OSFI.MemoAA

Question 1

Identify 5/8 elements that should be included in the AAR (Appointed Actuary’s Report).

Answer 1

1. Identification: Of the AA (employee/consultant, tenure) and the Peer Reviewer.
2. Opinion on whether PolLiabs as determined by AA are fairly represented in insurer’s F/S
3. Detailed commentary
4. Materiality: Description of the standard used and a comparison to external audit materiality
5. Reinsurance Held: Describe significant arrangements
6. Data and calculations (Describe data sources, controls, and any changes from prior years.)
7. Assumptions: Describe key assumptions
8. Reliance on Others: Identify and accept responsibility for work relied upon

Question 2

Can AA’s valuation be different from amounts booked in A/R?

Answer 2

Yes, but if the difference is greater than the AA’s materiality standard, the AAR must provide an explanation

Question 3

Identify the 2 items in an unqualified opinion

Answer 3

1. The policy liabilities on the B/S make appropriate provision for all policy obligations
2. The Annual report fairly represents the results of the valuation

Question 4

AA’s main responsibility regarding data in the AAR?

Answer 4

That the data is RelSuff (reliable & sufficient) for valuation purposes

Question 5

What disclosures (3) are required by NEW AA in next AAR?

Answer 5

• DATES: outgoing AA exit date, incoming AA start date, OSFI notification date
• COMMUNICATION: between incoming AA and outgoing AA
• QUALIFICATIONS: of new AA

Question 6

What are the deadlines for submitting the AAR, FCT Report, and Peer Review Report?

Answer 6

• AAR: within 60 days of fiscal year end.
• FCT Report: Earlier of 30 days after board presentation or one year after fiscal year end.
• Peer Review Report: Same as P&C financial returns for pre-release; within 30 days after AA's report release.