I am confusing about the answer for the payment pattern for AY2012. Here is my understanding for AY2013:
12-24: (70%-50%)/(1-50%) = 40%;
24-36: (85%-70%)/(1-50%) = 30%;
36-48: (100%-85%)/(1-50%) = 30%;
Company has been in business for two years and has unpaid estimates for 2-years:
2012 Net Unpaid @ 24 mo = 47,500
2013 Net Unpaid @ 12 mo. = 64,031
If there was data for 2011 @ 36 mo. it would be paid @ 100% in the next year.
Payment pattern for 2013: 40%, 30%, 30%
Payment pattern for 2012: 50%, 50% (it's one year ahead in terms of development).
Payment pattern for 2011: 100%
Most of the CAS examples include the phrase: company began operations in Jan 1, YYYY and then provide a TOTAL unpaid for YYYY. In this case we are given 2-years of data. We need to calculate incremental payments based on each year's development progress to date (age: 12 mo, 24 mo, 36 mo, etc.)
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Company has been in business for two years and has unpaid estimates for 2-years:
2012 Net Unpaid @ 24 mo = 47,500
2013 Net Unpaid @ 12 mo. = 64,031
If there was data for 2011 @ 36 mo. it would be paid @ 100% in the next year.
Payment pattern for 2013: 40%, 30%, 30%
Payment pattern for 2012: 50%, 50% (it's one year ahead in terms of development).
Payment pattern for 2011: 100%
Most of the CAS examples include the phrase: company began operations in Jan 1, YYYY and then provide a TOTAL unpaid for YYYY. In this case we are given 2-years of data. We need to calculate incremental payments based on each year's development progress to date (age: 12 mo, 24 mo, 36 mo, etc.)
I got it. Thank you for your detailed explanation chrisboersma.