FRC publishes review of companies’ IFRS 17 disclosures
News types: Guidance, Inspection, Policies and Responsibilities
Published: 15 November 2023
The Financial Reporting Council (FRC) has today published its thematic review of companies’ first-time application of IFRS 17, a new and fundamental change in accounting for insurance contracts.
The FRC reviewed the interim financial statements of ten companies and overall was pleased with the quality of IFRS 17 disclosures.
The review aims to provide examples of better practice and details the FRC’s expectations for companies ahead of their more extensive, year-end disclosures.
While the FRC identified examples of good practice, there is scope for improvement under IFRS 17 in the following key areas:
- Providing quantitative and qualitative disclosures, that are company-specific, enabling users to understand how insurance contracts are measured and presented in the financial statements.
- Ensuring that accounting policies are sufficiently granular and provide clear, consistent explanations of accounting policy choices, key judgements and methodologies, particularly where IFRS 17 is not prescriptive.
- Avoiding any boiler plate wording - narrative should always reflect the company’s particular circumstances.