Exam 6C Practice Question 17
Study guide: Exam 6C
A P&C insurer measures its contracts under the premium allocation approach and has elected the option in IFRS 17.88 to disaggregate insurance finance income or expenses (IFIE) between profit or loss and other comprehensive income (OCI).
For the year:
- Total IFIE on its liability for incurred claims is a net income of 90.
- The systematic allocation to profit or loss, computed with the yield curves locked in at the dates the claims were incurred, is an expense of 60.
How is the IFIE presented?
- A) Profit or loss: income of 90; OCI: nil
- B) Profit or loss: income of 150; OCI: expense of 60
- C) Profit or loss: nil; OCI: income of 90
- D) Profit or loss: expense of 60; OCI: income of 150
- E) Profit or loss: income of 90; OCI: income of 150
Answer this question and see the worked solution
Concepts tested
- Other Comprehensive Income Option
- Insurance Finance Income or Expenses
- IFRS 17 Discount Rates
- Comprehensive Income