UNAUDITED CONSOLIDATED AND SEPARATE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 MARCH 2024
AIICO INSURANCE PLC | |
UNAUDITED CONSOLIDATED AND SEPARATE FINANCIAL STATEMENTS | |
FOR THE PERIOD ENDED 31 MARCH 2024 | |
Table of contents | Page |
Corporate Information | 2 |
Consolidated Results at a Glance - The Group | 4 |
Results at a Glance - The Company | 5 |
Shareholding structure and free float status | 6 |
Statement of Directors' Responsibilities in Relation to the Financial Statements | 7 |
Certification Pursuant to Section 60(2) of Investment & Securities Act No. 29 of 2007 | 8 |
Material Accounting Policies | 9 |
Consolidated and Separate Statements of Financial Position | 41 |
Consolidated and Separate Statements of Profit or Loss and Other Comprehensive Income | 42 |
Consolidated Statement of Changes in Equity - the Group | 43 |
Statement of Changes in Equity - the Company | 44 |
Consolidated and Separate Statements of Cash Flows | 45 |
Notes to the Consolidated and Separate Financial Statements | 46 |
1
AIICO INSURANCE PLC
UNAUDITED CONSOLIDATED AND SEPARATE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 MARCH 2024
Corporate Information | |||
Directors | Mr. Kundan Sainani (Indian) | Chairman | |
Mr. Babatunde Fajemirokun | Group MD / CEO | ||
Mr. Adewale Kadri | Executive Director | ||
Mr. Samaila Zubairu | Director/Independent | ||
Mr. Ademola Adebise | Director | ||
Mrs. Oluwafolakemi Edun (nee Fajemirokun) | Director | ||
Mr. Olalekan Akinyanmi | Director | ||
Mr. Raimund Snyders * | Director | ||
Mr. Rotimi Okpaise ** | Director | ||
Key | |||
* | South African by Nationality | ||
** | Appointed effective 23rd February 2023 | ||
Company Secretary | Mr. Donald Kanu | ||
AIICO Insurance Plc AIICO Plaza | |||
Plot PC 12, Churchgate Street | |||
Victoria Island, Lagos | |||
Registered Office | AIICO Plaza | ||
Plot PC 12, Churchgate Street | |||
Lagos | |||
RC No. | 7340 | ||
TIN | 00401332-0001 | ||
Corporate Head Office | AIICO Plaza | ||
Plot PC 12, Churchgate Street Victoria Island | |||
Lagos | |||
Tel: +234 01 2792930-59 | |||
0700AIIContact (0700 2442 6682 28) | |||
Fax: +234 01 2799800 | |||
Website: //www.aiicoplc.com | |||
E-mail: aiicontact@aiicoplc.com | |||
Registrar | Coronation Registrars (formerly, United Securities Limited) | ||
09, Amodu Ojikutu Street Off | |||
Bishop Oluwole Street, Victoria Island | |||
P.M.B. 12753 | |||
Lagos | |||
Independent Auditor | Ernst & Young | ||
10th & 13th Floors, UBA House | |||
57, Marina Road | |||
Lagos Island | |||
Lagos | |||
website: www.ey.com/ng | |||
Bankers | Access Bank Plc | ||
Ecobank Nigeria Plc | |||
First Bank of Nigeria Limited | |||
First City Monument Bank Plc | |||
Guaranty Trust Bank Limited | |||
Stanbic IBTC Bank | |||
Standard Chartered Bank Nigeria Limited | |||
Union Bank of Nigeria Plc | |||
United Bank of Africa Plc | |||
Wema Bank Plc | |||
Actuary | Firm Name: | Zamara Consulting Actuaries Nigeria Limited | |
Firm FRCN: | FRC/2019/00000012910 | ||
Life Valuation | Nikhil Dhodia | ||
