MANAMA: Challenges of IFRS 17 – a new accounting standard for insurance companies, were highlighted by advisory firm Keypoint during a seminar.
Guruparan Kumarasamy, an executive director with Keypoint, said: “Back in October, when the Central Bank of Bahrain (CBB) issued a circular to all of its insurance licensees requiring them to ensure that they were prepared for the significant changes IFRS 17 will introduce, we knew that the onus was on us to act – even though the standard doesn’t come into effect until 2022. We have worked with a large number of insurance licensees on a variety of issues, including the implementation of VAT, cyber security, data protection and IT optimisation.”
The official feels IFRS 17, however, represents a significantly higher hurdle to ‘business as usual’.
“Getting ready – and being able to produce IFRS 17-compliant financial statements – is going to take most insurance companies anywhere between nine and eighteen months, which suggests that insurance businesses are going to need to begin the process imminently.”
Mr Kumarasamy said it organised the seminar in conjunction with SRCO, a leading IFRS-focused North American consultancy firm that has developed a diagnostic tool that will ease the adoption of these new, complex accounting standards.
The seminar, which looked at IFRS 17 from both an accounting and an actuarial perspective, featured two Canadian experts, Sameer Parekh and Muneer Feeroze.
Mr Parekh, an SRCO director who has led IFRS implementations for more than 100 public and private companies in North America and across the GCC, covered a number of accounting issues, including the relevance of IFRS 9, data requirements, expected credit loss models and IFRS 17 through an accounting lens.
Mr Feeroze, with deep actuarial valuation experience, covered valuations, historical and future data requirements, allocating and categorising insurance products, the complexity of projections, determining and setting actuarial assumptions and the importance of modelling.
Naveed Jeddy, the managing partner of SRCO’s Bahrain office, said, “We look forward to working with Keypoint to support the region’s insurance companies as we move from understanding IFRS 17 (and IFRS 9) to comparing financial results under the old and new systems to parallel reporting – all before we see the first financial statements under the new standard in 2022.”
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