Exposure Draft of Proposed CAS Foundational Statements
08/25/2010 —Updated: 15 November 2010
The CAS Board of Directors has authorized the release of the Exposure Draft of the CAS Foundational Statements, which would be published July 1, 2011. The Statements will replace the current set of Statements of Principles (Statements of Principles for Loss Reserving, Statements of Principles for Ratemaking, and Statements of Principles for Valuation.).
The Exposure Draft is the result of the work of the Task Force on Foundational Statements, originally, the Task Force on Principles. The CAS Board reviewed the proposed Foundational Statements at its March 2010 meeting and authorized the release of the Exposure Draft. Members and other interested parties are now invited to participate in the process by submitting comments on the Exposure Draft. All comment letters will be considered by the Task Force and revisions may be made to the proposed statements based on the comments. The CAS Board of Directors has indicated that the proposed Statements are acceptable as a replacement for the existing Statements of Principles; barring substantive comment from the membership, the Board is expected to adopt the proposed policy at its March 2011 meeting.
How Are Members Affected?
CAS Statements of Principles have been published for over 20 years. These statements were referenced by CAS members in the preparation of actuarial work products in those specific areas and perhaps others. During that time period, the scope of actuarial work products have expanded, standard-setting bodies were formed and have promulgated standards in a number of countries where CAS members practice, improvements in the technical skills were made and the CAS scope of membership and practice broadened, globally. Many of the Statements were proscriptive or covered considerations that would more properly be covered in a standard of practice. As such these parts of the statements created potential conflicts with the Actuarial Standards Board and with other jurisdictional bodies governing CAS members’ practice. In addition, some concepts were similar across the existing Statements. Responding to these and other actions, the Board created a Task Force to examine and propose modifications to the existing Statements. The Board wanted to assure as well, that the essential concepts as they apply to actuarial work products would still govern, even if they were published in other vehicles.
When members review these proposed Statements, please keep in mind that these Statements when finally published will replace the existing Statements of Principles. The Principles themselves, however, are not being eliminated. While the proposed CAS Foundational Statements represent a significant change in format, the applicable concepts in those Principles will still govern where they are expressly published in the practice standards of appropriate governing organizations. This is addressed more fully in the Exposure Draft.
In your review of the Exposure Draft, please consider the following:
- All feedback, comments, and suggestions are welcome and could be included verbatim (without attribution) in a future document.
- While general comments may be submitted, it is essential that you provide specific alternative wording.
- Your suggestions to a particular section may impact other parts of the Exposure Draft; therefore it may be necessary to incorporate your changes throughout the document.
Please send your written comments on the Exposure Draft via e-mail by December 1, 2010, to Mike Boa at the CAS Office (email@example.com), who is compiling the comments on behalf of the CAS. In order to generate discussion about the Exposure Draft, the CAS would like to make your comments publically available on the CAS Web Site. When submitting your comments, please indicate whether you will grant permission to the CAS to post your comments.
In closing, I would like to take this opportunity to commend the outstanding professionals who participated on the Task Force. They devoted the necessary time and energy required of this project and the work product reflects the extent of that effort.
Thanks, in advance, for your consideration of this document.
Roger M. Hayne
- Exposure Draft of CAS Foundational Statements
- Background Material
- A Proposal to the EC to Expose Foundational Statements to the Membership with the Intent to Replace Existing CAS Statements of Principles
- Formulating the Foundational Statements: Defining the Characteristics and Purposes of Principles
- Mapping Current Statements of Principles and Proposed Foundational Statements