In the Shareholders’ Assembly, Regular Members are represented by their respective Council Member whereas Associate Members are represented by designated representatives.

Training activities Much appreciation and accolades have been lavished on our annual seminar on ‘Principles and Practice of Reinsurance” held in September 2011, attended by 24 participants from 10 countries .

Our dedicated staff remains our strength. They work tirelessly to deliver our promise of service and their contributions are praiseworthy.

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ASIAN REINSURANCE CORPORATION


Tel: +662 261 1251-4 Fax: +662 261 1255 www.bdo.co.th

BDO Limited 22nd Floor, CTI Tower 191/41 Ratchadapisek Road, Klongtoey, Bangkok 10110 Thailand

REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS To The Shareholders’ Assembly of Asian Reinsurance Corporation 1. I have audited the accompanying statement of financial position of the Asian Reinsurance Corporation as at 31st December, 2011 and the annexed fire, marine and miscellaneous insurance revenue accounts, profit and loss account, profit and loss appropriation account, statements of change in shareholders’ equity and cash flow for the year then ended. My examination was made in accordance with generally accepted auditing standards and, accordingly, included such tests of the accounting records and such other auditing procedures as I considered necessary in the circumstances. The financial statements of Asian Reinsurance Corporation for the year ended 31st December, 2010, which are presented here in for comparative purpose, were examined by another auditor whose report dated 22nd April, 2011, expressed an unqualified audit opinion. 2. As part of my examination, I have verified the cash and bank balances and investments by actual inspections or by the production of certificates or other documentary evidences. I have obtained all the information and exptanations which to the best of my knowledge and belief, were 3. (a) necessary for the purpose of my audit ; In my opinion, proper books of account have been kept by the Corporation so far as it appears from my (b) examination of the books of account and returns; (c) The Corporation’ s statements of financial position, revenue accounts, profit and loss accounts, profit and loss appropriation accounts and statements of change in shareholders’ equity and cash flow dealt with by this report are in agreement with the books of account and returns; (d) To the best of my information and according to the explanations given to me, in my opinion the said accounts give a true and fair view; (i) in the case of the statement of financial position, of the state of affair of the Corporation as at 31st December 2011. (ii) in the case of profit and loss account, of the operating result of the Corporation for the year then ended. (iii) in the case of statements of change in shareholders’ equity and cash flow, of the change in shareholders’ equity and the cash flow of the Corporation for the year then ended. 4. The operation of the Corporation during the year under report, so far as it appears from my examination of the books of account and returns, was in accordance with the provisions of the Agreement establishing the Corporation and guidelines issued by the Council of Members. 5. Without qualifying my opinion, I draw attention to the Note 1.2 to the financial statements, even though the Corporation’s Management set up loss reserve based on the best estimate, taking into account the avaitable facts and considered appropriate assumptions there are inherent uncertainties in the completeness and accuracy of the information and assumptions used by the Management. While preparing loss reserve as at the time of preparation of financial statements, claims were still under development. There is, therefore, likelihood of actual loss reserve differing from the loss estimates with the passage of time and availability of reliable information from cedants. However, the Corporation Management might consider to restate the financial statements to reflect the receipt of reliable loss information after the reporting date.

Ms. Thittraporn Klinklao Certified Public Accountant (Thailand) No. 3726 BDO Limited BANGKOK : 3rd April, 2012 BDO Limited, a limited liability company incorporated in Thaitand, is a member of BDO International Limited, a UK company limited by guarantee , and forms part of the international BDO network of independent member firms. BDO is the brand name for the BDO network and for each of the BDO Member Firms.

ANNUAL REPORT 2011

13


Statement of Financial Positions As at 31st December 2011 and 2010

In U.S. Dollars Note

2011

2010

100,000,000.00

100,000,000.00

LIABILITIES AND SHAREHOLDERS’ EQUITY SHAREHOLDERS’ EQUITY

Authorized share capital of 100,000 shares

at US$ 1,000 par value

Subscribed and paid up share capital

12

30,839,000.00

30,239,000.00

Share premium account

13

16,330,000.00

15,610,000.00

Statutory reserve

14

2,325,852.35

2,325,852.35

Contingency reserve

14

500,000.00

500,000.00

Fair value reserve

(486,390.46)

62,478.74

Profit and (loss) appropriation account

(26,027,967.58)

