By Rosemary Onuoha
The Nigerian Stock Exchange, NSE, has extended the deadline for insurance companies quoted on the NSE to submit their 2018 financial results, following their transition to the International Financial Reporting Standard, IFRS 9.
Accordingly, insurance companies have up till July 2019 31st to submit their results against the statutory time frame of June 30th every year.
The extension came as a result of an appeal by the National Insurance Commission, NAICOM, to the NSE to give insurance companies more time to file their results in the IFRS 9 model.
It will be recalled that Vanguard had exclusively reported that many of the companies had lamented that the implementation of the IFRS 9, in the 2018 financial year as against initial scheduled period of 2020 will cause delay in the submission of their results.
However, while reacting to the development, Deputy Commissioner, Technical, of NAICOM, Mr. Sunday Thomas, noted that the Commission had reached out to the other regulators to extend some grace period to the insurers.
Thomas, who spoke to journalists in Lagos, last week, said that NAICOM also had one-on-one dialogue with operators and had engaged Chief Financial Officers (CFOs) of insurance firms in terms of implementation of the financial model.
Thomas added that the adoption and effective implementation of IFRS9 will ultimately enhance transparency in financial transactions in the insurance industry.
Thomas said, “We have reached out to the NSE and SEC to grant extension to insurance companies as regards submission of their 2018 financial results, and they have granted one month extension to insurance firms quoted on the NSE.
“Operators need to do more to incorporate the tenets of IFRS 9 into their annual financial results. IFRS 9 provides significantly improved information because it introduces a structured approach to the classification and measurement of financial assets that reflects the business model in which they are managed and their cash flow characteristics.”
According to Thomas, many companies are already complying while some have already submitted their IFRS 9 compliant financial statements.
He said nine companies submitted last week.
He said, “We have invited the companies on one-on-one basis where they were requested to tell us how far they have gone in terms of implementation and challenges. The IFRS 9 came into the system as part of transparency in financial transaction. Since the 2008 crisis, relevant institution and regulators across the world became concerned about transactions within the financial services sector.
“Based on this, the International Accounting Standard Board came up with some standards that will enable an ordinary person looking at financial recordings to have a better understanding and comparability of financial statements becomes a lot easier,” he said.
Director, Inspectorate of NAICOM, Mr. Barineka Thompson, said the new accounting format is an improvement on IFRS 4 that was in use before now, noting that IFRS 9 introduces a new methodology for financial instruments classification and that the incurred loss impairment model is replaced with a more forward looking expected loss model.