The New IFRS

The world of accounting is no stranger to change, and the recent updates to International Financial Reporting Standards (IFRS) are proof of that. As they evolve, they bring both challenges and opportunities to businesses and financial professionals. In this post, we’ll explore some of the most significant new IFRS requirements and what they could mean for you.

IFRS 17: A New Era for Insurance Contracts

One of the most talked-about changes is IFRS 17, which overhauls how insurance contracts are reported. Set to be fully effective from January 2023, this standard introduces a more transparent model for measuring insurance liabilities, focusing on current fulfillment value and the separation of insurance revenue from finance costs.

While this offers improved comparability across insurers, it also demands significant adjustments in data systems, actuarial modelling, and disclosure practices. Companies in the insurance sector are advised to start preparing early to ensure smooth implementation.

IFRS 18: Enhancing Financial Statement Presentation

Scheduled for 2027, IFRS 18 will replace IAS 1 and bring stricter rules on how companies structure their income statements and define non-GAAP measures. The goal is to make financial performance easier to compare across entities and industries.

This standard will likely require companies to reassess how they present performance measures and may lead to more detailed disclosures around management-defined metrics.

Amendments to IFRS 9: Clarifying Financial Instruments

Recent amendments to IFRS 9 provide additional guidance on the classification and measurement of financial instruments—particularly those with sustainability-linked features. These changes, effective in 2026, aim to reduce ambiguity in areas such as ESG-linked loans and bonds.

Enhanced disclosure requirements will also mean that investors get a clearer picture of how environmental and social factors are integrated into financial products.

IFRS 16 Continues to Reshape Balance Sheets

Although not new, IFRS 16 (Leases) remains highly relevant—especially for industries with significant operating leases like aviation, retail, and logistics. By bringing most leases onto the balance sheet, it has increased transparency but also added complexity to financial reporting and ratio analysis.

Lessees must continue to ensure accurate recognition of right-of-use assets and lease liabilities, with robust note disclosures.

Climate-Related Disclosures

While still on discussion, a new exposure draft focusing on climate-related and other uncertainties is expected to shape future reporting. This initiative highlights the growing emphasis on sustainability and risk transparency—themes that are becoming central to corporate accountability.

Companies should keep an eye on developments in this area, as early adoption of clear climate reporting could become a competitive advantage.

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For Successful Implementation, get ready with these…

· Start Early: Major standards like IFRS 17 require long lead times for system upgrades and staff training.

· Focus on Disclosures: New rules often include expanded note requirements. Ensure your teams understand what’s needed.

· Leverage Technology: Use automated tools for data collection, validation, and reporting to reduce errors and save time.

· Seek Expertise: Don’t hesitate to consult external advisors for complex areas like insurance accounting or financial instruments.

The accounting landscape is shifting toward greater transparency, consistency, and integration of non-financial factors. While new IFRS standards may seem daunting, they also offer a chance to improve financial clarity and build stakeholder trust.

Staying informed and proactive is key—whether you’re in insurance, banking, leasing, or general corporate reporting.

Keep learning, keep adapting, and remember: good financial reporting isn’t just about compliance—it’s about communication.