Asset revaluation reservesAsset revaluation reserves

Asset revaluation reserves

28. Amounts referred to in paragraph (a) or (b) are excluded from being assets in Australia:

(a) 55 per cent of pre-tax revaluation reserves of each of the following:[18]

(i) property not held at fair value; and

(ii) investments of the Category C insurer in subsidiaries not held at fair value, other than subsidiaries that APRA deems part of an Extended Licensed Entity (ELE) (refer to Prudential Standard GPS 114 Capital Adequacy: Investment Risk Capital Charge)

(the amount recognised must be net of any fair value gains and losses and any gains or losses on hedges offsetting revaluations included in reserves); and

(b) 55 per cent of the post-acquisition reserves of the Category C insurer’s associates,[19] which includes, under equity accounting, the Category C insurer’s share of undistributed profits, plus any share of asset revaluations in associates or any other revaluation of investments in associates (the amount recognised must be net of fair value gains and losses and any gains or losses on hedges offsetting revaluations of investments in associates included in reserves).[20]