The Impact of IFRS 17 and the Changing Accounting & Finance Landscape
With a lot of buzz in the Financial Services industry surrounding the impact of IFRS 17, OCG Consulting’s Sherry Zeng is on hand to share her thoughts on how it (and other trends and changes in the industry) are affecting the way Finance teams approach their day-to-day roles.
There has been a lot of buzz in the Financial Services
industry (particularly insurance) regarding the new international accounting
standards, which are due to come into force in January 2021. Superseding IFRS
4, a lot of companies have already begun implementing software and process
changes across the globe but for most New Zealand finance teams, it is all
quite new to us! We already know that the changes will affect how insurance
policies and contracts are assessed, yet for employers, what does this mean for
your talent strategy, especially considering the other trends and changes in the
Handling the IFRS 17
What we’re likely to see, as New Zealand-based organisations
begin the transition over the next 18 months, is an increased demand for
accounting professionals in a couple of areas: Risk and Compliance, and Business
Analysis. With most Finance Controllers and Finance Managers unlikely to have
the capacity to carry out BAU in addition to handling the IFRS 17 transition,
there are a couple of options worth considering. Should a project team be
brought in to deal with the changes? Or would it be better to bring in contract
professionals to support BAU, allowing the team to manage the transition alongside
software vendors and other stakeholders?
It’s not just IFRS 17 that’s causing changes – regulatory/legislation
changes, not to mention automation and digitisation, are transforming the way Finance
teams go about their roles. What’s clear is that there are a lot of Financial
Services organisations that are stretched to capacity, and as a result, they
are restructuring their Finance teams to meet these changes head-on. We’ve
certainly come a long way since the times where teams were largely focused on
transactional, day-to-day tasks. While managing the bottom line and reporting will
always be business critical, in the Financial Services industry, these changes
are creating plenty of opportunities that will allow people to move away from
BAU and focus on specific areas.
What does this look like in practice? We’re seeing a trend
of more Finance professionals stepping into specialist roles; widening their
skill sets and providing more value. One example is the rise in analytical
business partnering. As well as collaborating with teams and departments (such
as Marketing, Sales and HR) to solve real-world problems, they’re also working alongside
senior management teams to develop strategies for investment and future growth.
One other specialty worth noting (borne from various regulatory/legislation
changes) is the rising demand for people with Risk and Compliance expertise as
organisations look to increase business efficiency.
In a world that is constantly changing, will this focus on
specialist roles be sustainable? Is it one size fits all? Does it mean that
having specialist roles will limit people’s career progression and skill sets?
Given that New Zealand is a small market (with SMEs the majority), candidate
demand will always be different from larger economies. While jobs might be
changing as a result of restructured Finance teams and other changes (in an
effort to better shape the business to a better operational model), it’s
certainly an exciting time to be a part of the industry. What changes have been
affecting the way your finance team operates? I’d love to hear your thoughts.