General Insurance Article - ACA cautions on regulatory reform of actuarial work

The Association of Consulting Actuaries (ACA) in its response to the BEIS consultation on Restoring trust in audit and corporate governance, which also encompasses the future regulation of actuaries, has cautioned on the unintended consequences that could arise in the implementation of reforms primarily focussed on audit.

 Commenting on the response, ACA Chair, Patrick Bloomfield says: “We support the high-level principles behind the proposed regime. We also support the aim of enhancing public confidence in the sector and in the work undertaken by actuaries.

 “In particular, we note that the consultation is not recommending a material change from the existing one, which is generally accepted to be working. We do hold some concerns, however, which relate not to the principles but to the implementation.

 “We consider that it is vital that the draftsmen understand that actuarial work is fundamentally different from audit so needs to be considered separately.

 “In addition, we are very aware of the regulation that already exists for certain work undertaken by actuaries and this needs to be taken into account to avoid overlap which will muddy the waters and potentially dilute the protections for the public currently in place.”

 The ACA response adds that the scope of regulated work should be restricted to work that can reasonably be expected to be carried out primarily or exclusively by actuaries or in which actuaries are particularly suited by virtue of their professional knowledge and training.

 It continues, ‘we would expect the scope to include, as a minimum, all reserved work which can only be carried out by actuaries, noting that we are responding on behalf of the ACA and consulting actuaries, not for the entire profession, so the work that would be covered by this new regime we are primarily concerned with is that of scheme actuaries and other pensions consultants.’

 In addition, considering the other side of the coin, to the extent that the scope of work includes work that can be carried out by non-actuaries, the ACA adds that it considers that it is important the regime is sufficiently flexible/robust to ensure that all practitioners regardless of qualification carrying out work deemed to be of high public interest, should be covered by the same ethical and regulatory standards.

 ACA response to the BEIS consultation on Restoring trust in audit and corporate governance

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