Objective and key requirements of this Prudential Standard

This Prudential Standard aims to ensure that the Board and senior management of the parent entity of a Level 2 insurance group are provided with impartial advice in relation to the group’s operations, financial position and insurance liabilities. This advice is designed to assist the Board and senior management of the parent entity in carrying out their responsibility for the sound and prudent management of the group.

Accordingly, this Prudential Standard specifies the roles and responsibilities of a Level 2 insurance group’s Group Auditor and its Group Actuary; it also specifies the obligations of the parent entity of a Level 2 insurance group to make arrangements to enable its Group Auditor and Group Actuary to fulfil their responsibilities. In addition, the Prudential Standard establishes a set of principles and practices for the measurement and reporting of insurance liabilities for all Level 2 insurance groups.

The key requirements of this Prudential Standard in relation to audit and actuarial reporting and valuation are that a Level 2 insurance group must:

• appoint a Group Auditor and Group Actuary;
• make arrangements to enable its Group Auditor and Group Actuary to undertake their roles and responsibilities;
• ensure that on an annual basis its Group Auditor conducts a limited assurance review of the annual accounts of the group and reviews other aspects of the group’s operations;