UAE – IA Holds the 1st Meeting for New IFRS 17 Application Working Group
The Insurance Authority (IA) held the first meeting for the sector’s working group on the International Financial Reporting Standard related to insurance contracts (IFRS17) under the auspices of H.E. Ebrahim Obaid Al Zaabi, Director General of the Insurance Authority.
The meeting discussed the Working group’s objectives, scope of work, goals, and purposes for applying the new standard (IFRS 17). In addition to discussing the major challenges encountering the arrangements by insurance companies to apply the requirements amid Coronavirus pandemic.
The meeting was attended by the technical and financial supervision team and actuaries in the Authority, as well as, members of the Emirates Insurance Association (EIA) and members of the working group representing insurance companies, some of external auditors’ firms and actuaries operating in the state.
The IFRS 17 issued by the International Accounting Standards Board (IASB) in May 2017, is a new comprehensive IFRS for insurance contracts. IFRS 17 will become effective for annual reporting periods that commence early 2023 or later, and allowing early application. Given that the annual reports of 2023 include the financial statements of the previous year (2022).
The new IFRS increases the transparency of the financial reality and performance of insurance companies, and aims to make their financial statements more comparable with other insurance companies and other industries.
The IFRS 17 provides fixed principles for all accounting aspects of insurance contracts. It eliminates the existing contradictions and enables investors, analysts and other to compare companies, contracts and industries effectively. Additionally, it provides a consistent framework to improve comparability between companies across different countries, insurance contracts and different industries. Furthermore, it will provide a more transparent and useful information about the value of insurance contract liabilities and profitability.