It’s been a tough week for Zurich Australia, which has come under scrutiny – some of it wrong – from local business media. To set the record straight: Zurich is in ongoing discussions with the regulators about errors in its reinsurance accounts between 2000 and 2003 – but it’s not going to restate four years of financial results.

Reports in the Sydney media said that since conducting an independent review and reporting to the regulators that the company had uncovered errors in its accounting and would re-issue the accounts.

On March 3 Zurich submitted a “request for correction” form to the Australian Securities and Investments Commission (ASIC), stating it had identified errors in the financial statements of Zurich Australian Insurance. One media report took this as an indication Zurich would restate the accounts that had errors in them.

Last June the Australian Prudential Regulation Authority (APRA) and ASIC announced a joint investigation into reinsurance arrangements made by the group’s local general insurance business. It’s understood the arrangements are related to a deal – rumoured to be worth about $200 million – with General Re, which is currently being scrutinised for a deal it did with FAI in the late ’90s.

Three weeks after the investigation was announced, Zurich CEO John Butler resigned, despite the fact that he wasn’t leading the company at the time when the errors were made.

Last year APRA also accepted an enforceable undertaking from former Zurich actuary Richard Mayo which required him not to work as a senior manager or director of a general insurer for five years.

But Zurich spokesman Rob White told Sunrise Exchange News the report that Zurich will restate its accounts is “completely incorrect”, and while the group will “work on correcting our past mistakes” there’s been no feedback from the regulator that the insurer should restate its accounts. He says the group will provide information on the financial impact of the errors when it lodges its 2004 financial statements.

Mr White is also confident the outcome of the investigation will have “no impact on the day-to-day operations of the company. We’re financially strong and that’s not likely to change.”

While he cannot indicate how long Zurich’s discussions with APRA and ASIC will last, he says the insurer would prefer to solve the issue “sooner rather than later”.

Company Secretary Cathy Manolios said in the company’s Request for Correction Zurich “continues to more than adequately meet APRA’s minimum capital requirement solvency test”.

While APRA and ASIC told Sunrise Exchange News they weren’t in a position to comment on the case, they said their investigations into the group are continuing.