Financial Sector (Collection of Data) (reporting standard) determination No. 122 of 2023

Reporting Standard LRS 310.0 Statement of profit or loss and other comprehensive income

Financial Sector (Collection of Data) Act 2001

I, Michael Murphy, delegate of APRA, under paragraph 13(1)(a) of the Financial Sector (Collection of Data) Act 2001 (the Act) and subsection 33(3) of the Acts Interpretation Act 1901:

(a)          revoke Financial Sector (Collection of Data) (reporting standard) determination No. 33 of 2023, including Reporting Standard LRS 310.0 Income Statement made under that Determination; and

(b)   determine Reporting Standard LRS 310.0 Statement of profit or loss and other comprehensive income, in the form set out in the Schedule, which applies to the financial sector entities to the extent provided in paragraph 3 of that reporting standard.

Under section 15 of the Act, I declare that Reporting Standard LRS 310.0 Statement of profit or loss and other comprehensive income shall begin to apply to those financial sector entities, and the revoked reporting standard shall cease to apply, on the day Reporting Standard LRS 310.0 Statement of profit or loss and other comprehensive income is registered on the Federal Register of Legislation.

This instrument commences upon registration on the Federal Register of Legislation.

Dated: 18 May 2023

Michael Murphy

General Manager - Chief Data Officer (Acting)

Technology and Data Division

Interpretation

In this Determination:

APRA means the Australian Prudential Regulation Authority.

Federal Register of Legislation means the register established under section 15A of the Legislation Act 2003.

financial sector entity has the meaning given by section 5 of the Act.

Schedule

Reporting Standard LRS 310.0 Statement of profit or loss and other comprehensive income comprises the document commencing on the following page.

Reporting Standard LRS 310.0

Statement of profit or loss and other comprehensive income

Objective of this Reporting Standard

Authority

1. This Reporting Standard is made under section 13 of the Financial Sector (Collection of Data) Act 2001.

Purpose

2.             The information reported to APRA under this Reporting Standard is used by APRA for the purpose of prudential supervision including assessing compliance with capital adequacy standards.

Application and commencement

3.             This Reporting Standard applies to all life insurance companies including friendly societies (together referred to as ‘life companies’) registered under the Life Insurance Act 1995 (Life Act). This Reporting Standard applies for reporting periods ending on or after 1 July 2023.

Information required

4.             A life company must provide APRA with the information required by this Reporting Standard for each reporting period.

5.             The information reported to APRA under this Reporting Standard is not required to be given to policy owners pursuant to section 124 of the Life Act. It does not constitute a reporting document for the purposes of section 124.

Method of submission

6.             The information required by this Reporting Standard must be given to APRA:

(a)   in electronic format using an electronic method available on APRA’s website; or

(b)   by a method notified by APRA prior to submission.

Reporting periods and due dates

7.             Subject to paragraph 8, a life company must provide the information required by this Reporting Standard:

(a)   in respect of each quarter based on the financial year of the life company on an unaudited basis; and

(b)   in respect of each financial year of the life company on an audited basis.

Note 1: This means that information provided under this Reporting Standard will be submitted five times for a full financial year.

Note 2: The annual audited information provided under this Reporting Standard must be submitted in conjunction with the annual auditor’s report, as required under Prudential Standard LPS 310 Audit and Related Matters.

8.             If, having regard to the particular circumstances of a life company,  APRA  considers it necessary or desirable to obtain information more or less frequently than as provided by subparagraph 7(a) or 7(b), APRA may, by notice in writing, change the reporting periods, or specify reporting periods, for the particular life company.

9.             The information required by this Reporting Standard in respect of a life company must be provided to APRA:

(a)   in the case of quarterly information, within 20 business days after the end of the reporting period to which the information relates;

(b)   in the case of annual information, within three months after the end of the reporting period to which the information relates; or

(c)   in the case of information provided in accordance with paragraph 8, within the time specified by notice in writing.

10.         APRA may, in writing, grant a life company an extension of a due date, in which case the new due date will be the date on the notice of extension.

Note: For the avoidance of doubt, if the due date for a particular reporting period falls on a day other than a usual business day, a life company is nonetheless required to submit the information required no later than the due date.

Quality control

11.         The information provided by a life company under this Reporting Standard must be the product of systems, processes and controls that have been reviewed and tested by the Auditor of the life company. This will require the Auditor to review and test the life company’s systems, processes and controls supporting the reporting of the information to enable the life company to provide reliable financial information to APRA. This review and testing must be done on:

(a)   an annual basis or more frequently if necessary to enable the Auditor to form an opinion on the reliability and accuracy of data; and

(b)   at least a limited assurance engagement consistent with professional standards and guidance notes issued by the Auditing and Assurance Standards Board as may be amended from time to time, to the extent that they are not inconsistent with the requirements of Prudential Standard LPS 310 Audit and Related Matters.

