SUMMARY OF BOARD DECISIONS

Summary of Board decisions are provided for the information and convenience of constituents who want to follow the Board’s deliberations. All of the conclusions reported are tentative and may be changed at future Board meetings. Decisions are included in an Exposure Draft for formal comment only after a formal written ballot. Decisions in an Exposure Draft may be (and often are) changed in redeliberations based on information provided to the Board in comment letters, at public roundtable discussions, and through other communication channels. Decisions become final only after a formal written ballot to issue a final standard.

July 21, 2009 Board Meeting

Insurance contracts. The Board continued to discuss the accounting for insurance contracts, in particular, how an entity would measure an insurance liability. The Board decided that the objective of the liability measurement is to report a value based on the insurer’s fulfillment of its contractual obligations to its policyholders and that the fulfillment value should include only a composite margin with no explicit risk margin.

The Board decided that the expected cash flows in the measurement of an insurance liability should be discounted to reflect the time value of money. It also agreed that the discount rate used should be updated each reporting period. The Board will discuss at a future meeting the discount rate that should be used.