LOMA 291 Module 4 EXAM QUESTIONS & Answers 100% Accurate!!
5 views 0 purchase
Course
LOMA 291
Institution
LOMA 291
At a typical insurance company, which of the following areas are part of financial operations? Choose all that apply.
a. Accounting and financial reporting
b. Treasury operations
c. Information technology
d. Investment operations
e. Internal audit - ANSWERA, B, D, & E- All of these areas—exc...
LOMA 291 Module 4 EXAM QUESTIONS &
Answers 100% Accurate!!
At a typical insurance company, which of the following areas are part of financial operations? Choose
all that apply.
a. Accounting and financial reporting
b. Treasury operations
c. Information technology
d. Investment operations
e. Internal audit - ANSWERA, B, D, & E- All of these areas—except for information technology—are
part of a typical insurance company's financial operations. Although the IT department plays an
essential role in maintaining the quality of the data provided to financial managers, it is not
technically part of financial operations.
Board and Executive Roles
The financial management function - ANSWERProvides information to stakeholders
Ensures that financial obligations are met
Ensures compliance with complex financial regulations
Generates adequate returns for the company's owners and customers
Role of the Board of Directors - ANSWER- Investment committee: The investment committee sets
Forthright's investment policy and oversees investment operations.
- Audit/risk committee: The audit/risk committee directs Forthright's audit and internal control
function.
The role of the Ceo - ANSWERI approve our budget numbers. Then I manage our resources—in line
with budget guidelines and all current laws and regulations.
Technically I'm responsible for directing financial objectives and strategies, but I delegate most of
these responsibilities to senior financial officers.
,However, make no mistake, the buck stops here! We are a publicly held company. Investors,
customers, and regulators can, and should, hold me responsible for our financial results.
The role of the CFO - ANSWERAs CFO, I report to Grace Avon, our CEO. I work closely with company
directors to develop corporate goals and strategies. I coordinate, monitor, and direct Forthright's
financial activities.
That covers a lot of territory. In the financial world, information quality and accuracy are critically
important—I work closely with IT to make sure we get that right. That information has to be
communicated to company managers and external parties. When we need to raise funds—that's also
my job.
Last, but not least, strong financial controls and measurement tools are absolutely essential.
Financial Management Operating Units - ANSWERSpecific job titles and organizational structures vary
according to a company's unique needs, but all insurers must perform certain core financial
functions, as shown below.
An organization chart. Under Financial Operations are Accounting and Financial Reporting, Treasury
Operations, and Investment Operations. Separate is Internal Audit.
An insurance company's investment committee directs the company's internal audit and control
function.
a. True
b. False - ANSWERA company's internal audit and control function is directed by the audit/risk
committee. The investment committee sets the company's investment policy and oversees
investment operations.
Let's look at how Forthright Financial organizes its financial operations, starting with its accounting
and financial reporting function.
accounting - ANSWERA system or set of rules and methods for collecting, recording, analyzing,
summarizing, and reporting financial information.
financial reporting - ANSWERThe process of presenting financial data about a company's financial
position, operating performance, and flow of funds.
, The controller - ANSWERresponsible for the timely and accurate collection and reporting of all of
Forthright's financial data
The accounting function:
Records, tracks, and reports on financial transactions
Coordinates the budget process and oversees expense analysis
Prepares financial statements and reports for external users
Gathers, records, analyzes, and distributes financial information to company managers
financial accounting - ANSWERThe field of accounting that focuses primarily on reporting a
company's financial accounting information to meet the needs of the company's external
stakeholders.
- regulators
- creditors
- investors
- rating agencies
- tax authorities
Management accounting - ANSWERThe field of accounting that focuses primarily on reporting and
presenting a company's financial information to meet the needs of the company's internal users.
- managers
financial statements - ANSWERStandardized summary reports of a company's major monetary events
and transactions.
tax accounting - ANSWERLarge insurers often have a separate function that handles tax reporting,
which has its own set of reporting rules. In smaller companies, the accounting function typically is
responsible for tax reporting.
For insurers, one unique aspect of tax accounting is premium taxes. Forthright pays premium taxes
on the premiums paid to Forthright within a particular jurisdiction. Premium taxes are calculated as a
percentage of these premiums.
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller papersmaster01. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for $15.49. You're not tied to anything after your purchase.
