True or False: An insurer can enter ceding commission from a reinsurer as an asset immediately on its balance sheet.

The statement that an insurer can enter ceding commission from a reinsurer as an asset immediately on its balance sheet is true.

In insurance accounting, ceding commission represents a contractual agreement where the reinsurer provides a commission to the primary insurer for transferring risk. This commission is typically related to the reinsurance premium and is intended to cover administrative costs and profit margins for the ceding insurer. Because the ceding commission is a recognized asset that reflects a future economic benefit, it can be recorded on the balance sheet as soon as the reinsurance agreement is in force and the ceding commission is established.

This accounting treatment aligns with the principles of recognizing assets based on enforceable agreements and the expectation of receiving future benefits, as stipulated by relevant accounting standards. This makes it an immediate asset rather than one constrained by future events or conditions.