FRCN | FRC/2021/004/00000024023 | ||
Firm Name: | Zamara Consulting Actuaries Nigeria Limited | ||
Firm FRCN: | FRC/2019/00000012910 | ||
Non life Valuation | Jay Kosgei | ||
FRCN | FRC/2021/004/00000023786 |
2
AIICO INSURANCE PLC
UNAUDITED CONSOLIDATED AND SEPARATE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 MARCH 2024
Corporate information (continued) | ||
Reinsurers | Africa Reinsurance Corporation | |
Continental Reinsurance Plc | ||
Swiss Reinsurance | ||
WAICA Reinsurance | ||
Nigerian Reinsurance | ||
Trust Reinsurance | ||
Zep Reinsurance | ||
Arig Reinsurance | ||
Aveni Reinsurance | ||
NCA Reinsurance | ||
Estate Valuer | Firm Name: | Niyi Fatokun & Co. |
Firm FRCN: | FRC/2019/00000012894 | |
Partner | Niyi Fatokun | |
FRCN | (Chartered Surveyors & Valuer) | |
FRC/2013/NIESV/70000000/1217 | ||
Regulatory Authority | National Insurance Commission (NAICOM) |
Branch Networks | |
1. Port Harcourt | 2. Kaduna |
11 Ezimgbu Link Road (Mummy B Road) | Yaman Phone House |
Off Stadium Road | 1, Constitution Road |
G.R.A Phase 4, Port Harcourt | Kaduna, Kaduna State |
Rivers State | Tel: +234 803 338 6968; |
Tel: +234 808 313 4875 | +234 805 601 9667 |
+234 909 448 9393 | |
3. Abuja Area Office | 4. Kano |
No 44 Durban Street, | 8, Post Office Road |
Off Adetokunbo Ademola Crescent, Wuse II | Kano |
FCT, Abuja. | Kano State |
Tel: +234 805 820 0439 | Tel: +234 807 810 7938 |
+234 817 668 4115 | +234 806 593 4787 |
5. Abeokuta | 6. Lagos, Ikeja |
46, Tinubu Street | AIICO House |
Ita Eko, Abeokuta | Plot 2, Oba Akran Avenue |
Ogun State | Opp. Dunlop, Ikeja, Lagos |
Tel: +234 803 255 7071 | Tel: +234 1 460 2097-8; +234 808 313 4376 |
+234 1 460 2218 | |
7. Aba | 8. Lagos, Isolo |
7, Factory Road | 203/205, Apapa-Oshodi Expressway |
Aba, Abia State | Isolo, Lagos |
Tel: +234 805 531 4351 | Tel: +234 802 305 4803; +234 805 717 6063 |
9. Enugu | 10. Lagos, Ilupeju |
55-59, Chime Avenue | AIICO House |
Gbuja's Plaza New Haven | 36/38, Ilupeju Industrial Avenue |
Enugu State | Ilupeju, Lagos |
Tel: +234 803 724 6767 | Tel: +234 816 046 6239 |
+234 803 334 3036 | |
11. Benin | 12. Onitsha |
28, Sakponba Road | Noclink Plaza, 41 New Market Road |
Benin City | Opp UBA Bank, Onitsha |
Edo State | Anambra State |
Tel: +234 805 116 3395 | Tel: +234 708 606 4999 |
+234 813 405 1972 | +234 803 375 0361 |
13. Jos | 14. Owerri |
4, Beach Road | 46, Wetheral Road |
Jos, Plateau State. | Owerri, Imo State |
Tel: +234 805 735 6726 | Tel: +234 805 603 3269 |
+234 809 033 5125 | +234 706 603 2065 |
15. Ibadan | 16. Warri |
12, Moshood Abiola Way | 60, Effurun/Sapele Road |
Challenge Area | Warri. |
Ibadan, Oyo State | Delta State. |
Tel: +234 803 231 8925 | Tel: +234 803 971 0794 |
+234 802 834 4263 | +234 818 749 7490 |
3
AIICO INSURANCE PLC
UNAUDITED CONSOLIDATED AND SEPARATE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 MARCH 2024
Results at a Glance - The Group | ||||
For the period ended 31 March 2024 | ||||
Profit or Loss and Other Comprehensive Income | Increase/ | Increase/ | ||
(decrease) | (decrease) | |||
