203 IFRS accounting policies for financial instruments and insurance contracts, which embed a number of accounting policy alternatives  that companies may select in presenting their results (i.e. companies can use different local GAAPs to measure the insurance contract  liability) and that can make the comparability from period to period difficult. Below details are provided for the individual line items  presented in this note. Certain assets held by Aegon Americas, Aegon the Netherlands and Aegon United Kingdom are carried at fair value and managed on  a total return basis, with no offsetting changes in the valuation of related liabilities. These include assets such as investments in hedge  funds, private equities, real estate (limited partnerships), convertible bonds and structured products. Underlying earnings exclude any  over- or underperformance compared to management’s long-term expected return on assets. Based on current holdings and asset returns, the long-term expected return on an annual basis is 8-10%, depending on asset class,  including cash income and market value changes. The expected earnings from these asset classes are net of deferred policy acquisition  costs (DPAC) where applicable. In addition, certain products offered by Aegon Americas contain guarantees and are reported on a fair value basis, including  the segregated funds offered by Aegon Canada and the total return annuities and guarantees on variable annuities of Aegon USA.  The earnings on these products are impacted, among others, by movements in equity markets and risk-free interest rates. Short-term  developments in the financial markets may therefore cause volatility in earnings. Included in underlying earnings is a long-term  expected return on these products and excluded is any over- or underperformance compared to management’s expected return. The fair  value movements of certain guarantees and the fair value change of derivatives that hedge certain risks on these guarantees of Aegon  the Netherlands and Variable Annuities Europe (included in New Markets) are excluded from underlying earnings, and the long-term  expected return for these guarantees is set at zero. Holding and other activities include certain issued bonds that are held at fair value through profit or loss (FVTPL). The interest rate risk  on these bonds is hedged using swaps. The fair value movement resulting from changes in Aegon’s credit spread used in the valuation  of these bonds are excluded from underlying earnings and reported under fair value items. Fair value items include the over- or underperformance of investments and guarantees held at fair value for which the expected  long-term return is included in underlying earnings. Changes to these long-term return assumptions are also included in the fair  value items. Underlying earnings Fair value items Realized gains or losses on investments Impairment charges / reversals Other income or charges Run­off businesses In addition, hedge ineffectiveness on hedge transactions, fair value changes on economic hedges without natural offset in earnings and  for which no hedge accounting is applied and fair value movements on real estate are included under fair value items. Includes realized gains and losses on available-for-sale investments, mortgage loans and loan portfolios. Also included are impairments on mortgage loans and loan portfolios on amortised cost and associates. Other income or charges is used to report any items which cannot be directly allocated to a specific line of business. Also items that are  outside the normal course of business are reported under this heading. Other charges include restructuring charges that are considered other charges for segment reporting purposes because they are outside  the normal course of business. In the consolidated income statement, these charges are included in operating expenses. Includes underlying results of business units where management has decided to exit the market and to run off the existing block of  business. This line includes the run-off of the institutional spread-based business, structured settlements blocks of business, Bank- Owned and Corporate-Owned Life Insurance (BOLI/COLI) business and life reinsurance business in Aegon Americas. Aegon has other  blocks of business for which sales have been discontinued and of which the earnings are included in underlying earnings.