5,980,285.87

23,480,494.31

54,717,616.96

LIABILITIES

Reserves for unexpired risks

3.3

Fire

4,875,476.04

5,366,035.27

Marine

2,326,144.21

2,248,203.08

Miscellaneous

5,703,065.21

5,783,952.32

12,904,685.46

13,398,190.67

Reserves for outstanding claims

3.4

Fire

61,295,274.31

8,925,130.57

Marine

4,135,893.68

3,575,291.73

Miscellaneous

10,763,376.65

8,957,021.35

76,194,544.64

21,457,443.65

169,566.21

161,464.45

Provision for expenses incurred but not paid

Reserve held on reinsurance retroceded

4,904,768.74

4,843,322.81

Amounts due to other insurance or reinsurance companies

5,676,068.96

7,092,590.27

Sundry creditors

23,388.56

16,965.76

123,353,516.88

101,687,594.57

6

Total (The accompanying notes are an integral part of the financial statements)

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ASIAN REINSURANCE CORPORATION


Statement of Financial Positions As at 31st December 2011 and 2010 In U.S. Dollars Note

2011

2010

ASSETS

Investments - net

3.11, 7

13,634,918.80

4,655,294.51

Office condominium - net

3.12, 8

92,327.66

153,879.50

Furniture, fixtures, vehicles and office equipment - net 3.12, 9

586,911.84

166,502.41

Interest and dividend accrued

868,305.10

872,426.15

Reserves held by reinsurance companies

13,652,159.24

12,505,806.53

Amounts due from insurers or reinsurers - net

10

27,206,241.50

10,308,737.42

Cash balances with banks and on hand :

(a) Short-term deposits and current accounts

11

66,707,473.43

71,902,896.32

(b) Cash on hand

3,088.01

15,658.33

(c) Saving accounts

585,541.35

813,464.74

Sundry debtors

3,572.37

3,061.70

Advances, deposits and prepaid expenses

12,977.58

289,866.96

123,353,516.88

101,687,594.57

Total

(The accompanying notes are an integral part of the financial statements)

ANNUAL REPORT 2011

15


Profit and Loss Accounts For the years ended 31st December 2011 and 2010 In U.S. Dollars Note

2011

2010

REVENUES

Income from investments and bank accounts

Less : Income tax deductions

5

2,645,749.10

2,265,011.06

3.6

(23,388.57)

(16,977.04)

2,622,360.53

2,248,034.02

-

444,575.63

643,331.86

211,515.28

77,873.90

-

684.46

281.41

(307,797.40)

354,509.49

3,036,453.35

3,258,915.83

33,396,189.89

-

Net

Profit transferred from Revenue Account

Fire insurance

Marine insurance

Miscellaneous insurance

Miscellaneous income

Gain (loss) on currency exchange

Total

EXPENSES

Loss transferred from Revenue Account

Fire insurance

Marine insurance

-

-

Miscellaneous insurance

-

452,174.49

(14,628.09)

23,831.52

(30,345,108.45)

2,782,909.82

3,036,453.35

3,258,915.83

Adjustment of provision for :

Doubtful debts

Balance being profit and (loss) for the year carried forward

to Profit and Loss Appropriation Account

Total (The accompanying notes are an integral part of the financial statements)

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ASIAN REINSURANCE CORPORATION


Profit and Loss Appropriation Accounts For the years ended 31st December 2011 and 2010 In U.S. Dollars Note

2011

2010

Profit and (loss) appropriation balance

at the beginning of the year

5,980,285.87

4,307,239.53

Profit and (loss) transferred from Profit and Loss Account

(30,345,108.45)

2,782,909.82

Total

(24,364,822.58)

7,090,149.35

Transfer to statutory reserve

14

-

278,290.98

Dividends

15

1,663,145.00

831,572.49

(26,027,967.58)

5,980,285.88

(24,364,822.58)

7,090,149.35

Balance being profit and (loss) appropriation

carried forward

Total

(The accompanying notes are an integral part of the financial statements)

ANNUAL REPORT 2011

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ASIAN REINSURANCE CORPORATION

(The accompanying notes are an integral part of the financial statements)

30,839,000.00

-

Change in the value of investments

Balance as at 31st December, 2011

-

-

15

Operating loss for the year

Cash dividends

600,000.00

12, 13

30,239,000.00

Balance as at 1st January, 2011

Share capital increased during the year

30,239,000.00

-

Change in the value of investments

Balance as at 31st December, 2010

-

Transfer to statutory reserve

-

15

16,330,000.00

-

-

-

720,000.00

15,610,000.00

15,610,000.00

-

-

-

-

15,610,000.00

account

capital

30,239,000.00

premium

paid-up share

Operating profit for the year

Cash dividends

Balance as at 1st January, 2010

Note

Share

Subscribed and

2,325,852.35

-

-

-

-

2,325,852.35

2,325,852.35

-

278,290.98

-

-

500,000.00

-

-

-

-

500,000.00

500,000.00

-

-

-

-

500,000.00

-

-

-

-

(486,390.46)

(548,869.20)

