EY | May 11, 2018
IFRS 17 Insurance Contracts (IFRS 17 or the standard) represents a fundamental change to accounting practice for most entities issuing insurance contracts and is expected to require significant implementation effort.
Therefore, as one of the activities to support implementation of IFRS 17, the International Accounting Standards Board (IASB or the Board) has set up a Transition Resource Group (TRG).
Following on the first discussion, important highlights you need to know about this second discussion are:
- The second technical discussion of the IASB’s TRG took place on 2 May 2018.
- The TRG discussed five IASB staff papers on specific issues submitted to the Board.
- The TRG was also asked to confirm whether an outreach report on certain implementation challenges reflected their input fairly.
- IASB staff responses to twelve further issues raised were summarised and reported to the TRG.
- TRG members expressed disagreement with the IASB staff view that insurance services are the only service that an entity takes into account when releasing the CSM for contracts accounted for under the general model. This is particularly important for participating contracts that do not meet the criteria for the variable fee approach where expected profits from investment services can form a significant proportion of the CSM.
- TRG members felt that the staff summary of certain operational challenges arising from the implementation of IFRS 17 did not reflect the full scale, complexity and potential expense of the issues identified and the limited perceived value of the outcome.
- The TRG will discuss, at a future meeting, submissions regarding IFRS 17 issues faced by mutual insurers and whether IFRS 17 should apply to certain contracts typically issued by non-insurance entities.
- The next TRG meeting will be held on 26 September 2018.
To find out more, please download the report 
here.