COMPARATIVE STUDY OF INTERNATIONAL FINANCIAL REPORTING STANDARD 17 (IFRS 17) AND INTERNATIONAL FINANCIAL REPORTING STANDARD 4 (IFRS 4); A CASE STUDY OF PT ASURANSI JIWA GENERALI INDONESIA

• Main Author: Astrid Satmaka, Monika
• Format: Theses
• Language: Indonesia
• Online Access: https://digilib.itb.ac.id/gdl/view/49255
• Institution: Institut Teknologi Bandung

This final project conducts a comparative study based on secondary data of audited financial report upon the impact of a new accounting standard, International Financial Reporting Standard: IFRS 17 Insurance Contract, or in short called as IFRS 17, on commonly applied performance indicators, as well as on insurance industry-specific indicators, with PT Asuransi Jiwa Generali Indonesia as the case study through the application of Financial Ratio Analysis. The objectives of this final project are to introduce several performance indicators applied specifically within the insurance industry as an addition to the widely and commonly applied financial indicators and to understand if such indicators are affected by the implementation of IFRS 17. In addition, this final project is intended to assess and compare Generali Indonesia’s financial performance with current IFRS 4 accounting system and the upcoming IFRS 17 accounting system, which would then be applied in giving recommendations upon which strategy Generali Indonesia and other stakeholders should take in anticipating IFRS 17 to improve its financial performance, and ultimately to achieving management objectives and generating an optimal return to its shareholders. This study concludes that while results from the majority of insurance industry-specific indicators do not vary between IFRS 4 and IFRS 17 accounting system, the result from non-industry-specific indicators is showing quite a major shift due to a more conservative approach to revenue recognition from insurance contracts as prescribed by IFRS 17. It is expected that through the application of IFRS 17, investors and financial analysts would receive from insurance companies a clearer and more comparable financial statements presentation, which would attract more interest from investors towards investing in the insurance industry. However, within the transition period, due to a major shift in financial indicator results from IFRS 4 and IFRS 17 as portrayed through result from Generali Indonesia, it is recommended to refer to insurance industry-specific indicators in analyzing the performance thereof which does not show major shift between IFRS 4 and IFRS 17.