Document ID: chunk:federal_register_of_legislation:F2023C00382:reg:66:p4
Version: federal_register_of_legislation:F2023C00382
Segment Type: reg
Provision Reference: reg 66 (pt 4/8)
Character Range: 319866–322935

recognition with other industries noted in paragraph AusBC7(a)(ii), outweighed the drawbacks noted in paragraph AusBC7(b).  Accordingly, the AASB decided to supersede AASB 4, AASB 1023 and AASB 1038 (and Interpretation 1047 – see paragraphs AusBC14–AusBC17) for for-profit private sector entities with the issue of AASB 17.  NFP private sector entities and public sector entities are discussed in paragraphs AusBC23–AusBC30.
AusBC11               The AASB noted that a consequence of its decision to supersede AASB 1023 and AASB 1038 is that Australian specific disclosures (eg paragraphs 17.8 and 17.10(c) of AASB 1038 relating to regulatory capital disclosures and conformance with the Life Insurance Act 1995) are no longer required.  However, as a separate project the AASB intends to review the usefulness and necessity of those disclosures under AASB 17 at a future date prior to AASB 17 becoming mandatory.
AusBC12               The AASB further considered the interaction between AASB 4, AASB 1023 and AASB 1038, noting that compliance with either AASB 1023 or AASB 1038 simultaneously achieved compliance with AASB 4.  However, the AASB observed that this fact was not explicitly stated in AASB 4 itself, which resulted in divergent interpretations of whether an insurer could apply either of the AASB 9 Financial Instruments deferral or overlay approaches introduced with AASB 2016-6 Amendments to Australian Accounting Standards – Applying AASB 9 Financial Instruments with AASB 4 Insurance Contracts.
AusBC13               The AASB decided to clarify paragraph Aus3.1 and insert paragraph Aus3.2 in AASB 4 to replicate similar wording already present in AASB 1023 and AASB 1038 to highlight the simultaneous compliance noted above.  Furthermore, the AASB decided to clearly indicate that liabilities in scope of AASB 1023 and AASB 1038 are included in an insurer's consideration of whether it qualifies for either the deferral or overlay approaches.  The AASB noted that these amendments are purely mechanical and for clarification only, expecting no change in practice arising from these amendments.

Implications for Interpretation 1047
AusBC14               Interpretation 1047 was originally issued in June 2002 to address divergent views as to whether a Medical Defence Organisation (MDO) should recognise a liability for future claims arising from the medical indemnity insurance it offered given the MDO had discretion on whether to pay claims made by members.  The Interpretation required that a MDO recognise its obligations in a manner consistent with the principles in AASB 1023.
AusBC15               After 1 July 2003, the Medical Indemnity Act 2002 came into effect and regulatory arrangements allowed only authorised general insurers to offer medical indemnity insurance.  In August 2016 the AASB noted feedback from staff outreach to industry stakeholders indicating that all medical indemnity insurance had, as of then, been transferred to authorised general insurers (or subsidiaries thereof).
AusBC16               Also at its August 2016