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Chuks Udo Okonta
The West African Insurance Companies Association (WAICA) has set in motion the need for insurance companies in the subregion to commence harmonisation of International Financial Reporting Standard (IFRS) 17.
Chief Executive Officer Mettlehouse Consulting & Ex-Director, National Insurance Commission Barineka Thompson, re-echoed this in a Paper entitled:’Harmonizing Financial Reporting in West Africa IFRS 17 Insurance Contract Implementation Guide for Operators and Regulators’ presented at the 2023 WAICA Education Conference in Freetown Sierra Leone.
He noted that the implementation of IFRS 17 presents a great opportunity for all WAICA members to set the tone and as example to other regional blocks, with common cooperation and interest.
He submitted that IFRS 17 was issued in May 2017 to be effective for annual
periods beginning on or after January 1, 2021 but now taking effect on January 1, 2023, with earlier application permitted for entities to supersedes IFRS 4.
According to him, IFRS 17 heralds a new era of accounting for insurance contracts because it sets. out principles-based requirements.
The impact of IFRS 17, he said would be felt by many stakeholders, including, but not limited to preparers of financial statements, those charged with the governance of entities that issue insurance contracts, investors,y regulators, analysts and auditors.
He stated that IFRS 17 would improve the comparability of the measurement, recognition, presentation and disclosure of insurance contracts and over-all, the financial statements of member companies.
He said with the reporting standard, work of the College of Insurance Supervisors (CIS) of the WAISA would be more efficient.
“It is a great opportunity for WAICA members to develop and adopt uniform illustrative financial reporting (to
provide minimum basis) template for use by operators in the region.
“This can be achieved through policy adoption by the WAISA) under the West African Monetary Zone (WAMZ) protocol,” he posited.
He enjoined WAICA member countries to commence the harmonization of financial reporting and going forward, adding that the effective implementation of the standard is hinge on the following guiding principles:
Embrace IFRS 17 principles; IFRS 17 provides principle-based requirement that aim to improve the comparability of measurement and presentation of insurance contract by insurance entities; High Quality Implementation; management should ensure high quality implementation while avoiding undue complexities; consistent interpretation and application across groups and the standard introduces various accounting policy choices; hence, stakeholders must ensure consistent interpretation and application of the standard across group entities.
Continuing he said it would also require robust governance over the entire implementation program.
To ensure effective implementation of the standard, he said management must set up a steering committee saddled with the responsible of providing governance for the successful implementation of the standard and foster methodologies and solutions based on transparency and auditability.
It will improve the comparability of the measurement, recognition, presentation and disclosure of insurance contracts and over-all, the financial statements of member companies, he posited.
Thompson implored regulators to show leadership and coordinate the industry with clearly detailed road map to achieve seamless implementation.
He pointed out that some disparities obtain in insurance financial reporting models across the WAICA block, similar to other jurisdictions and maintained that the birth and operation of West African Insurance Supervisors Association (WAISA) is noble.
Commenting on the outcome of the event, President of WAICA Eddie Efekoha, applauded the Secretary General of WAICA Davis Iyasere and his team at WAICA secretariat for the good work, stressing that the first outing was great and called on them to build on the successes recorded.
A participant also said: “I hereby join to applaud the WAICA Council and staff, the LOC, delegates and faculties for a highly eventful and knowledge impactful conference.”
A delegate fro Ghana said: “On behalf of Ghana’s delegation, I sincerely thank WAICA organisers and all others involved for such a wonderful event and hospitality. God bless you all.”