Relevant Comments (Purpose)

EmmaEmma
in COPLFR.SAO

What would be some different examples of intended purpose of the SAO? Why would the purpose change or differ from year to year or company to company?

Comments

  • grahamgraham

    Here are some intended purposes of the SAO:

    1. Regulatory Compliance
    2. Reserve Adequacy
    3. Financial Statement Integrity
    4. Stakeholder Communication
    5. Risk Management
    6. Support for Auditors

    Typically, the primary intended users of an insurance company's financial statements and actuarial opinions remain consistent from year to year. These primary intended users include regulators, investors, auditors, and company management. However, there can be scenarios where there might be a shift or addition in the intended audience:

    • Mergers & Acquisitions (M&A)
    • New Funding or Capital Raising
    • Expanding into New Markets
    • Major Business Model Change
    • Public Relations or Rebranding
  • arch1892arch1892

    In the COPLR text, intended users & purpose is included in the Relevant Comments section but in the Odomirok, it's mentioned in the Identification s
    ection. Is it included in both?

  • grahamgraham

    This is discussed in the ASOP.36 wiki article under the heading: One Small Point:

  • arch1892arch1892

    Yes, I took a look so it. But COPLR makes reference to ASOP36 note about intended users and purpose under the Relevant comments section.

  • grahamgraham

    If this comes up on the exam, I would write, "According to ASOP 36, intended users should be listed the identification section."

  • arch1892arch1892

    Thanks!

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