Financial statements in insurance sector should follow IFRS

Experts tell ICAB seminar

Published : 25 Sep 2022 08:57 PM

Mentioning that Bangladesh is in a critical juncture for graduating to a middle income country by 2026, experts at a seminar on Monday suggested that it is imperative that financial reporting in the insurance sector is done in accordance with the International Financial Reporting Standards (IFRS). 

Financial Reporting Act, 2015 requires that financial statements of public interest entities to which the insurance industry belong to are prepared in accordance with IFRS. 

The Institute of Chartered Accountants of Bangladesh (ICAB) being the premier accountancy body in Bangladesh is ready to help this transition to “IFRS 17: Insurance Contracts” can play pivotal role in successful implementation of this standard in Bangladesh.

Experts exchanged these views at the seminar on “IFRS 17-Insurance Contracts: Overview, Implementation Challenges & Way Forward” was organized by the Institute of Chartered Accountants of Bangladesh (ICAB) on Sunday, 25 September 2022 at Pan Pacific Sonargaon Hotel, Dhaka. 

Mohammad Jainul Bari, Chairman, Insurance Development and Regulatory Authority (IDRA), GoB graced the occasion as the chief guest.  Md. Shahadat Hossain FCA, President-ICAB delivered the address of welcome and Md. Humayun Kabir FCA, Council Member and Past President- ICAB moderated the session. ICAB Vice President Fouzia Haque FCA delivered closing remarks. 

Wasequl Huq Reagan, Partner, Mahfel Huq & Co., Chartered presented the keynote paper. ICAB CEO Shubhashish Bose made introductory remarks. 

Chairmen, Managing Directors, Chief Executive Officers, and Directors of Life and Non-Life Insurance Companies participated in the seminar and exchange their views. 

Mohammad Jainul Bari said, Insurance Development and Regulatory Authority (IDRA) will pay more attention to the compliance with IFRS 17. As soon as this standard becomes effective next year, insurance companies in Bangladesh need to prepare their financial statements according to this standards, he said.

The Insurance Development and Regulatory Authority will prepare an action plan to implement this standard as soon as it becomes effective in January next year. He sought the cooperation of various stakeholders including ICAB and FRC in implementation of IFRS-17: Insurance Contracts.

Full compliance with IFRS 17: Insurance Contracts will increase transparency and accountability in the insurance sector of the country and enable companies to gain public trust as well, he added. 

ICAB President Md. Shahadat Hossain FCA said, the Insurance companies are the large investors in financial markets.  So, the growing linkage between the insurers and the banks is considered as safeguard of financial stability of the country, he said adding, the transparency delivered by accounting standards in this sector, is a crucial ingredient for sustainable growth.  

The keynote presenter said, IFRS 17: Insurance Contracts took 20 years to be issued highlighting the complexity of the standard and overcomes many challenges posed by the interim standard IFRS 4. IFRS 17 ensures more transparent and comparable financial statements.