Deloitte is looking to expand its Asia Pacific team to assist insurers as they gear up for the introduction of International Financial Reporting Standard 17 “Insurance Contracts” (IFRS 17).
With just two-and-a-half years to go before the standard becomes mandatory, an increasing number of insurance companies are turning to professional services organisations to help them meet the January 1, 2021 compliance deadline.
Francesco Nagari, Global Insurance IFRS Leader at Deloitte, says: “The situation we face right now is the demand for professionals with deep knowledge of the IFRS 17 requirements has increased substantially since the publication of IFRS 17 in May 2017.”
“For that reason, Deloitte is ramping up its capabilities, searching the market for the best talent interested in performing these services and join our existing team.”
Nagari describes the IFRS 17 journey as a long and complicated one, reflected in the fact that the International Accounting Standards Board has allowed three-and-a-half years for the transition, one of the longest periods firms have ever been given in which to comply with a new IFRS.
“It is almost like there is now a new financial language that insurance companies must learn to speak to their stakeholders, and the dictionary and grammar are in IFRS 17,” Nagari says.
“Just as when you learn a new language you have to dedicate a lot of time to it and you have to practice, similarly the work that the consultants we are trying to hire are going to be doing is to help insurance companies understand what they need to do to change the way they communicate their financial performance.”
He explains that not only will financial statements produced for the stock market and shareholders need to be changed to comply with IFRS 17, but internal reporting like management information will also need altering to make sure managers maintain their grasp on the business performance using the same metrics.
“It means planning, forecasting, and many other aspects of the business will have to be translated into the new language and that is why IFRS 17 is such a big deal,” Nagari says.
Deloitte is looking to recruit professionals with the ability to convert the IFRS 17 requirements into practical business applications for clients.
Nagari says: “The requirement for IFRS 17 are pervasive and extensive. The impact of IFRS 17 is particularly large on the entities that are going to apply it.”
As a result, Deloitte is looking for professionals with deep technical accounting knowledge, focused on this particularly set of rules, who can assist clients with all aspects of the insurance model, including data, systems and processes, as well as workforce organisation.
Deloitte is particularly focused on strengthening its capabilities in Asia Pacific.
“Within this vast region we have built a number of hubs that act as centres of excellence for our broad engagement teams,” Nagari explains.
“Hong Kong is probably the largest and most important hub within the Asia Pacific region and that is where our talents will be deployed in the first place. Other locations include Singapore and operations in Australia, Korea, Japan and Mainland China and in other parts of South East Asia as well.”
Nagari believes there are significant benefits to talented professionals who join the Deloitte team to assist insurers in preparing for IFRS 17.
“We have been investing a lot in preparing our global network of firms for this challenge, and the result of that investment is that we are reaping very good success in terms of the recognition the market has given us for our capabilities.”
“If you are joining the Deloitte team, you will join a team that is at the leading edge in the delivery of services to the insurance industry.”
He adds Deloitte has always retained fully-fledged consulting capabilities, which makes it different to the other large professional services organisations when a multi-disciplinary regulatory change programme such as the one required from IFRS 17 is on the cards.
“At Deloitte you will be working at a firm where the capability of our services, from accounting to actuarial to technology to data management, is fully developed and yet continuously evolving to meet clients’ needs.
“You will work with other like-minded professionals, equally focused on serving the client, but with different perspectives,” he says.
Nagari is keen to point out that this environment gives talents great potential for enriching their own capabilities, knowledge and skills.
“If and when you want to move on in the industry, moving to service insurers from the inside, you will actually have an intellectual capital and experience that is probably unrivalled,” he says.
Nagari thinks the introduction of IFRS 17 is a challenging and exciting time for the industry, and he is keen to welcome new members to the Deloitte team.
He says: “We already have a large team of very lovely colleagues. We work hard but we have fun doing what we are doing. There is a good team spirit.
“The Deloitte environment is a very welcoming one, the team is growing, there is lots of excitement and lots of hard work as well, but we do it with a smile on our face.”