Regulatory Alerts2016-01-01
Circular Letter No. 3 of 2016 on Reclassification of Debt Instruments by Insurance and Reinsurance Companies
The Egyptian Financial Supervisory Authority mandates that insurance and reinsurance companies reclassifying debt instruments from "Financial Assets Available for Sale" to "Financial Investments Held to Maturity" must amortize the associated fair value reserve using the effective interest method over the instrument's remaining life. This amortization must be recognized under the "Net Investment Income" line item in the applicable financial statements. Additionally, companies are required to fully disclose the reasons for the accounting policy change and its quantitative effects on the financial statements in compliance with Egyptian Accounting Standards.
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