2000 i31 After studying IRDA Regulations, let us work out few illustrations which will help you in understanding the procedure for preparation of financial statements of insurance companies. Students are required to go through the formats of Revenue Account, Profit and Loss Account, Balance Sheet and its Schedules as prescribed in Part V of Schedule A for Life Insurance business given in Annexure I for better understanding of the illustration given here under. Illustration 1 From the following balance as at 31st March, 2012 in the books of the National Life Assurance Co. Ltd., prepare Profit and Loss Account and Balance Sheet 000 Life Assurance Fund on 1 Agents' Balances (Dr.) 18,000 April, 2011 34,00,000 Advances to ceding companies 47,000 Annuities paid (in India 72,500) 81,750 Due from Re-insurers 38,500 General Reserve 2,25,000 Due to Re-insurers 47,500 Deposit with the Reserve Bank Sundry Creditors 1,800 -Government Securities 2,10,000 Premiums: First year 5,90,000 Indian Government Securities 10,90,000 Renewal 1,20,000 Foreign Government Securities 75,000 Reinsurance accepted 50,000 Loan on Company's Policies 2,10,000 Reinsurance ceded 70,000 Leasehold Buildings 63,300 Interim Bonus to Policy-holders 22,500 Securities on which interest is Commission- guaranteed by the Government 4,50,000 Direct: First year 40,500 Stocks of Shares of companies Renewal 2.000 incorporated in India 14,50,000 Reinsurance accepted 12,000 Share Capital (20,000 shares @ 20,00,000 Reinsurance ceded 4,000 100 each) Claims Mortgages in India 14,32,500 By Death (in India 1,30,000) 2,00,000 Cash with Bankers on By Maturity (in India 1,40,000) 2,20,000 Current Account 40,500 Bank Loan 21.750 Cash with Bankers on Salaries 30,400 Deposit (short-term) Account 20,000 Auditors' Fees 5,400 Cash in hand 7,000 Law Charges 3,400 State Government Securities 7,25,000 Rent paid 3,600 Furniture and Fixtures 39,000 Other Expenses of Management 750 Outstanding Premiums 66,000 Travelling Expenses 1,950 Interest and Rents Received (Gross) 2,16,000 Transfer the surplus amount if any to Life Fund for the year ended 31st March, 2012. 5% dividend is also proposed on share capital