FASB on Thursday amended transition steering in Accounting Requirements Replace No. 2018-12, Monetary Services and products — Insurance coverage (Matter 944): Focused Enhancements to the Accounting for Lengthy-Period Contracts (LDTI).
The amendments to the ASU require that an insurance coverage entity follow a retrospective transition way as of the start of the earliest duration introduced or the start of the prior fiscal yr if early software is elected.
In FASB’s abstract of the amended common, the board mentioned it won comments from stakeholders “indicating that making use of the LDTI steering to contracts that have been derecognized on account of a sale or disposal of particular person or a gaggle of contracts or felony entities earlier than the LDTI efficient date most likely would no longer supply decision-useful data to buyers and different allocators of capital and would possibly lead to important operability demanding situations for insurance coverage entities to use the steering.”
The replace used to be issued to cut back implementation prices and complexity associated with the adoption of LDTI for contracts derecognized earlier than the LDTI efficient date.
— To remark in this article or to indicate an concept for some other article, touch Bryan Strickland at [email protected].
Supply By means of https://www.journalofaccountancy.com/information/2022/dec/fasb-issues-updated-insurance-standard.html
