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U.A.E. to introduce Corporate Tax – 2023 -ask Synergy Software Systems

February 2nd, 2022

Background

The UAE has long positions itself as a place where foreign investors are welcome and where incomes are tax free. Low taxes and a friendly business environment helped to transform the 50-year-old nation.

The UAE faces steep competition from neighboring Saudi Arabia, which is working overtime to attract businesses and families to relocate to the kingdom

The UAE’s Finance Ministry said that it will aunch corporate tax in line with worldwide efforts to combat tax evasion and to meet issues posed by the global economy’s digitization,

The ministry also stated that the measure will prepare for the implementation of a worldwide minimum tax rate, which will apply a different corporate tax rate to large multinationals that meet certain conditions.

It was announced on Jan 31 that for the first time, the United Arab Emirates (UAE) will establish a federal corporate tax of 9% on profits on business profits on June 1, 2023,

  • Businesses engaged in the extraction of natural resources will be exempt from the UAE CT as such businesses shall continue to be subject to Emirate level taxation
  • The UAE CT shall be a Federal level corporate taxation. Thus, all UAE businesses, corporations and entities engaged in and licensed to undertaken commercial activities shall be subject to the UAE CT.
  • Corporate tax will be payable on the profits of UAE businesses as reported in their financial statements prepared in accordance with internationally acceptable accounting standards “with minimal exceptions and adjustments”, 
  • The corporate tax will not apply to personal income from employment, real estate and other investments, nor to income earned from a business licensed outside the UAE.

Introduction of Transfer Pricing

Under the CT regime, UAE businesses will be required to comply with transfer pricing rules and documentation requirements as set out in the OECD Transfer Pricing Guidelines

Free Zone Businesses

Free zone businesses will be within the scope of UAE CT and required both to register and to file a CT return.

Those businesses will however continue to benefit from CT holidays / 0% taxation while they comply with all regulatory requirements and do not conduct business in mainland UAE. 

Multinationals

The press release and FAQs indicate that there will be a different tax rate for large multinationals that meet the criteria under ‘Pillar Two’ of the OECD Base Erosion and Profit Shifting project (i.e. those that have consolidated global revenues above EUR 750m).

Tax basis

The Federal Tax Authority will be responsible for the administration, collection, and enforcement of CT.

Where a business is resident for CT purposes will be determined either based on the place of incorporation / registration (legal seat), or the place of effective management and control of the business.

To help small firms and entrepreneurs, the ministry further stated that the new system entails:

  • a basic statutory tax rate of 9%,
  • a 0% rate for taxable profits up to 375,000 dirhams, ( about $102,107.50 . )

CT will be payable on the accounting net profit reported in the financial statements of the business, with minimal exceptions and adjustments. 

Tax losses incurred from the CT effective date can be carried forward to offset taxable income in future financial periods.

No UAE CT will apply to:  

  • Employment income, income from real estate, income from savings, investment returns and other income earned by individuals in their personal capacity that is not attributable to a UAE trade or business;
  • Dividends, capital gains and other investment returns earned by foreign investors.  

Exemption from UAE CT will be available for: 

  • Capital gains and dividends earned from qualifying shareholdings; 
  • Qualifying intra-group transactions and restructurings.

Domestic and cross border payments of interest, dividends, royalties and other payments will not attract a withholding tax in the UAE.

UAE CT will have to be filed electronically once for each financial period but without a requirement for advance UAE CT payments on the basis of provisional tax returns. 

The tax scheme will allow UAE business groups to be taxed as a single entity or to apply for relief amid losses or restructuring. UAE group companies can form a tax group and file a single tax return for the entire group, and transfer tax losses to other members of the group.

Foreign tax credits will be available for taxation incurred by UAE businesses on income earned outside the UAE’s corporate tax to avoid double taxation.

The UAE CT regime should remain one of the most competitive in the world. The UAE will offer the most competitive CT regime in the region, with Egypt, Jordan, Kuwait, Lebanon, Oman, Saudi Arabia and Qatar imposing CT at rates between 10% to 35% (Bahrain currently does not have a broad based CT regime). 

