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FASB Discussion Paper on Insurance Contracts

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20 Sep 2010

The US Financial Accounting Standards Board (FASB) has issued a Discussion Paper (DP) to solicit broad-based input on how to improve, simplify, and converge the financial reporting requirements for insurance contracts.

The DP is part of the FASB's joint project with the International Accounting Standards Board (IASB). In July 2010, the IASB issued an Exposure Draft (ED) without the FASB after it became clear that agreement between the two standard setters could not be reached on all points in question. The proposed international financial reporting standard (IFRS) would apply to all insurance contracts written by both insurance companies and noninsurance companies. The FASB DP now published is a wrap-around invitation to comment on the IASB ED and asks stakeholders to provide input about the following:
  • Whether the IASB's proposal would be a sufficient improvement to U.S. GAAP to justify the cost of change;
  • Whether the project goals of improvement, convergence, and simplification would be more effectively achieved by making targeted improvements to existing U.S. GAAP (rather than issuing comprehensive new guidance); and
  • Certain critical accounting issues for which the preliminary views of the FASB differ from the IASB's ED.

Comments on the DP are due on 15 December 2010. Click for:


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