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Actuarial FAQs (May 2012)

Please note that these FAQs relate to transition to the old TASs and therefore are no longer being supported.

The complete set of answers to FAQs (version 1, May 2012) is available as a single PDF, or you can download the answers to specific questions below.

1. General

1.1 - To what extent can practitioners take account of the expertise of users?
1.2 - If complying with a TAS would involve a disproportionate amount of work, is this work necessary?
1.3 - What is actuarial work?
1.4 - What is the difference between a measure and a method?
1.5 - Why do users need to know whether an exercise is a valuation exercise, a planning exercise or some other type of exercise?
1.6 - How will a practitioner know that a piece of work complies with the TASs at the time it is delivered?
1.7 - Which regulatory body decides whether work complies with the TASs?
1.8 - Who is responsible for complying with TASs?
1.9 - What counts as a decision by users? What about conditional decisions? What happens if the decision has already been taken (e.g. reports of record and certificates)?
1.10 - How can practitioners comply with the TASs when some assumptions or results on which they rely have been produced by a third party and are not subject to the TASs?
1.11 - Am I required to include information that I consider should not influence users' decisions, if I suspect that a user might consider it relevant and might in fact be influenced by it?

2. Reporting

2.1 - Is it necessary to produce lots of formal reports in order to comply with TAS R?
2.2 - Must an aggregate report be a single document?
2.3 - Does an aggregate report have to list the component reports that make it up?
2.4 - Users are likely to find the term "aggregate report" confusing. Is it necessary to use this term?
2.5 - Can a minute of a meeting be a component or aggregate report?
2.6 - If users make a decision on a matter, and subsequently request more information because they wish to revise the decision, does the revised decision need to be preceded by an aggregate report?
2.7 - Why should practitioners have to define "prudent", when it's not defined in legislation or regulation?
2.8 - If a table of lapse rates or other decrements is based on past scheme experience does this count as a set of probabilities (which therefore need to be explained under TAS R) or as data?

3. Data

3.1 - What counts as data?

4. Modelling

4.1 - What does "neutral" mean?
4.2 - Is it always necessary to produce a neutral estimate?
4.3 - Is it necessary to go back and document and test all existing models?
4.4 - What are the requirements for models that I use which are developed by someone else?
4.5 - What is meant by the requirements regarding suitability of models?

5. Pensions work

5.1 - Is the projected unit credit method a measure of pension liabilities, or a method?
5.2 - Won't it confuse people to be told that a pension scheme valuation exercise is really a planning exercise, not a valuation exercise?
5.3 - The final report to the trustees on a Scheme Funding exercise is available to pension scheme members. Do they count as users of that report?
5.4 - Does actuarial work that supports compliance with FRS17 constitute Reserved Work?
5.5 - Does the provision of deficit reduction certificates constitute Reserved Work?
5.6 - What are an actuary's obligations when undertaking actuarial work concerning statutory money purchase illustrations for pension scheme members?
5.7 - When producing Statutory Money Purchase Illustrations in line with version 2.0 of TM1, how should the male and female mortality assumptions be blended?

6. Insurance Work

6.1 - From 1 December 2010 it's possible to comply with GN12 by complying with the TASs.  What does this mean if the work is outside the scope of the TASs?
6.2 - Do I have to provide an estimate of the technical provisions at the end of the following year when I'm calculating them at the year-end?
6.3 - Does validation work on an internal model used to calculate the Solvency Capital Requirement (SCR) in accordance with Solvency II fall within the scope of the TASs?

7. Transformations

7.1 - Does a review of pension scheme factors fall within scope of the Transformations TAS?
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