-

-

-

62,478.74

62,478.74

62,478.74

reserve

reserve

reserve

2,047,561.37

Fair value

Contingency

Statutory

(1,663,145.00)

1,320,000.00

54,717,616.96

54,717,616.96

62,478.74

-

2,782,909.82

(831,572.49)

52,703,800.89

Total

(26,027,967.58)

-

23,480,494.31

(548,869.20)

(30,345,108.45) (30,345,108.45)

(1,663,145.00)

-

5,980,285.87

5,980,285.87

-

(278,290.98)

2,782,909.82

(831,572.49)

4,307,239.52

Account

Appropriation

Profit and Loss

In U.S. Dollars

Statement of changes in Shareholders’ equity

For the years ended 31st December 2011 and 2010


Fire Insurance Revenue Accounts For the years ended 31st December 2011 and 2010 In U.S. Dollars Note

2011

2010

REVENUES

Balance of account at the beginning of the year

Reserve for unexpired risks

Premium - net of reinsurances

Loss transferred to Profit and Loss Account

4

5,366,035.27

5,107,777.56

12,188,690.09

13,415,088.17

33,396,189.89

-

50,950,915.25

18,522,865.73

40,803,038.95

6,836,736.67

4,621,634.37

5,226,104.64

601,527.54

602,803.55

49,238.35

46,609.97

4,875,476.04

5,366,035.27

-

444,575.63

50,950,915.25

18,522,865.73

Total

EXPENSES

Claims incurred - net of reinsurances :

Net commission

Expenses of management

Miscellaneous outgo

Balance of account at the end of the year

Reserve for unexpired risks

3.10

3.3

Profit transferred to Profit and Loss Account

Total

(The accompanying notes are an integral part of the financial statements)

ANNUAL REPORT 2011

19


Marine Insurance Revenue Accounts For the years ended 31st December 2011 and 2010 In U.S. Dollars Note

2011

2010

REVENUES

Balance of account at the beginning of the year

Reserve for unexpired risks

Premium - net of reinsurances

4

2,248,203.08

1,871,353.78

5,815,360.53

5,620,507.71

8,063,563.61

7,491,861.49

Total

EXPENSES

Claims incurred - net of reinsurances :

3,287,281.65

3,403,960.98

Net commission

1,493,174.16

1,349,600.96

Expenses of management

286,995.53

252,556.07

Miscellaneous outgo

26,636.20

26,025.12

Balance of account at the end of the year 2,326,144.21

2,248,203.08

643,331.86

211,515.28

8,063,563.61

7,491,861.49

Reserve for unexpired risks

3.10

3.3

Profit transferred to Profit and Loss Account

Total

(The accompanying notes are an integral part of the financial statements)

20

ASIAN REINSURANCE CORPORATION


Miscellaneous insurance revenue accounts For the years ended 31st December 2011 and 2010 In U.S. Dollars Note

2011

2010

REVENUES

Balance of account at the beginning of the year

Reserve for unexpired risks

Premium - net of reinsurances

Loss transferred to Profit and Loss Account

4

5,783,952.32

5,438,908.73

14,257,663.03

14,459,880.81

-

452,174.49

20,041,615.35

20,350,964.03

Total

EXPENSES

Claims incurred - net of reinsurances :

8,981,195.93

9,376,503.30

Net commission

4,541,736.89

4,462,689.75

Expenses of management

703,634.02

649,751.04

Miscellaneous outgo

34,109.40

78,067.62

Balance of account at the end of the year 5,703,065.21

5,783,952.32

77,873.90

-

20,041,615.35

20,350,964.03

Reserve for unexpired risks

3.10

3.3

Profit transferred to Profit and Loss Account

Total

(The accompanying notes are an integral part of the financial statements)

ANNUAL REPORT 2011

21


Statement of cash flows For the years ended 31st December 2011 and 2010 In U.S. Dollars Note CASH FLOWS FROM OPERATING ACTIVITIES

2011

2010

(30,345,108.45)

2,782,909.82

117,239.56

103,971.55

Gain on sale of investments

(199,227.28)

(250,324.61)

Gain on disposal of fixed assets

(120.82)

(248.17)

388,568.18

(412,693.66)

(30,038,648.81)

2,223,614.93

Reserve for unexpired risks

(493,505.21)

980,150.60

Reserve for outstanding losses

54,737,100.99

3,595,827.96

Reinsurance payables

(1,415,355.55)

1,347,223.23

Reinsurance receivables

(16,879,998.01)

(5,623,370.70)

Other payables

251,343.26

2,126.78

Other receivables

(1,372,678.51)

(434,376.08)

4,788,258.16

2,091,196.72

Purchase of fixed assets

(476,122.40)

(121,608.49)

Purchase of investments

(15,080,288.82)