The introduction of a UAE CT regime would enable the UAE to adopt and implement the OECD BEPS 2.0 measures to address the tax challenges arising from the digitalisation of the global economy, and the introduction of a global minimum tax rate for large multinationals.

What next?

The relevant legislation for the CT regime is currently being finalised and will be subsequently promulgated. Once promulgated, the UAE CT Law will provide more details and guidance on several critical aspects.

Further information is expected to be made available by mid-2022, to give UAE businesses at least 12 months to get ready.

Key considerations for UAE businesses

To prepare for the new corporate tax (CT) profile of the UAE consider an internal working team and whether auditor discussions are needed

Consider the application and impact of the new UAE CT Law on :

  • UAE entity(ies) and/or operations
  • Revenue booked under Mainland UAE versus Free Trade Zone setups
  • Economic substance profile and/or CbCR filings
  • Group structure
  • Inter-company transactions
  1. Investment/Holding structures
  2. Be prepared to adopt new tax and transfer pricing compliances (where applicable).
  3. Consider impact on share price and ability to raise finance
  4. Review IT systems and their configuration to support taxation, and budget for any external consulting resource to e.g. create filing returns reports, or to amend existing reports e.g. TB, cash flow.
  5. Consider whether there needs to be any changes to policies and training for the finance team.
  6. Consider a dry run pilot in a test system to ensure that you can produce timely accurate reports in the correct format.

(Most Dubai stocks fell in the Middle East on February 1 after the United Arab Emirates unveiled that it will be taxing corporate earnings from next year.

Moody’s said: “the introduction of the 9% federal corporate tax is broadly credit negative for domestic UAE corporates because it will reduce their operating cash flows.”)

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Posted in Corporate Perfomance Management, Dubai and regional news, Dynamics 365, Microsoft Dynamics Ax, Security and Compliance, Sunsystems and Vision

Assets with Dynamics 365 Finance & Supply Chain – ask Synergy Software Systems

October 19th, 2021

Assets include for example buildings and machinery, IT equipment. company mobile phones and credit cards, cars, shipping vehicles and containers and son on.. TA malfunction or failure of your assets for example a production machine or a delivery vehicle can negatively impact your supply chain. Aa global enterprise will have thousands of assets.

Dynamics 365’s, Asset Management module allows companies to manage their maintenance operations with real-time access to their maintenance costs without having to separately collect data, to analyze it. Use Asset Management to both plan and execute maintenance and and servicing of equipment in your company, . It integrates seamlessly with several Dynamics 365 modules and other apps.

Functional Locations and Assets

Use Functional locations to manage assets on locations and to track asset costs at functional locations. Functional locations are structured hierarchically, and locations can have sub-locations.. Assets can be installed on functional locations and, be reinstalled on other functional locations.

Asset costs always follow the location of the asset. When you install an asset on a new functional location, the asset automatically uses the financial dimensions that are related to the new functional location. Therefore, asset costs are always related to the functional location that the asset is currently installed. This automatic handling of financial dimensions helps guarantee accurate cost tracking when your company does project controlling and reporting on functional locations.

Also build a hierarchy of functional locations for your company internal equipment maintenance, or for servicing customer equipment.

Assets and Work Orders

. An asset is a machine assembly  or machine part that requires on-going maintenance and service.

Assets can be created in a hierarchical structure, and they can be related to functional locations.

Maintenance jobs can be planned at all levels in the asset structure.

For each asset set up related data, such as asset specification, and required maintenance plans and the affiliation of assets to job types.

Every work order has a work order type, such as preventive or corrective maintenance, or inspection.

The work order contains one or more work order jobs. Every work order job defines a job that must be performed on an asset and a related job type.

Examples of related job types include 10,000 km, 50,000 km, 1-year overhaul, and safety inspection.

One work order can be related to multiple assets.

A work order can be related to another work order, and job types can contain succeeding jobs that create a work order. In general, there are no dependencies between work orders. Therefore, they can change their work order lifecycle state and can be scheduled independently of each other.

