Constructive obligation is an obligation that derives from an entity’s actions whereby an established pattern of past practice, published policies or a sufficiently specific current statement, the entity has indicated to other parties that it will accept certain responsibilities, and as a result, the entity has created a valid expectation on the part of those other parties that it will discharge those responsibilities. 

Credit risk  is the risk that one party to a financial instrument will fail to discharge an obligation and cause the other party to incur a financial loss. 

Currency exchange rate risk is a market risk, namely the risk that the value of a financial instrument will fluctuate due to changes in foreign exchange rates. 

Deferred tax assets are amounts of income taxes recoverable in future periods in respect of deductible temporary differences; the carryforward of unused tax losses; and the carryforward of unused tax credits. 

Deferred tax liabilities are amounts of income taxes payable in future periods in respect of taxable temporary differences. 

Defined benefit obligation is the present value, without deducting any plan assets, of expected future payments required to settle the obligation resulting from employee service in the current and prior periods. 

Defined benefit plans are post-employment benefit plans other than defined contribution plans. 

Defined contribution plans are post-employment benefit plans under which an entity pays fixed contributions into a separate entity (a fund) and will have no legal or constructive obligation to pay further contributions if the fund does not hold sufficient assets to pay all employee benefits relating to employee service in the current and prior periods. 

Deferred Policy Acquisition Cost (DPAC)  – are the variable costs related to the acquisition or renewal of insurance contracts and investment contracts with discretionary participation features. 

Deposit accounting method includes amounts charged and paid to customers directly into the financial liability and not through the income statement as premium income and claims. 

Derecognition is the removal of a previously recognized asset or financial liability from an entity’s statement of financial position. 

Derivatives are financial instruments whose value changes in response to an underlying variable, that require little or no net initial investment and are settled at a future date. 

Discretionary participation feature is a contractual right to receive, as a supplement to guaranteed benefits, additional benefits: 

■ That are likely to be a significant portion of the total contractual benefits; 

■ Whose amount or timing is contractually at the discretion of the issuer; and 

That are contractually based on: 

■ The performance of a specified pool of contracts or a specified type of contract; 

■ Realized and/or unrealized investment returns on a specified pool of assets held by the issuer; or 

■ The profit or loss of the company, fund or other entity that issues the contract. 

Effective interest rate method is a method of calculating the amortized cost of a financial asset or liability and of allocating the interest income or expense over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash payments or receipts through the expected life of the financial instrument or, when appropriate, a shorter period to the net carrying amount of the financial asset or liability. 

Embedded derivative is a component of a hybrid instrument that also includes a non-derivative host contract, with the effect that some of the cash flows of the combined instrument vary in a way similar to a derivative. 

Equity instruments  are financial instruments issued by the Group that are classified as equity if they evidence a residual interest in the assets of the Group after deducting all of its liabilities. 

Equity method is a method of accounting whereby the investment is initially recognized at cost and adjusted thereafter for the post-acquisition change in the investor’s share of net assets of the investee. The profit or loss of the investor includes the investor’s share of the profit or loss of the investee. 

Equity volatility is the relative rate at which the price of equity changes. 

Exchange differences are differences resulting from translating a given number of units of one currency into another currency at different exchange rates. 

Finance lease is a lease that transfers substantially all the risks and rewards incident to ownership of an asset. 

