-31-
Streff determined a reasonable range of deviation extending
from $570,000 below to $1,140,000 above his most likely reserve
estimates.
As part of his report, Streff “restated” petitioner’s
carried reserves for each year of its history by considering
subsequent payments and changing reserve levels for successive
years through 1995. According to this analysis, petitioner’s
initial reserves for each of the years 1982 through 1985, were
lower than their restatement in 1995, whereas petitioner’s
initial reserves for each of the years 1987 through 1994 were 27
to 52 percent higher than their restatement in 1995.23
23 Streff’s expert report indicates that on the basis of
information in petitioner’s annual statements, petitioner’s
“restated” reserves as of Dec. 31, 1995, and the resulting
deficiency or redundancy in the initial booked reserve, were as
follows (in millions of dollars):
Original 1995 Deficiency
Year Reserve Restatement (Redundancy)
1982 $105 $302 $197
1983 498 1,397 899
1984 1,245 2,320 1,075
1985 2,138 2,961 823
1986 4,323 2,792 (1,531)
1987 5,557 3,116 (2,441)
1988 5,989 4,388 (1,601)
1989 7,837 5,165 (2,672)
1990 9,618 4,656 (4,962)
1991 10,127 4,954 (5,173)
1992 10,550 5,577 (4,973)
1993 11,636 6,953 (4,683)
1994 11,581 7,885 (3,696)
1995 12,500 12,500
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