Insurance associations from around the world are asking for a two-year delay in the implementation of the International Financial Reporting Standard 17 for insurance contracts.
“A number of important issues need to be resolved in order to ensure the quality and operational practicability of the new standard,” write nine insurance associations in a joint letter to the International Accounting Standards Board.
These organisations include Insurance Europe and associations from Australia, Canada, Korea, New Zealand and South Africa.
“There are serious operational constraints on insurers’ ability to successfully implement IFRS 17 on the current timelines,” they write.
The implementation of IFRS 17 is scheduled to start on 1 January 2021. It will replace IFRS 4, which has given companies dispensation to carry on accounting for insurance contracts using national accounting standards, resulting in a multitude of different approaches. Under IFRS 17, insurance obligations will be accounted for using current values – instead of historical cost.
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