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What is IFRS 17?
All insurance companies reporting under IFRS (International Financial Reporting Standard) will be impacted by the new reporting standard when it becomes effective in January 2023. IFRS 17 will result in significant changes to the way that financial information is presented, and adoption will require significant planning.
IFRS 17 presents opportunities to harness data more effectively, to improve the structure of your finance function and to better inform your decision making. Ultimately IFRS 17 is about what story you want to tell about your company… and if you really grab the opportunities that implementing the standard presents, imagine the sort of business you could be running in 2023.
MFRS 17, issued by the Malaysian Accounting Standards Board (MASB) is equivalent to IFRS 17 Insurance Contracts as issued and amended by the International Accounting Standards Board (IASB). Angie Wong, a partner within Assurance Financial Services, is the project manager on MASB's Working Group on Insurance Contracts
How can PwC help on your IFRS17 journey
- Reporting for general insurers
- Workshop
- Gap analysis
- Financial impact assessment
- Technical design
- Transition
Reporting for general insurers
PwC's General Insurance Reserving & Reporting Suite (GIRRS) is a one-stop solution designed for general insurers to help them with their IFRS 17 reporting and management reporting. It is cost-effective and provides integration between data, actuarial and reporting, among other benefits. The tool automatically performs calculations for insurers and produces the required accounting entries and disclosures to comply with IFRS 17.
Workshop
The introduction of IFRS 17 will lead to significant changes across the business. The workshop sessions will help to:
- Align key stakeholders across the main business units on the technical aspects of reporting under a new standard.
- Ensure that key stakeholders are making decisions based on a sound understanding of the IFRS 17 principles.
- Provide your team the grounding for next steps, including the gap analysis and determine the transition project plan.
Gap analysis
By analysing the gaps between your current process of financial reporting and a process under the new standard, you will have:
- An indication of the areas that are going to be most affected from your current IFRS reporting. This will consider:
- The major data gaps / system that are likely to exists
- The differences from your current accounting policies and methodologies to IFRS 17 for key products
- The gap between the processes that will be needed for IFRS 17 and your current processes. It includes an assessment that measure the current readiness and help you to set priority for change in key areas in scope.
- An estimation of resources required for the future project.
- A key input to understanding the deeper systems impact.
Financial impact assessment
The introduction of IFRS 17 will lead to significant changes across the business. The workshop sessions will help to:
- Align key stakeholders across the main business units on the technical aspects of reporting under a new standard.
- Ensure that key stakeholders are making decisions based on a sound understanding of the IFRS 17 principles.
- Provide your team the grounding for next steps, including the gap analysis and determine the transition project plan.
Technical design
After understanding the result from the performed impact assessment and the gap between what your company has and what is needed, the next challenge would be on making the leap to the implementation stage in the near future. You might be wrestling with how to start this long-term IFRS 17 implementation project – this is where the technical design stage comes into play as it sets the foundation for the other phases towards implementation stage.
During this phase, we will work with you to provide industry knowledge about how your peers are planning to account for their business, produce new charts of accounts and disclosure requirements, evaluate the target operating model, and design the likely analyst packs and communications. Our insurance experts will partner with you to help you understand the areas to focus on when designing your underlying systems architecture.
To succeed in these endeavors, we advocate taking a “soft design” approach which introduces a flexible way of working following three well-established principles.
Transition
The new standard requires insurers to restate their opening balance sheet to reflect their existing business. This one-off exercise should not be overlooked. For life companies this is a critical component of P&L for next ten plus years. PwC can support you with the design and implementation of the opening balance sheet and advise you on how to convert your existing processes to your target financial architecture, using existing data in the most effective way.
IFRS 17 In A Box; Take the headache out of implementation
Are you looking for an “out of the box” solution for your IFRS 17 implementation project?
At PwC, we have used the collective experience of over 190 IFRS 17 projects to create a one-stop-shop solution centred around an industrial strength IFRS 17 valuation engine.
Watch the video for a quick introduction to PwC’s IFRS 17 In A Box offering.
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Contact us
Nicholas Lim
Director, Risk & Regulatory Transformation Leader, PwC Malaysia
Tel: +60 (3) 2173 1558
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