In thousands of naira | 31-Mar-24 | 31-Mar-23 | Changes | % |
Gross written premium | 49,082,934 | 31,739,824 | 17,343,110 | 55 |
Insurance revenue | 22,669,763 | 14,839,171 | 7,830,592 | 53 |
Insurance service expense | (17,755,037) | (13,465,447) | (4,289,590) | 32 |
Net Expenses from reinsurance contracts | (4,792,847) | (2,156,138) | (2,636,709) | 122 |
Insurance service result | 121,879 | (782,414) | 904,294 | (116) |
Net investment income before fair value changes | 7,747,365 | 5,977,624 | 1,769,741 | 30 |
Net fair value loss | (18,558,166) | (9,705,753) | (8,852,413) | 91 |
Net impairment loss | - | (71,852) | 71,852 | (100) |
Net foreign exchange income/(expense) | 7,739,023 | (436,713) | 8,175,736 | (1872) |
Net insurance/reinsurance finance expenses | 13,315,905 | 6,673,322 | 6,642,583 | 100 |
Net insurance and investment result | 10,366,008 | 1,654,214 | 8,711,794 | 527 |
Other Income | 259,899 | 356,039 | (96,140) | (27) |
Other Expenses | (545,545) | (567,199) | 21,653 | (4) |
Profit before income tax from continuing operations | 10,080,361 | 1,443,054 | 8,637,307 | 599 |
Income tax expenses | (1,293,385) | (8,339) | (1,285,047) | (15411) |
Profit for the period | 8,786,976 | 1,434,715 | 7,352,260 | 512 |
Total other comprehensive income/(loss) | (1,280,672) | (550,250) | (730,422) | 133 |
Total comprehensive income for the period | 7,506,304 | 884,465 | 6,621,839 | 749 |
Basic and diluted earnings per share (kobo) | 24 | 4 | ||
Financial Position | ||||
In thousands of naira | 31-Mar-24 | 31-Dec-23 | Changes | % |
Assets | ||||
Cash and cash equivalents | 36,022,326 | 18,422,728 | 17,599,598 | 96 |
Financial assets | 258,627,503 | 266,747,074 | (8,119,571) | (3) |
Trade receivables | 1,769,515 | 980,752 | 788,763 | 80 |
Reinsurance contracts assets | 22,959,929 | 17,116,370 | 5,843,559 | 34 |
Other receivables and prepayments | 5,057,477 | 3,667,351 | 1,390,126 | 38 |
Investment properties | 707,500 | 707,500 | - | 0 |
Property and equipment | 8,809,190 | 8,913,645 | (104,455) | (1) |
Statutory deposits | 500,000 | 500,000 | - | - |
Right of use assets | 116,775 | 132,512 | (15,737) | (12) |
Goodwill and other intangible assets | 1,166,216 | 907,630 | 258,587 | 28 |
Total assets | 335,736,432 | 318,095,562 | 17,640,870 | 6 |
Liabilities | ||||
Insurance contract liabilities | 224,342,321 | 218,023,682 | 6,318,639 | 3 |
Investment contract liabilities | 4,056,210 | 3,855,324 | 200,887 | 5 |
Reinsurance contract liabilities | 2,100,868 | 930,616 | 1,170,252 | 126 |
Other insurance contract liabilities | 1,840,416 | 2,423,168 | (582,752) | (24) |
Trade payables | 3,116,361 | 1,612,909 | 1,503,452 | 93 |
Other payables and accruals | 6,423,042 | 8,332,138 | (1,909,097) | (23) |
Fixed income liabilities | 32,185,073 | 30,241,800 | 1,943,273 | 6 |
Current income tax payable | 2,138,447 | 845,061 | 1,293,385 | 153 |
Deferred tax liabilities | 498 | 498 | 0 | 0 |
Total liabilities | 276,203,236 | 266,265,196 | 9,938,040 | 4 |
Equity | ||||
Share capital | 18,302,638 | 18,302,638 | - | - |
