Following the directive of the federal government that all quoted companies must comply with the International Financial Reporting Standards (IFRS) from 2012, the National Insurance Commission (NAICOM) has said that guidelines to regulate the implementation of IFRS for the insurance industry would be unveiled this month.
The Acting Director, Supervision, NAICOM, Mr. Nicholas Okpara, who stated this recently while delivering a lecture at a workshop organised by the commission for journalists on IFRS in Ijebu Ode, Ogun State, said the commission was putting finishing touches to ensure that the guidelines were issued to enable insurers adopt it to aid their accounts preparations next year.
Okpara noted that the commission was also working on a uniform IFRS template to ensure harmony in the account presentations of companies in the industry.
He said insurers were engaged regularly to ensure seamless transmission from the old accounting standard to IFRS.
Okpara noted that the insurance industry was ahead of other sectors in the quest to meet government’s deadline on the compliance with the new standard, adding that insurers had been enjoined to produce dual accounts this year to enable them transit smoothly to the IFRS come next year.
He said: “We are close to the release of the guidelines, we are presently engaging the operators. When we are through with the sorting out of some identified challenges that may stall the implementation of the initiative, we will issue the guidelines. We are hopeful that by December (later this month), the guidelines will be issued to enable operators use them in their operations next year.
“Under the existing financial reporting, we have what we call uniform financial reporting standard. We have looked at the basis of accounting presentations and have prepared a format which would be followed by all the operators in preparing and presenting their financial statements. The same thing we are trying to achieve under the IFRS.
“The commission is working towards choice of options. Right now, we have identified all the options that are available under the various guidelines and we would work with the operators and consultants in choosing the best options.
“We are also working to ensure that the accounting system of insurance companies will be uniform. We will achieve this by looking at options that are available in the IFRS. The IFRS gives provisions for options, if the companies are allowed to choose their options, without harmonising them, it is possible that the financial statements they would prepare would be different from others,” he said.
Chief Executive, Sirius Associates, Mrs. Oluwakemi Adeniran, who underscored the need of IFRS, said the adoption of the initiative would improve management decision making, better access to capital, reduction in capital cost and facilitation of mergers.
Adeniran said the initiative would also help policy makers in having better access to global markets and promoting cross border investments and wise investment especially in the capital market.