FSCO requiring semi-annual reports on IFRS readiness

Ontario’s insurance regulator, the Financial Services Commission of Ontario (FSCO), has served notice that it considers the required transition to International Financial Reporting Standards (IFRS) in 2011 to be an “enterprise risk,” and so “we are therefore monitoring the company’s response to that risk.”
Specifically, FSCO is calling on all Ontario Regulated Insurance Companies (ORICs), including reciprocals and fraternals, to submit a progress report to FSCO every six months detailing their plans to adopt IFRS.
IFRS will replace the current Canadian GAAP accounting standards on Jan. 1, 2011. The two principles-based accounting methods are similar in general respects, but they are different in the way they account for specific balance sheet items such as impairments, intangible assets, investment property, financial instruments, etc.
“Your progress review should include a discussion of the institution’s assessment of its readiness to adopt IFRS in 2011, any challenges it envisions and steps it plans to take on resolving these issues,” FSCO says in a letter to the companies dated Dec. 24, 2008.
The first progress report is due Feb. 28, 2009.
“FSCO recognizes that, due to time pressures, the companies may not be able to provide all details by Feb. 28, 2009,” the letter says. “However, we expect subsequent semi-annual filings to contain progressively more details as the impact of IFRS is better understood.
“As a minimum, the Feb. 28, 2009 filing should contain details of the project and the work done to date.” 
No early adoption of IFRS will be allowed for ORICs. FSCO will not accept IFRS financial reporting prior to Jan. 1, 2011.