(5,559,624.58)

Proceeds from the sale of fixed assets

146.07

274.15

Proceeds from the sale of investments

5,751,022.60

3,677,517.37

Net cash used in investing activities

(9,805,242.55)

(2,003,441.55)

1,320,000.00

-

Dividend paid to equity holders of the Corporation

(1,663,145.00)

(831,572.50)

Net cash (used in) provided by financing activities

(343,145.00)

(831,572.50)

Net (decrease) increase in cash

(5,360,129.39)

(743,817.33)

Cash at beginning of year

72,732,019.39

73,457,834.29

(75,787.21)

18,002.43

67,296,102.79

72,732,019.39

Profit / (loss) for the year Adjustments for Depreciation

Unrealised (gain)/loss on exchange CHANGES IN

Net cash provided by operating activities CASH FLOWS FROM INVESTING ACTIVITIES

CASH FLOWS FROM FINANCING ACTIVITIES

Proceeds from issue of equity shares

Effect on currency exchange Cash at end of year (The accompanying notes are an integral part of the financial statements)

22

ASIAN REINSURANCE CORPORATION


Notes to the financial statements For the years ended 31st December 2011 and 2010 These notes form an integral part of the financial statements. 1. GENERAL INFORMATION

1.1 Corporate information

Asian Reinsurance Corporation (‘the Corporation”) is a regional intergovernmental organization established in 1979 through the initiative of United Nations Economic and Social Commission for Asia and the Pacific (“UN/ESCAP”). The Corporation is governed by the provisions and protocols of the agreement establishing the Corporation (“the Agreement”). The registered address of the Corporation’s headquarter office is 17th Floor, Tower B, Chamnan Phenjati Business Center, 65 Rama 9 Road, Huaykwang, Bangkok.

The principal activity of the Corporation is that of a professional reinsurer accepting business from the insurance markets in member states as well as other markets of the region and elsewhere, and retroceding its surpluses after net retention with priority given to the national insurance and reinsurance markets of the member states.

1.2 Severe flood disaster

Due to severe flood disaster which inundated large parts of Thailand including many economic areas and industrial zones during August, 2011 to December, 2011 a number of losses were reported and these losses materially affected the financial statements of the Corporation. The financial impact of the flood losses reflected in the financial statements are as below: (Unit : US$)

LOSS RESERVES

Gross claims

144,261,297

Claims reserve refundable from Proportional Retrocessionares

(91,056,144)

Net claims

Less : Claims reserve refundable from Excess of Loss Contracts

Net claims expense

53,205,153 (16,998,182) 36,206,971

After the reporting period, the Corporation has received preliminary loss advices without supporting loss survey report, total gross claim in approximately US Dollar 31.02 million and net claim in approximately US Dollar 6.85 million. The Corporation did not account for the claims in the reporting period because of lack of adequate reliable loss survey information for accounting for loss reserve.

Even though the Corporation’s Management set up loss reserve based on the best estimate, taking into account the available facts and considered appropriate assumptions there are inherent uncertainties in the completeness and accuracy of the information and assumptions used by the Management. While preparing loss reserve as at the time of preparation of financial statements, claims were still under development. There is, therefore, likelihood of actual loss reserve differing from the loss estimates with the passage of time and availability of reliable information from cedants. However, the Corporation Management might consider to restate the financial statements to reflect the receipt of reliable loss information after the reporting date.

ANNUAL REPORT 2011

23


Notes to the financial statements For the years ended 31st December 2011 and 2010 2. BASIS OF PREPARATION OF FINANCIAL STATEMENTS

The financial statements are prepared in accordance with the provisions of the Agreement and guidelines issued by the Council of Members (“the Provisions and Guidelines”).

The financial statements are prepared on the historical cost basis except as stated in the accounting policies. They are prepared and presented in United States Dollars (“US$”).

The preparation of financial statements in conformity with the Provisions and Guidelines requires management to make judgements, estimates and assumptions that affect the application of accounting policies and reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised in any future period affected.

3. SIGNIFICANT ACCOUNTING POLICIES

3.1 Foreign currency transactions

3.2 Cash

24

Reserves for unexpired risks are provided at 40% of premiums net of retrocessions for all type of insurances.

3.4 Reserves for outstanding claims

Cash in the statement of cash flow comprises cash balances at bank and on hand.

3.3 Reserves for unexpired risks

The Corporation uses United Nations Organization (“UNO”) announced foreign exchange rates for currency translation. Transactions in foreign currencies are translated to US$ at the foreign exchange rates ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies at the reporting date are translated to US$ at the foreign exchange rates ruling at that date. Foreign exchange differences arising on translation are recognized in the Profit and Loss Account.

