Document ID: chunk:federal_register_of_legislation:F2023L00702:front:0:p6
Version: federal_register_of_legislation:F2023L00702
Segment Type: other
Provision Reference: 
Character Range: 14075–19610

112 and LPS 114.
Aggregated risk charge component                                                    This is the aggregated result of applying the aggregation formula over risk charge components in accordance with LPS 114. The formula allows for the likelihood of the asset risk stress scenarios occurring simultaneously.
Assets deducted from capital base                                                   This is the value of assets that have been deducted from assets not supporting investment-linked liabilities for the purpose of determining the fund's capital base (other than deferred tax assets).

(Items subject to Asset Risk Charge type)                                           These will not be subject to the asset risk stresses.
Assets not supporting investment-linked liabilities                                 This is the fair value of all assets not supporting investment-linked liabilities.

                                                                                    This item is calculated as the sum of:

                                                                                        * cash;
                                                                                        * investment property;
                                                                                        * listed equities;
                                                                                        * unlisted equities;
                                                                                        * non-indexed interest-bearing securities;
                                                                                        * indexed interest-bearing securities;
                                                                                        * loans;
                                                                                        * other investment assets (exclude derivative financial instruments);
                                                                                        * current tax assets;
                                                                                        * deferred tax assets;
                                                                                        * derivative financial instruments (assets);
                                                                                        * premiums receivable;
                                                                                        * reinsurance recoveries receivable;
                                                                                        * other accounts receivable;
                                                                                        * other non-investment assets; and
                                                                                        * adjusted policy liabilities ceded (reinsurance assets) (for the calculation of default stress only).

                                                                                    This item (hence the asset components outlined above) must exclude:

                                                                                        * assets supporting investment-linked liabilities;
                                                                                        * assets deducted from capital base; and
                                                                                        * assets subject to Asset Concentration Risk Charge.
Assets subject to Asset Concentration Risk Charge                                   This is the value of assets in excess of their respective asset concentration limits and therefore is subject to asset concentration risk charge.

(Items subject to Asset Risk Charge type)                                           These will not be subject to the asset risk stresses.
Assets subject to credit spreads stress type                                        This is the category of assets subject to credit spreads stress. The options are:

                                                                                        * bonds and other non-securitised assets;
                                                                                        * structured and securitised assets; and
                                                                                        * re-securitised assets.
Assets supporting investment-linked liabilities                                     This is the fair value of assets supporting investment-linked policies that do not have performance guarantees. The asset risk stresses are not applied to these assets or their associated adjusted policy liabilities.

C
Cash                                       This is the amount of the cash assets which includes any cash at call up to 30 days as well as any cash held with non-bank financial institutions.

(Items subject to Asset Risk Charge type)  Note that this item does not include negotiable certificates of deposits, which should be reported under non-indexed interest-bearing securities or indexed interest bearing securities.
Claims payable                             This is the amount related to claims due but not yet paid which has been recognised within insurance and reinsurance contract liabilities and assets reported on the balance sheet under AASB 17 Insurance Contracts (AASB 17).

(Items subject to Asset Risk Charge type)  Life companies must exclude any