Integration with ERP

The integration of Asset Management with Dynamics 365  applications supports drill down into your maintenance data to understand exactly what is driving your costs, and to determine how optimise your assets.

  • Project management and accounting – allows a holistic view into the costs associated with work on specific objects, by area, by a worker, etc.
  • Human resources – provides the capability to assign workers to specific work requests and allows for a clearer vision of the true cost of maintaining your assets.
  • Fixed assets – allows greater visibility into the cost of maintaining an asset.
  • Inventory management – maintains spare parts inventory.
  • Master planning – provides planned purchase orders based on criteria set up in the system, ensuring that the maintenance department never runs out of parts.
  • Procurement and sourcing – allows maintenance departments to have clear visibility into their orders and expenditures.
  • Accounts payable – allows vendors to be paid on time and allows the accounting department greater visibility into maintenance expenses.
  • General ledger – grants visibility into the maintenance process from an accounting perspective.

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Posted in Corporate Perfomance Management, Dynamics 365, Microsoft, Technology

Power BI autp install for TEAMS is coming.

September 17th, 2021
  • Power BI will begin automatically installing the Power BI app for Teams for users when they visit the Power BI service
  • Power BI admins can choose not to auto-install through a new Power BI tenant setting
  • The tenant setting has started to roll-out now, giving admins time to opt-out if desired.
  • The automatic installation will start to take effect in November 2021, for organizations with the setting enabled.

Auto-install for Power BI app for Microsoft Teams

When the Power BI app for Microsoft Teams is installed, users get better experiences without leaving Teams, like:

These capabilities are available once the Power BI app for Teams is installed for a user

The Install Power BI app for Microsoft Teams automatically tenant setting is added to the Power BI admin portal. Power BI admins can control the auto-install behavior. By default, the auto-install is enabled.

The automatic installation happens for a user under the following conditions:

  1. The Power BI app for Microsoft Teams is set to allowed in the Microsoft Teams admin portal
  2. The Power BI tenant setting Install Power BI app for Microsoft Teams automatically is enabled
  3. The user has a Microsoft Teams license
  4. The user opens the Power BI service (e.g. app.powerbi.com) in a web browser

Initially, auto-install applies to new users the first time they visit the Power BI service in a web browser. In the future, auto-install will occur for all active users of the Power BI service who meet the criteria.

When auto-install occurs, the following notification is shown in the Power BI service notification pane.

Questions and Answers

What happening today?

Pre-announcing auto-install of Power BI in Teams.

Starting to roll-out a Power BI tenant admin setting which enables Power BI admins to choose to opt-out of the automatic installation behavior.

When will these changes take effect?

In November 2021, Power BI auto-install of Power BI in Teams will start rolling out.

Which users will be affected?

When the Power BI tenant setting is enabled, the Power BI app for Microsoft Teams will be installed for users who meet the criteria specified. Initially, automatic installation will apply to new users and will expand to all users who visit the Power BI service in a web browser after the initial roll-out in November 2021.

When should I use a Microsoft Teams App Setup Policy?

Microsoft Teams app setup policies allow Microsoft Teams Admins to install an app for a target set of users. Since this applies to all users in the specified group, you can ensure everyone who needs Power BI has it, even when they’re not active Power BI users. Use app setup policies to pin the Power BI app in Teams to the Microsoft Teams left rail. This additional step makes data and analytics prominently available throughout your organization..

Read more about automatic installation in the Power BI documentation

Read more about the Power BI app for Microsoft Teams

Read more about collaboration in Microsoft Teams with Power BI

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Posted in Business Central, Corporate Perfomance Management, Dynamics 365, Microsoft, Security and Compliance, Teams collaboration remote access

IFRS16 Asset leasing in Dynamics 365

September 1st, 2021

Asset leasing helps customers feel more confident that they’re following the proper accounting standards for ASC 842 and IFRS 16, reducing the risk of spending extensive time doing offline calculations. Asset leasing will reduce manual errors and save your users time through automatic lease status updates, right of use assets, wholistic monitoring and analytics, and calculations of net present value, lease interest, and future cash payments.

