How is EBUB recorded before and after the exposure is audited?

• A. Before: EBUB is estimated and premium modified by exposure; After: adjusted to reflect actual exposures; revenue recognized immediately
• B. Before: EBUB is not used; After: EBUB recognized as expense
• C. Before: EBUB is fixed; After: EBUB revenue recognized later
• D. Before: EBUB is a liability; After: EBUB reversed

Answer: (A)