Ethical Issues Forum
Keeping Current With Qualifications
Editor's Note: This article is part of a series written by members of the CAS Committee on Professionalism Education (COPE) and the Actuarial Board of Counseling and Discipline (ABCD). The opinions expressed by readers and authors are for discussion purposes only and should not be used to prejudge the disposition of any actual case or modify published professional standards as they may apply in real-life situations.
John Doe, FCAS, works for Discount Opinions, a large consulting firm. Around this time of the year, John signs a number of actuarial opinions for his property/casualty insurance company clients. In January, Discount Opinions sent out an interoffice e-mail reminding all actuaries that they need to be current with the Qualification Standards if they intend to sign a Prescribed Statement of Actuarial Opinion. Qualification Standards are a requirement of Precept 2 of the Code of Professional Conduct, which states:
"Precept 2: An Actuary shall perform Actuarial Services only when the Actuary is qualified to do so on the basis of basic and continuing education and experience and only when the Actuary satisfies applicable qualification standards."
Shortly after receiving the e-mail, John skimmed through the Qualification Standards but had trouble understanding the continuing education requirements. John decided to ask his boss, Bob Smith, FCAS, to help him interpret them. Their conversation was as follows:
John: "Hi Bob. Do you understand the continuing education requirements contained in the Qualification Standards?"
Bob: "Don't worry about the technical detail of the continuing education requirements. The requirements are too complicated and nobody fully understands them. Just make sure you attend one actuarial meeting a year and you should be in compliance."
John: "Will one meeting a year cover all of the time requirements?"
Bob: "It might not cover all of the time requirements, but you can always allocate in retrospect the normal day-to-day activities that you did over the past such as reading trade magazines to any shortfall."
Do you agree with Bob's advice?
Activities that qualify as continuing education for purposes of signing a property/casualty statement of actuarial opinion must be relevant to the specific list of topics provided in Section III(A)(1)(b) of the Qualifications Standards. Not all sessions available at an actuarial meeting address these topics and therefore may not qualify as continuing education. The same is true with articles contained in trade magazines. In addition, blanket assumptions regarding the time spent over the past year in retrospect would be a violation of the recordkeeping requirements in Section VI of the Qualifications Standards, which require the actuary to keep appropriate records as evidence that their continuing education requirements have been met.
Actuarial meetings, such as the Casualty Loss Reserve Seminar, can provide the opportunity for an actuary to obtain the majority of the required minimum credit hours needed for continuing education. Although it is true that there are specific topics required for signing property/casualty actuarial opinions, most sessions at actuarial meetings are reasonably relevant to the topics listed in the Qualification Standards. With respect to trade magazines, up to half of the required credit hours can be attributable to "other activities" which are defined as "informal activities that provide the actuary with continuing education." Reading trade magazines should qualify as an "other activity" and if done periodically, can generate a significant amount of credit hours. While it is preferred to keep records of continuing education activities up to date, Bob's advice is acceptable given that the recordkeeping requirements in the Qualification Standards do not specifically address the timeliness of an actuary's records. As long as John can prepare a record identifying the date of continuing education, the credit hours obtained, and the brief description of the subject matter, it shouldn't matter when the recordkeeping was done.