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News from the Board and the IAA

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By Micheline Dionne, FCIA
CIA President

On September 22, your Board of Directors held its first meeting for 2010–2011. After welcoming five new members, namely President-elect Jim Christie, Steve Bonnar, Sylvie Charest, Bill Chinery and Jacques Lafrance, Daniel Lapointe gave an orientation session on the CIA structure and the way the Board operates. The aim was to help the new members get off on the right foot and refresh the memories of the returning members. It was a good introduction to the governance report that followed. We had asked a task force to examine the Board’s mode of operation, since it hadn’t been reviewed for several years. The task force’s key recommendations included creating a committee to manage the risks facing the Institute, preparing a code of conduct for Board members, providing for a quarterly review of finances and reviewing the relevance of existing committees and their respective mandates. Other recommendations will be taken up in our next meeting, as will a plan to implement them.

The Pension Advisory Task Force reported on its activities, chief among them its responses to the Ontario government concerning pension plan reform and the pre-budget consultations by the federal government; a joint venture with the C.D. Howe Institute for an upcoming conference on retirement (Canada Retirement 20/20); and the creation of a task force on individual savings and financial education. As you can see, we are looking at retirement one component at a time, given the wide range of subjects.

The Actuarial Standards Board (ASB) and the Actuarial Standards Oversight Council (ASOC) provided an overview of their work, focusing in particular on standards of practice relating to marriage breakdown, a file that the Board is following with much interest. They also discussed their concerns regarding the ability to respond to needs, given the already high demand on our volunteers. In this regard the CIA, ASB and ASOC will join forces to find partners willing to provide us with financial support, which will allow us to be more proactive than reactive.

You will be happy to know that the CIA intends to apply by year’s end to become an award signatory of the CERA (Chartered Enterprise Risk Analyst) designation.

We also had an in-depth look at the Accreditation Committee’s report on education reform, which has just been released. I encourage you to read the report and submit your comments to the committee. The report can be found at the following link:

Amendments to Rules of Professional Conduct 6 and 13 are in full swing. The Task Force to Review Rule of Professional Conduct #13 has taken your comments into account and reviewed its position on exemption in situations of conflict.

We ended the meeting by thanking Daniel Lapointe for his contribution to the Institute’s development. (Our recruitment efforts to find a new executive director are well underway, and a number of worthy candidates have come forward. I’d like to remind you that if the position interests you, I invite you to send your résumé to andrew.dumont@odgersberndtson.ca.)

International Actuarial Association

We had some excellent discussions last week at the biannual meeting of the International Actuarial Association (IAA). The actuarial associations have agreed to develop general standards of practice that can be used by associations that don’t have any standards, and believe me, there are quite a few that don’t. They also agreed to develop standards pertaining specifically to the International Financial Reporting Standards (IFRS). These standards will be accompanied by educational notes, but it is too early to know to what extent these standards will cover technical aspects. They must be based on principles, but certain jurisdictions could define these principles so generally that a large gap will remain between possible practices. Another challenge will lie in the necessary delays to finalize these standards, in view of the costs inherent in such an undertaking. Still, it is encouraging that an agreement in principle has been reached.

On the same subject, it is worth noting that the IAA presented a report on convergence in an effort to determine to what extent the standards should be the same from one country to another, and what level of divergence could be acceptable. The report recommends a medium level of convergence, which is to say that standards should be developed in the form of model standards and approved in each jurisdiction, not by using the same wording but by adapting the standards to the specific set of circumstances in each jurisdiction. The IAA also delved into the question of efficiency and speed of implementation, and is looking into creating a new structure within the IAA or creating an independent standards board.

Have a great November, et à bientôt!

If you have any questions or comments that you would like to share, please contact me at president@actuaries.ca.
Micheline Dionne, FCIA, is President of the Canadian Institute of Actuaries.


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