Mail Stop 6010
Via Facsimile and U.S. Mail
September 14, 2005
Mr. Martin P. Hughes
Chairman of the Board and Chief Executive Officer
Hub International Limited
55 East Jackson Boulevard
Chicago, Illinois 60604
Re: Hub International Limited
Form 10-K for Fiscal Year Ended December 31, 2004
File No. 1-31310
Dear Mr. Hughes:
We have limited our review of your filing to those issues
addressed in our comments. In our comments, we ask you to provide
us
with information so we may better understand your disclosure.
After
reviewing this information, we may raise additional comments.
Please understand that the purpose of our review process is
to
assist you in your compliance with the applicable disclosure
requirements and to enhance the overall disclosure in your filing.
We look forward to working with you in these respects. We welcome
any questions you may have about our comments or any other aspect
of
our review. Feel free to call us at the telephone numbers listed
at
the end of this letter.
Managements` Discussion and Analysis
Contractual Obligations, page 36
1. We note that you have omitted $35 million of subordinated
convertible debentures and interest on long-term debt from your
table
of contractual obligations. The purpose of Financial Reporting
Release 67 is to obtain enhanced disclosure concerning a
registrant`s
contractual payment obligations and the exclusion of ordinary
course
items is inconsistent with the objective of Item 303 (a)(5) of
Regulation S-K. Due to the significance of estimated payments
associated with these items, we believe that this information is
necessary for investors` evaluation of your liquidity and capital
resources. Please provide us with the analysis supporting your
conclusion that including this information in the table was
unnecessary because it was not material to investors` evaluation
of
your liquidity and capital resources.
Consolidated Financial Statements
Note 2. Summary of Significant Accounting Policies
Revenue Recognition, page 51
2. We note your disclosure that commission income, including
commissions subject to installment billing, and policy service
fees
are recognized at the policy effective date. Please clarify in a
disclosure type format how you are compensated for subsequent
premium
billing and collection services and the factors supporting your
conclusion that the commission earnings process is complete at the
policy effective date. Provide references to the applicable
technical
literature upon which you based your accounting.
3. We note that contingent commissions and volume overrides are
recorded either when they are received or can be reasonably
estimated. Please provide us in a disclosure-type format the
specific
terms of these arrangements, your related revenue recognition
policies, particularly how you determine when the related earnings
processes are complete. Provide references to the applicable
technical literature upon which you based your accounting. Also,
quantify in MD&A the extent to which contingent commissions and
volume overrides are shared with your insurance brokerage network
and
contribute to your net earnings before income taxes.
4. It appears that you perform significant premium billing and
collection, evidenced by client premiums receivable of $128.3
million
at December 31, 2004. Please provide us in a disclosure-type
format
your accounting policy for client premiums receivable. Discuss and
quantify in MD&A the financial impact of these billing and
collection
services on your operations, including service fee income,
interest
income on funds held, costs associated with uncollectible amounts,
net earnings before income taxes and cash flow from operating
activities. Also, expand your accounting policy for trust cash to
describe more specifically the nature and amount of "other
deductions" and the magnitude of restrictions as to use.
Note 13. Earnings per Share, page 67
5. It appears that you omit contingently issuable shares under the
Talbot earn out from your earnings per share calculation. Please
explain to us whether there are any differences between Canadian
GAAP
and US GAAP in accounting for contingently issuable shares. Please
refer us to the technical guidance upon which you based your
decision
to omit these shares from your US GAAP earnings per share
calculation.
* * * *
Please respond to these comments within 10 business days or
tell us when you will provide us with a response. Your letter
should
key your responses to our comments. Detailed letters greatly
facilitate our review. Please file your letter on EDGAR under the
form type label CORRESP.
We urge all persons who are responsible for the accuracy and
adequacy of the disclosure in the filing to be certain that the
filing includes all information required under the Securities
Exchange Act of 1934 and that they have provided all information
investors require for an informed investment decision. Since the
company and its management are in possession of all facts relating
to
a company`s disclosure, they are responsible for the accuracy and
adequacy of the disclosures they have made.
In connection with responding to our comments, please
provide,
in your letter, a statement from the company acknowledging that:
* the company is responsible for the adequacy and accuracy of the
disclosure in the filings;
* staff comments or changes to disclosure in response to staff
comments do not foreclose the Commission from taking any action
with
respect to the filing; and
* the company may not assert staff comments as a defense in any
proceeding initiated by the Commission or any person under the
federal securities laws of the United States.
In addition, please be advised that the Division of
Enforcement
has access to all information you provide to the staff of the
Division of Corporation Finance in our review of your filing or in
response to our comments on your filing.
You may contact Frank Wyman, Staff Accountant, at 202-551-
3660
or Don Abbott, Senior Staff Accountant, at 202-551-3608, if you
have
questions regarding the comments. In this regard, do not hesitate
to
contact me, at (202) 551-3679.
Sincerely,
Jim B. Rosenberg
Senior Assistant Chief Accountant
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Mr. Martin P. Hughes
Hub International Limited
September 14, 2005
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