Dynamics 365 Finance > Asset leasing > Lease management

Asset leasing can help you with the following:  

Automates the complex lease calculation of present value and its subsequent processes such as future lease payment, lease liability amortization, right-of-use asset depreciation, and expense schedules.

Automatically classifies the lease as either operating or finance, or as a short-term lease or low-value lease. The lease classification tests include transfer of ownership, purchase option, lease term, present value, and unique asset.

Centralizes the management of lease information, such as important dates, including the commencement and expiration dates, as well as the lease’s transaction currency, payment amounts, and payment frequency.

Helps to generate accounting entries for the initial recognition, and subsequent measurement of the lease liability and right-of-use asset.

Reduces time for complex calculation of lease modification and automatic adjustment transactions.

Provides posting to different layers to accommodate different reporting purposes, such as tax reports that are available in Dynamics 365 Finance.

Complies with the accounting standards to represent leases on a balance sheet using the Balance sheet impact calculator.

Provides audit controls over the integrity of the lease data to ensure that the posted transactions match the calculated amounts of the present value, future payments, and liability amortization.

Provides tools to import from or export to Excel for all lease data using data management.

Includes features that help in preparing asset leasing reports, particularly the preparation of disclosures and notes.

Integrates with company chart of accounts, currencies, fixed assets, vendors, journals, data management, and number sequences.

Asset leasing integrates seamlessly with other components of Dynamics 365 Finance, including Fixed assets, Accounts payable, and General ledger. Integrates with your company chart of accounts, currencies, fixed assets, vendors, journals, data management, and number sequences.

  • Complies with the accounting standards to represent leases in balance sheets using the Balance sheet impact calculator.
  • Provides audit controls over the integrity of the lease data to ensure that the posted transactions match the calculated amounts of the present value, future payments, and liability amortization.
  • Provides tools to import from or export to Excel for all lease data.

If you need to comply with IFRS16 , or need assistance with implementation or support of Dynamics 365 Finance and SCM then contact Synergy Software Systems 009714 3365589.

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Posted in Corporate Perfomance Management, Dynamics 365, Microsoft, SharePoint and EPM

IFRS 17 – compliance accelerator system- ask Synergy Software Systems.

September 1st, 2021

IFRS 17 is the newest IFRS standard for insurance contracts and replaces IFRS 4 on January 1st 2022. It states which insurance contracts items should by on the balance and the profit and loss account of an insurance company, how to measure these items and how to present and disclose this information.

This is a big change for insurance companies and data administration, financial presentation and actuarial calculations will need to change.

 

Why are IFRS 9 and IFRS 17 implemented together?

  • The insurance liability (IFRS 17) is always closely connected to the financial instruments (IFRS 9) within insurers.
  • When a client buys an insurance, the insurance liability is created and with the paid premiums are financial instruments bought.
  • Insurers want to reduce the volatility in their earnings and there are some choices within IFRS 9 and IFRS 17 which they can make which can impact the volatility.
  • Under IFRS 17 insurers can decide whether results of changing financial risk assumption go through OCI or through the profit and loss account.
  • Under IFRS 9 insurers can decide whether changes in equity will go through profit and loss or through OCI.

Both standards will impact earning volatility and hence balance sheet management choices are connected. Consequently, the IFRS board decided it is better that insurers are granted the option to implement both standards together.

IFRS 9 explains the classification and the measurement of financial instruments. Hence IFRS 9 helps to improve the information disclosure around financial instrument. Many perceive the information disclosure around financial instruments during the financial crisis as inaccurate for example impairments on financial instruments were taken too late and the amounts were too little.

IFRS 9 makes the classification of each financial instrument more logical and principle based. There are two questions which need to be answered for the classification:

  • Why is the company holding the asset; just for collecting the cash flows from the underlying asset, or is the asset also held for trading?
  • What kind of asset is the financial asset? Is it a derivative, an equity or a debt instrument? With the SPPI (solely payment of principal and interest) model it can be tested whether an instrument is really a debt instrument.

 The classification determines:

  • which accounting principle is used;
  • should the instrument be measured at fair value or at amortized cost
  • and whether earnings and losses should go through the profit and loss account or through the OCI (other comprehensive income) account.

