A new transition option for IFRS 17 – the classification overlay approach

AMR: Wednesday 15 September 2021

8:00am – 9:00am (EST)
1:00pm – 2:00 pm (BST)
2:00pm – 3:00pm (CEST)

ASPAC: Thursday 16 September 2021

8:00am – 9:00am (HKT)
9:00am – 10:00am (JST)
10:00am 11:00am (AEDT)

Webcast overview

IFRS 17, Insurance Contracts, introduces significant changes in financial reporting by insurers that report using IFRS. Did you know that when transitioning to IFRS 17 Insurance Contracts and IFRS 9 Financial Instruments, significant accounting mismatches may arise between financial assets and insurance contract liabilities in the comparative information?

The International Accounting Standards Board (the Board) has published an exposure draft (ED) for a narrow-scope amendment to IFRS 17 to alleviate the potential mismatches. The ED is open for comment until 27 September 2021.

The different transition requirements of IFRS 17 and IFRS 9 could result in operational complexities and one-time classification differences in the comparative information presented by some insurers on initial application of these standards.

To alleviate these issues, the ED proposes a classification overlay approach to provide insurers with an option to present comparative information about financial assets on a basis that is more consistent with how IFRS 9 will be applied in future reporting periods, without unnecessarily disturbing the implementation processes for both IFRS 17 and IFRS 9.

Following the webcast, participants should be able to explain at a high level:

  • The reasons for the proposed narrow scope amendment to IFRS 17.
  • The proposed optional ‘classification overlay’ approach available to insurers that first apply IFRS 17 and IFRS 9 at the same time.
  • How the proposed amendment applies to both insurers that restate and those that do not restate comparative information for IFRS 9 and some factors to consider in choosing which approach to adopt.
  • Some key areas insurers may wish to consider if proposing to comment on the narrow-scope amendment.

This webcast will last approximately 60 minutes. It will be recorded and a link circulated for those unable to attend.

Featured speakers

Mary Trussell

Mary Trussell

Global Insurance Change Lead Partner, KPMG International

Bob Owel

Bob Owel

Director, International Standards Group, Insurance, KPMG UK

Grinni Hsiao

Grinni Hsiao

Senior Manager, International Standards Group , KPMG

Joachim Koelschbach

Joachim Koelschbach

Partner, IFRS Insurance Leader, KPMG Germany