Reserves for outstanding claims are provided based on the outstanding loss advices and other information received from ceding companies. Where no data is available, the reserves are provided based on reasonable estimation. Further, an additional 5% of reserves for outstanding claims is provided for IBNR.

3.5 Amounts due from insurers or reinsurers and other receivables

Amounts due from insurers or reinsurers and other receivables are stated at net realisable value.

The allowance for doubtful debts is provided on the basis of the net balances due to the Corporation which are overdue more than one year from companies with poor records of settlement of accounts.

ASIAN REINSURANCE CORPORATION


Notes to the financial statements For the years ended 31st December 2011 and 2010

3.6 Income tax

Income tax is provided in the Profit and Loss Account in accordance with The Host Country Agreement with the Government of the Kingdom of Thailand under the Asian Reinsurance Corporation Act B.E. 2534 (“the Host Country Agreement”) which provides as follows:

1. The Corporation’s headquarters premises, funds, insurance premium, income derived from outside of Thailand and dividends to shareholders of the Corporation shall be exempted from all taxation and any obligation for the payments, withholding of any tax or duty. The Corporation shall not be exempted from taxes on charges which are no more than payments for public utility services which the Corporation must withhold tax.

2. In the determination of net profits of the Corporation to be taxed in Thailand, only income derived in Thailand, except income from underwriting, shall be included as the income of the Corporation. The expenses of the Corporation’s headquarter shall be calculated on the basis of the proportions of total income except income from underwriting derived from Thailand. Income tax presented in the financial statements is computed in accordance with the Host Country Agreement above.

3.7 Provisions

3.8 Offsetting

Provisions are recognised when it is probable that an outflow of resources embodying economic benefits will be required to settle a present legal or constructive obligation as a result of past events and a reliable estimate can be made of the amount of the obligation.

Financial assets and liabilities are offset and the net amount is reported in the statement of financial position when the Corporation has a legal, enforceable right to set off the recognized amounts and the transactions are intended to be settled on a net basis.

3.9 Revenues

Reinsurance premium

Inward reinsurance transactions with ceding insurance companies are recorded in the accounts upon receipt of statement of accounts from these companies.

Interest income and dividend income

Interest income is recognised in the Profit and Loss Account as it accrues. Dividend income is recognised in the Profit and Loss Account on the date the Corporation’s right to receive payments is established.

ANNUAL REPORT 2011

25


Notes to the financial statements For the years ended 31st December 2011 and 2010

3.10 Expenses

Commission

Commission is expensed when it occurs.

Expenses of management

Expenses of management are allocated to each insurance class as proportion to the net premium income.

3.11 Investments

Classification

The classification of investments depends on the purpose for which the investments were acquired. The Corporation determines the classification of the financial assets at initial recognition. Investments in financial assets are classified as follows:

- Held-for-trading

- Held-to-maturity

- Available-for-sale

Measurement

Investments held for trading are classified as current assets and are stated at fair value, with any resultant gain or loss recognized in the Profit and Loss Account.

Investments that the Corporation has a positive intention and ability to hold to maturity are classified as held-to-maturity investments. Held-to-maturity investments are stated at amortised cost. The difference between the acquisition cost and redemption value of investment is amortised using the effective interest rate method over the period of investment.

Investments other than those held for trading or intended to be held to maturity, are classified as availablefor-sale and are stated at fair value, with any resultant gain or loss recognized directly in a separate component of equity. The impairment losses and foreign exchange gains and losses of investments are recognized in the Profit and Loss Account. When these investments are disposed, the cumulative gain or loss previously recognized directly in a separate component of equity is recognized in the Profit and Loss Account. Where these investments are interest-bearing, interest calculated using the effective interest method is recognized in the Profit and Loss Account.

26

The fair value of trading investments in active markets is based on quoted market values at the balance sheet date. Fair values of other investments are estimated at realizable values. Where it is not possible to estimate fair value, the investment is carried at cost less impairment, if any.

ASIAN REINSURANCE CORPORATION


Notes to the financial statements For the years ended 31st December 2011 and 2010

Disposal of investments

On disposal of an investment, the difference between net disposal proceeds and the carrying amount together with the associated cumulative gain or loss that was reported in a separate component of equity is recognized in the Profit and Loss Account.

If the Corporation disposes of part of its holding of a particular investment, the deemed cost of the part sold is determined using the weighted average method applied to the carrying value of the total holding of the investment.

Impairment

The carrying amounts of the investments are reviewed at each reporting date to determine whether there is any indication of impairment. If any such indication exists, investments’ recoverable amounts are estimated.

An impairment loss is recognised if the carrying amount of an investment exceeds its recoverable amount. The impairment loss is recognised in the Profit and Loss Account unless it reverses a previous revaluation credited to equity, in which case it is charged to equity.

