FRC feedback statement on Joint Forum on Actuarial Regulation: A risk perspective
News types: Feedback Statement
Published: 13 July 2015
The Financial Reporting Council (FRC) has today published a feedback statement on the discussion paper, Joint Forum on Actuarial Regulation: A risk perspective (PDF), which sought views on the Joint Forum on Actuarial Regulation’s (JFAR) identification of risks to the public interest where actuarial work is relevant.
Common themes emerging from the feedback of over 300 respondents include risks arising from the fast changing pensions environment and the interconnectedness of many of the risks where actuarial work is relevant.
As a result of the feedback, JFAR will focus on three areas in 2015/16 to help determine if the risks are being appropriately mitigated and if additional co-ordinated response is needed:
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Defined benefit (DB) to defined contribution (DC) pension scheme transfers: this review will look at the actuarial work being performed to support DB to DC transfers in the light of the new pension freedoms.
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General insurance provisions: this review will investigate the actuarial work supporting the setting of general insurance claims provisions in the light of the current economic environment and competitive insurance market.
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Group think: this review will consider the factors affecting actuarial group think including whether regulation itself can cause group think.
JFAR intends to maintain its risk perspective using a range of inputs including from further public feedback.
Notes to editors:
1. The FRC is responsible for promoting high quality corporate governance and reporting to foster investment. We set the UK Corporate Governance and Stewardship Codes as well as UK standards for accounting, auditing and actuarial work. We represent UK interests in international standard-setting. We also monitor and take action to promote the quality of corporate reporting and auditing. We operate independent disciplinary arrangements for accountants and actuaries; and oversee the regulatory activities of the accountancy and actuarial professional bodies.
2. The Joint Forum on Actuarial Regulation (‘JFAR’) was established in 2013 by the Financial Reporting Council, the Institute and Faculty of Actuaries, the Financial Conduct Authority, the Pensions Regulator and the Prudential Regulation Authority. The JFAR is a unique collaboration between regulators to co-ordinate, within the context of its members’ objectives, the identification and analysis of public interest risks to which actuarial work is relevant. Actuarial work is relevant to many members of society, including:
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Individuals |
The financial system |
The community as a whole |
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Insurance policyholders |
Stability of the UK financial system |
Taxpayers |
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Pension scheme members |
Consumers / savers / potential policyholders |
Wider economic activity |
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Investors (shareholders) |
Confidence in the accountancy / actuarial professions |
Welfare and social inclusion |
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Creditors (bondholders) |
Government / regulators / auditors |
The environment |
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Creditors (other) |
Boards of companies / sponsors of pension schemes |
Future generations |
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Employees |
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Suppliers |
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