Actuarial Notes

Subsequent Events

By National Association of Insurance Commissioners · 2025 · SSAP No. 9

Study guide: Exam 6U

Statement of Statutory Accounting Principles No. 9 of the NAIC's Accounting Practices and Procedures Manual. It defines subsequent events and establishes the criteria for recording them in the financial statements and/or disclosing them in the notes; its conclusions apply to both quarterly and annual statement filings.

On the syllabus

  • Exam 6U — objective C5; NAIC Accounting Practices and Procedures Manual, 2025, SSAP No. 9, paragraphs 1-8, available in Appendix IV of the COPLFR P&C Practice Note (as the content outline states it)

Scope of Statement

  • The statement defines subsequent events and sets the criteria for recording them in the financial statements and/or disclosing them in the notes, for both quarterly and annual statement filings.

Summary Conclusion

  • Key Terms
    • Subsequent events are events or transactions that occur after the balance sheet date but before the statutory financial statements are issued and before the audited financial statements are issued, or available to be issued.
    • Material subsequent events are Type I (recognized), which provide additional evidence about conditions that existed at the balance sheet date, or Type II (nonrecognized), which provide evidence about conditions that did not exist at that date but arose after it.
    • Financial statements are "issued" when widely distributed for general use and "available to be issued" when complete in a form that complies with SAP and all necessary approvals have been obtained.
  • Recognition Guidance
    • The effects of all material Type I subsequent events are recognized in the financial statements; their nature and amount are disclosed only if necessary to keep the statements from being misleading.
    • Material Type II subsequent events are not recorded but are disclosed, with the nature of the event and an estimate of its financial effect or a statement that no estimate can be made.
    • An entity considers supplementing the statements with pro forma financial data when a nonrecognized event is significant.
    • Examples of Type I events include the settlement of litigation whose cause preceded the balance sheet date; examples of Type II events include the sale of a bond or capital stock, a business combination and loss of plant or inventories by fire or natural disaster after the balance sheet date.
  • Disclosures
    • Reporting entities disclose the dates through which subsequent events were evaluated and the dates the statements were issued, or available to be issued.
  • Relevant Literature
  • Effective Date and Transition

References

  • Relevant Issue Papers

Related readings

  • Statements of Actuarial Opinion on Property and Casualty Loss Reserves Practice Note (COPLFR - 2024) — its Appendix IV reproduces this statement, as the content outline notes

Sources

  • Property and Casualty Practice Note 2025 (American Academy of Actuaries, COPLFR) — the text of SSAP No. 9 as reproduced in its Appendix IV (pp. 9-1 to 9-4, marked © 1999-2025 NAIC): status table, contents, paragraphs 1-16 and references (348 pages, sha256 299cb328818f8669014180a0e1c8543121996b2f9c94f83ea0d8f131d3afe4c3); the NAIC's own Accounting Practices and Procedures Manual is sold by the NAIC and was not read
  • CAS Exam 6U Content Outline, Fall 2026 — the citation (Accounting Practices and Procedures Manual, 2025), the assigned paragraphs and the note that the material is in Appendix IV of the COPLFR practice note