IFRS 17 ‘Insurance Contracts’ will began in less than 2 years!
IFRS 17 – The new insurance contracts standard brings fundamental changes to international insurance accounting.
What Is IFRS17 ?
IFRS 17 is the first truly international IFRS Standard for insurance contracts. IFRS 17 replaces IFRS 4 Insurance Contracts. When introduced in 2004, IFRS 4—an interim Standard—was meant to limit changes to existing insurance accounting practices. Hence, IFRS 4 has allowed insurers to use different accounting policies to measure similar insurance contracts they write in different countries.
IFRS 17 provides consistent principles for all aspects of accounting for insurance contracts. It removes existing inconsistencies and enables investors, analysts and others to meaningfully compare companies, contracts and industries.
What Changes ?
IFRS 17 requires a company to measure insurance contracts using updated estimates and assumptions that reflect the timing of cash flows and any uncertainty relating to insurance contracts. This requirement will provide transparent reporting about a company’s financial position and risk. IFRS 17 requires a company to recognize profits as it delivers insurance services (rather than when it receives premiums) and to provide information about insurance contract profits the company expects to recognize in the future. This information will provide metrics that can be used to evaluate the performance of insurers and how that performance changes over time.
Who Is Affected?
450 listed insurers who use IFRS standards and more than 13 trillion total asset list of insurers.
When IFRS 17 Start?
Start from 1 January 2021 but some countries can choose to use it first and Thailand has plans to start using in 2022 which slower than the set up date in 1 year.
When you read through this, we know that you would like to know how to prepare for IFRS 17? How to invest and study for more information about IFRS 17? If you want to know more, you can see the VDO from Tagetik, which Triforce is the partner of Tagetik.
Triforce recommend the company to start looking and invest in IFRS 17 solutions. This new standard will help insurances business have more transparent and easy to evaluate the performance.
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