Backgrounder: International Financial Reporting Standard (IFRS) 17 - Guideline replacing temporary Advisory
Backgrounder -
Overview
The International Financial Reporting Standard (IFRS) 17 standardizes how insurers report insurance contracts, providing clearer insights into their obligations and financial health. By recognizing profits gradually, with improved transparency, this allows policyholders, investors, and regulators to compare companies more accurately and confidently, enhancing stability and trust across the insurance industry globally.
Key changes
The Office of the Superintendent of Financial Institutions’ (OSFI) IFRS 17 Guideline consolidates OSFI’s key accounting expectations for certain insurance products and transactions. Additionally, it addresses comparability concerns highlighted by stakeholders, replaces the current advisory, and supports consistent application of existing regulatory return instructions across the industry.
Why it’s important
These changes are important because they streamline and clarify OSFI’s insurance contract accounting expectations for certain types of products and transactions to promote more consistent and comparable financial statements across the industry. OSFI's guideline enhances transparency, making it easier for stakeholders—such as policyholders, investors and regulators—to understand an insurer's results from operations and its financial position.
Links to other OSFI guidance
OSFI’s capital guidelines have adapted the IFRS 17. The final IFRS 17 Guideline is closely linked to the Memorandum to the Appointed Actuary (2024). See the related letter for more information.
Effective date
The final IFRS 17 Guideline is effective immediately.