In the December 2019 and January 2020 IASB Board meetings, amendments regarding insurance acquisition cash flows were tentatively finalised. This means that there'll be an identification, allocation, asset and impairment testing element to insurance acquisition cash flows.

This video focuses on explaining what exactly an "allocation" means in this context and to what extent we need to recognise and derecognise any assets that relate to insurance acquisition cash flows.

I also discuss one area that is currently being discussed in the industry. This relates to paragraph 28A, where under the PAA, insurance acquisition cash flows can be fully expensed (if you can apply paragraph 59(a)). However if this is done, then that means there is zero insurance acquisition cash flows left over to allocate. Was this the original intention of the Exposure Draft? We'll find out in the future!

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