Course detail

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Contents

• Introduction
• Prerequisites
  
• Course Level
  
• Topics
  
• Course Benefits
  
• Teaching Method
  
• Continuing Professional Education
  
• Venue
  
  

Introduction

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Insurance organizations face unique financial reporting challenges due to complex product commitments, revenue recognition considerations, loss reserving requirements, investment accounting issues, reinsurance risk transfer evaluations and other issues specific to the insurance industry. This two-day course examines IFRS issues in detail and their effect on both life and non-life insurance entities. Our expert instructors dissect the critical issues that go beyond mere number-crunching and explain, clearly and simply, the way the insurance industry conducts and shapes its accounting and reporting practices.

This comprehensive two-day program covers the most important accounting and reporting requirements for insurance companies (life and non-life), providing an overview of IFRS 4 Insurance Contracts and the latest developments emerging from the IASB’s Insurance Project Phase II. International industry best practices and predominant accounting and financial reporting policies are also explored.

The program provides a comprehensive overview of how IFRS 4 affects the financial statements of insurers. Course coverage includes a review of the emerging developments with IFRS 4 and the Discussion Paper for Phase II of the IASB Insurance Project issued in May of 2007. Practical guidance and illustrations are presented to help delegates understand the new requirements.

These requirements are explained in clear, simple language and illustrated with model journal entries, corporate annual reports, and other real-world examples. Application of the various standards is illustrated through the use of short case studies.

The course answers questions such as:

• How should acquisition costs, investments, and reserves be recognized and measured?

• What are IFRS requirements and industry practices for presentation and disclosures in the financial statements?

• What are the key features of IFRS 4?

• What unresolved issues are being addressed by Phase II of the IASB’s Insurance Project?

Prerequisites

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Understanding of basic US IFRS accounting and reporting principles.
No advance preparation is required for this course.

Course Level

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Intermediate

Topics

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• Financial Overview of the Insurance Industry
• State of the industry
• Regulatory environment
• International Accounting Standards Board (IASB)
• Current accounting/financial issues
• Types of Insurance Contracts
• Short-duration contracts (non-Life)
• Long-duration contracts (Life)
• Deposit-type contracts (non-insurance)
• Revenues and expenses, including product classification and contingent commissions
• Accounting for Acquisition Costs
• Short-duration contracts
• Long-duration contracts
• Traditional (whole life, term life)
• Nontraditional (universal life) – loss recognition (premium deficiency)
• DAC for internal replacements
• Accounting for Investments
• Equity and fixed income investments – available-for-sale, trading, held-to-maturity
• ‘Shadow’ DAC
• Derivatives and hedging
• The ‘Fair Value’ Option
• Intangibles and goodwill
• Value of Business Acquired (VOBA)
• Impairment
• Reserving Methods and Analysis
• Aggregate life reserves
• Accident and health reserves
• Annuity reserves and product guarantees
• Non-life reserves
• Case and IBNR reserves
• Supplemental and bulk reserves
• Unearned premium reserves
• ‘Conditional’ reserves
• Reinsurance Accounting and Reporting
• Purposes of reinsurance
• Types of reinsurance
• Indemnity reinsurance
• Assumption reinsurance
• Proportional vs. nonproportional
• Facultative vs. treaty
• Prospective vs. retrospective
• Recapture and commutation
• Reinsurance accounting
• Transfer of risk criteria
• Finite/Financial reinsurance
• Deposit accounting
• Impact on financial performance
• Recent developments
• Financial Statement Analysis
• Financial statement presentation
• Balance sheet
• Income statement
• Cash flow statement
• Disclosures
• Regulatory measures
• Rating agency measures
• Capital adequacy measures
• Operations analysis
• Financial forecasting
• International Financial Reporting Standard 4
• Background and Reasons for issuance
• Scope and applicability
• Interrelationships with other IFRS/IAS standards
• IASB’s definition of an insurance contract
• Disclosures
• Insurance Project Phase II
• Background and goals of the project
• Tentative conclusions
• Discussion paper
• Exit value vs. fair value
• Convergence with US GAAP
• Alternative accounting models
• Next steps

Course Benefits

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• Understand the objectives and framework for IFRS financial reporting
• Comply with IFRS accounting and reporting for insurance companies
• Prepare IFRS financial statements
• Discern the major features of IFRS 4
• Appreciate key issues under discussion in Phase II of IASB’s Insurance Project
• Prepare for likely next steps in insurance accounting and reporting under IFRS

Teaching Method

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• Live group instruction with interactive participation encouraged
• Description and explanation of IFRS and accounting principles and international practices for insurance companies
• Practical illustrations using model journal entries, model financial statement disclosures, case studies, and real-world examples
• All participants receive a comprehensive binder containing copies of the presentation slides, handouts and other course materials

Continuing Professional Education (CPE)

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16 hours

Venue

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All of our Dubai seminars take place in 4 star professional conference facilities, usually in city-centre downtown hotels like the Marriott, Sheraton or Hilton brands.

Detailed Joining Instructions are sent to all registered delegates by email approximately one month before the event. The Joining Instructions will confirm exact venue details and nearby (or onsite) hotel recommendations with bedroom rates where available.

Coffee and lunch will be provided.