PenCom discovers Major Exception in the Implementation of IFRS 9 by Operators – PensionNigeria

PenCom discovers Major Exception in the Implementation of IFRS 9 by Operators

National Pension Commission (PenCom) has issued a deadline to Pension Fund Administrators (PFAs) and Closed Pension Fund Administrators (CPFAs) that are yet to forward the Business Models (BM) put in place on the adoption of International Financial Reporting Standards (IFRS) in 2018, to forward same to PenCom latest by Friday, 28 February 2021, for review and reference purposes.

PenCom said since PFAs/CPFAs commenced the valuation of pension fund assets in line with the provisions of IFRS 9 in 2018, it was expected that Business Models (BMs) had been developed to guide the investment decisions for all existing and newly set up Funds under Management. The need to develop BMs per Fund under Management was highlighted in the Joint Circular issued by PenCom and the Financial Reporting Council (FRC) dated 4 August, 2017.

However, PenCom’s review of the 2020 Half-Year Fixed Income Audit of Funds under Management of PFAs/CPFAs, revealed that though some Pension Fund Operators were already valuing their portfolios in line with the provisions of IFRS 9, they were yet to put in place duly formalized BMs for all Funds under Management and this was a major exception in the implementation of IFRS 9 by Operators.

Read the Circular here

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