Description: Illustrates the effects that proposed GAAP changes will have on earnings emergence of universal life contracts.

Description: Presents a practical solution to some of the distortion caused by a typical application of the retrospective assumption update (unlocking) method.

Description: Review of some subtle details in GAAP targeted improvements for long-duration contracts (ASU 2018-12).

Description: This is the first in a series of articles about accounting for reinsurance under GAAP Targeted Improvements to the Accounting for Long-Duration Contracts (LDTI). It provides an introduction to the topic, giving an overview of what has and hasn't changed. Changes include a few that directly address reinsurance and others that indirectly result from changes to direct accounting and the existing ties between reinsurance and direct accounting.

Description: GAAP's elimination of gross profit as a basis for amortization of deferred acquisition costs enables the accounting for reinsurance of universal life contracts to better reflect the economic protection provided by reinsurance. It also makes it easier to assess the effectiveness of different techniques. Building on the analysis of an earlier article, "A Fresh Look at Accounting for Reinsurance of Universal Life," this article presents a practical approach to estimating the ineffectiveness of several existing techniques at accounting for the economic protection provided by reinsurance. The article ends with a summary of what a company might do to improve the effectiveness of its reinsurance accounting.

Description: After a summary of FASB decisions in their GAAP Targeted Improvements project, this article describes several issues that will need to be resolved either by the board or in actuarial practice and argues for seeking solutions that provide meaningful results without overly complicating valuation processes.

Description: Presentation of formulas for measuring the effects of experience variances and assumption changes on traditional contract DAC and benefit reserves under GAAP targeted improvements (ASU 2018-12).

Description: Article describing an exposure of a practice note titled, “Treatment of VOBA, Goodwill, and Other Intangible Assets under PGAAP.”

Description: Continues the look from previous articles at unlocking of traditional contract valuation assumptions, this time examining the effects of lapses.

Description: This article highlights the fact that new requirements for disclosure of average liability duration and interest rates could lead to diversity in practice. It also recognizes that elements of the new disclosure requirements will enable financial statement users to perform their own crude estimates of these averages in ways that could help them to better understand the liabilities and to compare companies using consistent methods. Finally, the article describes how companies might also find value in such crude estimates.