Heads Up — FASB provides implementation relief related to ASU 2018-12’s transition guidance for derecognized contracts

Published on: 16 Dec 2022

This Heads Up discusses the FASB’s recently issued Accounting Standards Update (ASU) No. 2022-05, Financial Services — Insurance (Topic 944): Transition for Sold Contracts. ASU 2022-05 introduces an optional accounting policy election under which insurers can choose not to apply the amendments made by ASU 2018-12, Financial Services — Insurance (Topic 944): Targeted Improvements to the Accounting for Long-Duration Contracts, to certain contracts that are derecognized as a result of a sale or disposal before the effective date of ASU 2018-12. Insurers that make this accounting policy election would also be subject to additional disclosure requirements.


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