The recoverable amount of held-to-maturity investments carried at amortised cost is calculated as the present value of the estimated future cash flows discounted at the original effective interest rate. The recoverable amount of available-for-sale investments is calculated by reference to the fair value.

An impairment loss in respect of an investment is reversed if the subsequent increase in recoverable amount can be related objectively to an event occurring after the impairment loss was recognised.

3.12 Office condominium, furniture, fixtures, vehicles and office equipment

Office condominium, furniture, fixtures, vehicles and office equipment are stated at cost less accumulated depreciation.

Gain or loss on disposal of equipment is recognized in the Profit and Loss Account. Expenditures on addition, renewal and improvements, which result in a substantial increase in an asset’s current replacement value, are capitalized. Repair and maintenance costs are recognized as an expense when incurred.

ANNUAL REPORT 2011

27


Notes to the financial statements For the years ended 31st December 2011 and 2010

Depreciation is charged to the Profit and Loss Account on a straight-line basis over the estimated useful lives of the assets. The estimated useful lives are as follows:

Office condominium

20

Years

Furniture and fixtures

5

Years

Office equipment

5

Years

Vehicles

5

Years

No depreciation is provided on assets under construction.

28

3.13 Employee benefits

Post retirement employee benefits

Employees are allowed for optional early retirement after completion of 20 years of continuous service with the Corporation and are entitled to termination benefits.

The Corporation operates defined contribution plan for the post retirement benefits of its employee. The Corporation pays contributions to provident funds, and such amounts are charged to personnel expenses under expenses of management. The Corporation has no further payment obligations once the contributions have been paid. Each of the employees under the plan is entitled to the entire contribution plus earnings thereon regardless of the length of service with the Corporation.

The Corporation has established contributory provident funds for its employees, separately for each of its international and local employees. Contributions are made monthly by the employees at rates 5% of their basic salaries and by the Corporation at rates ranging from 6% to 10% of the employees’ basic salaries depending on years of service.

The provident funds for the international employees are managed by the Corporation through a fixed deposit bank account which is not included in the balance sheet. The provident funds for local employees are registered with the Ministry of Finance as juristic entities and are managed by licensed Fund Manager “TISCO Asset Management Co., Ltd.�, and therefore they are not included in the statement of financial position.

Short-term employee benefits

Short-term employee benefit obligations are measured on an undiscounted basis and are expensed as the related service is provided.

ASIAN REINSURANCE CORPORATION


Notes to the financial statements For the years ended 31st December 2011 and 2010

3.14 Amounts due to insurers or reinsurers and other payables

Amounts due to insurers or reinsurers and other payables are stated at cost.

4. SEGMENT INFORMATION (Unit : US$) 2011

2010

Premium - net of reinsurances

Miscellaneous

14,257,663.03

14,459,880.81

Fire

12,188,690.09

13,415,088.17

Marine

5,815,360.53

5,620,507.71

32,261,713.65

33,495,476.69

Total

Following is the detail for gross premium written by territory.

(Unit : US$) 2011

2010

28,913,868.14

24,175,590.26

Member - countries

Thailand

India

6,154,488.74

8,347,266.36

South Korea

6,186,183.98

7,896,314.37

Philippines

3,570,598.75

5,065,890.64

Bangladesh

1,225,647.13

1,109,250.47

Others

1,549,431.06

1,360,036.44

47,600,217.80

47,954,348.54

7,808,222.84

6,681,634.62

928,149.55

2,900,246.83

56,336,590.19

57,536,229.99

(24,074,876.54)

(24,040,753.30)

32,261,713.65

33,495,476.69

Countries in the UN/ESCAP region Other countries Total Less : Premium ceded Premium - net of reinsurances

ANNUAL REPORT 2011

29


Notes to the financial statements For the years ended 31st December 2011 and 2010 5. INCOME FROM INVESTMENTS AND BANK ACCOUNTS (Unit : US$) 2011

2010

Interests and dividends income

Interest on bank deposits and savings accounts

1,983,833.00

1,775,204.14

Interest on US$ bonds

348,313.21

115,517.18

Interest on reserves – net

79,096.27

73,601.98

Dividends

35,279.34

50,363.15

2,446,521.82

2,014,686.45

199,227.28

250,324.61

2,645,749.10

2,265,011.06

Gain on sales of investments Total

6. PROVISION FOR EXPENSES INCURRED BUT NOT PAID (Unit : US$) 2011 Employee benefit expenses Others Total

30

2010

162,735.14

145,006.78

6,831.07

16,457.67

169,566.21

161,464.45

For the year 31st December, 2011 the Corporation contributed US$ 56,461.63 (2010 : US$ 51,538.13) to the provident funds for its international and local employees as defined in Note 3.13. The contribution is included in expenses of management.

