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“[D]isclosure is NOT disclosure if it doesn't communicate.”
Arthur Levitt, former SEC Chairman, July 23, 1997
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SAMPLE 7 - Re-written by ICS
A “problem bond” is either delinquent or restructured-typically to reduce the interest rate or extend the maturity date.
“Potential problem bonds” are fully current, but management believes they have certain characteristics that make them likely to become “problem bonds.”
The table below provides information about the potential problem bonds and problem bonds in ABC Insurance's investment portfolio as of December 31:
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Type of bond
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Year
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Amount (in
millions) ...
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... net of
cumulative write-
downs of ... (in
millions)
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Portion of total
attributable to
policyholder
contracts
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Potential
problem
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2004
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$69
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$14
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35%
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2003
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$63
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$10
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45%
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Problem
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2004
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$119
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$19
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29%
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2003
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$137
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$30
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24%
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Click here for original
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