AASB Research Report 18 AASB 17 Insurance Contracts Presentation, Disclosure, Transition and Other Accounting Policy Decisions: A Survey on Australian Insurance Entities

Thursday, March 30, 2023

AASB Research Report 18 provides findings on how some insurers plan to apply AASB 17 Insurance Contracts. This information will be useful for the post-implementation review of the standard.

The key findings include:

• the level of aggregation for a range of disclosures and presentations varies, although the responses indicate a tendency to apply those disclosure and presentation requirements at an aggregated level;
• some insurers plan to apply presentation choices differentially in their insurance liability reconciliations (roll-forward tables) compared with the face of the financial statements;
• the amounts presented in reconciliations for liability for remaining coverage or liability for incurred claims may differ between insurers based on judgements made about whether and when it is appropriate to transfer cash flows related to unexpired coverage between the two liabilities; and
• many of the presentation choices that insurers make understandably appear driven by the relevance to their circumstances and, accordingly, to their stakeholders.

The findings demonstrate that the principle-based standard provides preparers with the necessary flexibility to determine how relevant information should be presented to meet user needs.