IFRS 9 also includes a more dynamic credit loss model instructing when an insurer should take an impairment on financial assets. The model is forward looking thereby also expected future losses should be taken into account with the impairment.

 IFRS 9 also makes hedge accounting possibilities more rule based, thereby being in line with how risks are  managed within insurers.

Why does this matter?

There is a huge impact on insurers and a big change in the disclosure.

  • Almost all of the asset and liability side is hit by the combination of IFRS 9 and IFRS 17.
  • New concepts and terms are introduced.
  • The standards will impact the presented numbers. Under IFRS 17 the insurance liability needs to be based on updated assumptions which is not currently a requirement. .
  • More data with more granularity and more history will challenge internal data storage, reporting and IT performance.
  • Reporting timelines are shortened, which will challenge the systems, and the cooperation between different departments.
  • New components like the unbiased Cash Flows, Risk Adjustment, Discount Rate and CSM are introduced. This means the insurer needs to understand the IFRS 17 principles and decide how to implement IFRS 17. For example which measurement model to choose for an insurance product, which transition measure to user. Read here more about the IFRS 17 model, and here about the transition period.
  • In the balance and income statement, insurance liability will n be specified in a different way, the importance of gross written premiums will disappear, while equity will be impacted.
  • The presentation of the balance and P&L are also significantly affected.
  • Risk engines are needed to calculate the CSM and cope with all the different groups
  • Insurers need to disclose information bases on group of contracts.
  • A group is a managed group (often a product) of contracts which were all profitable, onerous, or may become onerous (decided at inception) with a certain inception year. Insurance companies can have hundreds of groups and IFRS 17 insists on this grouping to have more transparency as insurance companies cannot offset the result of one group to another

Synergy Software Systems has been implementing and supporting financial solutions in the insurance vertical for 25 years. If you need to rapidly implement a solution for IFRS 17 compliance that will sit alongside your existing erp and finance systems then call us on 0097143365589.

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Posted in Business Central, Corporate Perfomance Management, Dynamics 365, Healthcare, Infor Financial solutions, Microsoft Dynamics Ax, Project Management, Security and Compliance, Technology

August 24th, 2021

A bungled data migration of a network drive caused the deletion of 22 terabytes of information from Dallas Police Department police force’s systems – included case files in a murder trial,during a data migration exercise carried out at the end of the 2020-21 financial year

“On August 6, 2021, the Dallas Police Department (DPD) and City of Dallas Information and Technology Services Department (ITS) informed the administration of this Office that in April 2021, the City discovered that multiple terabytes of DPD data had been deleted during a data migration of a DPD network drive,” said a statement [PDF] from the Dallas County prosecutor’s office.

14TB were recovered, presumably from backups, but “approximately 8 Terabytes remain missing and are believed to be unrecoverable.”

The Home Office initially issued a statement saying the data loss was down to a “technical issue”, which had been resolved, There must have been some technical resolution because the Home Office later said it was not a technical issue after all, and in fact a “housekeeping error” with Home Secretary Priti Patel saying: “Home Office engineers continue to work to restore data lost as a result of human error during a routine housekeeping process earlier this week.”

In a letter published by The Guardian, National Police Chiefs’ Council (NPCC) deputy chief constable Naveed Malik, lead for the organisation on the Police National Computer (PNC), said approximately 213,000 offence records, 175,000 arrest records and 15,000 person records had potentially been deleted in error. The DNA database connected to the PNC saw 26,000 records corresponding to 21,710 subjects potentially deleted in error, “including records previously marked for indefinite retention following conviction of serious offences”. The letter also said 30,000 fingerprint records and 600 subject records may have been deleted in error.

The PNC dates back to the 1970s. The current iteration is a Fujitsu BS2000/OSD SE700-30 mainframe based in a Hendon data centre, running Software AG’s natural programming language-using ADABAS database. The UK’s territorial and regional police forces, Serious Fraud Office, Security and Secret Intelligence Services (MI5, MI6), HM Revenue & Customs, and the National Crime Agency all make use of it. They have controlled and 24-hour access from remote terminals and through local police force systems.

