IBERSOL Annual Report and Consolidated Accounts 2017

ANNUAL REPORT 2017 f) Annual Improvements 2015 - 2017 (generally effective for annual periods beginning on or after 1 January 2019). These improvements are still subject to endorsement by the European Union. The 2015-2017 annual improvements impact: IAS 23, IAS 12, IFRS 3 and IFRS 11. It is not expected that its application has significant impacts. g)IFRS 17 (new), ‘Insurance contracts’ (effective for annual periods beginning on or after 1 January 2021). This standard is still subject to endorsement by European Union. This new standard replaces IFRS 4 and applies to all entities issuing insurance contracts, reinsurance contracts and investment contracts with discretionary participation characteristics. IFRS 17 is based on the current measurement of technical liabilities at each reporting date. The cur- rent measurement can be based on a complete “building block approach” or “premium allo- cation approach”. The recognition of the technical margin is different depending on whether it is positive or negative. IFRS 17 is of retrospective application. It is not expected that its application has significant impacts. Interpretation a)IFRIC 22 (new), ‘Foreign currency transactions and advance consideration’ (effective for annual periods beginning on or after 1 January 2018). This interpretation is still subject to en- dorsement by European Union. An Interpretation of IAS 21 ‘The effects of changes in foreign exchange rates’ it refers to the determination of the “date of transaction” when an entity ei- ther pays or receives consideration in advance for foreign currency denominated contracts”. The date of transaction determines the exchange rate used to translate the foreign currency transactions. It is not expected that its application has significant impacts. b)IFRIC 23 (new), ‘Uncertainty over income tax treatment’ (effective for annual peri- ods beginning on or after 1 January 2019). This interpretation is still subject to endorse- ment by European Union. This is an interpretation of IAS 12 - ‘Income tax’, referring to the measurement and recognition requirements to be applied when there is uncertainty as to the acceptance of an income tax treatment by the tax authorities. In the event of un- certainty as to the position of the tax authority on a specific transaction, the entity shall make its best estimate and record the income tax assets or liabilities under IAS 12, and not under IAS 37 - “Provisions, contingent liabilities and contingent assets “, based on the ex- pected value or the most probable value. The application of IFRIC 23 may be retrospective or retrospective modified. It is not expected that its application has significant impacts. 281