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FASB Improves Accounting Guidance for Insurance Companies That Issue Long-Duration ContractsThe Financial Accounting Standards Board (FASB) today issued an Accounting Standards Update (ASU) that improves financial reporting for insurance companies that issue long-duration contracts, such as life insurance, disability income, long-term care, and annuities. "The new ASU provides investors and other financial statement users with better and more timely and transparent information about long-term contracts issued by insurance companies," stated FASB Chairman Russell G. Golden. "Featuring targeted improvements to the current reporting model for these contracts, it reflects the input we received from diverse insurance industry stakeholders over more than 10 years of extensive outreach." That outreach included more than 150 meetings with users and more than 250 meetings with preparers, auditors, industry groups, and others; 13 group meetings with 60 users; 14 conferences with more than 150 users; more than 450 comment letters from users, preparers, auditors, industry groups, and others; 13 public roundtables hosted or attended by the Board or staff; and numerous additional discussions. To improve this area of financial reporting, the new ASU:
The ASU, as well as a FASB in Focus overview, an Understanding Costs and Benefits document, and an educational video, is available at www.fasb.org. About the Financial Accounting Standards Board Established in 1973, the FASB is the independent, private-sector organization, based in Norwalk, Connecticut, that establishes financial accounting and reporting standards for public and private companies and not-for-profit organizations that follow Generally Accepted Accounting Principles (GAAP). The FASB is recognized by the Securities and Exchange Commission as the designated accounting standard setter for public companies. FASB standards are recognized as authoritative by many other organizations, including state Boards of Accountancy and the American Institute of CPAs (AICPA). The FASB develops and issues financial accounting standards through a transparent and inclusive process intended to promote financial reporting that provides useful information to investors and others who use financial reports. The Financial Accounting Foundation (FAF) supports and oversees the FASB. For more information, visit www.fasb.org.
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