These incidents highlight the importance of backups and backup and recovery processes. How often do you test whether you can restore your back ups? Does this still work for restoring older back ups when you upgrade? Has a move to the cloud changed the retention of your back ups, the frequency of upgrades, or the ease or time for restore?

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Posted in Business Central, Corporate Perfomance Management, Dynamics 365, HR and Payroll, Infor Financial solutions, Microsoft, Microsoft Dynamics Ax, Microsoft Dynamics CRM, Project Management, Security and Compliance, SharePoint and EPM, SQL, Sunsystems and Vision, Teams collaboration remote access, Technology

AML/CFT – Anti-money Laundering & Combating the Financing of Terrorism – Regulatory compliance

August 23rd, 2021

Global Governments have implemented concerted measures to increase the scrutiny of AML/CFT processes and controls, to fight financial crimes.

In December 2020, the UAE Cabinet adopted the formation of the Executive Office of the Anti-Money Laundering and Countering the Financing of Terrorism with an aim to follow the international requirements in this sector. The Ministry of Economy (MoE) sent out e-mails to all companies with a link to the Annual AML/ CFT Risk assessment form along with deadlines for each category of DNFBPs.

All Designated Non-Financial Businesses and Professions (“DNFBP’s) must register on a “goAML portal” before 31 March 2021.  So any ‘grace period ‘ is well over.

The goAML portal is a integrated platform used to file Suspicious Transaction Reports (STRs) and/or Suspicious Activity Reports (SAR).

“It is your obligatory duty under the Federal Decree Law 20 of 2018 and Article 20(2) of Cabinet Decision No. (10) of 2019, to have procedures in place to report Suspicious Transactions to manage anti-money laundering (“AML) and counter terrorist financing (“CFT”). This system will allow you to help authorities identify criminal and suspicious activity.Failure to register on goAML may result in severe penalties invoked by the Ministry of Economy. We therefore urge you to treat this notice as a matter of priority and complete your application to ensure access to the goAML system.“

Non- compliance to this will attract fines up to AED 5 Million!
In addition to the financial sector, this regulation applies to all Designated Non-Financial Businesses and Professions (DNFBP), and the members of their boards of directors, management, and employees, established and/or operating in the territory of the UAE. They are applicable to all such natural and legal persons in the following categories: 

• Auditors and accountants; 
• Lawyers, notaries and other legal professionals and practitioners; 
• Company and trust service providers; 
• Dealers in precious metals and stones; 
• Real estate agents and brokers; 
• Any other Designated Non-Financial Businesses and Professions (DNFBPs) not mentioned above.

All such businesses must:

• register with the Financial Intelligence Unit (go AML)

• enroll on the Committee for Commodities Subject to Import and Export Control system (Automatic Reporting System for Sanctions List).

To determine whether you are likely to be a DNFBP go to: https://www.economy.gov.ae/english/AML/goAML/Pages/verify.aspx

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Posted in Corporate Perfomance Management, Dubai and regional news, Security and Compliance

e-invoicing in KSA and Dubai – does your system meet the requirements? Ask Synergy Software Systems.

July 16th, 2021

The Kingdom of Saudi Arabia (KSA). The Kingdom announced e-invoicing for resident companies, which was published on December 4, 2020. e-invoicing will become mandatory for tax payers from December 4, 2021.

The aims of the e-invoicing mandate are to provide more transparency, and enhance consumer protection and anothee benefit of e-invoicing implementation is the readability of the invoice formats

. Companies registered in Saudi Arabia should immediately start updating or changing their systems and processes to support issuance of e-invoices. This may be a little challenging. However, the key to successful implementation is to start early.

Note that Dubai has also announced similar legislation.

If you need to upgrade or change your system or to .add additional functionality to your systems to comply with the invoicing mandate then please contact us 009714336589

On this blessed occasion of Eid, we wish you and your family good health, wealth and prosperity. And don’t forget to take a reflection on you and your business this Summer.

