The International Accounting Standards Board (IASB) has taken the decision to delay the IFRS17 insurance accounting standard for a year. IFRS 17 which determines how insurers report their profits.
The industry has welcomed the move, giving it more time to assess the likely impact of the standard, which is intended to make it easier to compare insurance companies globally (although insurers say this is like comparing apples with pears as markets are vastly different) and compel insurers to record profits from long-term policies over the life of the contract instead of upfront.
“South African insurers, through The Association for Savings and Investment South Africa (ASISA), were supportive of this delay and those insurers that have not yet started their IFRS 17 journey will welcome the extra time,” says Dewald van den Berg, PwC South Africa’s IFRS 17 technical lead.
Industry lobbying to delay the implementation of IFRS 17 clearly paid off – but Chantel van den Heever, PwC South Africa’s IFRS 17 lead, has cautioned insurers to “use the extra time wisely” to prepare for roll-out.