IFRS 17 - it's time to prepare
Public sector organisations are reminded to ensure accounts will be IFRS 17 compliant when accounting for insurance contracts, from this financial year onwards.
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It is time for public sector organisations to ensure their accounts will be IFRS 17 compliant when accounting for insurance contracts.
The International Financial Reporting Standard 17 (IFRS 17) Insurance Contracts is the new accounting standard for insurance contracts. It replaced IFRS 4 Insurance Contracts for accounting periods starting on or after 1 January 2023.
GAD was involved in the development of the IFRS 17 application guidance which is for accounts within scope of the government financial reporting manual (FReM).
Transition date
The transition date for IFRS 17 was 1 April 2024. This is the date from which organisations will need to keep in mind that accounts for this financial year will be considered as part of the overall IFRS 17 approach. Taking this into account now will mean organisations are properly prepared for the first year of IFRS 17, which will be from 2025 to 2026.
It will be applied by HM Treasury in the FReM from 1 April 2025 (with limited options for early adoption). The underlying aim of IFRS 17 is to make reporting of risk transfer contracts more comparable between different entities.
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Remember IFRS 17
GAD’s lead on IFRS 17, Actuary Nick Clitheroe, said: “This financial year is key for prepping accounts using IFRS 17. This is because as the first year of IFRS 17 will be 2025 to 2026, the accounts for this financial year will also need to be shown on an IFRS 17 basis.
“It is worth considering this now because there is less than 2 years for the first set of accounts to be introduced.”
GAD support
GAD’s skills include analysis and advice around probability weighted cashflows, contingent liabilities and risk adjustments. If you expect to be in scope of IFRS 17 and would like actuarial support, contact us at enquiries@gad.gov.uk.