Implementation of IFRS 17 - non-executive directors’ focus

As the IFRS 17 implementation deadline of 2023 draws closer, there are several questions that Board members can ask to navigate the transition to implementing IFRS 17 successfully in their firms. We have identified three pillars that encompass essential considerations for NED’s to take.

Strategy and Performance

Revenue patterns: How does the revenue recognition pattern change upon adoption of IFRS 17? What is the impact on product mix/design strategy going forward?
Impact on shareholder equity: What is the impact at IFRS 17 transition and after?
KPIs: How will KPI frameworks be revised, will these address accounting ‘mismatches’/volatility arising from IFRS 17 adoption?
Dividends: How does IFRS 17 impact future dividend capacity?

Risk

Technical issues: What is the solution to technical issues not addressed during standard-setting?
Implementation governance: Have the appropriate risk management controls been in place throughout the implementation process?
Significant judgement: Approach to the key areas of judgement of the Standard, especially where there is no prescribed methodology? Assurance from the auditors?
Internal controls: Have the internal controls and processes been updated to factor in IFRS 17 changes?

People

Remuneration and forecasting: Has the approach to remuneration been revised? Have the new goals, based on IFRS 17 revised forecasting, been set?
Training: Is there an appropriate education programme in place throughout the whole organisation?
Readiness for BAU: Has the transition of knowledge been completed from Implementation Team to Business As Usual?

National Contact

Vitalina Kobernik Audit Director - FS Insurance

Detailed profile

What the boardroom needs to know

IFRS 17 is the first international standard for insurance which will improve accounting. It is also a very technical standard that requires a very specific knowledge and understanding.

IFRS17 Insurance contracts

Insurers are expected to apply IFRS 17 for the recognition, measurement, presentation and disclosure of insurance contracts, which will affect many aspects of their day to day operations.