IFRS 17: What can we learn from the Middle East?

13 May 2019

In the past 2 weeks, I was lucky enough to spend a week in sunny Dubai with my PwC counterparts across the Middle East, in order to gain an understanding of how their IFRS 17 plans are shaping up in comparison to the other countries around the world. This was a fantastic opportunity not just for knowledge sharing and networking, but also to focus on areas that we can learn from the Middle East’s experience, and vice versa. So, other than the importance of factor 50 suncream, what lessons can we learn from the Middle East IFRS 17 journey so far?

The first thing that really stood out to me was the involvement of the regulator. I have spoken about the importance of involving regulators from an early stage in previous blogs, so it was great to hear that regulators in the Middle East have been asking for completed impact assessments - this has been the perfect way of getting the Insurance industry moving.

The level of detail required by these assessments partially depends on the country; one has focused on the detailed questions, whereas another has chosen the more principle based approach; but in all cases it is the push that many companies need - particularly the smaller companies, who might otherwise sit back and hope for another delay.

The good news for these markets is that they are not behind many other jurisdictions and in some cases, thanks to the regulators, they are ahead of the pack as impact assessments have been completed. That said, it is interesting that the main technology vendors do not appear to have a presence in the Middle East; instead small local vendors are the only vendors that currently show interest in the standard. I wonder, how long will it be until the 10 key vendors that we see in the other markets turn their attention to the Middle East? This is a whole new world of opportunity that is so far untapped.

Finally, it is essential to note that whilst it is tempting to think of the Middle East as one region, it is, of course, made up of many distinct territories each with different regulators and therefore different nuances for each territory. The complexity that each of these individual territories brings means that there is already a huge demand for resources, which is likely to peak in around 12-18 months time. Where will this extra resource come from? No time like the present to look ahead for ways to secure resources, or risk being short staffed at key milestones in the build up to 2021.

Keep your eyes peeled for my next blog that will focus on the impact of IFRS 17 on internal audit, and how you can best prepare for the changes.

Alex Bertolotti

Alex Bertolotti | Partner
Profile | Email | +44 (0)7525 298694

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