OLDWICK, N.J.–(BUSINESS WIRE)–In this episode of AM BestTV, Anthony Silverman, associate
director of analytics, AM Best, said International Financial
Reporting Standards (IFRS) 17, which takes effect in 2022,
requires insurers to perform calculations closer to the policy level.
Click on http://www.ambest.com/v.asp?v=ifrs419
to view the entire program.
In the episode, Silverman explains why there is a need for an updated
global set of accounting standards.
“IFRS 17 is intended to bring more market-related values to the
insurance liability numbers and accounts, as well as consistence across
territories,” said Silverman. “It is necessary because the current
practice, which is IFRS 4, introduced in 2005, actually grandfathered
local gaps that were in place then. This means that different accounting
standards are actually used in different countries.”
Silverman also addressed how AM Best will use IFRS 17 data in its
ratings process, once implemented.
“AM Best will be using the data for its quantitative model; however, we
do make adjustments, since we are interested in the economic realities
underlying these companies. With the principles-based targeting of
market values that IFRS 17 represents, we do anticipate that the
adjustments to those numbers will be considerably less than what we do
presently,” he said.
To access a copy of this special report, titled, “IFRS 17 – A Welcome
Advance. Value Measures in Primary Accounts. Delay was a Necessity”,
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