Margin on Services
As you are now aware, I am currently studying for Life Insurance Part B. This second half of the life insurance specialisation deals with liability valuations, profit, capital, appraisal value and professionalism.
I am currently doing profit reporting. In Australia, the methodology for profit recognition is called Margin on Services. It's complicated. It doesn't help that the actuarial standard is yet to be in "plain English". But once you understand it, it makes sense.
And the good thing about it is that it is a "non-fair value asset-liability" method for profit reporting. As IFRS Insurance Phase 2 is likely to favour "fair value asset-liability" methods, it means less work for me in the future in understanding what that is all about.
The world says, So do I.