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 an Accounting Standards Update.
June 10, 2010 FASB/IASB Joint Videconference Board
Meeting
Insurance
contracts. The Boards discussed participating investment contracts
and risk adjustment techniques.
Participating Investment
Contracts
The Boards discussed whether investment contracts with a
discretionary participation feature should be within the scope of a future
standard on insurance contracts or within the scope of standards for financial
instruments.
The IASB tentatively decided to include investment contracts
that both contain a discretionary participating feature and also participate in
the same pool of assets as participating insurance contracts within the scope of
the future standard on insurance contracts. The Boards asked the staff to
consider further the criteria for determining when a pool of assets supports
both participating insurance contracts and participating investments contracts,
for example, by reference to the proportion of assets relating to insurance
contracts in those pools.
Furthermore, the IASB tentatively decided that
the boundary of these contracts should be defined as the point at which the
contract holder no longer has a contractual right to receive benefits arising
from a discretionary participating feature.
The FASB tentatively decided
to include these investment contracts in the scope of standards for financial
instruments.
Risk Adjustment Techniques
The Boards
discussed further which techniques could be used to measure the risk adjustment
for insurance contracts (in a measurement approach that includes such an
adjustment).
The Boards directed the staff to develop draft guidance that
describes techniques for measuring risk adjustments that would satisfy the
proposed objective and characteristics of the risk adjustment, such as
approaches using confidence intervals, conditional tail expectations, or cost of
capital.
Next Steps
The Boards will continue their
discussion of this project at their joint meeting on June
14–17.