Share premium | 64,745 | 64,745 | - | - |
Revaluation reserve | 2,764,016 | 2,764,016 | - | - |
Fair value reserve | (2,374,269) | (1,107,650) | (1,266,619) | 114 |
Contingency reserve | 12,606,325 | 11,755,475 | 850,851 | 7 |
Retained earnings | 27,718,256 | 19,615,890 | 8,102,366 | 41 |
Shareholders' funds | 59,081,711 | 51,395,114 | 7,686,597 | 15 |
Non-controlling interests | 451,485 | 435,252 | 16,234 | 4 |
Total equity | 59,533,197 | 51,830,366 | 7,702,831 | 15 |
Total liabilities and equity | 335,736,432 | 318,095,561 | 17,640,871 | 6 |
4
AIICO INSURANCE PLC
UNAUDITED CONSOLIDATED AND SEPARATE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 MARCH 2024
Results at a Glance - The Company | ||||
For the period ended 31 March 2024 | ||||
Profit or loss and other comprehensive income | Increase/ | Increase/ | ||
(Decrease) | (Decrease) | |||
In thousands of naira | 31-Mar-24 | 31-Mar-23 | Changes | % |
Gross written premium | 48,756,519 | 31,415,815 | 17,340,704 | 55 |
Insurance revenue | ||||
Insurance service expense | (17,595,240) | (13,384,611) | (4,210,629) | 31 |
Net Expenses from reinsurance contracts | (4,792,847) | (2,156,138) | (2,636,709) | 122 |
Insurance service result | (67,268) | (1,057,903) | 990,634 | (94) |
Net investment income before fair value changes | 7,594,475 | 5,880,974 | 1,713,500 | 29 |
Net fair value loss | (18,558,166) | (9,705,753) | (8,852,413) | 91 |
Net foreign exchange income/(expense) | 7,739,023 | (436,713) | 8,175,736 | (1872) |
Net insurance/reinsurance finance expenses | 13,315,905 | 6,673,322 | 6,642,583 | 100 |
Net insurance and investment result | 10,023,969 | 1,361,229 | 8,662,740 | 636 |
Other Income | 220,259 | 266,964 | (46,705) | (17) |
Other Expenses | (372,953) | (343,121) | (29,832) | (9) |
Profit before income tax from continuing operations | 9,871,275 | 1,285,072 | 8,586,203 | 668 |
Income tax expenses | (1,286,529) | (11,763) | (1,274,766) | 100 |
Profit for the period | 8,584,745 | 1,273,309 | 7,311,437 | 574 |
Total other comprehensive loss | (1,140,143) | (121,884) | (1,018,259) | 835 |
Total comprehensive income for the period | 7,444,603 | 1,151,425 | 6,293,178 | 547 |
Basic and diluted earnings per share (kobo) | 24 | 3 | ||
Financial Position | ||||
In thousands of naira | 31-Mar-24 | 31-Dec-23 Changes | % | |
Assets | ||||
Cash and cash equivalents | 23,547,115 | 7,921,257 | 15,625,858 | 197 |
Financial assets | 236,114,317 | 243,686,602 | (7,572,285) | (3) |
Trade receivables | 1,506,547 | 909,559 | 596,988 | 66 |
Reinsurance contracts assets | 22,959,929 | 17,116,370 | 5,843,559 | 34 |
Other receivables and prepayments | 4,278,725 | 2,838,437 | 1,440,288 | 51 |
Investment in subsidiaries | 1,087,317 | 1,087,317 | - | - |
Investment properties | 707,500 | 707,500 | - | 0 |
Property and equipment | 8,564,191 | 8,708,397 | (144,205) | (2) |
Statutory deposits | 500,000 | 500,000 | - | - |
Right of use assets | 116,775 | 132,512 | (15,737) | (12) |
Goodwill and other intangible assets | 1,103,647 | 840,555 | 263,093 | 31 |
