PracticeAuditASB delays life assurance standard for a year

ASB delays life assurance standard for a year

The UK Accounting Standards Board has confirmed that it is to delay the implementation of its contentious life assurance standard for a year following concerns expressed by the insurance industry.

Link: Treasury extends life funds tax consultation

Following discussions with major insurers and bancassurers, FRS27 ‘Life Assurance’ will apply from the end of December 2005 rather than the end of this year, with some smaller societies getting further extensions.

In addition, a memorandum of understanding has been signed by the Association of British Insurers and several large insurers, under which the companies will voluntarily comply with the standard from 2005. For 2004, year ends will disclose much of the information in the operating and financial review or elsewhere in their annual report.

‘I am very pleased that the major insurance groups and bancassurers have demonstrated their commitment to good financial reporting by entering into a voluntary undertaking, with the support of their industry bodies,’ said ASB chairman Ian Mackintosh. ‘We have been able to achieve a practical solution that represents worthwhile progress in life assurance reporting.’

Peter Vipond, director of financial regulation and taxation at the ABI responded that the changes now need time to ‘bed down’ and should be evaluated in practice before further changes are made.

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