LRC at Initial Measurement = 0?

LetMePassLetMePass
in CIA.IFRS17-LRC

From the CAS IFRS17 Sample Questions Q7, we have LRC=0 at initial measurement.

When is this statement true? Is it only in situation (a) below?

a. Non-Onerous Contracts using GMA (yes, since LRC=FCF+CSM and CSM=-FCF)
b. Non-Onerous Contracts using PAA (maybe not, since LRC = UEP-DAC??)
c. Onerous Contracts using GMA (?)
d. Onerous Contracts using PAA (?)

Thanks!

Comments

  • Staff-T1Staff-T1

    a) Yes this is true
    b) Not true as you mentioned above
    c) Will have positive FCF and no CSM
    d) Will have to book a LC so it will be non-zero

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