One of the world’s largest international insurance carriers had federated International Financial Reporting Standards (IFRS) reporting to local entitles, since consolidation was not needed. KPMG assessed the 30+ global entities in risk-weighted tiers, based on entity size, product mix, and local regulatory conditions— including IFRS 17 adoption expectations. In-depth workshops and procedures included:
- Accounting: Initial portfolios were defined and contract boundary issues identified via contract level review
- Actuarial: PAA eligibility and onerous contract testing executed on more than 35 (re)insurance products
- Data: Key data elements and significant gaps identified for sourcing into the SAS data model
- SAS implementation: Actuarial prototype cash flows staged into the SAS sandbox; LRC and LIC balances tested compared to with accounting desktop tools
- Operating model: Identified close processes changes needed for pivot to SAS-centric, offshore business-as-usual model.
Insights helped the client to:
- Quickly identify which approximately 20 percent of products have a significant possibility of GMM treatment
- Facilitate hard risk and budgetary choices, concerning which activities are needed immediately under “no regrets” approaches, versus where waiting maintains flexibility
- Focus accounting policy development on items with the greatest impact on implementation (e.g., PAA eligibility, contract boundary, reinsurance, expenses, transition)
- Fast-track SAS IFRS17 solution procurement and infrastructure development, to provide a stable core for upstream actuarial and data and downstream accounting teams to build out from
- Engage country executives, with holistic views of the implementation process and end state
- PMO a lean, effective, SAS-based IFRS 17 implementation.
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