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2 Jackson National LifeThe results of Jackson National Life are consolidated into the Group accounts based on US Generally Accepted Accounting Principles (US GAAP). However, certain adjustments are made to the US GAAP results to comply with the Group’s accounting policies, principally: (i) For Group reporting purposes, all fixed income securities are carried at amortised cost subject to provisions for permanent diminutions in value. Under US GAAP, fixed income securities classified as ‘available for sale’ are carried at market value with movements in unrealised gains and losses, including related changes in deferred acquisition costs and applicable tax, recognised as movements in shareholders’ reserves. (ii) For the purposes of determining Group operating profit, realised investment gains and losses are recognised on a five year averaged basis. Under US GAAP, these items are not included in operating income but are included in profit before tax. (iii) Under US GAAP, deferred tax provisions are generally established in respect of all timing differences whereas, under UK SSAP 15, provision is made only for timing differences which are expected to reverse in the foreseeable future. Reconciliations between the US GAAP and Group reporting bases are shown below.
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