IFRS

The introduction of International Financial Reporting Standards (IFRS) has changed the primary reporting method for insurers. All EU listed companies now have to comply with IFRS for their year-end 2005 accounts, as the standards have replaced local GAAP.

PwC has developed an ‘IBIS’ (Impact, Business Implication and Solutions) toolkit which helps insurance companies embed and implement IFRS within their organisations and identify and understand any IFRS implications, in order to meet the future needs of their business.

How we can support you
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Potential issues

• You need to raise awareness of IFRS within your company in order to:
• Control profit volatility and manage stakeholders' expectations
• Maximise, measure and monitor the profitability and pricing of new and existing products
• Control your capital requirements and solvency
• Review investment and hedging strategies and reinsurance strategies
• Understand and report on your management information requirements
• Manage your internal and external resourcing requirements

How we can support you

• Understand the financial impact of moving to reporting under IFRS
• Develop an implementation plan, including tasks, roles and responsibilities, resource requirements and a timetable for implementation
• Develop IFRS valuation methodology for insurance contracts and distinguish between those contracts that meet the IFRS definition of insurance and those that do not
• Perform a valuation of financial instruments and embedded derivatives to determine adjustments needed
• Build and run investment and stochastic models and interpret the results produced, in order to resolve uncertainties and complexities

PwC’s services in relation to IFRS include

• Assessment of the impact of the introduction of IFRS through an impact study
• Assessment of existing actuarial / reserving systems
• Calculation of profit profiles for individual products
• Investment modelling
• Actuarial input into project governance
• Preparation of detailed groundwork and instructions for implementation
• Help with training of individuals involved in the implementation process
• Assistance with deriving assumptions
• Help with selecting appropriate model points (life) and units of account (non-life)
• Help in dealing with the business implications
• Assistance in establishing technical committees including experts from within your company and our AIMS (actuarial) team
• Help in determining the adjustments required to local GAAP
• Assistance in meeting reporting and disclosure requirements.