PART IIIA
VALUATION OF ASSETS
Application of this Part
13A.  This Part applies to the valuation of any asset of an insurance fund established and maintained under regulation 11(1).
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Valuation of assets
13B.—(1)  Unless otherwise specified in this Part, a Service Company shall value an asset of an insurance fund in accordance with the Accounting Standards.
(2)  The following items shall not be treated as assets of an insurance fund:
(a)assets comprised in the deposit made and maintained by the administrator under regulation 16; and
(b)intangible assets, including the goodwill of the syndicate to which the insurance fund relates.
Equity securities
13C.—(1)  A Service Company shall value an equity security as follows:
(a)where it is listed on a securities exchange, at its market value; or
(b)where it is not listed on any securities exchange, at its net realisable value.
(2)  In determining the net realisable value of an equity security which is not listed on a securities exchange, the Service Company shall take into account —
(a)the amount of consideration it would receive by selling the equity security; and
(b)the net tangible asset value of the equity security.
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Debt securities
13D.—(1)  A Service Company shall value a debt security as follows:
(a)where it is listed on any securities exchange, at its market value; or
(b)where it is not listed on any securities exchange, at its net realisable value.
(2)  In determining the net realisable value of a debt security that is not listed on a securities exchange, the Service Company shall take into account —
(a)the prevailing interest rate;
(b)the likelihood of default by the issuer; and
(c)the cash flows that are expected to arise from the debt security.
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Land and buildings
13E.—(1)  A Service Company shall value any land or building at its estimated market value.
(2)  In estimating the market value of any land or building, the Service Company shall take into account —
(a)the last available valuation report made by a qualified property valuer;
(b)the prevailing market for the land or building; and
(c)any damage or improvement affecting the land or building from the date of the last available valuation report.
(3)  A Service Company shall obtain a new valuation from a qualified property valuer —
(a)when the value of the land or building has been substantially impaired by any event; and
(b)in any event, at least once every 3 years.
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Loans
13F.  A Service Company shall value loans made to other persons by aggregating the principal amounts outstanding under all loans less any provision for doubtful debts.
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Cash and deposits
13G.—(1)  A Service Company shall value any cash or deposit with a financial institution, other than a negotiable certificate of deposit, at the nominal amount of such cash or deposit after deducting any amount deemed uncollectible from the financial institution.
(2)  A Service Company shall value a negotiable certificate of deposit at its market value.
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Outstanding premiums and agents’ balances
13H.  A Service Company shall value the outstanding premiums and agents’ balances by aggregating the principal amounts outstanding after deducting any provision for doubtful debts.
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Deposits withheld by cedants
13I.  A Service Company shall value deposits withheld by cedants by aggregating the amounts of deposits outstanding after deducting any amount deemed uncollectible from the cedant.
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Reinsurance recoverables
13J.  A Service Company shall value reinsurance recoverables by aggregating the amounts of reinsurance recoverables outstanding after deducting any provision for doubtful debts.
[S 814/2004 wef 01/01/2005]