Annual Report IPF 2021 - Flipbook - Side 23
INDUSTRIENS
PENSIONSFORSIKRING
A/S and
ANNUAL
REPORT
2021
value
is based on
valuation models, data
significant
assumptions,
which are not directly
observable by a third party. Changes in significant assumptions, which are included in the accounting
estimate, may have a material effect on the Financial Statements.
We focused on the measurement of unlisted investments, as the accounting estimate is by nature
complex and influenced by subjectivity and thus to a large extent associated with estimation
uncertainty.
Reference is made to the description in the Financial Statements of “Accounting estimates” in Note 1
“Significant accounting policies” and “Equity investments in group enterprises”, “Equity investments
in associated enterprises” and “Investment assets related to market rate contracts” in Note 10, 11, 12
and 22.
We tested on a sample basis the consistency between the assumptions applied, data and the
calculation of fair values.
We tested on a sample basis the applied fair values against relevant reporting from external fund
managers.
We challenged the significant assumptions forming the basis of the accounting estimate,
incorporated in the calculation of the fair values based on our knowledge of the portfolio and the
market development.
We assessed whether the disclosures on the unlisted investments were adequate.
Measurement of provisions for insurance and investment contracts
The Company’s provisions for insurance and investment contracts total DKK 219,461 million, which
constitutes 92% of the balance sheet total.
The provisions primarily comprise life insurance provisions for average-rate DKK 202,842 million and
market-rate contracts DKK 7,441 million as well as provisions for claims relating to health and accident
insurance DKK 9,791 million.
The provisions for market-rate contracts are based on the fair value of the assets allocated and for the
remainder of provisions actuarial principles are applied, which involve significant accounting estimates
associated with the actuarial assumptions concerning the timing and extent of future payments to the
members.
The significant actuarial assumptions comprise yield curve used for discounting, longevity, mortality,
disability, probability of buy-backs and lapses as well as costs.
We focused on the measurement of provisions for insurance and investment contracts, as the
accounting estimate is by nature complex and influenced by subjectivity and thus to a large extent
associated with estimation uncertainty.
Reference is made to the description in the Financial Statements of “Accounting estimates” in Note 1
“Significant accounting policies” and “Provisions for insurance and investment contracts” in Note 14
and 15.
We performed risk assessment procedures with the purpose of achieving an understanding of IT
systems, procedures and relevant controls relating to provisioning of insurance and investment
contracts. In respect of controls, we assessed whether these were designed and implemented effectively
to address the risk of material misstatement. For selected controls, on which we planned to rely on, we
tested whether these controls had been performed on a consistent basis.
We used our own actuaries in the evaluation of the actuarial methods and models applied by the
Company as well as assumptions applied, and calculations made.
We assessed and challenged the methods and models and significant assumptions applied comprising
yield curve used for discounting, longevity, mortality, disability, probability of buy-backs and lapses as
well as costs based on our experience and knowledge of the sector with a view to assess, whether these
assumptions are in accordance with regulatory and accounting requirements. This comprised an
assessment of the continuity of the basis for the calculation of provisions.
We tested the calculation of provisions for insurance and investment contracts on a sample basis.
We assessed whether the disclosures on the provisions were adequate.
Statement on Management’s Review
Management is responsible for Management’s Review.
Our opinion on the Financial Statements does not cover Management’s Review, and we do not express any form of assurance conclusion thereon.
In connection with our audit of the Financial Statements, our responsibility is to read Management’s Review and, in doing so, consider whether Management’s Review is materially inconsistent with the Financial
Statements or our knowledge obtained in the audit, or otherwise appears to be materially misstated.
Moreover, we considered whether Management’s Review includes the disclosures required by the Danish Financial Business Act.
Based on the work we have performed, in our view, Management’s Review is in accordance with the Financial Statements and has been prepared in accordance with the requirements of the Danish Financial
Business Act. We did not identify any material misstatement in Management’s Review.
Management’s responsibilities for the Financial Statements
Management is responsible for the preparation of financial statements that give a true and fair view in accordance with the Danish Financial Business Act, and for such internal control as Management determines
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