Tower Group (TWGP)
Q2 2011 Earnings Call
August 09, 2011 9:00 am ET
Michael Lee - Chairman, Chief Executive Officer and President
William Hitselberger - Chief Financial Officer, Principal Accounting Officer and Senior Vice President
Richard Mortell - Piper Jaffray Companies
Robert Paun - Sidoti & Company, LLC
Randy Binner - FBR Capital Markets & Co.
Elizabeth Malone - Wunderlich Securities Inc.
Adam Klauber - William Blair & Company L.L.C.
Good morning, ladies and gentlemen. My name is Tyrone, and I will be your conference facilitator today. At this time, I would like to welcome everyone to Tower Group's Second Quarter 2011 Earnings Conference Call. [Operator Instructions] It is now my pleasure to turn the floor over to your host, Bill Hitselberger, Executive Vice President and Chief Financial Officer. Please go ahead, sir.
Thank you, Tyrone, and good morning, everyone. Before I turn the call over to Tower Group President and CEO, Michael Lee, I would like to remind you that some of the statements that will be presented during this call will be forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Actual results could differ materially from these projected in the forward-looking statements. For more information on the risks and other factors that may affect future performance, investors should review periodic reports that are filed by the company with the SEC from time to time.
As we noted in our earnings release, in October 2010, the Financial Accounting Standards Board issued new guidance concerning the accounting for costs associated with acquiring or renewing insurance contracts. We have adopted this guidance effective January 1, 2011, and have therefore adjusted our previously issued financial information. Adoption of this guidance reduced the carrying value of our deferred acquisition costs as of December 31, 2010, by $78.7 million and Tower Group Inc.'s stockholders' equity by $42.6 million. Diluted operating earnings per share for the second quarter 2010 and for the 6 months ended June 30, 2010, were reduced by $0.06 and $0.16 per share, respectively, as a result of this change in accounting.