The ABI today published its revised version of the Statement of Recommended Practice (SORP).  This follows receipt of “negative assurance” from the Accounting Standards Board. The revised SORP, which replaces the SORP issued in 2003, applies to insurers’ financial statements for periods beginning on or after 1 January 2005.

Revisions to the SORP have been necessary to recognise some new UK accounting standards, in particular FRS 26 (Financial Instruments: Measurement), and FRS 27 (Life Assurance). The scope of the SORP is also now restricted to entities that are continuing to prepare their financial statements in accordance with UK GAAP (Generally Accepted Accounting Practice), although entities that are required or choose to adopt international accounting standards are encouraged to have regard to its provisions insofar as this is compatible with the requirements of those standards.

Commenting on the revised SORP Peter Vipond, ABI Director of Financial Regulation and Taxation said:

“While the focus of accounting is now very much on international financial reporting standards, the ABI SORP is still relevant to insurance entities that prepare their financial statements in accordance with UK requirements. 

“Pending further development by the IASB of a Phase II accounting standard for insurance, the SORP and the current international standard on insurance (IFRS 4) continue to reflect traditional insurance accounting methodology.   We are currently working with the International Accounting Standards Board to ensure a satisfactory outcome to the ‘Phase II’ project on insurance. 

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Notes

Notes for Editors

1.   Enquiries to:    

         Alan Leaman    020 7216 7440 (Mobile: 07957 482 330)

         Lucy Butler        020 7216 7411 (Mobile: 07712 841 184)

         Malcolm Tarling    020 7216 7410 (Mobile: 07776 147 667)

         Jonathan French      020 7216 7392 (Mobile: 07958 330 480)

2.     Copies of the Revised ABI SORP be accessed as an attachment below and on  the ABI website at www.abi.org.uk under “Publications”.

3.      The ABI is the trade association for Britain’s insurance industry. Its nearly 400 member companies provide over 94% of the insurance business in the UK. It represents insurance companies to the Government, and to the regulatory and other agencies, and is an influential voice on public policy and financial services issues. ABI member companies hold more than a sixth of all investments traded on the London Stock Exchange, on behalf of millions of pensioners and savers.

4.                  An ISDN line is available for broadcasts.

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