Ten months after it was due, American International Group is still promising to give insurance regulators its 2004 combined statutory report, a stricter accounting of its finances than securities markets require.

“We do intend to get it out,” said AIG Spokesperson Chris Winans, who noted yesterday that aside from the combined report the more than 30 individual insurance companies under the AIG umbrella have all filed 2004 statutory reports with the National Association of Insurance Commissioners.

The statutory combined report can sometimes disclose a radically reduced asset figure.

In mid-January, Steve Johnson, Pennsylvania deputy insurance commissioner for the Office of Company Financial Regulation said the company told him it would be filing the 2004 combined report no later than Jan. 31.

AIG has been involved in a drawn out restatement of its finances that began after federal and New York State investigators began examining various transactions suspected of improperly improving the company's financial picture.

Last year, after three delays, AIG filed a five-year restatement with the Securities and Exchange Commission, using the generally accepted accounting procedures, which reduced the company's profits for that period by 10 percent.

New York authorities lodged civil fraud charges against the company over the accounting, which AIG settled last month for $1.64 billion. The fraud suit is continuing with former AIG Chairman Maurice Greenberg and former AIG Chief Financial Officer Howard Smith as defendants.

The missing combined statutory report can reveal a sharply different picture of the group's assets than the figure obtained by simply adding the numbers from individual company reports.

For example, totaling the individual company assets in 2003 from statutory reports produces a figure of $80.3 billion while the combined report for that year shows it to be $70.1 billion–$10.1 billion less.

The difference is created by the elimination of double counting of inter-company ownership of equity holdings and other transactions. It involves a more conservative approach to accounting than the GAAP method used for SEC filings.

Combined statutory reports are studied by investment banks, primary insurers, accounting firms and consultants among others, but a spokesperson for Pennsylvania's Insurance Department dismissed its importance.

“It's not a document widely used by regulators,” said Melissa Fox, with the department. She said the annual statements from individual companies, which are due today, have greater importance for regulators. “Our main focus is the annual statements.”

Pennsylvania oversees New York-based AIG's combined filing because it regulates the commercial property casualty pool that includes AIG's Pittsburgh-based National Union Fire Company. Combined statutory reports are filed May 1.

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AIG Still Late With Combined Asset Picture

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