Question ID: 1532
Regulation Reference: Guidelines on recognition and valuation of assets and liabilities other than technical provisions
Topic: Valuation of Assets and Liabilities other than TPs
Article: 75
Status: Final
Date of submission: 01 Mar 2018
Question
Upon adoption of IFRS 16, the business will recognise right-to-use assets under lease contracts as a gross up of assets and liabilities. For Solvency II reporting, we are waiting for a decision from EIOPA on whether or not to adopt the new IFRS 16 measurement basis as the proxy for SII reporting. If the IFRS basis is adopted then further guidance is needed from EIOPA to assess the admissibility of the lease assets recognised under IFRS 16. Looking forward to your thoughts on this subject.
EIOPA answer
Please see response to QA1336. The recognition criteria of the rights of use asset is determined by the underlying item. For example, if the rights of use assets refers to an intangible asset, the recognition and valuation criteria follow Art. 12 of Delegated Regulation (EU) 2015/35. This includes the necessary market-consistent valuation in line with Art. 75 of the SII Directive.