Insurance companies in Bangladesh not fully compliant with IFRS: Speakers

The Insurance companies in Bangladesh are preparing their financial statements in accordance with Insurance Act (1938) and Rules (1958) which are not fully compliant with the International Financial Reporting Standards (IFRS).

Therefore, the insurance companies are facing a setback and cannot grow further.

Speakers expressed these opinions at a webinar on ‘‘IFRS 17 Insurance Contracts’’ organized by the Institute of Chartered Accountants of Bangladesh (ICAB) on Thursday.

Sheikh Mohammad Salim Ullah, Secretary, Financial Institutions Division Ministry of Finance, GoB was present as the chief guest.

Dr Md. Hamid Ullah Bhuiyan, Chairman, Financial Reporting Council (FRC) joined the webinar as special guest.

ICAB President Md. Shahadat Hossain FCA delivered the address of welcome.

Ala Uddin FCA, Chief Financial Officer (CFO) Metlife Bangladesh American Life Insurance Company and Mohammad Redwanur Rahman FCA, Partner, Rahman Mustafiz Haq & Co., Chartered Accountants were the panel speakers.

AKM Aftabul Islam FCA, Principal Partner, Islam Aftab Kamrul & Co.-Chartered Accountants moderated the session while Wasequl Huq Reagan FCA, Partner, Mahfel Huq & Co. - Chartered Accountants presented the keynote paper.

ICAB President Md. Shahadat Hossain FCA said, as per the Financial Reporting Act 2015 and the Income Tax Ordinance 1984, all the public interest entities(PIEs) including insurance companies should prepare Financial Statements in line with IFRS.

He said insurance companies have been playing an important role in the economic development of the country as they are the large investors in financial markets and can play a catalyst role in the economic growth via risk sharing, savings and higher investment.

He said the transparency delivered by the international accounting standards is a crucial ingredient for achieving financial stability.

Proper accounting sheds light on risks that might otherwise go unnoticed—both by companies themselves and by the investors, Hossain said.

So robust modifications are required to the 84 years old insurance act in order to make the insurance companies fully compliant with the IFRS, otherwise, the insurance companies cannot grow further, he opined.