Good News in a Tough Time!

These are indeed challenging times, and I hope you are all well and keeping safe.

As the scope of the COVID-19 pandemic continues to take shape, medical professionals advised that social distancing and limiting gatherings are key strategies to slow the spread and limit the growth and impact of the disease. In deference to above advice I will be working from home for some days!

To this end, I will be dedicating part of my free times to educate interested parties on technical accounting matters and latest developments – pro bono.

So, here’s my Series 1, titled - Good News in a Tough Time!

The International Accounting Standards Board, in a not-so unanimous decision during March 2020 meeting, deferred the effective date of IFRS 17 Insurance Contracts and extends the exemptions currently in place for some insurers regarding the application of IFRS 9 Financial Instruments to January 1, 2023. This move will undoubtedly make IFRS 17 one of the standards with longest development years (for almost 20 years record since IFRS 4 was issued in 2004! ).

IFRS 17 sets out the requirements that a company should apply in reporting information about insurance contracts it issues and reinsurance contracts it holds. The standard replaces an interim Standard—IFRS 4 Insurance Contracts as well as represents the most significant change to insurance accounting requirements with the main objective of aligning accounting treatment across insurance industry to increase the understandability, comparability and visibility of insurance company’s performance. (I will cover more details in future series, on request).

In my view, this is not only a smart move by IASB but a huge relief to many insurance companies and some regulators, (particularly those in developing economies without clear roadmaps and with little or no understanding of Solvency II) who are still struggling with how not navigate the ‘perceived’ difficult and rough implementation terrain (to be covered in future series) in the new standards.

You can read more about this and listen to the summary podcast here - https://lnkd.in/ewHVp4D

Recommended resources for the week:

Why Working from Home Is a “Future-Looking Technology”

Companies and employees benefit from workplace flexibility

Turbulence Ahead for Global Supply Chains

Faced with the coronavirus outbreak and trade wars, global companies need to practice “operational hedging.