NEW YORK, NY (May 15, 2020) - The American Institute of CPA’s (AICPA) Financial Reporting Executive Committee (FinREC) has issued several working drafts of accounting issues for Insurance Entities and is requesting feedback. The drafts are related to the implementation of FASB Accounting Standards Update (ASU) No. 2018-12, Targeted Improvements to the Accounting for Long-Duration Contracts.
The new FASB accounting standard on Long-Duration Contracts makes targeted improvements to the existing recognition, measurement, presentation, and disclosure requirements for long-duration contracts issued by an insurance company. FinREC and the AICPA Insurance Expert Panel will continue to develop working drafts on accounting implementation issues that have been identified for the new standard.
The working drafts for implementation of ASU 2018-12 are available at:
- Issue #11B: Ceded reinsurance – What is the liability for future policy benefits to be used to reinsure existing traditional life insurance contracts?
- Issue #13: Impact of FASB ASU 2018-12 on Shadow Accounting.
Final issues for the project will be included in the Audit and Accounting Guide: Life and Health Insurance Entities.
The AICPA is seeking feedback from preparers of financial statements, practitioners, and other interested parties. Please submit informal feedback to Kim.Kushmerick@aicpa-cima.com by July 17, 2020.
About the Financial Reporting Executive Committee
The Financial Reporting Executive Committee (FinREC) is the senior committee of the Institute for financial reporting. It is authorized to make public statements on behalf of the Institute on financial reporting matters without the clearance of either the Council or the board of directors of the Institute and to clear statements of other committees that include references to financial reporting positions. The mission of FinREC is to determine the Institute's technical policies regarding financial reporting standards and to be the Institute's spokesbody on those matters, with the ultimate purpose of serving the public interest by improving financial reporting.