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Posted in Corporate Perfomance Management, Dubai and regional news, Dynamics 365, e procurement, General Synergy News, Infor Financial solutions, Microsoft Dynamics Ax, Microsoft Dynamics CRM, Sunsystems and Vision, Technology

IFRS 17 and IFRS9 – Insurance contracts – are you ready? Ask Synergy Software Systems

June 1st, 2021

IFRS 17 is the newest IFRS standard for insurance contracts and replaces IFRS 4 on January 1st 2022. Mainly to make the financial statement easier to compare across insurance companies and among industries

It states which insurance contracts items should by on the balance and the profit and loss account of an insurance company, how to measure these items and how to present and disclose this information.

This is a big change for insurance companies because data administration, financial presentation and actuarial calculations will need to change!

IFRS 9 explains the classification and the measurement of financial instruments. Hence IFRS 9 helps to improve the information disclosure around financial instrument. Many perceive the information disclosure around financial instruments during the financial crisis as inaccurate for example impairments on financial instruments were taken too late and the amounts were too little.
IFRS 9 makes the classification of each financial instrument more logical and principle based. There are two questions which need to be answered for the classification:
• Why is the company holding the asset; just for collecting the cash flows from the underlying asset, or is the asset also held for trading?
• What kind of asset is the financial asset? Is it a derivative, an equity or a debt instrument? With the SPPI (solely payment of principal and interest) model it can be tested whether an instrument is really a debt instrument.
The classification determines:
• which accounting principle is used;
• should the instrument be measured at fair value or at amortized cost
• and whether earnings and losses should go through the profit and loss account or through the OCI (other comprehensive income) account.
IFRS 9 also includes a more dynamic credit loss model instructing when an insurer should take an impairment on financial assets. The model is forward looking thereby also expected future losses should be taken into account with the impairment.
IFRS 9 also makes hedge accounting possibilities more rule based, thereby being in line with how risks are managed within insurers.

Why are IFRS 9 and IFRS 17 implemented together?
• The insurance liability (IFRS 17) is always closely connected to the financial instruments (IFRS 9) within insurers.
• When a client buys an insurance, the insurance liability is created and with the paid premiums are financial instruments bought.
• Insurers want to reduce the volatility in their earnings and there are some choices within IFRS 9 and IFRS 17 which they can make which can impact the volatility.
• Under IFRS 17 insurers can decide whether results of changing financial risk assumption go through OCI or through the profit and loss account.
• Under IFRS 9 insurers can decide whether changes in equity will go through profit and loss or through OCI.
Both standards will impact earning volatility and hence balance sheet management choices are connected. Consequently, the IFRS board decided it is better that insurers are granted the option to implement both standards together.

Likely impacts
• New concepts and terms are introduced. for example components like unbiased Cash Flows, Risk Adjustment, Discount Rate and CSM
• The standards will have an impact on the presented numbers. Under IFRS 17 the insurance liability needs to be based on updated assumptions which is currently not the case with IFRS 4.
• Faster disclosure is needed, which needs faster processes within the organization
• Insurance liability needs to be specified in a different way, the importance of gross written premiums disappears, while equity will be impacted.
• Risk engines are needed to calculate the CSM and cope with all the different groups
• The general ledger system will change as new measurements are introduced
• Big impact on presentation of the balance and P&L
• More data is needed. with finer granularity and with more history, which challenges internal data quality and consistency and IT performance.
• Reporting timelines are also shortened. both challenging the systems but also the cooperation between different departments.
• Staff training will be needed.

To find out more about the requirements contact us or your auditors.
To update your financial software or to acquire software to support IFRS 17 please call Synergy Software Systems on 009714 3365589


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Posted in Corporate Perfomance Management, Healthcare, Hospitality, Infor Financial solutions, Project Management, Security and Compliance, Sunsystems and Vision, Technology, Uncategorized

Quickly identify and fix your performance bottleneck

May 4th, 2021

Are you responsible for a busy SQL server, for example, the Finance Department’s systems, documentation management, CRM, BI, or a Web Server; perhaps a busy file and print server, or something else entirely.