Total assets | 300,486,063 | 284,448,506 | 16,037,557 | 6 |
Liabilities | ||||
Insurance contract liabilities | 224,342,321 | 217,701,608 | 6,640,712 | 3 |
Investment contract liabilities | 4,056,210 | 3,855,324 | 200,887 | 5 |
Reinsurance contract liabilities | 2,100,868 | 930,616 | 1,170,252 | 126 |
Other insurance contract liabilities | 1,840,416 | 2,423,168 | (582,752) | (24) |
Trade payables | 3,116,361 | 1,612,909 | 1,503,452 | 93 |
Other payables and accruals | 5,747,931 | 7,570,587 | (1,822,656) | (24) |
Current income tax payable | 2,049,556 | 763,026 | 1,286,530 | 169 |
Total liabilities | 243,253,664 | 234,857,238 | 8,396,426 | 4 |
Equity | ||||
Share capital | 18,302,638 | 18,302,638 | 0 | 0 |
Share premium | 64,745 | 64,745 | (0) | (0) |
Revaluation reserve | 2,764,016 | 2,764,016 | - | - |
Fair value reserve | (1,153,686) | (13,544) | (1,140,143) | 8,418 |
Contingency reserve | 12,606,325 | 11,755,475 | 850,851 | 7 |
Retained earnings | 24,648,361 | 16,717,938 | 7,930,423 | 47 |
Shareholders' funds | 57,232,399 | 49,591,268 | 7,641,131 | 15 |
Total liabilities and equity | 300,486,063 | 284,448,506 | 16,037,557 | 6 |
5
AIICO INSURANCE PLC
UNAUDITED CONSOLIDATED AND SEPARATE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 MARCH 2024
Shareholding Structure And Freefloat Status | ||||
Company name | AIICO Insurance Plc | |||
Year end | December | |||
Reporting Period | 31-Mar-24 | |||
Share Price at end of reporting period | N0.80 (31 December 2023: N0.76) | |||
Shareholding Structure/Free Float Status | ||||
31-Mar-24 | 31-Dec-23 | |||
Description | Unit | Percentage | Unit | Percentage |
Issued Share Capital*** | 36,605,276,013 | 100% | 36,605,276,013 | 100% |
Substantial Shareholdings (5% and above) | ||||
AIICO Bahamas Limited | 15,104,442,427 | 41.26% | 15,104,442,427 | 41.26% |
LeapFrog III Nigeria Insurance Holdings LTD | 11,173,946,135 | 30.53% | 11,173,946,135 | 30.53% |
Total Substantial Shareholdings | 26,278,388,562 | 71.79% | 26,278,388,562 | 71.79% |
Directors' Shareholdings (direct and indirect), excluding directors with substantial interests | ||||
Babatunde Fajemirokun | 117,119,739 | 0.32% | 117,119,739 | 0.32% |
Ademola Adebise | 49,070 | 0.00% | 49,070 | 0.00% |
Total Directors' Shareholdings | 117,168,809 | 0.32% | 117,168,809 | 0.32% |
Total Other Influential Shareholdings | - | 0.00% | - | 0.00% |
Free Float in Units and Percentage | 10,209,718,642 | 27.89% | 10,209,718,642 | 27.89% |
Free Float in Value | ₦ 8,167,774,913.60 | ₦ 7,759,386,167.92 |
Declaration:
AIICO Insurance Plc with a free float percentage of 27.89% as at 31 March 2024, is compliant with The Nigeria Stock Exchange's free float requirements for companies listed on the Main Board.
Mr. Donald Kanu
Company Secretary
FRC/2013/PRO/NBA/004/00000002884
Plot PC 12, Churchgate Street
Victoria Island
Lagos, Nigeria
9-May-24
6
AIICO INSURANCE PLC
UNAUDITED CONSOLIDATED AND SEPARATE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 MARCH 2024
Certification Pursuant to Section 60(2) of Investment and Securities Act No. 29 of 2007.
