EFRAG final comment letter on the IASB's proposed narrow-scope amendment to IFRS 17
08 Oct, 2021
The European Financial Reporting Advisory Group (EFRAG) has issued its final comment letter on the International Accounting Standard Board's (IASB's) exposure draft ED/2021/8 'Initial Application of IFRS 17 and IFRS 9 — Comparative Information (Proposed amendment to IFRS 17)' ("the ED").
In its final comment letter EFRAG expresses its appreciation for the IASB’s swift response and delivery of the exposure draft. EFRAG welcomes and supports the IASB's proposal as it will allow insurance entities to provide more useful information about their activities during the comparative period and also reduce operational challenges. EFRAG also commends the IASB for addressing most of the comments raised by European constituents in this area.
Overall, EFRAG agrees with the IASB proposals in the exposure draft but does flag some remaining concerns that it would like the IASB to address when finalising the amendment. For example, EFRAG recommends that the IASB aligns the scope of the classification overlay and the temporary exemption from applying IFRS 9 (which is under IFRS 4 Insurance Contracts) due to operational complexity and presentation inconsistencies in the consolidated financial statements.
Also, EFRAG suggests that the IASB states explicitly that the classification overlay may be applied from a date pre-dating the publication of the ED or the final amendment.
The press release and the final comment letter are available on the EFRAG website.