12.         All information provided by a life company under this Reporting Standard must be subject to systems, processes and controls developed by the life company for the internal review and authorisation of that information. It is the responsibility of the Board and senior management of the life company to ensure that an appropriate set of policies and procedures for the authorisation of data submitted to APRA is in place.

13.         Actuarial valuations and calculations included in or used in the preparation of the information provided to APRA must be in accordance with the prudential standards in force for the reporting period. However, life companies may use reasonable estimates when preparing information that will not be audited (i.e. for the first four submissions of information for a full financial year).

Authorisation

14.         When an officer or agent of a life company provides the information required by this Reporting Standard using an electronic format, the officer or agent must digitally sign the relevant information using a digital certificate acceptable to APRA.

15.         An officer or agent of a life company who submits information under this Reporting Standard must be authorised by either:

(a)          the Principal Executive Officer of the life company; or

(b)          the Chief Financial Officer of the life company.

Variations

16.         APRA may, by written notice to the life company, vary the reporting requirements of this Reporting Standard in relation to that life company.

Transition

17.         A life company must report under the old reporting standard in respect of a transitional reporting period. For these purposes:

old reporting standard means the reporting standard revoked in the determination making this Reporting Standard; and

transitional reporting period means a reporting period under the old reporting standard:

(a)          which ended before 1 July 2023; and

(b)          in relation to which the life company was required, under the old reporting standard, to report by a date on or after the date of revocation of the old reporting standard.

Note: For the avoidance of doubt, if a life company was required to report under an old reporting standard, and the reporting documents were due before the date of revocation of the old reporting standard, the life company is still required to provide any overdue reporting documents in accordance with the old reporting standard.

Interpretation

18.         In this Reporting Standard:

(a)          unless the contrary intention appears, words and expressions have the meanings given to them in Prudential Standard LPS 001 Definitions (LPS 001); and

(b)          the following definitions are applicable:

Auditor means an auditor appointed under paragraph 83 of the Life Act.

capital adequacy standards means the prudential standards which relate to capital adequacy as defined in LPS 001.

Chief Financial Officer means the chief financial officer of the life company, by whatever name called.

financial year has the meaning in the Corporations Act 2001.

general instruction guide refers to the general instruction guide set out in Attachment A of LRS 001.

Life Act means the Life Insurance Act 1995.

Principal Executive Officer means the principal executive officer of the life company, by whatever name called, and whether or not he or she is a member of the governing board of the entity.

reporting period means a reporting period under subparagraph 7(a) or 7(b) or, if applicable, paragraph 8.

19.         Unless the contrary intention appears, a reference to an Act, Prudential Standard, Reporting Standard, Australian Accounting or Auditing Standard is a reference to the instrument as in force from time to time.             

Reporting Standard LRS 310.0

Statement of profit or loss and other comprehensive income

General instructions

These instructions assist completion of the information collected by Reporting Standard LRS 310.0 Statement of profit or loss and other comprehensive income (LRS 310.0). This Reporting Standard collects information relating to the licensed insurer’s profit or loss and other comprehensive income.

Reporting tables

Tables described in this reporting standard list each of the data fields required to be reported. The data fields are listed sequentially in the column order that they will appear in the reported data set. Constraints on the data that can be reported for each field have also been provided.

General accounting basis

In completing the reporting standards, unless otherwise stated specifically, reporting life companies are to follow the basis consistent with the relevant Australian Accounting Standards. In particular, appropriate consideration must be given to the interpretation, the basis for measurement, and the netting between revenues/expenses items and financial assets/liabilities.

References to Australian Accounting Standards

Each item reported under this Reporting Standard aligns with the Accounting Standards made by the Australian Accounting Standards Board (AASB). The applicable AASB references are specified with each item. AASB reference provides a written description of the accounting meaning of an IFRS Taxonomy element.

IFRS taxonomy element reference

Each IFRS taxonomy element contains at least one cross-reference to an AASB Standard (that incorporates IFRS 17 Standards as issued and amended by the International Accounting Standards Board (IASB)) and has a reference type that can be used to identify the source of that element.  The IFRS Taxonomy uses the following element reference types:

(a)   disclosure—an element of this type depicts a presentation or disclosure requirement of an IFRS/AASB Standard;

(b)   example—an element of this type represents an example provided in an IFRS/AASB Standard or its accompanying materials; and

(c)   common practice—an element of this type reflects common reporting practice within IFRS/AASB financial statements they not specifically mentioned in IFRS/AASB Standards or their accompanying materials, but are consistent with IFRS/AASB Standards. They have been found to be frequently disclosed across a range of companies and accounting jurisdictions.

Reporting direction for life insurers

For APRA reporting, life insurers must also meet the relevant policy liability valuation requirements outlined in the Prudential Standard LPS 340 Valuation of Policy Liabilities.

