NAICOM inaugurates NAS-DRC to strengthen global accounting standards

In a bid to strengthen insurance accounting standards, the Commissioner for Insurance, and CEO of the National Insurance Commission (NAICOM), Mr Sunday Olorundare Thomas has inaugurated the Nigerian Actuarial Society (NAS) Discount Rate Committee (NAS-DRC).

Thomas, while inaugurating the committee in Abuja said the NAS-DRC stakeholders is a standing committee, established to support the determination of standardised discount rate factors for use by the insurance industry and other stakeholders in the financial services sector, particularly in the implementation of the International Financial Reporting Standard 17 (IFRS 17) for Insurance Contracts.

The NAICOM boss expressed delight in welcoming the Nigerian Actuarial Society Discount Rate Committee (NAS-DRC), which comprises representatives from NAS, the National Insurance Commission (NAICOM), actuarial representatives from audit firms, and resident actuaries of insurance operators involved in annuity business.

He said President of NAS will serve as the chairman, while a representative from NAICOM, not below the rank of a director, will serve as the co-chairman, and NAS will provide the secretariat for the committee.

Thomas stressed the role of actuaries in implementing IFRS 17 and the need for a credible, prudent, consistent, and sustainable discount rate that is not subject to manipulation by different stakeholders.

He stated that the objectives of the NAS-DRC will include determining the risk-free yield curve for the insurance industry and providing commentary on market movements that may impact the risk-free yield curve determination.

According to Mr Thomas, “The inauguration of the NAS-DRC is expected to enhance accountability, prudence, and comparability in financial reporting, thereby supporting the stability of the Nigerian financial system.”

The NAICOM boss expressed optimism that the committee’s deliberations and activities will have a positive impact on the Nigerian financial system, and thanked the nominated members for accepting the task and acknowledged their individual and collective sacrifices.

He stressed that NAS-DRC is expected to work diligently to fulfill its terms of reference and contribute to the advancement of financial reporting standards in Nigeria.

Thomas affirmed that “The establishment of the NAS-DRC marks an important step towards enhancing transparency and reliability in the insurance industry and strengthening the overall financial system of Nigeria.

“As the committee begins its work, stakeholders are hopeful that the standardised discount rate factors determined by the NAS-DRC will promote consistency and integrity in financial reporting, ensuring the stability and growth of the Nigerian insurance sector.”

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