Document ID: chunk:federal_register_of_legislation:F2023L00717:body:0:p16
Version: federal_register_of_legislation:F2023L00717
Segment Type: other
Provision Reference: 
Character Range: 57582–65591

(overseas par) due to L6.1.                                                                                                     This is the experience adjustment amount allocated to EFCF (PRP portion), AASB 17 SRPP and AASB 17 SRP (overseas par) due to A6.1. This item is only relevant if the experience adjustments do not adjust CSM (i.e. emerges as profit immediately). Otherwise, report nil.

           A non-investment experience profit increase Life Act PRP, Life Act SRPP and Life Act SRP (overseas par).                                                                                                                                       Favourable experience adjustments increase EFCF (PRP portion), AASB 17 SRPP and AASB 17 SRP (overseas par) only if they do not adjust CSM.

7. Impact of assumption changes including losses on onerous contracts

Item L7.1  Report Best Estimate Liabilities (BEL) at insurer risk free rate for determining loss recognition.

           This is BEL of participating business calculated using the gross discount rate (or rates) that the life insurer considers to be risk free based on the current observable, objective rates that relate to the nature, structure and term of the future liability cash flows. The discount rate is used in determining the adequacy threshold for loss recognition under the VSA led method. It does not need to satisfy the definition of risk-free discount rate in LPS 001.
           Item A7.1                                                                                                                                                                                                                                                                                                                                                                                                                                                                       Report changes in estimates that adjust CSM.

                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           Show the increase / (decrease) in CSM corresponding to assumption changes that adjust CSM. Also show the corresponding (decrease) / increase in EFCF (non-PRP portion) and RA from the assumption changes.
Item L7.2  Report impact of assumption changes and loss recognition (reversal) on VSA.                                                                                                                                                                                                                                                                                                                                                                                                     Item A7.2                                                                                                                                                                                                    Report changes in estimates that do not adjust CSM and adjustments to Liability for Incurred Claims (LIC).

           Where the BEL reported in L7.1 is higher (or lower) than VSA and losses are being recognised (or reversed), show the increase / (decrease) in VSA that corresponds to the amount of loss recognition / (reversal).                                                                                                                                                                                                                                                                                                                                                                                                                                                                           Show the increase / (decrease) in EFCF (non-PRP portion) and RA corresponding to assumption changes and adjustments to LIC.

           The resulting impact on Life Act PRP, Life Act SRPP and Life Act (overseas par) is reported in L7.3.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         This is applicable where the assumption changes and adjustments to LIC do not adjust CSM.

                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        The resulting impact on EFCF (PRP portion), AASB 17 SRPP and AASB 17 SRP (overseas par) is reported in A7.3.

                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        Assumption and LIC strengthening increase AASB 17 liabilities.
Item L7.3  Report allocation to Life Act PRP, Life Act SRPP and Life Act SRP (overseas par) due to L7.2.                                                                                                                                                                                                                                                                                                                                                                                   Item A7.3                                                                                                                                                                                                    Report allocation to EFCF (PRP portion), AASB 17 SRPP and AASB 17 SRP (overseas par) due to A7.2.

           This is the amount of loss (recognition) / reversal allocated to Life Act PRP, Life Act SRPP and Life Act SRP (overseas par) due to L7.2.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    This is the