IASB publishes proposed amendments to IFRS 17

Released 27 June 2019

The IASB has released an exposure draft to aid the implementation of IFRS 17 Insurance Contracts, by reducing costs and making implementation easier to explain.

The Exposure Draft ED/2019/4 Amendments to IFRS 17 (June 2019) was raised as a result of concerns and challenges that have been raised by stakeholders over the implementation of the standard.

The exposure draft proposes targeted amendments to the following:

aexclude credit card contracts and loan contracts which meet the definition of an insurance contract;

bexpected recovery of insurance acquisition cash flows;

ccontractual service margin attributable to investment-return service and investment-related service;

drecovery of losses on underlying insurance contracts;

epresentation in the statement of financial position;

fapplicability of the risk mitigation option;

geffective date of IFRS 17;

htransition modifications and reliefs; and

iand some other minor amendments.

IFRS 17 is due for mandatory adoption for periods commencing on or after 1 January 2021, although the exposure draft proposes to defer this by a further year. Earlier adoption is permitted if both IFRS 9 Financial Instruments and IFRS 15 Revenue from Contracts with Customers are also applied.

The period of comment for the exposure draft is open to 25th September 2019.

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