GROUP ACCOUNTING POLICIES (continued) 5. Insurance, investment and reinsurance contracts (continued) 5.2 Valuation and recognition (continued) 5.2.2 Investment contracts (continued) Receivables and payables related to investment contracts Amounts due from and to policyholders and agents in respect of investment contracts are included in other receivables and payables. 5.3 Presentation The Group has presented separately in the statement of financial position the carrying amount of portfolios of insurance contracts issued that are liabilities and portfolios of reinsurance contracts held that are assets. The Group disaggregates the amounts recognised in the statement of profit or loss and other comprehensive income into an insurance service result, comprising insurance revenue and insurance service expenses, and insurance finance income or expenses. The Group does not disaggregate the change in risk adjustment for non-financial risk between a financial and nonfinancial portion and includes the entire change as part of the insurance service result. The Group does not disaggregate insurance finance income or expenses into amounts presented in profit loss and amounts presented in other comprehensive income. The Group separately presents income or expenses from reinsurance contracts held from the expenses or income from insurance contracts issued. The PPS Profit-share account is presented separately as part of the Life contracts with DPF. 5.3.1 Insurance finance income and expenses Insurance finance income or expenses comprise the change in the carrying amount of the group of insurance contracts arising from: • The effect of the time value of money and changes in the time value of money • The effect of financial risk and changes in financial risk The Group systematically allocates expected total insurance finance income or expenses over the duration of the group of contracts to profit or loss using discount rates determined on initial recognition of the group of contracts. The changes include changes in the measurement of cohorts of contracts caused by changes in the value of underlying items (including additions and withdrawals). This is particularly relevant to movements in the PPS profit-share accounts, including exits net of forfeitures, and allocations of profit to PPS Profit-share accounts. 5.3.2 Net income or expense from reinsurance contracts held The Group presents aggregated on the face of the statement of profit or loss and other comprehensive income the amounts expected to be recovered from reinsurers, and an allocation of the reinsurance premiums paid. The Group treats reinsurance cash flows that are contingent on claims on the underlying contracts as part of the claims that are expected to be reimbursed under the reinsurance contract held, and excludes investment components and commissions from an allocation of reinsurance premiums presented on the face of the statement of profit or loss and other comprehensive income. Amounts relating to the recovery of losses relating to reinsurance of onerous direct contracts are included as amounts recoverable from the reinsurer. 125 Group Accounting Policies
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