Achieving Effective IFRS 17 Reporting
As a principles-based standard, IFRS 17 provides room for different interpretations, meaning that insurers have choices to make about how to comply. The explicit integration of financial and non-financial risk has caused much discussion about the unprecedented and distinctive modeling challenges that IFRS 17 presents. These could cause ‘tunnel vision’ among insurers when it comes to how they approach compliance.
But all stages of IFRS 17 compliance are important, and each raises distinct challenges. By focusing their efforts on any one aspect of the full compliance value chain, insurers can risk failing to adequately comply. In the case of IFRS 17, it is not necessarily accidental non-compliance that is at stake, but rather the sub-optimal presentation of the business’ profits. To achieve ‘ideal’ compliance, firms need to focus on the logistics of reporting as much as on the mechanics of modeling.
Effective and efficient reporting comprises two elements: presentation and disclosure. Reporting is the culmination of the entire compliance value chain, and decisions made further up the chain can have a significant impact on the way that value is
presented. Good reporting is achieved through a mixture of technology and accounting policy, and firms should follow several strategies in achieving this.
In this report we focus on the challenges associated with IFRS 17 reporting, and consider solutions to those challenges from the perspectives of accounting policy and technology implementation. And in highlighting the reporting stage of IFRS 17 compliance, we focus specifically on how decisions about the presentation of data can dictate the character of final disclosure
Further Reading
