Accounting Standard Updates

12 Days of SSAP: SSAP No. 103R – Transfers and Servicing of Financial Assets and Extinguishment of Liabilities, Nonsubstantive Revisions

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Hot Take:

Hot Take

JLK Rosenberger continues to plow through the Twelve Days of SSAP. Rather than filling your head with turtle doves and gold rings, we are focusing on the latest changes to SSAP and how they will impact your insurance entity in 2022 and beyond.

Today we bring you an early 2021 SAPWG topic that added further disclosures under SSAP 103R, with the primary objective to assist as part of the much larger substantive project better known as the SSAP No. 43R Project. It involves annual statement data capture needs, so all you annual statement preparation elves out there should read on.

Full Article

During the SAPWG May 2021 call, the working group made revisions to install additional disclosure elements and data capture for various disclosures in SSAP No. 103R, Transfers and Servicing of Financial Assets and Extinguishment of Liabilities. The purpose is to better guide regulators in their analysis of transactions where an insurance company transfers (or sells) assets but still retains substantial participation in the asset transferred.

While the updated exposure included slight disclosure enrichments, it mainly emanated as fallout from discussions during the Working Group’s continued negotiation of agenda item 2019-21: SSAP No. 43R – Equity Instruments (referenced as the SSAP No. 43R Project). Agenda item 2019-21 is a major project (substantive), which will consider what investments fall within the scope of SSAP No. 43R—Loan-Backed and Structured Securities. The SSAP No. 43R project was later extended to assess which investments are truly appropriate for being reported in Schedule D1: Long-term Bonds.

The primary modifications for the 103R disclosures included updated data-capture fields and thorough instructions to safeguard that annual statement filing groups understand the requirements of the disclosure template. This was particularly important since the Blanks (E) Working Group did not post this request in a separate proposal.

Effective date:

2021 annual statement reporting