OSFI Consults on Regulatory Forms and Instructions for IFRS 17
OSFI is seeking views on the draft manual of regulatory forms and instructions for IFRS 17. OSFI published a letter which advises federally regulated insurers of the proposed changes made to the Canadian Council of Insurance Regulators (CCIR) manual of regulatory forms and instructions. The proposed changes ensure that federally regulated insurers will continue to report their financial statements to OSFI in accordance with the Generally Accepted Accounting Principles (GAAP). The public consultation will run till March 21, 2020.
The consultation encompasses the following regulatory forms and instructions:
- Life/Property and Casualty (P&C)/Mortgage Insurers Core Financial Statement Return
- Life/P&C/Mortgage Insurers Supervisory Quarterly Statement Return
- Life/P&C/Mortgage Insurers Supervisory Annual Supplement Return
- Life/P&C/Mortgage Insurers Provincial Statement Return
- The corresponding instructions and validation rules template for each regulatory form
The legislation governing the federally regulated insurers stipulates that "financial statements shall, except as otherwise specified by OSFI, be prepared in accordance with GAAP, the primary source of which is the Handbook of the Chartered Professional Accountants of Canada." GAAP for the federally regulated insurers is effectively the International Financial Reporting Standard (IFRS) as issued by IASB. Through its authority, OSFI may specify additional accounting guidance or disclosures.
In May 2017, IASB had issued IFRS 17 on insurance contracts, which replaces IFRS 4, the current insurance accounting standard. IFRS 17 is effective for annual periods beginning on or after January 01, 2021. This means that the federally regulated insurers will be required to publish financial statements and reporting regulatory returns complying with IFRS 17 for their first quarter in the fiscal year beginning on, or after, January 01, 2021. In June 2019, IASB released an exposure draft proposing amendments to IFRS 17, with one of the amendments being a deferral of the effective date of IFRS 17 by one year to January 01, 2022. IASB intends to finalize the IFRS 17 amendments by mid-2020. OSFI expects federally regulated insurers to continue efforts toward implementation in 2021 and to use the extra year (if extended) for testing and quality assurance purposes.
Related Links
- OSFI Letter
- Life Insurance Return for Consultation
- P&C Insurance Return for Consultation
- Mortgage Insurance Return for Consultation
Comment Due Date: March 21, 2020
Keywords: Americas, Canada, Insurance, IFRS 17, Insurance Contracts, Reporting, Forms and Instructions, GAAP, IFRS 4, IASB, OSFI
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