Greater transparency and comparability in the insurance sector are anticipated to result from the long-awaited IFRS 17 insurance contracts standard, which has been published by the International Accounting Standards Board (IASB). With the biggest impact foreseen for insurance companies, the local market will inevitably experience fundamental changes in product design, business models, processes and systems.

In this context, KPMG has organised a one day practical workshop Opening the Black Box | Demystifying IFRS 17, where an overview of the final standard was provided. The workshops were led by two subject matter experts in insurance namely Esther Pieterse, Director, KPMG in South Africa, and Désiré Lan, Partner, KPMG in Mauritius. The two experts walked through some of the complexities and benefits of the new requirements and what these may mean for insurance companies.

The new insurance contracts standard – IFRS 17 – brings fundamental changes to international insurance accounting.

The new accounting standard will come into force on 1 January 2021 and will give users of financial statements a whole new perspective.

It will represent a significant change for many insurers both in terms of financial results and operating model.

The ways in which analysts interpret and compare companies internationally will change. The standard places insurers reporting under IFRS on a level footing, opening up the ‘black box’ of current insurance accounting.

The new standard brings both benefits and challenges for insurers, who will need to gain an understanding of the accounting changes and the impacts on their businesses.

Subjects which were discussed during the workshop include:

• Key features of the new standard
• Practical implications and challenges ahead with the new standard
• Proposed implementation roadmap