Bright Line Indicator Test

The Bright Line Indicator Test is discussed in COPLFR.SAO as part of the SAO but it requires knowledge from the RBC chapter in Odomirok, Alice's 1st Day. That section will only take a few minutes to read so you should do that before proceeding.

Question: what is the bright line indicator test

IF

[1] the AA does not address material deviation

[2] 10% x (net L & LAE) > TAC - CAL

THEN

financial analyst should pursue comments from the AA