IFRS 17 “Insurance Contracts” establishes the principles for the recognition, measurement, presentation and disclosure of insurance contracts within the scope of the standard. The objective of IFRS 17 is to ensure that an entity provides relevant information that faithfully represents those contracts. This information gives a basis for users of financial statements to assess the effect that insurance contracts have on the entity’s financial position, financial performance and cash flows.
Insurance companies need to engage consulting firms to help them towards the optimal implementation of the standard.
What are the key features of the IFRS 17?
- combines current measurement of the future cash flows with the recognition of profit over the period that services are provided under the contract;
- presents insurance service results (including presentation of insurance revenue) separately from insurance finance income or expenses; and
- requires an entity to make an accounting policy choice of whether to recognise all insurance finance income or expenses in profit or loss or to recognise some of that income or expenses in other comprehensive income
What is the timeframe for implementing IFRS 17?
The International Accounting Standards Board (IASB) has set 01 January 2021 for commencing the implementation of the standard, and then the effective date for application of the standard has been deferred to 1 January 2023.
What services does Baker Tilly provide in this regard?
- Preparing and amending accounting policies;
- Amending accounts charts to include the principal and secondary accounts related to the implementation of the standard;
- Preparing and amending the manual of policies and operational procedures related to the standard implementation;
- Providing technology consulting that help insurance companies implement automated systems for managing insurance contracts and issuing the required financial reports in this regard
Why Baker Tilly to provide this service?
Baker Tilly is distinguished by specialist professional experience and offers the following characteristics carrying added values to our clients as follows:
- A global consulting firm operating in the State of Kuwait;
- Baker Tilly is licensed by the Capital Markets Authority;
- Local experience under an umbrella of a global network;
- Professional team with in- depth experience in providing accounting consultancy services;
- Bilingual team.