We the undersigned, hereby certify the following with regards to our unaudited financial statements for the period ended 31 March 2024 that:
- We have reviewed the report and to the best of our knowledge, the report does not contain:
- Any untrue statement of a material fact, or
- Omission to state a material fact, which would make the statements, misleading in the light of circumstances under which such statements were made;
- To the best of our knowledge, the financial statements and other financial information included in the report fairly present in all material respects the financial condition and results of operation of the Group as of, and for the periods presented in the report.
- We:
- are responsible for establishing and maintaining internal controls.
- have designed such internal controls to ensure that material information relating to the Company and its consolidated subsidiaries is made known to such officers by others within those entities particularly during the periods in which these reports are being prepared;
- have evaluated the effectiveness of the Group's internal controls as of date of the report;
- have presented in the report our conclusions about the effectiveness of our internal controls based on our evaluation as of that date;
- We have disclosed to the Audit Committee:
- all significant deficiencies in the design or operation of internal controls which would adversely affect the Group's ability to record, process, summarize and report financial data and have identified for the Group's auditors any material weakness in internal controls, and
- Any fraud, whether or not material, that involves management or other employees who have significant role in the Group's internal controls;
We have identified in the report whether or not there were significant changes in internal controls or other factors that could significantly affect internal controls subsequent to the date of our evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.
Mr. Babatunde Fajemirokun | Mrs. Bisola Elias |
Managing Director/ Chief Executive Officer | Chief Financial Officer |
FRC /2015/PRO/CIIN/010/00000019973 | FRC/2018/PRO/ICAN/001/00000018839 |
09-May-24 | 09-May-24 |
8
AIICO INSURANCE PLC
UNAUDITED CONSOLIDATED AND SEPARATE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 MARCH 2024
Material Accounting Policies
For the period ended 31 March 2024
-
Reporting entity
AIICO Insurance Plc ("the Company") was established in 1963 by American Life Insurance Company and was incorporated in 1970. It was converted to a Public Liability Company in 1989 and quoted on the Nigerian Stock Exchange (NSE) in December 1990. The Company was registered by the Federal Government of Nigeria to provide insurance services in Life Insurance Business, Non-Life Insurance Business, Deposit Administration and Financial Services to organizations and private individuals. Arising from the merger in the insurance industry, AIICO Insurance Plc acquired Nigerian French Insurance Plc and Lamda Insurance Company Limited in February 2007.
- Basis of accounting
-
Statement of compliance
These consolidated and separate financial statements have been prepared in accordance with International Financial Reporting Standards (IFRSs) as issued by the International Accounting Standards Board (IASB), the financial statements comply with the Companies and Allied Matters Act 2020, the Financial Reporting Council of Nigeria Act No 6, 2011, the Insurance Act of Nigeria 2003 and relevant National Insurance Commission (NAICOM) policy guidelines and circulars.
These consolidated and separate financial statements were authorised for issue by the Company's Board of Directors on 9 May 2024.
The consolidated financial statements do not include all the information and disclosures required in the annual financial statements, and should be read in conjunction with the Group's annual consolidated financial statements as at 31 December 2023. - Going concern
These consolidated and separate financial statements have been prepared using appropriate accounting policies, supported by reasonable judgments and estimates. The Directors have a reasonable expectation, based on an appropriate assessment of a comprehensive range of factors, that the Group and the Company have adequate resources to continue as going concern for the foreseeable future.
Functional and presentation currency
These consolidated and separate financial statements are presented in Nigerian Naira, which is the Group and Company's functional and presentation currency. Except as indicated, financial information presented in Naira has been rounded to the nearest thousand.
-
Statement of compliance
2.4 Basis of measurement
These consolidated and separate financial statements have been prepared under the historical cost convention, except for the following items; which are measured on an alternative basis on each reporting date.
