FRC issues Statement on Actuarial Standards
News types: Statements
Published: 24 July 2014
The statement confirms that the FRC’s and IFoA’s respective standard-setting responsibilities should continue as before but that there should be scope, by agreement, for more flexibility in the way in which those responsibilities are discharged.
The FRC will continue to set technical actuarial standards (TASs) for work carried out within the UK and the IFoA will continue to be responsible for setting ethical standards for all of its members, and for technical standards to be applied by its members carrying out work outside the UK.
In appropriate circumstances, the FRC can, with the IFoA’s agreement, include ethical material in its TASs and the IFoA can, with the FRC’s agreement, produce non-mandatory technical guidance. The FRC and IFoA have updated their Memorandum of Understanding (MoU) to reflect these arrangements.
Separately, the MoU has also been amended to give the FRC a reserve ability to issue ethical standards for actuaries when it considers such action to be in the public interest and after it has consulted with the IFoA and given the IFoA reasonable opportunity to address the matter.
Following this statement and taking account of the work on identifying the risks relating to actuaries and/or actuarial work being undertaken by the Joint Forum on Actuarial Regulation (JFAR), the FRC intends to consult later this year on proposed changes to its actuarial standards framework which include:
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High-level principles which are recognised as applicable across all actuarial work;
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more narrowly focused specific standards where there is a need for additional requirements in the public interest beyond the high-level principles.
These changes will simplify and improve the structure of actuarial standards. Applying the high level principles to all actuarial work will help to ensure that users can be confident that actuarial work meets minimum quality standards.
Notes to editors:
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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 work with other bodies to 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.
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The Joint Forum on Actuarial Regulation (JFAR) was established in 2013 to enhance collaboration on actuarial matters between the FRC, IFoA, Prudential Regulation Authority, Financial Conduct Authority and the Pensions Regulator. Its remit is to coordinate regulatory responses to public interest risks relating to actuaries and/or actuarial work.