Document ID: chunk:federal_register_of_legislation:F2023C00382:front:0:p4
Version: federal_register_of_legislation:F2023C00382
Segment Type: other
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Character Range: 8758–11619

set out in paragraph 3(c), except for the reference to insurance contracts in paragraph 3(c) and as described in paragraph 71.
5 All references in AASB 17 to insurance contracts issued also apply to insurance contracts acquired by the entity in a transfer of insurance contracts or a business combination other than reinsurance contracts held.
6 Appendix A defines an insurance contract and paragraphs B2–B30 of Appendix B provide guidance on the definition of an insurance contract.
7 An entity shall not apply AASB 17 to:
(a) warranties provided by a manufacturer, dealer or retailer in connection with the sale of its goods or services to a customer (see AASB 15 Revenue from Contracts with Customers).
(b) employers' assets and liabilities from employee benefit plans (see AASB 119 Employee Benefits and AASB 2 Share-based Payment).
(c) contractual rights or contractual obligations contingent on the future use of, or the right to use, a non-financial item (for example, some licence fees, royalties, variable and other contingent lease payments and similar items: see AASB 15, AASB 138 Intangible Assets and AASB 16 Leases).
(d) residual value guarantees provided by a manufacturer, dealer or retailer and a lessee's residual value guarantees when they are embedded in a lease (see AASB 15 and AASB 16).
(e) financial guarantee contracts, unless the issuer has previously asserted explicitly that it regards such contracts as insurance contracts and has used accounting applicable to insurance contracts. The issuer shall choose to apply either AASB 17 or AASB 132 Financial Instruments: Presentation, AASB 7 Financial Instruments: Disclosures and AASB 9 Financial Instruments to such financial guarantee contracts. The issuer may make that choice contract by contract, but the choice for each contract is irrevocable.
(f) contingent consideration payable or receivable in a business combination (see AASB 3 Business Combinations).
(g) insurance contracts in which the entity is the policyholder, unless those contracts are reinsurance contracts held (see paragraph 3(b)).
(h) credit card contracts, or similar contracts that provide credit or payment arrangements, that meet the definition of an insurance contract if, and only if, the entity does not reflect an assessment of the insurance risk associated with an individual customer in setting the price of the contract with that customer (see AASB 9 and other applicable Australian Accounting Standards). However, if, and only if, AASB 9 requires an entity to separate an insurance coverage component (see paragraph 2.1(e)(iv) of AASB 9) that is embedded in such a contract, the entity shall apply AASB 17 to that component.
8 Some contracts meet the definition of an insurance contract but have as their primary purpose the provision of services for a fixed fee. An entity may choose to apply AASB 15