IFRS reporting

The International Financial Reporting Standard for insurance contracts (IFRS 17) is expected to be published in early 2017. In parallel with this long-awaited development, IFRS 7 and 9 (Financial Instruments) have defined treatment of insurers' assets and investment contracts, while IFRS 13 has defined the concept of fair value.

Insurers have been using Prophet to report on insurance business under IFRS 4 since 2007, and at this stage the calculations are effectively consistent with local GAAP. 

Prophet's Life and Health liability libraries are designed to calculate the fulfilment cashflows, risk adjustment and the contractual service margin required for long term business modelling under the IFRS 17 Building Block Approach, BBA. With the use of the Nested Structures feature of Prophet these values can also be projected.

Similarly Prophet’s GI/P&C libraries are designed to calculate the Premium Allocation Approach, PAA, typical for short term business.

The IFRS regulations also assume a high level of control and auditability of the data, and FIS have solutions for each stage of the data management process – Assumptions Manager for the inputs, Prophet Enterprise for the calculations and results, Prophet Control Centre for overall work flow management, and the Insurance Data Repository for linking the actuarial data to the chart of accounts within the accounting systems.

Further, FIS is fully engaged with the ongoing consultation process to ensure that Prophet continues to support the still developing regulations in as efficient and effective way as possible aligned to the needs of our clients.

FIS encourages our customers to engage with us on this - both about the capability to meet the calculation requirements and about introducing the controls and software needed to ensure that analysts are convinced by the commentary on financial results and risk management. For more details please see our brochure.