Preparing to report under IFRS 17
The International Accounting Standards Board’s (IASB) forthcoming insurance contracts standard, IFRS 17 (formerly often known as IFRS 4 Phase 2), is expected to significantly affect the profit emergence pattern of insurance products, introduce volatility into some entities’ profit or loss or other comprehensive income, and impact funds available for shareholder and policyholder dividends.
Additionally, key metrics such as written and earned premiums have been replaced and new metrics introduced, for example insurance contract revenue and insurance finance income expense. These changes will completely alter the look and feel of reported results and how performance is reported internally, including the metrics used to steer the business.
During the session KPMG professionals shared practical examples of how reported profitability will be affected by IFRS 17, including showing how profit profiles will change and how volatile market conditions can impact reported profits. In addition, the impact of the variable fee approach and how this works in practice was explored.
The presenters also shared some of the lessons learned from other finance and actuarial change and transformation programs to help you shape your implementation plans.
As investors and regulators strive for ever-accelerated reporting timetables, insurers will likely want to streamline processes and ensure clear, concise communication to shareholders, investors and other key stakeholders. KPMG’s approach is distinctive, recognizing that this is more than just a technical accounting and actuarial issue.
Mark your calendars for future webcasts:
— 28 February 2017 (Systems and data impacts)
— 6 April 2017 (Building a roadmap)
Mary Trussell, Global Insurance Accounting Change Lead Partner
Ferdia Byrne, Global Insurance Actuarial and Risk Lead Partner
Danny Clark, Global Insurance Accounting Change Technical Partner
Lucinda Parlett, Life Actuarial Principal Advisor and Global Financial Impact Leader KPMG in the UK
As investors and regulators strive for ever-accelerated reporting timetables, insurers will want to streamline processes and ensure clear, concise communication to shareholders, investors and other key stakeholders. KPMG’s approach is distinctive, recognizing that this is more than just a technical accounting and actuarial issue.
We are at your disposal to discuss any questions you might have in this process to help you get ready for IFRS 17.
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