strong understanding of the elements of ifrs that relate to alm
- 3 layers
- ifrs17-grammar
- 5 principles from csm working-party
- logic
- ifrs 17 doesnt decide asset measurement
teleportation base images
IFRS 9
Many UK life insurers do hold debt assets at amortised cost under IFRS 9, if:
the business model is hold to collect, and
cash flows are SPPI.
Others are at FVOCI or FVTPL, depending on classification.
more stuff
i dont have hands on exposure to csm calculations, movements and sensitivities
That’s workable, but you need to close the credibility gap deliberately:
- Learn CSM roll-forward logic cold (opening → accretion → assumption changes → release)
- Be fluent in drivers, not calculations: discount rates, coverage units, VFA vs GMM
- Study management MI: explain past CSM movements and sensitivities
- Build toy models (Excel) to simulate shocks and see where impacts land
- Partner closely with IFRS 17 actuaries and practice challenging outputs
You don’t need production experience—just clear, confident insight into how CSM reacts to ALM decisions.
- CSM basics
- level of aggregation and recognition
- measurement
- transition
- kpis and management information
What you can skim or treat lightly
You probably don’t need deep mastery of:
Detailed worked numerical examples
Fine technical debates on:
Coverage unit methodologies
Loss component mechanics in depth
Grouping granularity edge cases
Academic discussion on conceptual frameworks
Nice to know, not interview-critical. What interviewers actually test for ALM + CSM
They’ll likely probe questions like:
“How would changing the asset mix affect CSM and earnings volatility?”
“Why does VFA matter for ALM strategy?”
“How does yield curve movement affect IFRS 17 profit timing?”
“How would you align ALM with IFRS 17 KPIs?”
This is synthesis, not paper memorisation. Minimal “ALM Manager ready” reading plan (from the paper)
If time is limited:
Must read carefully
CSM overview and purpose
Financial assumption treatment (discount rates, OCI)
VFA vs GMM sections
Skim
Coverage units methodology
Detailed numerical examples
Strategic tip (for actuaries moving into ALM)
You’ll stand out if you can articulate:
“ALM decisions change the distribution and volatility of IFRS 17 profit, not just solvency metrics.”
Most candidates can talk solvency; fewer can link asset strategy → CSM release → reported earnings.
If you want, I can:
Give you a 1-page ALM-focused cheat sheet of CSM mechanics,
Or help you prepare interview talking points tailored to ALM roles,
Or summarise the exact sections of the working party paper worth reading line-by-line.
practical IFRS knowledge that drives ALM decisions
IFRS 17
- measurement models
- GMM
- VFA
- CSM mechanics
- discount rates
- risk adjustment
- profit emergence
- impact on asset strategy
IFRS 9: asset classification (AC/OCI/PL), impairment, volatility management, and ALM interaction
IFRS 7: risk disclosures relevant to interest rate, credit, and liquidity risk
OCI vs P&L dynamics: accounting mismatches and hedge implications
Transition impacts: opening balance sheets and ALM constraints