Life Insurance (prudential standard) determination No. 1 of 2011 - Prudential Standard LPS 600 - Statutory Funds
Aggregate of IFRS starting amount adjustAggregate of IFRS starting amount adjustments
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To avoid doubt, the sum of the IFRS starting amount adjustments under Part 2 of paragraphs 39 to 43 must equal the IFRS change in net assets of the statutory fund.
Distribution of Shareholders’ Retained Profits (Australian Participating)
For the purposes of subsection 62(5) of the Act, the distribution of shareholders’ retained profits (Australian participating) from a statutory fund is prohibited if:
(a) there is not, at the same time, a distribution of Australian policy owners’ retained profits from the statutory fund; and
(b) immediately after the distribution, the shareholders’ retained profits (Australian participating) of the statutory fund that remain undistributed are less than 25% (or such lower percentage as is specified in the life company’s constitution) of the Australian policy owners’ retained profits of the statutory fund that remain undistributed.
Unsecured borrowings of a statutory fund
For the purposes of subsection 38(4) of the Act, a life company must not borrow money by means of unsecured borrowing, for the purposes of the business of a statutory fund, if the result would be that the total amount of principal outstanding under all unsecured borrowing relating to the fund would exceed 50% of the free assets of the fund.
where “free assets”, in relation to a statutory fund, means the amount that would be left from the total assets of the fund after deducting the amount required to meet the capital adequacy standard, within the meaning of the prudential standards, of the fund.
Form 1: Restructure of Statutory Funds
Name and Australian Business Number of life company
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Date from which the restructure is proposed to have effect
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Required documentation
By indicating “Yes” below, the signatory to this form confirms that the documents mentioned in Schedule 1 to this form have been attached.
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Contact person
Please provide the contact details for the person to whom enquiries relating to this application should be directed.
Name
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Position title
Division Aggregate of IFRS starting amount adjust - Life Insurance (prudential standard) determination No. 1 of 2011 - Prudential Standard LPS 600 - Statutory Funds - Aggregate of IFRS starting amount adjustments | Zoe
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Phone
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Email address
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Address for correspondence
Please provide the address to which correspondence relating to this application should be mailed.
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Signatures
This form must be signed by:
(a) the principal executive officer of the life company; or
(b) an officer of the life company who has been authorised for that purpose by the principal executive officer, if the principal executive officer has notified APRA in writing of the authorisation.
Name Position title
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Signature Date
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Please send completed form and accompanying documents to your responsible supervisor.
Schedule 1 to Form 1
Specified documents required to be lodged with Form 1
1. A statement of the nature of the receiving fund and the terms and conditions on which the restructure is to take place. The statement must include the following information:
(a) the identity of a transferring fund and a receiving fund; and
(b) the classes of life insurance business to be carried on by the company within the receiving fund; and
(c) the categories of life insurance business to be carried on by the company within each of those classes; and
(d) the sub-categories of life insurance business to be carried on by the company within each of those categories; and
(e) the kinds of policies within those categories and sub-categories and, where the policies are referable to more than one fund, the benefits to be written by the company within those categories and sub-categories; and
(f) the value of the policy liabilities to be transferred to the receiving fund, by kinds of policies; and
(g) the value of the policy liabilities to remain in the transferring fund, by kinds of policies; and
(h) the value of other liabilities (not being policy liabilities) to be transferred to the receiving fund; and
(i) the value of other liabilities (not being policy liabilities) to remain in the transferring fund; and
(j) the value of the assets to be transferred to the receiving fund, by asset class; and
(k) the value of the assets to remain in the transferring fund, by asset class; and
(l) the value of the amounts determined for the purposes of allocation and distribution of profits and losses under Divisions 5 and 6 of Part 4 of the Act to be transferred to the receiving fund; and
(m) the value of the amounts determined for the purposes of allocation and distribution of profits and losses under Divisions 5 and 6 of Part 4 of the Act to remain in the transferring fund.
2. A report by the appointed actuary on the proposed restructure, including:
(a) statement setting out the basis on which the nature and value of the assets to be transferred is to be determined; and
(b) statement as to whether the assets to be transferred are appropriate to the liabilities to be transferred; and
(c) statement as to whether the restructure will result in unfairness to the owners of the policies referable to any of the funds involved in the restructure; and
(d) statement as to whether, immediately after the restructure, a transferring fund and receiving fund will satisfy the solvency standard and the capital adequacy standard applicable to it under the Act.