A five-day workshop convened Montenegro sector stakeholders in support of ongoing efforts to modernize insurance accounting and embrace sustainability reporting. Attended by 35 participants, the five-day event organized by the World Bank Centre for Financial and Sustainability Reporting Reform (CFRR) focused on International Financial Reporting Standard (IFRS) 17: Insurance Contracts. It was designed to equip industry professionals with a comprehensive understanding of the standard’s requirements, in anticipation of the mandated first implementation in 2027.
IFRS 17 marks a significant shift in insurance accounting by introducing a standardized framework for measuring, recognizing, and disclosing insurance contracts that aims to improve transparency and comparability. While implementation can be complex and costly, it promises to provide more accurate and insightful financial reporting, enhance risk management, drive operational efficiencies, and offer global comparability for stakeholders. The workshop’s agenda addressed the adoption process and challenges of IFRS 17 for the insurance sector. The workshop provided a comprehensive overview of the core IFRS 17 framework, including scope, recognition, measurement, presentation, and disclosure, while also addressing the interactions with IFRS 9 and IFRS 18. It focused on topics relevant to the local context, such as contract separation, measurement approaches for short-term and certain long-dated insurance products, challenges in determining risk-free interest rates due to limited Montenegrin bond market activity, asset–liability duration matching, and unit-linked and participation contracts in the Montenegrin life insurance market. These discussions were supported by practical examples from local and regional practice.
The event was part of the CFRR’s Enhancing Accounting, Auditing, and Sustainability Reporting (EAASURE) Regional Program. With a development objective centered on improving corporate financial reporting and advancing the rollout of sustainability reporting across Europe and Central Asia, the program lends critical support to sector reforms in countries including Armenia, Azerbaijan, Albania, Bosnia and Herzegovina, Georgia, Kosovo, Moldova, Montenegro, North Macedonia, Serbia, and Ukraine. The program benefits from co-funding by the Austrian Ministry of Finance, the Swiss State Secretariat for Economic Affairs, and the Austrian Development Agency.
The workshop’s success was underlined by positive feedback from participants, who commended its relevance and timeliness. The active engagement of the Montenegro Insurance Supervision Agency, Audit Council, Audit Oversight Division and Institute of Certified Accountants of Montenegro contributed to the credibility and impact of the event.
EAASURE engagement with the Montenegro Insurance Supervision Agency will continue, with a view to assisting them in drafting a detailed action plan for the implementation and enforcement of IFRS 17 in the near future.