US GAAP Long Duration
Targeted Improvement (LDTI)

Moody’s Analytics AXIS™ actuarial software helps meet the demandsof current and new reporting standards, including VM-20, IFRS 17, andFASB Long Duration Targeted Improvements (LDTI). The AXIS software
solution supports actuarial calculations for current period reporting forvarious frameworks. It helps clients address reporting standards andincorporate them into projected financials for pricing, business planning,and other common actuarial applications.
Actuarial software to help address new US GAAP requirements
The AXIS actuarial system, including the new AXIS US GAAP Link module, delivers improved
enterprise-level control, auditability, scalability, reporting flexibility, and end-to-end
automation as demanded by the new US GAAP standards, as well as other new frameworks.
As your reporting requirements change, our solution lets you face the future with confidence.

Our actuarial software supports your current GAAP and statutory valuation requirements formost life products; fixed, indexed, and variable annuities; DI; and LTC products. Its flexibility,performance, and integrated governance features help meet the pending demands of newframeworks such as PBA VM-20, US GAAP with LDTI, and IFRS 17.
AXIS actuarial software is a robust, vendor-maintained system that is ready to use
immediately. If you need changes, we are ready to make them. With more than 30 software
releases per year, the AXIS solution is regularly enhanced to exploit new technology and meet
evolving standards based on North American financial reporting and regulatory frameworks.

US GAAP Targeted Improvements for Long Duration Contracts
The changes to financial reporting under LDTI include some fundamental differences:» Current assumptions requirement. Assumptions used to measure the liability fortraditional insurance contracts will be reviewed and updated at least annually.
» A prescribed approach to the discount rate. The liability discount rate will be astandardized, market-observable discount rate with the effect of rate changes recorded inother comprehensive income.
» Consistent measurement of Market Risk benefits. The two previous measurement
models for Market Risk benefits have been reduced to one measurement model (fair value)
applied across products.
» Simplified amortization of deferred acquisition costs. These will be amortized ona constant basis over the expected life of the contract. The deferred amortization costbalances will not be subject to testing for recoverability but held as long as the related
contracts remain in force.
» Enhanced disclosures. Comprehensive new disclosures are required to accompany
financial statements to reveal the reasons for the change in liability balances, as wellas information about significant assumptions and the effects of changes in thoseassumptions.
» Reporting challenges. These include multiple runs with different data models andassumptions, management of extensive cohort historic data, and post-run assembly ofresults for income and disclosures. Tight reporting deadlines place greater demands onsystem performance and require efficient processes.

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How AXIS US GAAP Link can help
With the introduction of AXIS US GAAP Link modules, the AXIS actuarial solution has beenenhanced to address the challenges of US GAAP LDTI in several ways:» Better model input—multiple runs with multiple seriatim data models and actuarialassumption sets.
» Historical data management—management of extensive cohort historic data and theability to store history in a centralized database.
» Streamlined batch processing and reporting—specialized “current period reporting” batchis tailored to US GAAP requirements.
» Improved run time governance, control, and efficiency.

The Moody’s Analytics service model
Our commitment to keep the AXIS actuarial system current and responsive to your changing
needs is just one component of a comprehensive service model. We want to be your partners
for life. If you adopt the Moody’s Analytics actuarial modeling solution, your next software
conversion could be your last.
Talk to any of our over 5,000 users. For a demo or free trial, contact Ricky Power at ricky.
power@moodys.com or David Moreno at david.moreno@moodys.com.

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CONTACT US
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