Prima Consulting's Technology Products for Digital Transformation

In Saudi Arabia, companies follow accounting standards set by the Saudi Organisation for Certified Public Accountants (SOCPA), which align with International Financial Reporting Standards (IFRS). These standards ensure consistent and transparent financial reporting, incorporating IFRS requirements and specific Saudi Arabian regulations like Zakat. Prima Consulting's technology products, including IAS 19 and Delta (an IFRS 17 compliance tool), integrate seamlessly with these standards, providing comprehensive IT solutions for financial reporting.

An IAS 19 actuarial valuation, offered by Prima Consulting's IAS 19 product, provides a detailed assessment of a company's employee benefit liabilities. This evaluation considers current and future obligations related to employee benefit programs, ensuring accurate pension accounting and compliance with IAS 19 standards. Our digital products simplify complex calculations, making the valuation process more efficient.

Since January 1st, 2017, listed entities in Saudi Arabia must report under IFRSs as adopted by SOCPA. This enhances transparency and consistency in financial reporting across the region. Prima Consulting's Delta solution, an IFRS 17 tool, helps insurance companies streamline compliance with these updated standards. Our IFRS 17 solution ensures that companies meet the regulatory requirements effectively.

• Current service cost: This represents the portion of employee benefits earned during the current reporting period.
• Projected unit credit method: The specific actuarial technique mandated by IAS 19 for estimating the ultimate cost of employee benefits.

An IFRS 17 software solution, such as Prima Consulting's Delta, is a specialized tool designed to facilitate compliance with the IFRS 17 accounting standard for insurance companies. This software offers functionalities including:

• Contract recognition and classification: Categorizes insurance contracts according to IFRS 17 guidelines.
• Automated IFRS 17 calculations: Performs complex calculations required by the standard.
• Seamless data integration: Ensures smooth data exchange between the IFRS 17 system and accounting engines.
• Support for various measurement approaches: Accommodates different methodologies like the General Measurement Model (GMM), Fair Value Approach (FVA), and Premium Allocation Approach (PAA).

IFRS 17 requires insurance companies to use a discounted cash flow approach to account for both fulfillment cash flows (future benefit payments) and the contractual service margin (profit earned over the contract's life). This method reflects the time value of money, providing a more accurate representation of insurance liabilities. Prima Consulting's Delta solution incorporates this approach, ensuring compliance with IFRS 17's core requirements and enhancing insurance standards.

The adoption of IFRS 17 in Saudi Arabia, as emphasized by SAMA (Saudi Arabian Monetary Authority), brings several advantages to the insurance industry:

• Enhanced transparency: Improved reporting standards under IFRS 17 increase transparency for investors and stakeholders.
• Stronger regulatory-industry relationship: Clear reporting fosters better communication between insurance companies and regulators.
• Investment in digital solutions: Implementing IFRS 17 often requires advanced technology solutions like Prima Consulting's Delta, strengthening the sector's technological capabilities.

Under IAS 19, an entity uses the projected unit credit method to estimate the ultimate cost of benefits earned by employees in return for their service in the current and prior periods. This method discounts those benefits to determine the value of the defined benefit obligation and the current service cost. It then deducts the fair value of any plan assets from the present value of the defined benefit obligation, determining the deficit or surplus, recognizing the amount in profit and loss, and other comprehensive income. Prima Consulting's IAS 19 solution automates these calculations, providing accurate and efficient employee benefits and pension accounting.