Contingencies Online - July/August 2011

Up to Code CURTIS HUNTINGTON
International Compliance
BEING AN ACTUARY IN A GLOBAL ECONOMY requires a lot of
diligence. And that diligence begins with the recognition that even if
your passport has expired and the only foreign language you speak is
pig Latin, you still are working in a global economy.
As a U.S. actuary practicing in 2011,
chances are good that at some point in
your career, your work product will
need to meet practice guidelines set
by entities other than the Actuarial
Standards Board (ASB).
Precept 3 of the Code of Professional
Conduct requires U.S. actuaries, when
providing professional services, to en-
sure that work prepared by them—or
under their oversight—meets the re-
quirements of applicable standards of

practice. This means that in the United
States, actuaries must comply with the
actuarial standards of practice published
by the ASB, which are intended to be
binding for purposes of U.S. practice.
It also means, however, that actuaries
who believe that their work product
will be used in Canada, for instance,
must consider Canadian standards when
completing the assignment.
Where this has gotten tricky in recent
years is in relationship to international
actuarial standards of practice. Since
June of 2006, the International Actuari-
al Association (IAA) has adopted a series
of 12 International Actuarial Standards
of Practice for actuaries to use when
providing professional services under in-
ternational financial reporting standards
issued by the International Accounting
Standards Board. The IAA standards
originally were designated as practice
guidelines, and bore the following ex-
planatory statement on their covers:
made mandatory. The fear is that U.S.
After extensive discussion, the IAA in
2008 changed its bylaws to permit the
issuance of model standards of actuari-
al practice that may be adopted by IAA
member associations. The U.S. actuarial
profession, represented by the Academy
and members of its Council of U.S. Presi-
dents (CUSP), agreed with that approach
but has been insistent in subsequent dis-
cussions that the IAA standards not be