Norm Reforming Article 5 of the Standard for the Implementation of the Accounting Framework for Insurance, Reinsurance, and Surety Companies

Page 1 of 2 Resolution No. CD-SIBOIF-1346-4-NOV22-2022 Dated November 22, 2022

STANDARD REFORMING ARTICLE 5 OF THE STANDARD FOR THE IMPLEMENTATION OF THE ACCOUNTING FRAMEWORK FOR INSURANCE, REINSURANCE, AND SURETY COMPANIES

The Board of Directors of the Superintendence of Banks and Other Financial Institutions,

CONSIDERING

I That on November 21, 2017, the Standard for the Implementation of the Accounting Framework for Insurance, Reinsurance, and Surety Companies (Accounting Framework Standard), contained in Resolution No. CD-SIBOIF-1028-1-NOV21-2017, published in La Gaceta, Official Gazette No. 240, on December 18, 2017, was approved. This standard established in its Article 5 the adoption of IFRS 17, "Insurance Contracts," effective January 1, 2021.

II That in June 2020, the International Accounting Standards Board (IASB) postponed the effective date of IFRS 17 to January 1, 2023; consequently, the Board of Directors of the Superintendence of Banks and Other Financial Institutions adjusted the adoption and implementation process of IFRS 17 to the aforementioned date.

III That it is necessary to reform Article 5 of the aforementioned standard in order to postpone the adoption and implementation date of IFRS 17, given that, prior to its application, the need has been identified to generate parallel financial information to detect and correct inconveniences arising from the use of new software, improvements or development of technological platforms, as well as to make adjustments to industry regulations that require them.

IV That according to the considerations expressed above and based on the authority provided for in Articles 4 and 5, numeral 1) of Law No. 733, "General Law of Insurance, Reinsurance, and Surety," and Article 3, numeral 13) and Article 10, numeral 1) of Law No. 316, "Law of the Superintendence of Banks and Other Financial Institutions"; both laws contained in Law No. 974, Law of the Nicaraguan Legal Digest on Banking and Finance, published in La Gaceta, Official Gazette No. 164, on August 27, 2018, and its updates.

In exercise of its powers,

HAS ISSUED

The following,

Page 2 of 2 CD-SIBOIF-1346-4-NOV22-2022

STANDARD REFORMING ARTICLE 5 OF THE STANDARD FOR THE IMPLEMENTATION OF THE ACCOUNTING FRAMEWORK FOR INSURANCE, REINSURANCE, AND SURETY COMPANIES

FIRST: Article 5 of the Standard for the Implementation of the Accounting Framework for Insurance, Reinsurance, and Surety Companies, contained in Resolution No. CD-SIBOIF-1028-1-NOV21-2017, dated November 21, 2017, published in La Gaceta, Official Gazette No. 240, on December 18, 2017, and its reforms, is hereby reformed, which shall read as follows:

"Article 5. Implementation of the accounting framework with IFRS 17.- From January 1, 2025, insurance, reinsurance, and surety companies must adopt and implement all matters concerning IFRS 17 'Insurance Contracts'. Without prejudice to the date established above, companies must continue to uninterruptedly develop their plans for the adoption and implementation of IFRS 17, issuing parallel financial reports for the period between January 1 and December 31, 2024, to facilitate the transition to IFRS 17.

Insurance, reinsurance, and surety companies must report to the Superintendent the progress of activities carried out for the adoption and implementation of IFRS 17, in the manner and frequency that the Superintendent requires."

SECOND: This standard shall enter into force upon its notification, without prejudice to its subsequent publication in La Gaceta, Official Gazette.

(S) legible (Magaly María Sáenz Ulloa), (S) Illegible (Luis Ángel Montenegro E), (S) Illegible (Fausto Reyes), (S) Illegible (Silvio Moisés Casco Marenco), (S) Illegible (Ervin Antonio Vargas Pérez).

SAÚL CASTELLÓN TÓRREZ Ad Hoc Secretary of the Board of Directors SIBOIF