The employees who have completed 20 years of service with the Corporation are entitled to separate termination benefits at the time of retirement. A provision is made for the payment of such benefits on the basis of annual basic salary for each year of service after completion of 20 years. The balance of the provision is included in provision for expenses incurred but not paid. Movement in the provision during the year is as follows:

ASIAN REINSURANCE CORPORATION


Notes to the financial statements For the years ended 31st December 2011 and 2010 (Unit : US$) 2011

Balance as at 1st January

2010

145,006.78

157,745.59

Additions

17,728.36

34,568.64

Payments

-

(47,307.45)

Balance as at 31st December

162,735.14

145,006.78

Eligible employees

9

8

7. INVESTMENTS - NET (Unit : US$) 2011

2010

10,869,051.74

3,491,558.23

1,260,836.51

1,039,328.35

12,129,888.25

4,530,886.58

1,449,439.62

14,817.98

541,981.39

47,111.21

Total Thailand investments

1,991,421.01

61,929.19

Total investments at cost

14,121,309.26

4,592,815.77

(486,390.46)

62,478.74

13,634,918.80

4,655,294.51

Foreign investments

Bonds

Mutual funds and notes

Total foreign investments

Thailand investments

Mutual funds

Stocks

Unrealised gain / (loss) on revaluation of investments Total investments at fair value

All investments of the Corporation are investments available-for-sale. The unrealised gain / (loss) on revaluation of investments comprises the cumulative net change in the fair value of available-for-sale investments until the investments are disposed or are impaired.

ANNUAL REPORT 2011

31


Notes to the financial statements For the years ended 31st December 2011 and 2010 8. OFFICE CONDOMINIUM - NET (Unit : US$) Costs

As at 1st January, 2011

1,231,036.70

Additions

-

Disposals

-

As at 31st December, 2011

1,231,036.70

Accumulated depreciation

As at 1st January, 2011

1,077,157.20

Depreciation charge for the year

61,551.84

Disposals

-

As at 31st December, 2011

1,138,709.04

Net book value

32

As at 31st December, 2011

92,327.66

As at 31st December, 2010

153,879.50

ASIAN REINSURANCE CORPORATION


Notes to the financial statements For the years ended 31st December 2011 and 2010 9. FURNITURE, FIXTURES, VEHICLES AND OFFICE EQUIPMENT - NET (Unit : US$) Costs

As at 1st January, 2011

466,799.46

Additions

476,122.40

Disposals

(8,065.43)

As at 31st December, 2011

934,856.43

Accumulated depreciation

As at 1st January, 2011

300,297.05

Depreciation charge for the year

55,687.72

Disposals

(8,040.18)

As at 31st December, 2011

347,944.59

Net book value

As at 31st December, 2011

586,911.84

As at 31st December, 2010

166,502.41

Addition included payments of US$ 409,470.97 made by the Corporation for the implementation of new software which is in progress.

The gross amount of the Corporation’s fully depreciated furniture, fixtures, vehicles and office equipment that were still in use as at 31 December 2011 amounted to US$ 232,940.43 (2010: US$ 221,027).

ANNUAL REPORT 2011

33


Notes to the financial statements For the years ended 31st December 2011 and 2010 10. AMOUNTS DUE FROM INSURERS OR REINSURERS - NET (Unit : US$)

Amounts due from insurers or reinsurers Less : Allowance for doubtful debts Net

2011

2010

27,588,980.00

10,706,104.01

(382,738.50)

(397,366.59)

27,206,241.50

10,308,737.42

11. SHORT-TERM DEPOSITS AND CURRENT ACCOUNTS (Unit : US$) 2011

2010

Analysed by country

Sri Lanka

22,781,023.29

21,750,089.03

United Kingdom (Member - Country Bank)

20,981,868.50

23,943,752.83

India

14,632,289.17

14,550,000.00

Iran

5,243,372.09

4,730,617.61

Thailand

2,118,712.39

5,886,257.02

Philippines

950,207.99

1,042,179.83

66,707,473.43

71,902,896.32

63,161,726.12

60,541,440.55

Total

Analysed by currency

US Dollars

Baht

2,118,712.39

5,886,257.02

Euro

1,084,399.28

5,069,036.25

Peso (Philippines)

272,074.83

373,801.51

GB Pound

67,531.44

29,538.44

Yen

3,029.37

2,822.55

66,707,473.43

71,902,896.32

Total

34

ASIAN REINSURANCE CORPORATION


Notes to the financial statements For the years ended 31st December 2011 and 2010 12. SHARE CAPITAL (Unit : US$) Par value per share (in US$)

