61G7-10.0012: Workers' Compensation Liability Statement
PURPOSE AND EFFECT: The Board proposes the rule amendment to remove duplicate information from the rule text which is already in the associated form.
SUBJECT AREA TO BE ADDRESSED: Duplicate information that is already in the associated form will be removed.
RULEMAKING AUTHORITY: 468.522, 468.524(2), 468.525(3), 468.526, 468.530(3), 468.531 FS.
LAW IMPLEMENTED: 468.525(3)(e), 468.529 FS.
IF REQUESTED IN WRITING AND NOT DEEMED UNNECESSARY BY THE AGENCY HEAD, A RULE DEVELOPMENT WORKSHOP WILL BE NOTICED IN THE NEXT AVAILABLE FLORIDA ADMINISTRATIVE WEEKLY.
THE PERSON TO BE CONTACTED REGARDING THE PROPOSED RULE DEVELOPMENT AND A COPY OF THE PRELIMINARY DRAFT, IF AVAILABLE, IS: Richard Morrison, Executive Director, Board of Employee Leasing Companies, 1940 North Monroe Street, Tallahassee, Florida 32399-0783
THE PRELIMINARY TEXT OF THE PROPOSED RULE DEVELOPMENT IS:
61G7-10.0012 Workers’ Compensation Liability Statement.
Each audited or reviewed financial statement submitted to the Board pursuant to Section 468.525(3)(e), F.S., and Rules 61G7-5.0031 and 61G7-5.0032, F.A.C., shall include a statement, signed by the chief executive officer (CEO) and chief financial officer (CFO) of the employee leasing company as well as the independent certified public accountant (CPA) auditing or reviewing the financial statement, in substantially one of the following forms:
(1) For the period(s) represented in the attached financial statements, we had a guaranteed cost policy for workers’ compensation provided by an admitted insurance carrier licensed to do business in the State of Florida. This policy does not have a deductible feature or other retention and is not subject to additional premium or assessment on the basis of claims and loss experience. We have no financial exposure to workers’ compensation insurers with respect to policies covering prior periods. Thus, we have no additional liability for workers’ compensation that must be presented on our financial statements.
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Year End: __________ |
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Signed: ____________ |
____________________ |
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CEO |
CFO |
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Date: ______________ |
Date: ______________ |
Acknowledgment by independent accountants:
We have examined the above assertion made by management of (employee leasing company) in connection with workers’ compensation liability as of _____________. Our examination was made in accordance with standards established by the American Institute of Certified Public Accountants and, accordingly, included such procedures as we considered necessary in the circumstances.
In our opinion, the assertion represented by management referred to above fairly presents, in all material respects, the workers’ compensation liability as of ___________________ in accordance with generally accepted accounting principles.
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Or, |
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(2) Workers’ compensation constitutes a very significant cost in the operation of an employee leasing company. Many employee leasing companies choose to provide workers’ compensation coverage through insurance arrangements that may involve certain retention of risks.
The determination of an appropriate accrual that adequately reflects the cost retained by the employee leasing company is essential to the fair representation of the employee leasing company’s financial position and results of operation for the reporting period, in accordance with generally accepted accounting principles.
Ultimate costs for workers’ compensation must include a reserve for loss development and a provision for incurred but not reported claims, as determined through the utilization of a variety of generally acceptable actuarial methodologies.
We hereby represent that our financial statements’ accrual for workers’ compensation is based upon a methodology that accounts for loss development and incurred but not reported claims for the period covered by the attached financial statements, and for all prior periods for which we may have continued financial exposure, as follows:
(a) through (c) No change.
(d) Through other methodologies described in detail on Exhibit A hereto, resulting in a loss development factor of __________, which our independent accountants consider adequate to enable them to express an opinion on the financial statements as required by Section 468.525(3)(e), F.S. and Rules 61G7-5.0031 and 61G7-5.0032, F.A.C.
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Year End: ______________ |
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Signed: ______________ |
______________ |
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CEO |
CFO |
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Date: ______________ |
Date: ______________ |
Acknowledgment by independent accountants:
We have examined the above assertion made by management of (employee leasing company) in connection with the methodology used in determining workers’ compensation liability as of __________. Our examination was made in accordance with standards established by the American Institute of Certified Public Accountants and, accordingly, included such procedures as we considered necessary in the circumstances.
In our opinion, the assertion represented by management referred to above presents the methodology used in determining workers’ compensation liability as of ______________, which fairly presents, in all material respects, the workers’ compensation liability in accordance with generally accepted accounting principles.
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Rulemaking Specific Authority 468.522, 468.524(2), 468.525(3), 468.526, 468.530(3), 468.531 FS. Law Implemented 468.525(3)(e), 468.529 FS. History–New 1-17-99, Amended________.