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As the holidays approach, JLK Rosenberger is taking a new perspective on a holiday classic – the Twelve Days of Christmas. Rather than filling your head with turtle doves and gold rings, we are going to instead focus on the latest changes to SSAP and how they will impact your insurance company in 2019 and beyond.
The NAIC is in the process of revising SSAP 22-Leases. Lease accounting has been substantially revised following the issuance of ASU 2016-02 – Leases (Topic 842), effective 2019 for public entities (2020 for non-public entities). The most significant changes under the new GAAP lease guidance is the requirement to treat operating leases as financing leases.
The NAIC interpretations of ASU–2016-02 rejected the new GAAP treatment. Therefore, for statutory accounting purposes, all leases continue to be recorded as operating leases with lease expense recognized on a straight-line basis over the lease term.
Join us tomorrow for day 4 in the 12 days of SSAP. If you have questions about leases and how the changes will impact your insurance entity, please call us at 818-334-8623, or click here to contact us. We look forward to speaking with you soon.