Introduction

Let us take a step back to better understand the current situation by revisiting the starting point. On January 1, 2005, the IFRS 4 standard for insurance contracts became effective. This was a significant moment for insurance accounting, as it provided a single source of guidance for insurance companies, replacing the multiple and inconsistent practices that previously existed in different countries. Prior to the introduction of IFRS 4, there was a wide variety of practices of accounting for insurance contracts, leading to a lack of consistency and comparability in financial reporting. However, it is important to note that IFRS 4 was not a fully developed accounting standard. Instead, it served as an interim standard, a temporary solution until a more comprehensive standard could be developed.