At the March meeting, a suggestion was made that would result in guidance prepared using a business model-approach, that is, if the issuer of a contract within the scope of the exposure draft had previously asserted that such contracts were insurance contracts and had used accounting applicable to insurance contracts, the issuer could apply either the approach proposed in the exposure draft or IFRS 4.

The Board discussed the fact that it would not be clear in which way an entity had to 'assert' that such contracts were insurance contracts. The staff indicated that in practice, it may be sufficient that the entity treated the contracts as insurance contracts in the last financial statements or, for example, it has to prove that it sold those contracts under the name 'insurance contract' or called itself an 'insurance company'.

Board members indicated that the proposal was not 'pretty' but this was probably the only way to achieve the Board's objectives, which are to have insurance contracts accounted for in accordance with IFRS 4, and the rest in accordance with IAS 39.

The staff recommended that the Board discontinues this project. The Board decided (vote 8-6) to continue with the project using the business model-approach.