OSFI IFRS 17: Insurance Contracts Standard - Project Plan TimelinesRelease Date: 11/23/2017 Staff Reference: Noeline Simon
Submission to OSFI
November 23, 2017
Mr. David Correia
Director, Accounting Policy Division
Office of the Superintendent of Financial Institutions (OSFI)
1900-121 King Street West
Toronto Ontario M5H 3T9
OSFI IFRS 17: Insurance Contracts Standard - Project Plan Timelines
Thank you for providing industry the opportunity to comment on OSFI's IFRS 17 Project Timeline. We are pleased to note that OSFI has incorporated industry's initial feedback in this latest version of the timeline, in particular by specifying that the first quantitative impact study may be more of a qualitative study and delaying some of the initial consultations and studies to accommodate when industry data may be available.
The industry's comments and questions on the current draft IFRS 17 Timelines are as follows:
1. Could OSFI provide more detail with regards to the Directed & Public Policy Consultation on Accounting Policy (green row) at this time? We recommend advance consultation with the industry on the design and content of such consultation/questionnaire.
2. The industry would like to preserve the principle based nature of the standard and avoid any narrowing through Accounting Policy Guidance, so we are pleased to note the "(if necessary)" under "Final Accounting Policy Guidance" and look forward to working with OSFI so that:
- no accounting policy guidance will be required and
- to the extent necessary, OSFI will use capital adjustments, instead of accounting policy guidance.
For example, are the QIS1 and QIS2 boxes for capital meant to include OSFI work effort before the QIS, followed by industry work to complete the QIS and finally OSFI time to review the results of the QIS?
4. Can we interpret the alignment of the blocks to suggest OSFI will release the first Capital Policy Directed Consultation part way through Q2 2018 (ie ~May 30 2018)?
5. The Directed Consultation and QIS1 under Capital Policy seem to straddle the green bar of the accounting policy consultation above. Could OSFI elaborate on how they propose to operationalize these two inter-related consultations?
6. What's in the scope of progress reports starting Q3 2018 (Transition Support)? We trust OSFI will consult the industry on the content and design of the report.
7. We assume that the ‘regulatory return’ noted is the LIFE return required by OSFI? We recommend planning for tight coordination of the "regulatory return" changes in consultation with the industry.
8. Could OSFI elaborate on the last bar under Transition Support ("Development and Review of Actuarial Guidance (CIA & OSFI)" and "Development CIA Guidance on Capital Returns") and any interdependencies on the timing and content of these with the Accounting and Capital Policy streams?
The industry welcomes OSFI's clarification on these questions and proposes a joint discussion with OSFI staff and the respective industry teams to review these timelines and related details, as soon as convenient.
Thanks again for allowing us the opportunity to interact and work together on the IFRS 17 Project Timeline.
Please let me know if you have any questions or require any further information.
VP, Taxation, Pension and Reporting