# ASC 210-944-55: Balance Sheet — Financial Services—Insurance — 55 Implementation Guidance and Illustrations

Source: FASB Accounting Standards Codification, Basic View

[Read online](https://asc.understandingaccounting.org/asc/210/944/#55-implementation-guidance-and-illustrations)

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## ASC 210-944-55: 55 Implementation Guidance and Illustrations

[Read section](https://asc.understandingaccounting.org/asc/210/944/#55-implementation-guidance-and-illustrations)

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#### Implementation Guidance

##### [210-944-55-1](https://asc.understandingaccounting.org/asc/210/944/#210-944-55-1)

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Amounts payable to a policyholder and amounts recoverable from a [reinsurer](https://asc.understandingaccounting.org/glossary/r/#reinsurer "The assuming entity in a reinsurance transaction.") do not meet the criteria for offsetting in Section 210-20-45 because paragraph [210-20-45-1(b)](https://asc.understandingaccounting.org/asc/210/20/#210-20-45-1) requires that the reporting party have the legal right to set off the amount owed to one party with an amount receivable from that same party.

##### [210-944-55-2](https://asc.understandingaccounting.org/asc/210/944/#210-944-55-2)

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Several balances may arise between the ceding and assuming entities in a [reinsurance](https://asc.understandingaccounting.org/glossary/r/#reinsurance "A transaction in which a reinsurer (assuming entity), for a consideration (premium), assumes all or part of a risk undertaken originally by another insurer (ceding entity). For indemnity reinsurance, the legal rights of the insured are not affected by the reinsurance transaction and the insurance entity issuing the insurance contract remains liable to the insured for payment of policy benefits. Assumption or novation reinsurance contracts that are legal replacements of one insurer by another extinguish the ceding entity's liability to the policyholder.") contract, including funds withheld on ceded premiums, commissions, unsettled claims, and funds advanced by the assuming entity. Those items may qualify for offsetting under the conditions established by Subtopic 210-20.