Regulatory Alerts2015-01-16
Added · Updated
Q&A Deferral Adjustment
Insurance entities must apply the deferral adjustment under IFRS 9 B5.1.2A(b) when the transaction price at initial recognition differs from the fair value of residential mortgages measured using Level 3 inputs. This adjustment requires deferring the difference between fair value and transaction price, recognizing it as a gain or loss only as factors such as time change. Entities must also disclose specific accounting policies, reconciliations of the deferred difference, and the evidence supporting the conclusion that the transaction price did not represent fair value.
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