At our recent IFRS 17 webinar we asked our audience of project leaders, accountants and actuaries the status of their IFRS 17 change programs and how they view the IFRS 17 data challenge.
The extension of the IFRS 17 effective date at the end of 2018, allowed the industry a short breathing space and time to take stock of current progress and plans for 2019. The first poll asked our webinar audience how the delay has affected their IFRS 17 project.
It was clear that the audience was evenly distributed in their answers.
29% of the audience, the majority by a very small percentage, were still on track with their projects with no change. This is great news, as firms will need to keep the momentum up in their IFRS 17 programs in order to confidently meet the new deadline of January 2022.
Timescales will continue to be challenging even with an additional 12 months. These firms are likely to have completed impact assessments, Proof of Concepts and are progressing into detailed design and early stage implementation.
The second largest group were those who have seen a minor shift of less than a quarter. The change program as a whole may not have been hugely affected, but there is a lot to do, and these firms cannot afford to defer their projects any further.
The final two groups were those who had seen a revision to their plans of more than three months, and those who were simply not sure.
The firms that have seen a major shift in their project plan by more than three months will need to use this additional time wisely to complete impact assessments, Proof of Concepts and technology selections, and to maximise the transformational benefits that an accounting change program can deliver, including: simplified processing, faster close, improved reporting and reduced costs.
IFRS 17 programs are challenging. They have a significant impact on systems, processes and people. The new and evolving standards must be interpreted, systemised and then put into operation. A key aspect of any project’s success will be the availability of data.
Our second poll asked attendees how their own organisations view the challenges of IFRS 17 data.
Data doesn’t seem to be a problem for a very confident 2% of attendees. This was by far the minority.
31% of organisations answered “quite challenging”. These firms may have maybe benefitted from earlier finance change programs such as Solvency II which started to address data management challenges.
The 55% who answered “very challenging” are certainly in line with Legerity’s experience and current view of the market, and 13% described the process as an “absolute nightmare”.
The new, more detailed reporting required by IFRS 17 will lead to a significant increase in the volume and granularity of data. Firms will have to make decisions for managing the data from source system through to disclosure. This process will lead to further choices regarding system architecture, business and accounting policy implementation.
Breaking the IFRS 17 data challenge down into a manageable framework is vital.
Contact us now to learn how the Legerity IFRS17 Data Management Framework can greatly assist your program.