Since the Data Call instructions for capturing exposure data and developing the audit file specifications do not require a premium to be reported, is the premium amount required for audit purposes?
A detailed premium report that reconciles to the company’s annual statement may be required at the time a company receives an audit notice (this is a separate report). The company usually receives 60-90 days advance notice of the date the FHCF will conduct an exposure audit. The advance notice provides detailed information that describes the records the company is required to produce for the audit. The audit file described in the Data Call instructions is intended to direct the company on how to retain the detail information which supports the exposure data submitted on September 1 of each year. The FSBA has found that companies are able to retain a detail record of its Data Call submission if they know in advance that one will be needed. The information provided in the Data Call instructions which relates to an audit is not intended in be inclusive of all required records.
