IFRS 17 · Workpapers (Step 4 of 5)
Workpaper assignment
- Course
- Exercises
- Case studies
- Workpapers
- Exams
Contractual service margin roll-forward: interest at the locked-in rate, changes relating to future service, release by coverage units and loss component: Group T1 — transition
Premium allocation approach, variable fee approach, reinsurance held, modification, transition and disclosures
Section 1 of 8
Objective
Section brief
- What to document
- The engagement, its scope and the working mode chosen.
- Why
- A workpaper answers one precise question: framing it avoids off-topic work.
- How
- Read the objective and the assignment, then choose the mode (guided, semi-guided, professional).
- Expected result
- You know which question the workpaper must settle, and for which reporting date.
- Your role
- Preparer of the IFRS 17 workpaper
- Level
- Expert
- Estimated time
- ≈ 90 min
- Progress
- 0 / 4 steps done (review excluded)
Context
Voyalis Assurances SA (fictitious entity) closes its accounts on 31 December 20X6. It manages a group of one-year travel insurance contracts, a group of three-year contracts, a group of savings contracts with participation, a quota share reinsurance treaty, a modified contract and three groups at the transition to IFRS 17. You prepare the technical note for the chief financial officer.
Assignment
Loss recovery on reinsurance held and margin at transition under the fair value approach
Purpose of the workpaper
Record the opening margin, the locked-in rate of the group, the changes relating to future service and the share of coverage units of the period: this share is case data. Compute the interest, the margin before release, the release and the closing margin, then record the release as insurance revenue. For an onerous group, compute the reversal of the loss component, capped at its balance. For proportionate cover of an onerous underlying group, compute the loss recovery; at transition, under the fair value approach, compute the margin as the fair value less the fulfilment cash flows (case data).
Questions of the file covered by this workpaper
- Reinsurance held: how is the treaty measured and which component appears for the onerous group S?
- Group T1: compute the margin at the transition date (fair value approach).
Documents in the file
Open the documents to pick out the relevant information.