AVBOB Financial Statements 2018

108 AVBOB MUTUAL ASSURANCE SOCIETY AND ITS SUBSIDIARIES NOTES TO THE SUMMARISED FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2018 (continued) SOCIETY GROUP 2018 2017 2018 2017 R 000 R 000 R 000 R 000 13. POLICYHOLDER LIABILITIES Balance at the beginning of the year 7 665 048 6 970 017 7 665 048 6 970 017 Realisation of depreciation on revaluation 2 106 1 993 2 936 1 212 Transfer from revaluation reserves 1 078 848 ( 2 561) 4 682 Broker commission correction - 288 - 288 Centenary expenses ( 4 847) - ( 4 847) - Reinsurance asset 1 522 1 649 1 522 1 649 Transfer from statements of comprehensive income 2 002 052 690 253 2 004 561 687 200 Ad-hoc benefit improvements 2 110 288 707 663 2 110 288 707 663 Balances in respect of new business ( 329 354) ( 465 837) ( 329 354) ( 465 837) Change in valuation assumptions ( 486 825) ( 151 229) ( 486 825) ( 151 229) Expected investment returns 820 160 731 852 820 160 731 852 Other ( 112 217) ( 132 196) ( 109 708) ( 135 249) Balance at the end of the year 9 666 959 7 665 048 9 666 659 7 665 048 Non-current liabilities 9 784 520 7 814 526 9 784 220 7 814 526 Current liability ( 117 561) ( 149 478) ( 117 561) ( 149 478) Not with-profit contracts 5 922 922 4 767 077 5 922 922 4 767 077 With-profit contracts 3 456 991 2 609 882 3 456 991 2 609 882 Group schemes 15 860 13 153 15 860 13 153 Insurance contracts 9 395 773 7 390 112 9 395 773 7 390 112 Investment contracts with discretionary participation features (DPF) 271 186 274 936 271 186 274 936 9 666 959 7 665 048 9 666 959 7 665 048 TRUE TRUE FALSE TRUE Net future cash outflows: Not longer than a year ( 117 561) ( 149 478) ( 117 561) ( 149 478) Between 2 and 5 years 1 298 396 1 066 377 1 298 396 1 066 377 Between 6 and 10 years 3 405 788 2 803 584 3 405 788 2 803 584 Longer than 10 years 26 659 158 18 603 748 26 659 158 18 603 748 Discounting of future cash flows (21 578 822) (14 659 183) (21 578 822) (14 659 183) 9 666 959 7 665 048 9 666 959 7 665 048 The current liability is the estimate of the benefits payable to policyholders within the next twelve months. The policyholder liability comprises of: The amounts in the net future cash outflows summarise the expected cash flows allowing for premium receipts, claim payments and policyholder behaviour consistent with the valuation methodology. All the cash flows are gross of reinsurance. The cash flows are not discounted and the effect of discounting is shown to reconcile to total policyholder liabilities. 108