FASB issued a proposed Accounting Standards Update that would grant all insurance companies that issue long-duration contracts, such as life insurance and annuities, additional time to apply the standard that addresses this area of financial reporting. Stakeholders are encouraged to review and provide comment on the proposal by September 20, 2019. As per the proposal, January 2022 (instead of January 2021) will be the new effective date for SEC filers other than smaller reporting companies while January 2024 (instead of January 2022) will be the new effective date for smaller reporting companies, other public business entities, and all the other entities (assuming the calendar-year-end reporting).
FASB, on August 15, 2018, had issued the Accounting Standards Update No. 2018-12 on targeted improvements to the accounting for long-duration contracts (Topic 944). The update made targeted amendments to improve, simplify, and enhance the financial reporting requirements for long-duration contracts issued by insurance companies. Since then, FASB has received a request to delay its effective date by one year. In response, FASB members and staff conducted outreach with numerous insurance companies that issue and/or reinsure long-duration contracts to better understand their implementation challenges and progress.
Furthermore, on August 15, 2019, FASB issued a proposed update that describes the new FASB philosophy for determining how effective dates for major standards are staggered between larger public companies and all other entities. Under this philosophy, a major standard would first be effective for larger public companies; effective dates for all other public and private companies and organizations would be staggered at least two years later. Therefore, based on the observations while monitoring implementation of the long-duration insurance standard and consistent with the new philosophy to stagger effective dates between large publicly traded companies and all other companies and organizations, FASB has proposed to grant all insurance companies at least one additional year to apply the standard. Generally, it is expected that early application would continue to be permitted for all entities.
- Press Release
- Proposed Update (PDF)
- Accounting Standards Update No. 2018-12 (PDF)
- New FASB philosophy
Comment Due Date: September 20, 2019
Effective Date: January 2022/January 2024
Keywords: Americas, US, Accounting, Insurance, Insurance Contracts, Topic 944, IFRS 17, Implementation Timeline, FASB
Previous ArticleEIOPA Updates Q&A on Regulations in May 2019
OSFI has set out the near-term priorities for federally regulated financial institutions and federally regulated private pension plans for the coming months until March 31, 2022.
Under the Italian G20 Presidency, BIS Innovation Hub and the Italian central bank BDI launched the second edition of the G20 TechSprint on the lookout for innovative solutions to resolve operational problems in green and sustainable finance.
EBA proposed the regulatory technical standards on a central database on anti-money laundering and countering the financing of terrorism (AML/CFT) in EU.
ECB published its response to the targeted EC consultation on the review of the bank crisis management and deposit insurance framework in EU.
ACPR published Version 1.0.0 of the RUBA taxonomy, which will come into force from the decree of January 31, 2022.
BCBS, CPMI, and IOSCO (the Committees) are inviting entities that participate in market infrastructures and securities markets through an intermediary as well as non-bank intermediaries to complete voluntary surveys on the use of margin calls.
ECB published Decision 2021/752 to amend Decision 2019/1311 on the third series of targeted longer-term refinancing operations or TLTRO III.
The Central Bank of Ireland published Version 2.7 of the draft credit data template and rules for monthly AnaCredit reporting by banks.
OSFI proposed revisions to the Basel Capital Adequacy Reporting (BCAR) and leverage requirements returns for the 2023 reporting, with the comment period ending on July 09, 2021.
EBA published a discussion paper on review of the standardized nonperforming loans (NPL) transaction data templates, along with the proposed revised NPL data templates.