Items | Measurement Bases |
Non-derivative Financial asset at fair value through other | Fair value |
comprehensive income | |
Non-derivative Financial asset at fair value through profit or | Fair value |
loss | |
Investment properties | Fair value |
2.5 Use of estimates and judgement
In preparing these consolidated and separate financial statements, management has made judgements and estimates that affect
-
the application of accounting policies and the reported amounts of assets and liabilities, income and expense. Actual results may differ from these estimates.
The significant judgements made by management in applying the Group's accounting policies and the key sources of estimation uncertainty are described in Note 4.
9
AIICO INSURANCE PLC
UNAUDITED CONSOLIDATED AND SEPARATE FINANCIAL STATEMENTS
FOR THE PERIOD ENDED 31 MARCH 2024
Material Accounting Policies
For the period ended 31 March 2024
2.6 Regulatory authority and financial reporting
The Group is regulated by the National Insurance Commission of Nigeria (NAICOM) under the National Insurance Act of Nigeria. The Act specifies certain provisions which have impact on financial reporting as follows:
- Section 20 (1a) provides that provisions for unexpired risks shall be calculated on a time apportionment basis of the risks accepted in the year;
- Section 20 (1b) requires provision for outstanding claims to be credited with an amount equal to the total estimated amount of all outstanding claims with a further amount representing 10 percent of the estimated figure for outstanding claims in respect of claims incurred but not reported at the end of the year under review;
- Sections 21 (1a) and 22 (1b) require maintenance of contingency reserves for general and life businesses respectively at specified rates as set out under Note 3.27 to cover fluctuations in securities and variation in statistical estimates;
2.7 Changes in accounting policies
New and amended standards and interpretations
The Group applied for the first-time certain standards and amendments, which are effective for annual periods beginning on or after 1 January 2023 (unless otherwise stated). The Group has not early adopted any other standard, interpretation or amendment that has been issued but is not yet effective.
- Issued and Amended standards effective from periods beginning on or after 1 January 2023
-
IFRS 17 - Insurance Contracts
In May 2017, the IASB issued IFRS 17 Insurance Contracts (IFRS 17), a comprehensive new accounting standard for insurance contracts covering recognition and measurement, presentation and disclosure. Once effective, IFRS 17 will replace IFRS 4 Insurance Contracts (IFRS 4) that was issued in 2005. IFRS 17 applies to all types of insurance contracts (i.e., life, non-life, direct insurance and re-insurance), regardless of the type of entities that issue them, as well as to certain guarantees and financial instruments with discretionary participation features. A few scope exceptions will apply.
The overall objective of IFRS 17 is to provide an accounting model for insurance contracts that is more useful and consistent or insurers. In contrast to the requirements in IFRS 4, which are largely based on grandfathering previous local accounting policies, IFRS 17 provides a comprehensive model for insurance contracts, covering all relevant accounting aspects. The core of IFRS 17 is the general model, supplemented by: - A specific adaptation for contracts with direct participation features (the variable fee approach)
- A simplified approach (the premium allocation approach) mainly for short-duration contracts.
IFRS 17 is effective for reporting periods beginning on or after 1 January 2023, with comparative figures required. Early application is permitted, provided the entity also applies IFRS 9 and IFRS 15 on or before the date it first applies IFRS 17. This standard will significantly change how the Group measures, present and disclose its insurance contracts from the year 2023 and the Group has put adequate processes in place.
-
Definition of Accounting Estimates - Amendments to IAS 8
In February 2021, the IASB issued amendments to IAS 8, in which it introduces a definition of 'accounting estimates'. The amendments clarify the distinction between changes in accounting estimates and changes in accounting policies and the correction of errors. Also, they clarify how entities use measurement techniques and inputs to develop accounting estimates.
The amendments are effective for annual reporting periods beginning on or after 1 January 2023 and apply to changes in accounting policies and changes in accounting estimates that occur on or after the start of that period. Earlier application is permitted as long as this fact is disclosed. The amendments are not expected to have a material impact on the Group's financial statements.
10
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AIICO Insurance plc published this content on 31 May 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 31 May 2024 19:28:01 UTC.