IFRS 17 Series #5 - Disclosure and Reporting

Welcome to part 5 of the IFRS 17 Series where we talk about disclosure and reporting requirements for the upcoming standard.

Transcript

Liam:

Hi there, Liam here from VantagePoint. Thank you very much for joining us again in another video in this IFRS 17 series and the best way to prepare for the upcoming standard. Today, we're going to talk about a really, really important aspect, which is, of course, disclosure and reporting. Now, on disclosure and reporting, Matt, as I see it, there's kind of two main things that I see coming up for a lot of the clients we speak to at the moment. It seems to be automation of reporting, because obviously, if that's not automated, it's inefficient and it's taking up a huge amount of their time. And then the next part really is around having a single solution to do this and not having a disparate kind of architectural diagram of systems that we need to figure out how to link together in order to do this disclosure and reporting. Did you maybe want to take us off on the first point and really just dig into automating reporting a little bit?

Matt:

Yeah. So the thinking about the technology you choose will be key to automation/ in terms of the standard, the disclosure requirements under the standard are intense. There are significant disclosure requirements. They're going to change, so making sure you've got some agility as well to have those disclosures evolve over the next few years as everyone gets a clearer view on what they want to disclose. But ultimately you don't want to be manually producing those. You don't want to be pulling data from different places. And you want to think about ultimately how efficiently and how quickly can you produce those disclosures. That would be the overall theme that I'd set to think about when you are considering a solution and thinking about how you're going to meet all the IFRS 17 disclosure requirements.

Matt:

But then it leads really onto the second point, which is around we recommend targeting having a single solution for everything, so a single solution for both your IFRS 17 calculation, but also your IFRS 17 disclosure. Now, that's potentially a bit of an ask because a lot of solutions are simply data hubs. They store data, they calculate data, but the front-end interface is something that might even still be work in progress. So in terms of reporting, they're potentially a long way off. Often, you'll see offer sensing solutions paired with BI tools, and BI tools the only way to interrogate the data within. Now, the concern or the challenge with that is that they'd always be on the back foot when implementing disclosures. And you've also got to have two technologies working hand in hand. You'll be moving data around. So where we see disclosure working the best is where it's the exact same technology, the same solution that's producing the numbers as is reporting on the numbers.

Matt:

A couple of other points to add is that think about what disclosures reports come out of the box. And after the box reports will give you a clear indication of how flexible the reporting capability is, but probably more importantly, have a view of how easy it is to configure and change those reports. Because whatever the reports look like today, in the next three years as the standard matures and implementations mature and the standard starts to go live, reporting requirements absolutely will change. Whether that's driven by external stat requirements or whether that's driven by internal management requirements, it's not always, for me, just about what comes out of the box. It's about how easy will it be for someone in the future to configure a new report, move that column about, slice the data in a different way, or just pull out completely different data sets from within the solution in a different way. The projects that are going really well often go well because you can report on everything within the solution really well.

Liam:

Okay, great. So I guess there's two kind of core aspects there. First of all, there's does the single solution having one solution rather than, as we said, the whole connectivity issues and everything else that comes along with having different solutions. And then there's also the automation point, which I guess is a more obvious one, but also really important. But one thing that you did mention there that I thought was really interesting is, again, we go back to the point around having the internal expertise and the knowledge that you're not implementing something that you can't have complete control over, the project team can't have complete control over. So I guess the ability to, with the consulting organisation that you choose and within your own organisation, developing that kind of internal expertise so that you have complete control to change, and as you mentioned, slice and dice the numbers as you need to, even from reporting as well. So it's really interesting that that's a recurring theme here that is really important, that you have complete control of your solution: format, configurability, perspective.

Matt:

Exactly. The point I'd add is that make sure through your project that you are onboarding those skills to your organisation, whatever the reporting tool is, BI tool or otherwise. And the challenges that you might find with a BI tool is you'll need to really understand the schema, the behind the scenes structure of the solution that you have. So think about how easy it will be. So not just onboarding that knowledge, but how easy will it be for a finance and actuarial business user to be the owner and composer of reports rather than having to lean on a technical resource, internal or external.

Liam:

Great. Excellent. So just to summarize, we really hear on disclosures, there's kind of two recommendations coming from ourselves based on the project experience, and, Matt, based on the project experience you currently have. I think that's really around ensuring that you have one single solution from an automation standpoint, ensuring that you have one single solution also from an architectural standpoint, just for the ease of connectivity, etc. And then I guess there's also one third point to add, which is really, again, as you know, it's a bit of a recurring theme here, but it's just around having the internal expertise to ensure that whatever solution you decide on, you're able to, I guess, change and configure that solution based on the requirements, based on what is a bit of a moving target at times, that is IFRS 17. Updates are coming, and I guess they're rethinking how they do this. So that's really important as well.

Liam:

I hope you found this video informative. Thank you very much for joining us again, and we have one video left in our series. If these are of interest to you and you'd like to discuss a little bit further with us, please just reply to this email and we're more than happy to discuss any of the points previously mentioned, be it from a data perspective, from a transparency perspective, or the points discussed today in terms of disclosure and reporting. Look forward to seeing you in the next video. Thanks very much. Bye bye.

Start preparing for IFRS17 now, talk to us