No decisions were made during this educational session.

Representatives from the IAA held an educational session on Participation and Performance - Linked Features in Insurance and Related Contracts.

Presenters gave an introduction to the principal scope of the products they would cover during the session. This would be mainly life insurance, investments contracts and certain non-life contracts. The Board considered features on insurance contracts such as performance-linked contracts, which include contractual reference to one of the parties of the contract. Presenters introduced the issue of discretion in insurance contracts, and the Board had a discussion on different discretionary elements and constraints in contracts.

At the end of this session the representatives raised three main accounting issues arising from use of these features in insurance contracts. Some members of the Board had concern about the perception of discretion and the effect this could have, specifically if this could create reclassification of surplus from equity to liabilities.