Summary
Insurance accounting often is viewed as a black box, since insurers' financial statements generally do not present information in a way that helps to identify business value drivers. Comparisons of insurance financial statements and comparisons of insurers with other industry sectors are difficult. The recent discussion paper issued by the International Accounting Standards Board, Preliminary Views on Insurance Contracts, is paving the way for the eventual publication of a new international standard for insurance contract accounting. With implementation not expected until 2010 or 2011, a Phase II international insurance standard may seem far off. However, companies should begin preparing well in advance, considering that comparative disclosures will be required in the first year of application, and the possible implications of a new measurement basis could be far-reaching. The greatest area of disagreement in measuring current exit value relates to setting risk margins.
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Insurance accounting often is viewed as a black box, since insurers' financial statements generally do not present information in a way that helps to identify business value drivers. Since current International Financial Reporting Standards for insurance accounting is still based on each insur...
See the full content of this document
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