Definitions

Terms that are highlighted in bold italics are defined in these instructions.

Specific instructions

Reporting basis

Information in this Reporting Standard is to be completed by life insurers including friendly societies (together referred to as life insurers or licensed insurers) for each reporting period on statutory fund (approved benefit fund for a friendly society), licensed insurer and statutory fund eliminations bases.

LRS 310.0 must be submitted for each statutory fund (approved benefit fund for a friendly society) separately for each reporting period.

LRS 310.0 must be submitted for the sum of individual statutory funds, the sum of statutory fund eliminations, the general fund, and if applicable the general fund eliminations for each reporting period. The term ‘general fund’ has been used to refer to the shareholders’ fund of a life company other than a friendly society or the management fund of a friendly society.

Please disclose non-distinct investment components in Reporting Standard LRS 320.0  Liability Roll Forwards at:

• Part A: Liability Roll Forward 1, item 12: ‘Investment components and premium refunds’, item 18: ‘Claims and other expenses paid, including investment components’; and
• Part B: Liability Roll Forward 1, item 9: ‘Investment components and premium refunds’

as applicable (refer to AASB 17.103 (c) and AASB 17.105 (a) (iii)).

APRA class of business

The APRA class of business that apply for the purpose of this Reporting Standard are:

        Australia – Ordinary Business

        Australia – Superannuation Business

        Overseas – All Business

The expressions ‘Australian Business’ and ‘Overseas Business’ refer to the territories where the life insurance business is carried on.

The expressions ‘Ordinary Business’ and ‘Superannuation Business’ are defined in the Life Act.

This section is also to be completed for each participating and non-participating business. The expressions ‘participating business and ‘non-participating business’ are defined in the Life Act.

Direct business is any insurance business written / insurance contracts issued by the reporting insurer.

Inwards reinsurance is any reinsurance business written / reinsurance contracts issued by the reporting insurer.

Non-life insurance business is insurance business carried on by a life company in accordance with APRA’s declaration made under section 12A or section 12B of the Life Act.

Units of measurement

Report values in this Reporting Standard in whole Australian dollars (AUD) with no decimal place.

Convert amounts denominated in foreign currency to AUD in accordance with AASB 121 The Effects of Changes in Foreign Exchange Rates.

Report losses and expenses as negative values.

Columns for Licensed insurer and Statutory fund eliminations reporting:

Columns for Statutory fund reporting:

1.               Insurance revenue

2.                  Insurance service expense

3.                  Insurance service result before reinsurance contracts held

4.                  Allocation of reinsurance premiums

5.                  Amounts recoverable from reinsurers

6.                  Net expense from reinsurance contracts held

7.                  Insurance service result

8.                  Interest revenue calculated using the effective interest method

9.                  Other interest and similar income

10.             Net gains/losses on financial assets at fair value through profit or loss

11.             Net gains/losses on derecognition of financial assets measured at fair value through other comprehensive income

12.             Net change in investment contract liabilities

13.             Net gains/(losses) on derecognition of financial assets measured at amortised cost

14.             Impairment loss on financial assets

15.             Net gains from fair value adjustments to investment properties

16.             Net foreign exchange income / expense

17.             Total investment result

18.             Insurance finance expenses for insurance contracts issued

19.             Reinsurance finance income for reinsurance contracts held

20.             Net insurance financial result through profit or loss

21.             Asset management services revenue

22.             Investment management expenses

23.             Share of profit/loss of associates and joint ventures accounted for using the equity method

24.             Profit/loss from non-current assets and disposal groups classified as held for sale and not qualifying as discontinued operations

25.             Impairment loss for goodwill

26.             Other income

27.             Other finance costs

28.             Other expenses

29.             Profit/loss from continuing operations before tax

30.             Income tax expense from continuing operations

31.             Profit/loss for the year from continuing operations after income tax

32.             Profit/loss from discontinued operations after income tax

33.             Profit (loss) after income tax attributable to members of the company

Other comprehensive income

Items that may be reclassified to profit or loss in subsequent periods

Report this item in accordance with AASB 101.82A (a) (ii).

34.             Change in fair value of financial assets at fair value through other comprehensive income

35.             Amount reclassified to profit or loss

36.             Insurance finance expenses for insurance contracts issued

37.             Reinsurance finance income for reinsurance contracts held

38.             Net insurance financial result through other comprehensive income

39.             Share of other comprehensive income of associates and joint ventures accounted for using the equity method

40.             Income tax relating to items that will be reclassified

Items that will not be reclassified to profit or loss

Report this item in accordance with AASB 101.82A (a) (i).

41.             Revaluation of land and buildings

42.             Share of other comprehensive income of associates and joint ventures accounted for using the equity method

43.             Remeasurements of post-employment benefit obligations, before tax

44.             Income tax relating to items that will not be reclassified

45.             Total other comprehensive income

46.             Total comprehensive income