As part of its project for developing a new structure for actuarial standards, the Board for Actuarial Standards has today published its conceptual framework.

Paul Seymour, Chairman of the BAS explained the reasons for the framework.

“The BAS’s strategic goal for the future of actuarial practice is that people should have confidence in the reliability of actuarial information. To deliver that in a consistent manner across a range of standards, we need a framework which will promote information that is complete, transparent, relevant and comprehensible.

After a very positive consultation with our stakeholders, we now have that framework. Some of the ideas we are introducing are new, in terms of both the framework and the conceptual content.”

The new Conceptual Framework addresses:

• How to strike a balance between regulating the content of actuarial information and not stifling the development of new ideas, especially in areas where non-actuaries are free to compete against actuaries for the work.
• How the component parts of an actuarial calculation fit together and how to describe and explain the linkages between the different components in terms that are relevant to the user’s needs, without over-burdening the user with unnecessary information.
• The importance of professional judgement. Standards will be compulsory, with exceptions defined narrowly, but they will also be principles-based to avoid a “tick box” approach to compliance.

The BAS is the world’s first independent setter of actuarial standards, and this is the first time that such a Conceptual Framework has been constructed in the actuarial field. The work has attracted interest from a wide community, both from inside the profession and from elsewhere.

Copies of the Conceptual Framework can be downloaded from the BAS’s website at http://www.frc.org.uk/bas/publications. The BAS is also publishing today the Scope & Authority of Technical Standards, which explains the basis for compliance with BAS standards. The Scope & Authority can also be downloaded from http://www.frc.org.uk/bas/publications.

1. The Financial Reporting Council (FRC) is the UK’s independent regulator responsible for promoting confidence in corporate reporting and governance. Its functions are exercised principally by its operating bodies (the Accounting Standards Board, the Auditing Practices Board, the Board for Actuarial Standards, the Financial Reporting Review Panel, the Professional Oversight Board and the Accountancy and Actuarial Discipline Board) and by the FRC Board. The Committee on Corporate Governance assists the Board in its work on corporate governance.
2. The Board for Actuarial Standards has a primary objective of promoting competence and transparency of actuarial practice by establishing and improving actuarial technical standards and ensuring that they are coherent, consistent and comprehensive.
3. All media enquiries should be addressed to Paul Seymour, Chairman of the Board for Actuarial Standards, 020 7492 2328 or email at p.seymour@frc.org.uk.