Current through Reg. 50, No. 187; September 24, 2024
(1) Designation of Independent Certified
Public Accountant.
(a) Each fund required by
subsection 69O-190.059(4),
F.A.C., to file an annual audited financial statement shall, by the end of the
fiscal year subject to audit, notify the Office in writing of the name and
address of the fund's independent certified public accountant or accounting
firm (generally referred to in this rule as the "accountant") retained to
conduct the annual audit required by subsection
69O-190.059(4),
F.A.C.
(b) The fund shall obtain a
letter from the accountant, and file a copy with the Office, stating that the
accountant is aware of the provisions of the Florida Statutes which relate to
the financial reporting and operation of the fund and the Rules and of the
Office, and affirming that he will express his opinion on the financial
statements in terms of their conformity to the NAIC's Accounting Practices and
Procedures Manual for Property and Casualty Insurance Companies, 1993 edition,
specifying the exceptions as he may believe appropriate.
(c) If an accountant who was the accountant
for the immediately preceding filed annual audited financial statement is
dismissed or resigns, the fund shall within five (5) business days notify the
Office of this event. The fund shall also furnish the Office with a separate
letter within ten (10) business days of the above notification stating whether
in the twenty-four (24) months preceding that event there were any
disagreements with the former accountant on any matter of accounting principles
or practices, financial statement disclosure, or auditing scope or procedure;
which disagreements, if not resolved to the satisfaction of the former
accountant, would have caused him to make reference to the subject matter of
the disagreement in connection with his opinion. The disagreements required to
be reported in response to this section include both those resolved to the
former accountant's satisfaction and those not resolved to the former
accountant's satisfaction.
(d)
Disagreements contemplated by this section are those that occur at the
decision-making level, i.e., between personnel of the fund responsible for
presentation of its financial statements and personnel of the accounting firm
responsible for rendering its report. The fund shall also in writing request
the former accountant to furnish a letter addressed to the fund stating whether
the accountant agrees with the statements contained in the fund's letter, and
if not, stating the reasons for which he does not agree; and the fund shall
furnish the responsive letter from the former accountant to the Office together
with its own.
(e) The reporting
requirements in paragraphs (c) and (d), above, shall also apply to the fund's
qualified actuary.
(2)
Qualifications of Independent Certified Public Accountant.
(a) The Office shall not recognize any person
or firm as a qualified independent certified public accountant that is not in
good standing with the licensing authority or accrediting authority for
certified public accountants in the State of Florida.
(b) Except as otherwise provided herein, an
independent certified public accountant shall be recognized as qualified as
long as he or she prepares reports, filings, and statements as required by
Florida Statutes, and conforms to the standards of his or her profession as
contained in the Rules and Regulations and Code of Ethics and Rules of
Professional Conduct of the Florida Board of Public Accountancy, or similar
code.
(3) Scope of
Examination and Report of Independent Certified Public Accountant. Annual
audited financial statements required by subsection
69O-190.059(4),
F.A.C., shall be examined by an independent certified public accountant in
accordance with generally accepted auditing standards. Consideration should
also be given to the procedures set forth in the Financial Condition Examiner's
Handbook of the National Association of Insurance Commissioners, 1993
edition.
(4) Notification of
Adverse Financial Condition.
(a) Each fund
shall require the independent certified public accountant to report, in
writing, within five (5) business days to the board of trustees and its audit
committee any determination by the independent certified public accountant that
the fund has materially misstated its financial condition as reported to the
Office as of the balance sheet date currently under examination. A fund which
has received a report pursuant to this paragraph shall forward a copy of the
report to the Office within five (5) business days of receipt of said report
and shall provide the independent certified public accountant making the report
with evidence of the report being furnished to the Office. If the independent
certified public accountant fails to receive the evidence within the required
five (5) business day period, the independent certified public accountant shall
furnish to the Office a copy of its report within the next five (5) business
days.
(b) An independent certified
public accountant shall not be liable in any manner to any person for any
statement made in connection with the paragraph
69O-190.0591(4)(a),
F.A.C., if the statement is made in good faith in compliance with paragraph
69O-190.0591(4)(a),
F.A.C.
(c) If the accountant,
subsequent to the date of the annual audited financial statement filed pursuant
to subsection 69O-190.059(4),
F.A.C., becomes aware of facts which might have affected his report, the
accountant shall report those facts to the Office and the fund within seven (7)
business days of discovery.
(5) Report on Significant Deficiencies in
Internal Controls. In addition to the annual audited financial statement
required by subsection
69O-190.059(4),
F.A.C., each fund shall file with the Office with a written report prepared by
the accountant describing significant deficiencies in the fund's internal
control structure noted by the accountant during the audit. The report on
significant deficiencies in internal controls of the fund shall be filed with
the annual audited financial statement. The report on significant deficiencies
in internal controls may be filed as part of the management letter, or may be a
separate report. The fund is required to provide a description of remedial
actions taken or proposed to correct significant deficiencies, if said actions
are not described in the accountant's report.
(6) Definition, Availability, and Maintenance
of CPA Workpapers.
(a) Every fund shall
require the accountant to make available for review by Office examiners all
workpapers prepared in the conduct of his examination, and any communications
related to the audit between the accountant and the fund at the offices of the
fund, the offices of the certified public accountant, or at any other
reasonable place agreed to by the Office. The fund shall require that the
accountant retain the audit workpapers and communications until the Office has
filed a report on examination covering the period of the audit, but no less
than seven (7) years from the date of the audit reports.
(7) Funds shall be subject to examination
pursuant to Section 624.316, F.S. Funds shall
reimburse the Office for actual expenses incurred for the examination pursuant
to Sections 624.316 and
624.320,
F.S.
Rulemaking Authority 440.5705, 624.4621 FS. Law Implemented
624.316, 624.424, 624.4621 FS.
New 12-19-93, Formerly 38F-5.0591,
4-190.0591.
