Unsatisfactory financial position — actuUnsatisfactory financial position — actuarial requirements

Unsatisfactory financial position – actuarial requirements

30. Paragraph 31 applies where an RSE actuary:

(a) conducting an initial or regular investigation, makes a finding, in the actuarial report of the investigation, that:

(i) the fund is to be treated as being in an unsatisfactory financial position; or

(ii) the financial position of the fund is likely to become unsatisfactory; or

(b) conducting an interim investigation makes a finding, in the actuarial report of the investigation, that:

(i) the fund is in an unsatisfactory financial position; and

(ii) the fund is in breach of its shortfall limit

unless a restoration plan is already in place under paragraph 32 or the fund has been declared to be technically insolvent under regulation 9.16(1) of the SIS Regulations.

31. An RSE actuary must, in the situations identified in paragraph 30:

(a) prepare a statement that, at a minimum:

(i) describes the recommended actions to be taken to address the financial position; and

(ii) contains a recommendation, or sets a date by which a recommendation will be made, in respect of a contribution rate or level that, on reasonable expectations, will restore the fund to, and maintain it in, a satisfactory financial position, within a time period that is reasonable in the circumstances of the fund but which must not exceed three years from the valuation date, or, in the case of an interim investigation, the later of the valuation date and the date the RSE licensee determined that an interim investigation was required under paragraph 17; and

(b) provide the statement to the RSE licensee as soon as practicable and, in any event, within 15 business days of making a finding, in the actuarial report of the investigation, that the financial position is to be treated as unsatisfactory, or is likely to become unsatisfactory or that the shortfall limit has been breached.