KUALA LUMPUR: Deloitte Malaysia has highlighted the need for clearer guidance and understanding on key performance indicators (KPIs) for the insurance industry under a new accounting standard for insurance contracts called IFRS 17 that will take effect on Jan 1, 2023.

       The accounting firm’s audit and assurance partner Sharon Kok Pei Loo said with the changes to measurement, presentation, and disclosure of insurance contracts introduced, many insurers would need to focus on the business performance aspect and its implications on the financial reporting framework.

       “It is not easy to adjust existing KPIs for the new IFRS 17 reporting model. It is thus vital that insurers be proactive in understanding the potential changes in KPIs and its implications, and the need to consider changes to their existing KPIs,” she said in a statement yesterday.

       “KPIs are the headlines in every internal management information prepared for board meetings, and are metrics used regularly by analysts and investors for market valuation.”

       KPIs used by insurers vary by industry and jurisdiction, but generally, their main focus would be on business growth and volume, as well as profitability, she noted. — Bernama