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Kingman review

The Kingman Review is an independent review of the Financial Reporting Council (FRC), the regulator for auditors, accountants and actuaries. The review will be led by Sir John Kingman, who has extensive private and public sector experience. Find out more about how the IFoA is responding to the review

Independent Review of the Financial Reporting Council

The Independent Review of the Financial Reporting Council issued a Call for Evidence in June 2018. On 6 August, the IFoA submitted its response to the consultation.

You can read our response.

 

FAQs

What is the Independent Review of the Financial Reporting Council and why is it taking place?

In April 2018, the Government announced its intention to conduct an independent review of the FRC. This followed a number of high profile corporate collapses, notably Carillion, which subsequently led to a joint inquiry by the Work and Pensions and the Business, Energy and Industrial Strategy Select Committees

The Government is therefore undertaking this review to assess the effectiveness of the FRC’s governance, impact and powers, to ensure it is fit for the future.

Find the Review’s Terms of Reference here

 

Who is Sir John Kingman?

Sir John Kingman was appointed by the Secretary of State for Business, Energy and Industrial Strategy to lead the Review. As a consequence, it is sometimes referred to as the Kingman Review.

Sir John is a former senior civil servant who was Second Permanent Secretary to HM Treasury until 2016. He is currently the Chairman of Legal & General.

He is supported by a small secretariat team and an Advisory Group.

 

What is the Financial Reporting Council (FRC)?

The FRC is a UK Non Departmental Public Body that has regulatory roles in relation to auditors, accountants and actuaries in the UK, and is responsible for the UK’s corporate governance code.

Since 2005, the FRC has had specific responsibilities in relation to the regulation of actuaries carrying out work within UK geographic scope (more details below).

 

Why is the Review important to the IFoA?

Whilst the call for evidence predominantly focuses on how the FRC regulates audit and accountancy, the Review also asks whether the existing arrangement for the regulation of actuaries in the UK (put in place following a review in 2005 (the Morris Review)) is still fit for purpose.  

 

What are the current regulatory arrangements for IFoA members?

Since the 2005 Morris Review, the FRC has, by agreement with the IFoA set out in a Memorandum of Understanding, been responsible for three functions relating to the regulation of actuaries in the UK:

  • Independent oversight of IFoA regulation in the UK (including the IFoA qualifications system);
  • Setting of Technical Actuarial Standards (TASs) in relation to UK actuarial work (the IFoA is responsible for all ethical/conduct standards, including the Actuaries’ Code); and
  • Disciplinary enforcement in relation to cases involving IFoA members that potentially give rise to “important issues affecting the public interest in the UK” (the IFoA deals with other disciplinary cases through its Disciplinary Scheme).

The IFoA is responsible for all other aspects of the regulation of its members, including all non-UK work/members, CPD requirements and Practising Certificates, as well as the regulation of the different qualification standards and admissions. The IFoA also retains responsibility for enforcing the TASs in relation to members carrying out UK work.

 

What changes would we like to see as a result of the Review?

The IFoA believes that the model of professional self-regulation subject to effective independent oversight remains the most appropriate arrangement for the regulation of actuaries in the UK.

However, our response highlights some specific aspects of the arrangements where there may be an opportunity to make changes to improve effectiveness as well as to reflect developments in the actuarial profession since the time of the Morris review.

In particular, the IFoA considers that the current arrangements could be sensibly improved by:

  1. clearer distinction between regulatory/qualification (IFoA) and independent oversight (FRC) roles; and
  2. simplified arrangements in relation to the setting of professional standards.

One area where we see no need for change is a suggestion in the consultation for the FRC to receive statutory powers in relation to actuarial regulation.

We believe that there no evidence to suggest that the current arrangements are not serving to protect the public interest and the introduction of a system of statutory regulation, where there is not an identifiable need to do so, seems disproportionate.

 

How was the IFoA’s response developed?

The IFoA established a Steering Group comprised of senior volunteers and the IFoA Executive. The Group worked together throughout the consultation period to inform our response, which was then reviewed and signed off by the Regulation Board, the Policy and Public Affairs Board (PPAB) and Council.

 

Which other professions are affected by the Review?

The Financial Reporting Council also oversees the professional bodies for accountants and auditors in the UK and has particular regulatory roles in relation to audit and accountancy, therefore those professions are also in scope of the Review.

 

What happens next?