Were you responsible for installing the application running the workload for your company? Is the workload business critical, i.e. TOO BIG TO FAIL?

Do users, or even worse, customers, complain about performance?

If you are responsible to keep the workloads running in your organization that would benefit from additional performance, please read on – even if you don’t consider yourself a “Techie”.

Windows and VMs are both factors of high latency that impacts performance.

Variables Affecting the Performance of the Applications

There are many variables that affect the performance of those applications. The slowest, i.e. the most restrictive of these is the “Bottleneck”. Think of water being poured from a bottle. The water can only flow as fast as the neck of the bottle, the ‘slowest’ part of the bottle.

In a computer hardware the bottleneck will almost always fit into one of the following categories:

  • CPU
  • DISK
  • MEMORY
  • NETWORK

With Windows, it is usually very easy to find out which one the bottleneck is in, and here is how to do it (like an IT Engineer):

  • To open Resource Monitor – click the Start menu, and type “resource monitor”, and press Enter. Microsoft includes this as part of the Windows operating system and it is already installed.
  • Notice the graphs in the right-hand pane. When your computer is running at peak load, or users are complaining about performance, which of the graphs are ‘maxing out’? This is a great indicator of where your workload’s bottleneck is to be found.
Resource monitor

What You Can Do to Improve Application Performance

Once you have identified your bottleneck – the slowest part of your ‘compute environment’ then, what can you do to improve it?

The traditional approach to solving computer performance issues is to throw bigger and more powerful hardware at the solution like an extra disk or a new laptop, or putting more RAM into your workstation, or on the more extreme end, buying new servers or expensive storage solutions.

How do you decide when it is appropriate to spend money on new or additional hardware, and when it isn’t. Well the obvious answer is; ‘when you can get the performance that you need’, with the existing hardware infrastructure that you have already bought.

You don’t replace your car, just because it needs a service or tuning?

Let’s take disk speed as an example. Look at the response time column in Resource Monitor. Open the monitor to full screen or large enough to see the data. On the Overview tab, open the Disk Activity section so that you can see the Response Time column.

Do it now on the computer you’re using to read this. (You didn’t close Resource Monitor yet, did you?) This shows the Disk Response Time, or , how long is the storage taking to read and write data? Of course, a slower disk speed = a slower performance, but what is considered a good disk speed or a bad speed?

Scott Lowe, has written a great post that you can read here…TechRepublic: Use Resource Monitor to monitor storage performance that perfectly describes what to expect from faster and slower Disk Response Times:

“Response Time (ms). Disk response time in milliseconds. For this metric, a lower number is definitely better; in general, anything less than 10 ms is considered good performance. If you occasionally go beyond 10 ms, you should be okay, but if the system is consistently waiting more than 20 ms for response from the storage, then you may have a problem that needs attention, and it’s likely that users will notice performance degradation. At 50 ms and greater, the problem is serious.”

I hope when you check on your computer, the Disk Response Time is below 20 milliseconds. What about those other workloads that you were thinking about earlier. What’s the Disk Response Times on that busy SQL server, the CRM or BI platform, or those Windows servers that the users complain about?

Your Two Options

When the Disk Response Times are often higher than 20 milliseconds, and you need to improve the application performance, then it’s choice time and there are two main options:

  • Storage workload reduction software like DymaxIO™ fast data (Diskeeper®, SSDkeeper®, and V-locity® are now new DymaxIO fast data software). This tool will reduce Disk Storage Times by allowing much e of the data that your applications need to read, to come from a RAM cache, rather than be read slower disk storage. RAM is much faster than the media in your disk storage.
  • Contact us to trial this. You don’t even need to reboot.
  • If you have tried the DymaxIO software, and you still need faster disk access, then, it’s time to start getting quotations for new hardware. It does make sense though, to take a couple of minutes to install DymaxIO first, to see if that can be avoided. The software solution to remove storage inefficiencies is typically a much more cost-effective solution than having to buy hardware! A software solution to a software problem.

Improve Your Application Performance by Decreasing Disk Latency like an IT Engineer – call us to learn more 0097143365589

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