- GNAIE Provides Summary Highlights of Remarks to IASCF -
NEW YORK, June 27 /CNW/ -- The Group of North American Insurance
Enterprises (GNAIE) today reported that Philip Bancroft, a GNAIE Board Member
and Chief Financial Officer of ACE, Ltd., a global leader in insurance and
reinsurance, recently addressed the International Accounting Standards
Committee Foundation (IASCF), the oversight body of the International
Accounting Standards Board (IASB). Mr. Bancroft spoke on behalf of GNAIE, an
association of 18 leading insurance companies -- including some of the largest
global providers of insurance -- from the United States, Canada and Bermuda
focused on global financial reporting, accounting and solvency issues.
Mr. Bancroft's remarks were delivered on June 19, 2008 at a roundtable
held in London, under the IASCF's Constitutional Review process, which is
designed to address concerns with respect to public accountability, governance
and the composition of the IASB.
Key highlights of Mr. Bancroft's remarks on the Constitutional Review
process are as follows:
- GNAIE supports creating a Monitoring Group to improve accountability
and due process at the IASB. GNAIE believes it is of critical
importance for the IASCF to strengthen its proposals with respect to
the proposed Monitoring Group's authorities and responsibilities
within the constitutional review of the IASB.
- GNAIE strongly recommends that the IASCF establish enhanced
structures and systems for ensuring that proposed accounting
standards are vetted under appropriate due process standards.
- GNAIE believes that any proposed accounting standard should be
field tested before it is applied, so that there is assurance that
such a standard appropriately reflects the way affected companies
manage and run their businesses, and provides financial reporting
information that is, reliable, consistent, comparable and
meaningful for financial decision-makers.
- As evidenced by developments in the IASB's efforts to formulate
accounting standards for the global insurance industry, IASB's
preliminary views often include fundamental and theoretical
changes from existing practices, and therefore cannot and should
not be completely considered without a "practical application"
In subsequent remarks, Philip Bancroft said, "We are now at a critical
juncture in the development of global accounting standards for insurance
contracts, and it is essential that the process allow for sufficient impact
assessments, rather than be rushed or limited due to the urgencies of the
moment in the global capital markets. GNAIE's foremost priority remains on
assisting global accounting standard setters and regulators to develop and
support high quality insurance accounting and solvency standards that are
decision-useful, reliable, consistent, comparable and meaningful for financial
decision-makers. We believe that a rushed process at this stage runs counter
to these goals.
"What we have before us is a problem that can be turned into an
opportunity. By conducting appropriate analyses and exercising caution before
importing untested methodologies into how we assess insurance balance sheets,
we can build a truly robust single set of global accounting standards for the
international insurance industry. On the other hand, should untested
accounting standards be rushed into implementation, the consequences for error
or miscalculation for the broader capital markets could be severe.
Accordingly, we urge the IASCF to establish appropriate field testing
processes and systems for the IASB going forward."
GNAIE works to achieve high quality international accounting and solvency
standards for insurance enterprises globally. The organization meets its goals
through modeling of proposed accounting standards, analysis, comment and
coordination with various end users of financial reports. The member companies
of GNAIE also include: ACE Ltd.; AIG, Inc.; The Allstate Corporation; Axis
Capital; Genworth Financial; The Hartford; Lincoln Financial; Manulife
Financial; Metropolitan Life Insurance Company; New York Life Insurance
Company; Partner Re; Principal Financial; Prudential Financial, Inc.;
Renaissance Re; State Farm; Sun Life Financial; Travelers; and XL Capital,
Ltd. For more information, please visit http://gnaie.net/.
Joseph Kuo or Fred Spar
Kekst and Company
For further information:
For further information: Joseph Kuo or Fred Spar of Kekst and Company,
(212) 521-4800, for GNAIE, Web Site: http://gnaie.net