2010

2011 Number

Number

Amount

Amount

Authorised share capital

As at 1st January

1,000

100,000

100,000,000.00

100,000

100,000,000.00

As at 31st December

1,000

100,000

100,000,000.00

100,000

100,000,000.00

Subscribed and paid-up share capital

As at 1st January

1,000

30,239

30,239,000.00

29,739

29,739,000.00

Additional paid-in

1,000

600

600,000.00

500

500,00.00

As at 31st December

30,839

30,839,000.00

30,239

30,239,000.00

13. SHARE PREMIUM

Share premium is not available for dividend distribution. (Unit : US$)

Balance at 1st January Additional paid-in Balance at 31st December

2011

2010

15,610,000.00

15,010,000.00

720,000.00

600,000.00

16,330,000.00

15,610,000.00

ANNUAL REPORT 2011

35


Notes to the financial statements For the years ended 31st December 2011 and 2010 14. RESERVES

Statutory reserve

The statutory reserve is made in accordance with the provisions of the Agreement that requires to transfer one tenth of the annual profits to the statutory reserve until such reserve equals to 100% of the share capital of the Corporation. The Council of Members may, however, decide to continue such transfer beyond this limit.

Contingency reserve

At the 13th meeting of the Council of Members held in 1990 it was decided to allocate US$ 500,000 from Profit and Loss Appropriation Account to Contingency Reserve to cover contingent liabilities which may arise.

15. DIVIDENDS

At the 5th Shareholders Assembly Meeting held on 24th June, 2011, it was resolved to pay 5.50% cash dividends of paid up share capital. The dividends were paid to shareholders in August, 2011.

Dividend for the current year, if any, will be decided and approved by Shareholders Assembly. The same will be accounted for in shareholders’ equity as an appropriation of profits in the next year.

16. INCOME TAX DEDUCTIONS

The income tax deductions in the Profit and Loss Account include tax deducted on interest and dividends income derived in Thailand. As defined in Note 3.6, under the Host Country Agreement the Corporation is exempt from Thailand tax on all income except for the income, other than from underwriting activities, derived in Thailand.

17. APPROVAL OF FINANCIAL STATEMENTS

36

These financial statements have been agreed on 3rd April, 2012 by the President & Chief Executive Officer’s Corporation to present to the Shareholders’ Assembly for approval.

ASIAN REINSURANCE CORPORATION


Certificate by Management Board ACCOUNTS FOR THE PERIOD ENDED 31ST

DECEMBER 2011

We certify that :

1. Investments have been shown in the Balance Sheet as per the significant Accounting policies stated in the annual Report.

2. Ample provision has been made for all liabilities.

3. Treaty and facultative returns received upto 31 December 2011 have been, incorporated into these accounts.

4. All currencies have been converted into US Dollars at the rates of exchange ruling on the date of transactions and at the rates of exchange ruling on 31 December 2011 for the Balance Sheet.

5. The Balance Sheet, Revenue Accounts, Profit and Loss Account and Profit and Loss Appropriation Account are to the best of our knowledge and belief correct and are drawn up so as to give a true and fair view of the state of affairs of the Corporation as at 31 December 2011 and of the results for the year ended on that date.

(Dr. Abdolnaser Hemmati) Chairman

(Ms. G.D.C. Ekanayake) Vice - Chairman

(Mr. A. K. Roy)) Member

(Mr. Seyed Mohammad Karimi) Member

(S.A. Kumar) President & CEO

ANNUAL REPORT 2011

37


Senior Management

S.A. Kumar Chartered Insurer M.A.., M.B.A., FIII., FCII. kumar@asianrecorp.com

Kumudini S.S. Dassenaike

K.Thanamohan

Chartered Insurer Deputy Chief B.A. (Hons) FCII. Executive Officer kumudini@asianrecorp.com

B. Sc, ACA, FIII, PGDM Vice-President Finance thanamohan@asianrecorp.com & I.T.

Md. Alamgir Kabir

Kencho Yeshey

M. Com, ABIA, Dip CII kabir@asianrecorp.com

38

President & Chief Executive Officer

Vice-President – Treaty

Dip. CE, AIII, Dip CII fac@asianrecorp.com

Parkpoome Nivatvongs

Sarinporn Namsirikul

Deputy Vice-President Chartered Insurer – Treaty MBA., ACII parkpoome@asianrecorp.com

MBA sarinporn@asianrecorp.com

Chailit Viriyaakavuti

Nittaya Agesitiphong

B.A.. (Acct.) ATII. chailit@asianrecorp.com

B.A.. (Mgt.) nittaya@asianrecorp.com

ASIAN REINSURANCE CORPORATION

Administrative Officer – R/I Accounts

Deputy Vice-President – Facultative

Deputy Vice-President – Investments

Administrative Officer – EDP




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