SOP issued on accounting and reporting by insurance enterprises for certain nontraditional long-duration contracts, separate accounts.

Statement of Position No. 03-1, Accounting and Reporting by Insurance Enterprises for Certain Nontraditional Long-Duration Contracts and for Separate Accounts (No. 014936CPA07), will be issued this month. The SOP provides guidance on accounting and reporting by insurance enterprises for certain nontraditional long-duration contracts and for separate accounts, including: separate account presentation; accounting for an insurance enterprise's interest in a separate account; transfers to separate accounts; valuation of liabilities; accounting for contracts with death or other insurance benefit features; accounting for contracts that provide annuitization benefits; sales inducements to contract holders; and disclosures.

The SOP is effective for financial statements for fiscal years beginning after Dec. 15, 2003, with earlier adoption encouraged. The SOP may not be applied retroactively to prior years' financial statements, and initial application should be as of the beginning of an entity's fiscal year. To obtain a copy, contact the Member Satisfaction Center (see page 11; price: $14 member/$17.50 non-member).