A large South African bancassurer asked MBE Consulting to produce their coverage units calculation as part of their IFRS 17 implementation programme.
The client needed a partner who fully understood their business and IFRS 17. Having previously helped them to define their risk adjustment model, when a key member of their IFRS 17 team left, the client needed urgent support.
Reduced team size: Losing a key member of the IFRS 17 team presented challenges across project execution and collaboration. Workload distribution became too concentrated, putting a strain on other team members.
Coverage unit calculations: The partially executed coverage units calculations were disrupting workflow continuity, leading to delays and compromising outcome quality.
Inexperienced team: In some instances, the inexperienced team members lacked the knowledge needed to confidently complete complex tasks.
Lack of version control: The absence of good version control posed risks to data integrity and collaboration. Managing multiple iterations was challenging and increased the likelihood of errors and inconsistencies.
Looming IFRS 17 deadline: The impending IFRS 17 deadline necessitated timely preparations to ensure regulatory compliance and mitigate risks.
The first stage of the project was to quickly familiarise ourselves with the work that had already been developed for the coverage unit calculation. This involved digesting a vast amount of information either supplied or through self-learning.
However, the initial quote for the implementation of the software – excluding ongoing fees – was considerably above budget. The client approached the MBE team for advice on how to reduce the costs while still achieving the desired outcome of a complete and efficient IFRS 17 solution.
In parallel to understanding the current setup, the client was implementing a new and very different version of their modelling application. Therefore, it was necessary to convert the work that had already been undertaken, and apply new processes and calculations to the updated application.
To understand how the modelling application was being used, it was essential we worked in close collaboration with the team.
We quickly gained a full understanding of the application setup, including the bespoke aspects of the application and other processes that impacted how the calculations were executed. From the knowledge gained, we made improvement recommendations to the client which we were then asked to implement.
Based on this work the client expanded the project brief. We were asked to extract transition numbers and also examine and make improvement recommendations which we subsequently implemented in the Business Analysis Process model.
The support we provided to the less experienced IFRS 17 team ensured calculation errors were identified before reaching the management team. This meant calculations only had to be checked once by management and reruns were eliminated. In addition, we introduced version control which enabled the team to review how the calculations were produced.
“I want to give credit where credit is due. On behalf of the team and myself, I want to convey that the MBE team has been instrumental in transforming the IFRS 17 transition calculation. Without their knowledge and insights we would not have reached such an advanced position.”
Chief Financial Officer