Answer of Qz-7 LRC-PAA (5.4-6): describe the difference between LRC under GMA & PAA for: risk adjust
The answer in the quiz is
"GMA: cannot recognize acquisition costs immediately
PAA: can recognize acquisition costs immediately if coverage period of all contracts in group ≤ 1 year", which is same as the answer for difference between LRC under GMA & PAA for acquisition costs.
However, based on wiki article, the answer of difference for risk adjustment is
"GMA: RA is required for non-onerous contracts
PAA: RA is not required for non-onerous contracts".
Could I get some clarification on the answer?
Comments
Sorry, that was a typo. It's fixed. Thanks for letting me know.