The Commissioner for Insurance and Chief Executive Officer, National Insurance Commission (NAICOM), Mr. Olorundare Sunday has inaugurated the Nigerian Actuarial Society Discount Rate Committee (NAS-DRC).
Inaugurating the Committee at a meeting in Abuja, Mr. Olorundare said the NAS-DRC was constituted to support the setting of a standardized basis of determining discount rate factor for use by the insurance industry and other stakeholders in the financial services sector, particularly in the imp.lementation of the International Financial Reporting Standard 17 (IFRS 17), Insurance Contracts.
The NAICOM Boss disclosed that the President cf NAS and a representative of NAICOM (not below the rank of a Director) will serve as Chairman and Co-Chairman respectively, while the NAS is expected to provide the Secretariat.
He revealed further that the membership of the NAS-DRC was drawn from representatives of NAS, NAICOM, Actuarial representatives of Audit Firms, as well as Resident Actuaries of Insurance Operators (with annuity business).
“It is apparent the role of Actuaries in the implementation of IFRS 17 cannot be overemphasised, likewise the need for credible, prudent, consistent and sustainable discount rate devoid of possible manipulation by different stakeholders if left to determine same for individual company’s use”, he said.
The objectives of the NAS-DRC according to Mr. Olorundare includes:
To determine the risk-free yield curve for use by the insurance industry: and To provide commentary on any market movement that might impact on the determination of the risk-free yield curve.
Consequently, he expressed optimism that the inauguration of the NAS-DRC would enhance accountability, prudence and comparability in financial reporting and thereby support the stability in the Nigerian financial sys:em.
The NAICOM CEO said “| am hopeful that the deliberations and activities of the NAS-DRC will bring about the desirable impact for the Nigerian financial system.
“Note also that the terms of reference terrain as earlier circulated to members”.
The Nigerian Actuarial Society Discount Rate Committee (NAS-DRC) was inaugurated on Wednesday, 12th July, 2023.