Revision to pension
fund audit requirement
The Brazilian regulatory agency for
Closed Pension Funds, the SPC,
issued a new rule in March that
established requirements for
periodic actuarial audits of the
pension funds. Fund sponsors,
administrators and consultants
campaigned for the changes for
various reasons, including concern
that implementing the previous
legislation was excessively
burdensome. The main change
introduced is the distribution of
Closed Pension Funds into four
major groups, with different audit
timing requirements for each with
effect from the accounting year
ending in 2001. Publication of the
composition of each group is still
awaited. The due date for filing the
audit report with the SPC has been
fixed as follows:
-
Group 1 - 31 March
- Group 2 - 31 May
- Group 3 - 31 July
- Group 4 - 30 September
in the year following that of the audit.
Qualified independent actuaries
must audit all Closed Pension
Funds at least every five years or
more frequently if the SPC so
requires. Auditors must use the
same database provided for the most
recent actuarial valuation, and the
auditing process must encompass
each of the benefit plans sponsored
by the Closed Pension Fund. Audits
cover the choice of actuarial
assumptions, financing methods,
actuarial solvency, and data integrity.
The legislation also requires
communication of the results of
the audit to plan members.
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