Estimated reading time: 3 minutes
“50% of respondents to the latest PwC South African IFRS 17 survey say the integration of technology solutions is by far the most common challenge being faced by insurers.”
South African insurers have all started their IFRS 17 programme plans in earnest and, with IFRS 17 delayed to 2023, some have taken time to review their decisions. Companies that made an early start to their implementation journey are mostly developing solutions in-house or reusing existing solutions — driven by the lack of vendor-solution maturity at the time they were ready to commence detailed design and build of systems. Those that have waited for the dust to settle are looking at vendor solutions to meet the complex requirements of IFRS 17, notably for determining the contractual service margin (CSM), the IFRS 17 subledger and for disclosure reporting tools.
Finance functions already face many challenges, which IFRS 17 will further strain:
As finance executives navigate the IFRS 17 implementation roadmap, some areas will require careful consideration:
Based on our survey findings, I consider South African insurers to fall into two IFRS 17 maturity camps. Their 2021 will look very different. Those who are well advanced will start testing solutions and parallel run reporting processes to make sense of the numbers. They will be able to focus on their transition efforts for producing the opening balance sheet.
Those that are still in the design phase will need to urgently complete the design and start building. Meanwhile, those who indicated that they haven’t started yet will need to take immediate action. Any further delay could seriously compromise any IFRS 17 solution implementation.