On transition, insurance contracts will be measured differently from the measurement going forward, unless the full retrospective approach is applied. This will impact the measurement of insurance contracts in the statement of financial position and in the income statement after transition until the insurance contracts in force on transition are derecognised. The following disclosures are required for all periods where simplifications on transition affect the measurement in the financial statements:
- Reconciliation of the contractual services margin and revenue presenting separately contracts measured using the modified retrospective approach, contracts measured using the fair value approach and other contracts, together with an explanation for the measurement on transition using the modified and fair value approaches.
- For entities that use simplifications on transition to disaggregate insurance finance income or expenses between profit or loss and other comprehensive income, reconciliation of accumulated other comprehensive income for the reporting period for financial assets measured at fair value through other comprehensive income related to the groups of insurance contracts to which the disaggregation applies.