Sablier SA recognises a group of contracts: it receives 3,500 of premiums at issue and expects to pay 4,840 of claims in two years. Case data, from management's judgement: the discount rate is 10 % (a rate not imposed by the standard) and the risk adjustment for non-financial risk is 300. Calculate the present value of the claims, the net amount of the fulfilment cash flows and the premiums received at issue, and the loss on initial recognition.
- Claims to be paid in two years
- 4,840
- Premiums received at issue
- 3,500
- Discount rate (case data)
- 10 %
- Risk adjustment for non-financial risk (case data)
- 300