Don't panic if your IFRS 17 implementation is falling behind, get tactical

IFRS 17 implementations are complex. Even for the simplest of insurance organisations, there’s a lot to do. First, you select a contractual service margin (CSM)/premium allocation approach (PAA) earnings and loss component (LC) engine - or choose to build one in house. Second, you need to integrate that solution into your enterprise architecture. Third, you stand up your IFRS 17 chart of accounts (CoA) in your general ledger. You might even be implementing a new general ledger. The list goes on. Cash flow models, risk capital models, expense systems, FP&A systems, accounting rules, transition, controls, business intelligence...

A scope of this size is understandably causing issues as we draw closer to the promised minimum viable product (MVP) delivery date for IFRS 17 solutions. Programme Directors are finding that, even with the right data going in, the ‘plug and play’ readiness of solutions is falling short of expectations. IFRS 17 solutions often require significant configuration or development to deliver the full suite of features to meet the requirements of the Standard. Scalability of solutions to meet both local and group reporting is also proving to be more of a challenge than had been expected.

Cue the emerging trend of the ‘plan B’.  An alternative plan that seeks to de-risk IFRS 17 implementation projects. This tactical approach ensures data discovery and data solutioning work, financial impact assessment exercises, transition balance sheet and delivery of local IFRS and group IFRS reporting work can continue uninterrupted - without fear of continual and constant rework. At the same time, this plan B buys time for strategic solutions to continue to mature and come to market having reached their MVP status.  

Our 'IFRS 17 In A Box' (IAB) solution is increasingly being considered as a tactical stop gap to reduce pressure on Programme Directors and buy time without jeopardising your ability to meet the requirements of the Standard. IAB offers the breadth of functionality and configuarability needed as an IFRS 17 MVP, including a CSM, PAA and LC engine, a subledger with pre-configured IFRS 17 CoA and rules engine, and a complete IFRS 17 reporting layer. This means, in the short term, insurers have the data needed to produce your IFRS 17 income statement, balance sheet and disclosure requirements of the Standard but, equally importantly, gives them the breathing space to get their strategic programmes back on track.

At the same time, clients can also establish a robust back-up valuation and accounting rules/IFRS 17 journals postings engine. This secures an independent validation model that can be used to challenge and check the build out of your strategic solution and assist with your preparations for your external auditor model validation exercise and, if required, serve as a build blueprint.

If this situation sounds familiar to you, and you would like to hear more about PwC's IFRS 17 In A Box solution, please contact your local PwC office/Relationship Partner or the central PwC IFRS 17 In A Box team. 

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