The IASB defers effective date of IFRS 17 Insurance Contracts
The International Accounting Standards Board (IASB) has completed its deliberations on the proposed amendments to International Financial Reporting Standard (IFRS) 17 Insurance Contracts, that were exposed for public consultation in June 2019.
The IASB has decided (17 March 2020) that the effective date of IFRS 17 will be deferred to annual reporting periods beginning on or after 1 January 2023. Additionally, it decided to extend the exemption currently in place for some insurers with regards to the application of IFRS 9 Financial Instruments to enable them to implement both IFRS 9 and IFRS 17 at the same time.
In previous meetings the IASB had confirmed that it would proceed with the proposals outlined in the June 2019 consultation document with only some minor modifications in response to feedback received. Furthermore, the IASB also made some additional amendments in response to feedback received.
Whilst the IASB highlights that timely implementation of IFRS 17 is vital to improve the quality and comparability of accounting for insurance contracts, it recognises that the decision to defer the effective date by two years from the original date to 2023 will enable insurers around the world to implement the new standard at the same time. The IASB considers this approach to be beneficial for stakeholders.
It is expected that the IASB will issue the amendments to IFRS 17 in the second quarter of 2020.