The IFRS 17 standard
After 20 years of preparation, on 18th of May 2017 a new international standard concerning insurance contracts, IFRS 17, was published. The goal of this new standard is to provide better info on insurance companies’ financial state and profitability by creating more transparency and enhancing comparability between financial statements.
IFRS 17 standard differs from Solvency II which leads to underwriting reserve amounts being differentiated. IFRS 17 standard unifies accounting of insurance liability in insurance contracts, which implies that national manners of calculating it are no longer compliant. In IFRS insurance contract liability is to be calculated as the present value of future cash flows with a provision for risk.
IFRS 17 will replace IFRS 4, which was published in 2004 and was intended to be a temporary standard. IFRS 17 has an effective date of 1st of January 2021.
The Tagetik IFRS 17 solution
Because IFRS 17 will be a mandatory part of insurance companies’ reporting requirements, it will influence operational costs, KPI figures and forecast reports. This means that insurance companies might have a difficult and expensive process of rebuilding financial managerial processes, solutions and workflows ahead.
CCH Tagetik IFRS reporting software has an automated compliant solution with the expanding features (e.g. Solvency II). With CCH Tagetik IFRS 17 solution you can focus on your core business while relying on being compliant with regulations. CCH Tagetik offers a set of solutions (e.g. Solvency II, IFRS 9, IFRS 15, IFRS 16 and IFRS 17), which are available as a cloud based or an on-premise solution making sure, that in all circumstances your business remains its compliance.