Gap Assessment

Gap Assessment A comprehensive Ind AS 117 gap assessment is essential for insurers and entities issuing insurance-like contracts to transition smoothly from Ind AS 104 or Indian GAAP. It identifies differences in accounting treatment, operational readiness, and system capabilities, helping organizations align with the new standard’s principles of recognition, measurement, presentation, and disclosure. What Is an Ind AS 117 Gap Assessment? It’s a structured diagnostic exercise that compares your current practices with the requirements of Ind AS 117, highlighting:

• Accounting policy gaps (e.g. treatment of acquisition costs, risk adjustments, CSM)
• Measurement model alignment (General Model, PAA, Variable Fee Approach)
• System and data architecture readiness
• Disclosure enhancements and actuarial integration
• Training and change management needs

Key Focus Areas

Area	Assessment Scope
Contract Classification	Identify contracts that meet the definition of insurance under Ind AS 117
Measurement Models	Evaluate applicability of GMM, PAA, or VFA based on contract features
Onerous Contract Testing	Assess methodology for identifying and measuring loss components
Actuarial Assumptions	Review discount rates, risk adjustments, and cash flow estimates
System Integration	Check compatibility of finance, actuarial, and policy admin systems
Disclosures	Map current disclosures to Ind AS 117 requirements
Transition Adjustments	Quantify impact of first-time adoption and retrospective restatements

Benefits of a Gap Assessment

• Early identification of high-impact areas
• Informed decisions on accounting policy elections
• Smooth system integration and process redesign
• Stakeholder alignment and training roadmap
• Improved transparency and investor confidence

Practical Example An insurer may discover gaps in:

• Aggregation levels and cohort definitions
• Recognition of reinsurance contracts held
• Presentation of insurance revenue and service expenses
• Disclosure of risk assumptions and sensitivity analyses

These findings guide remediation plans, system upgrades, and policy refinements. Ready to explore your Ind AS 117 transition strategy? We’re here to support you every step of the way. Whether you’re seeking a tailored gap assessment, implementation roadmap, or hands-on training, our experts are ready to help. Please email us info@nybblelogics.com