Annuity Life & Re gets adverse opinion from auditor
Auditor Grant Thornton has issued an adverse opinion on the 2022 and 2021 accounts of Annuity Life and Re Holdings, a life reinsurer which has been run-off since 2015.
Grant Thornton said the adverse opinion was being issued because Annuity Life had not consolidated the accounts of a wholly owned subsidiary which was determined to be impaired.
Grant Thornton said in accounts issued through the Bermuda Stock Exchange: “Annuity and Life Re (Holdings) Ltd has not consolidated the financial statements of subsidiary Multivir inc because the investment is fully impaired in the Group’s consolidated financial statements and the Group has documented plans to dispose of this investment. This investment is therefore accounted for on a fair value basis by the company.
“Under accounting principles generally accepted in the United States of America and relevant legislation, the subsidiary should have been consolidated because it is controlled by the company.
“Had Multivir Inc been consolidated, many elements in the consolidated financial statements would have been materially affected. The effects on the consolidated financial statements of the failure to consolidate have not been determined.”
As a result of the adverse opinion, Grant Thornton said it could not support the unqualified audit opinion given by its predecessor company Arthur Morris of the 2021 accounts because Multivir was not consolidated.
According to the accounts, Annuity and Life Re had assets of $18.6 million, consisting mainly of investments valued at $18.3 million.
For the year, the accounts said the company had lost $1.9 million compared to $3.6 million the year before, having recorded a cost of $915,799 for impairment of a $14.4 million loan owed to the company by Multivir.
For 2021, an impairment charge of $1.7 million had been recorded.
The company reported $1.052 million in operating expenses compared to $401,000 the previous year, and net investment income of $31,008 compared to an investment loss of $1.586 million in 2021.
