IFRS 17 Special report 2019
The insurance industry has long been vocal about the need for a two-year extension to the International Accounting Standards Board’s (IASB’s) proposed 2021 implementation date for International Financial Reporting Standard (IFRS) 17 – the accounting standard for valuing the liability side of insurers’ balance sheets that replaces IFRS 4. Eventually, IASB met them halfway, opting for a 12-month extension – a decision that hasn’t been greeted with universal approval from the sector.
What has been less talked about is IASB’s move at the same time to delay IFRS 9 – which looks at the valuation of financial instruments – for insurers until 2021. In other words, the industry will be able to co-ordinate the implementation of both the asset and liability accounting reform in the same year, a move that William Gibbons, asset-liability management specialist at PwC, says is a major boon to be drawn from IASB’s November announcements.
The insurance sector is the only part of the financial markets to be given a reprieve from IFRS 9, which is pretty much mandatory from January 1, 2019, so does this exemption contradict the IFRS’s mission statement to bring transparency”, “accountability” and “efficiency” to global financial markets?
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