There is a slight change in Schedule D reporting for securities deemed to be Filing Exempt (FE) and determination of the appropriate NAIC designation for these securities for the 2018 Annual Statement. The NAIC’s Investment Analysis Office’s (IAO) database is now considered the “official” NAIC Designation for FE securities. These official designations are determined using up to 9 ratings from the NAIC’s approved Credit Rating Providers (CRPs). While insurers are not required to purchase the NAIC’s IAO database NAIC designations, if another method is used to arrive at an NAIC Designation and it differs from what the IAO database provides, regulators may identify these discrepancies. These rating designation discrepancies could potentially affect an investment’s valuation (if the lower of cost or market rule applies), and could also potentially affect the company’s determination of its RBC.
In the past, most companies either relied on their investment accounting provider to provide NAIC designations, or determined the appropriate NAIC designation internally by using a limited number of approved organizations, like S&P, Moody’s, and Fitch, to arrive at their NAIC designations. Because this methodology could result in different designations than the IAO database (which uses up to 9 CRP ratings), a decision needs to be made whether to purchase the IAO database or continue using your company’s current rating methodology. If an insurer chooses to purchase the IAO database, the fee is variable based on its investment portfolio value (per https://www.naic.org/prod_serv_avs.htm
Companies will have to evaluate the cost/benefit of purchasing the IAO database versus continuing to use their current methodology for determining NAIC designations for its FE securities. Again, the risk of not purchasing the IAO database is that incorrect ratings could be used in Schedule D and be identified by regulators, and other methods could result in potential security valuation errors and/or RBC consequences.
Each year, Strohm Ballweg selects a specific community charity to support and participates in a number of fundraising efforts for this charity, including donations, fun runs, golf outings, and other charity-sponsored events. For 2018, Middleton Outreach Ministries (MOM) was adopted as our charity of the year. MOM serves the communities of Middleton and West Madison by providing a food pantry, a clothing and household goods pantry, housing assistance, senior support, a back to school program, Thanksgiving food baskets, and the Sharing Christmas gift program. In typical fashion, Strohm Ballweg employees threw themselves into fundraising and support. So far, we have donated over $1,650 in cash, 861 pounds of non-perishable food and household items, and over 25 hours of service to MOM clients!
Beyond our annual selected community charity, Strohm Ballweg emphasizes its desire to be a responsible employer by supporting its employees that contribute time, money, or other goods and services every year to other charities supporting the community, including the United Way, Salvation Army, and Gilda’s Club. We’re very pleased to help those that are less fortunate in our community and are very proud of what we are able to achieve with a group of less than 30 employees!
This fall, we have added two new full-time Staff Accountants and a familiar Manager to the Strohm Ballweg team. Mike Henke, CPA, has returned to Strohm Ballweg as a Manager after a three-year hiatus working in the industry in finance and internal audit with two different insurers. We are very pleased to have Mike return with his additional industry experience. Marissa Gallitz graduated from UW-Whitewater with a degree in accounting in May 2018. Marissa was an intern at Strohm Ballweg for the 2017 busy season and has worked part-time since then until graduation in May. Marissa started with us full-time beginning in September. Shari Kassube is a May 2018 graduate of Lakeland University with a degree in accounting, and she started with us in October. Both Marissa and Shari will be studying for their upcoming CPA exams!
We will also have Ashley Mathis, an Edgewood College graduate in accounting, joining us as an intern in January 2019.
With continuing additions to the personnel at Strohm Ballweg, we are happy to announce that we will be expanding our existing office space in our current building. An additional 3,000 feet is currently being built-out and will be occupied in December before busy season begins. The new space will include office cubes, three offices, extra storage, a common work area, and a larger conference room to host internal and client meetings. Stop in for a visit in 2019 to check it out!
Strohm Ballweg is excited to announce two recent promotions (left to right): Matt Hasenbein to Supervisor and Mario Prcic to Senior Accountant.
With warm thoughts of Thanksgiving for our valued relationship. We wish you all the best at this special time of the year!