Reference no: EM133031183
-Nancy is an experienced investor in stocks and bonds of companies in several industries, but not in property and insurance. Her investment advisor has recommended she invest in insurer XYZ to diversify her investments. Nancy has obtained XYZ's current NAIC Annual Statement to review. The following questions relate to Nancy's investment in Insurer XYZ.
-Nancy likes to start her review of a company's financial statements by determining how much shareholders' equity the company has. However, she is unable to locate this item in XYZ's balance sheet portion of the Annual Statement. Where is this amount listed, and why is it not labeled "shareholders' equity"?
-Because she is unfamiliar with insurer operations, Nancy is curious how XYZ generates its income. What could her investment advisor, who is familiar with insurer operations, tell her about XYZ's sources of earnings?
-Nancy has asked her financial advisor to tell her concisely what XYZ's core business function is. What can her advisor tell her?
-Nancy is a socially conscious investor. Regardless of how much potential investment income might be lost, she refuses to invest in a business that, in turn, invests in a company that exploits its workers. How can the annual statement help her determine the companies in which XYZ invests?