Under what circumstances would gross Deferred Acquisition Costs be negative?

Discussion in 'SA3' started by Nadeem Naidoo, Feb 8, 2019.

  1. Nadeem Naidoo

    Nadeem Naidoo Member

    I was looking through a short term and health insurer's financial statements and noticed a negative gross DAC figure. The only circumstances that I could think of in which gross DAC would be negative was if there had been a mass lapse causing a large clawback of commission.
     
  2. That's a possibility I guess. Alternatively, I've a feeling IFRS17 only has limited allowance for DAC, so perhaps this company is adopting the accounting standard early (ie before it comes into force in 2021/2022).
     

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