International Accounting Standards

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20 CEV Model Building Blocks • Explicit, unbiased, market‐consistent, probability weighted and current estimates of the contractual cash flows • Current market discount rates that adjust the estimated cash flows for the time value of money • An explicit and unbiased estimate of the margin that market participants require for: • Bearing risk (a risk margin); and • Providing other services ( a service margin) 20
21 IFRS 4 –Phase II Recent discussions (July 23, 2009 meeting) and current challenges: – IASB not conclusive on issues – Will reserves be valued at Current Fulfillment Value (CFV) or Current Exit Value (CEV) – Differences exist between IASB and FASB, for example, IASB and FASB both in favor of CFV but currently debating certain points: • FASB – Service margin is already factored into liability estimate included in PV Cash flow and premium determination. Risk margin is a exit value concept and not CFV • IASB – Risk margin needs to be included or you are not accounting for expected variability • FASB: DFV is entity specific and does not require market participant views • IASB: More in favor of a modified IAS 37 approach that includes elements of market participants views. 21
Page 1 and 2: International Accounting Standards
Page 3 and 4: 3 IFRS Who IASB, FASB and SEC What
Page 5 and 6: 5 IFRS ‐ Key Players • IASB Int
Page 7 and 8: 7 IFRS On August 27, 2008, the SEC
Page 9 and 10: 9 Current IFRS Current Relevant Gui
Page 11 and 12: 11 IFRS -Open Items Open Items Spec
Page 13 and 14: 13 IFRS IFRS 1 -First Time Adoption
Page 15 and 16: 15 IFRS Significant differences bet
Page 17 and 18: 17 IFRS 4 ‐Phase I • Interim St
Page 19: 19 IFRS 4 -Phase II May 2007: IASB
Page 23 and 24: 23 IFRS 4 ‐ Phase II: Recent Disc
Page 25 and 26: 25 IFRS 4 ‐ Phase II: Current Cha
Page 27 and 28: 27 IFRS ‐ Impact of Changes • R
Page 29 and 30: 29 IFRS ‐ Impact of Changes • A
Page 31 and 32: 31 Solvency II Solvency II (cont) F
Page 33: 33 IFRS ‐ Challenges New challeng

International Accounting Standards

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