The call for evidence closed on 6 August 2018. The Review Secretariat will now consider the evidence it receives and will produce a final report for Government on its findings towards the end of 2018. The Government will then consider the report and will consult on any necessary recommendations or changes in 2019.

In the interim, members of the IFoA Steering Group will continue to engage with the FRC Secretariat Team.

For more information regarding the Review, please visit the review website

For more information regarding the IFoA’s response, please contact the IFoA Regulation team

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Events calendar

  • IFoA Joint Member Event with the Sunshine Insurance Group, Beijing China

    Room TBC, Kuntai International Plaza, No.12, Chaowai Street, Chaoyang District, Beijing 地址:会议室待定,北京市朝阳区朝外大街乙12号1号楼昆泰国际大厦
    12 December 2019

    Spaces available

    The IFoA’s President-elect Tan Suee Chieh will visit Beijing. We will co-host CPD and Awards Presenting event with the Sunshine Insurance Group on Thursday 12 December 2019. The event is part of Mr Tan’s first presidential trip to China.

  • ARC Sessional Research Event: Drivers of Mortality - Risk Factors and Inequality

    Staple Inn Hall, High Holborn, London, WC1V 7QJ
    6 January 2020

    Spaces available

    The authors will focus on a large dataset obtained from the UK’s Office for National Statistics (ONS) and related sources. Data are available at the level of Lower Super Output Areas (LSOAs) – small geographical areas with, typically, 1000-2000 residents and include death counts, exposures and a significant number of socio-economic variables including the index of multiple deprivation (IMD).

  • SIAS Event: My Journey to Data Science, Big Data and AI

    Staple Inn Hall, High Holborn, London, WC1V 7QJ
    7 January 2020

    Spaces available

    Patrick Lee is an actuary who has made the transition to working in software architecture and artificial intelligence (AI). He holds Microsoft Professional qualifications in Data Science, Big Data and AI and is currently working towards a DevOps (the automation of software testing and deployment) qualification. He is a member of the IFoA Council and is also President of the Wessex Actuarial Society. He is also a member of the IFoA and the RSS's joint Data Science Focus Group and will talk on the ethical use of AI. 

  • Spaces available

    This IFoA event for NEDs explores what skills and experience are required to undertake non-executive roles, e.g. as independent NEDs on fund boards or members of IGCs. The event will be chaired by Brandon Horwitz, an actuary who is a consultant and who has held various investment governance roles and who specialises in investment governance as well as being an iNED.

  • Spaces available

    This presentation covers the detail for how the matching adjustment is calculated. A small simple example spreadsheet is provided and discussed in detail.

    For actuaries wanting to get more involved with the matching adjustment, this is the opportunity to get a detailed description of the mechanics involved. This includes cashflows derisking, PRA tests as well as hypothecation.

    The presentation is provided by James Sharpe who has worked on a number of matching adjustment calculations with several firms.

  • IFoA Volunteer Recognition Reception

    Staple Inn, 4 High Holborn, Holborn, London WC1V 6DR, UK
    15 January 2020

    Spaces available

    As a thank you to all our Institute and Faculty of Actuaries (IFoA) volunteers, you are invited to join us at Staple Inn Hall, for an evening of drinks, canapes and networking, in London.

    IFoA President, John Taylor, will be attending and will make a speech

    If you support the IFoA as a volunteer (member or non-member), or in any other role, and you are going to be in London on 15 January, please book your place and join us at this reception.

     

  • Sessional Meeting - Operational Risk Dependencies

    Royal College of Physicians of Edinburgh 9 Queen St Edinburgh EH2 1JQ
    20 January 2020

    Spaces available

    The Operational Risk Working Party aims to assist actuaries and others in the modelling and management of operational risk. One of the key challenges in modelling operational risk is the modelling of dependencies between operational risks, and between operational and non-operational risks such as market, credit and insurance risk. Their paper seeks to assist in this regard, and help develop good practice in setting assumptions and modelling operational risk dependencies. 

  • KSS event in Glasgow: Public Sector Pensions

    Hymans Robertson, Glasgow 20 Waterloo St, Glasgow
    30 January 2020

    Spaces available

    – the unappreciated key assumption, the resulting unsustainable promises, the unmanaged risk and the unrecognised debt? 

    Speaker: Allan Martin will present this talk on 30 January in Glasgow, Stirling and Edinburgh. If you wish to register for another location please return to the Events Calendar.

  • KSS event in Stirling: Public Sector Pensions

    M&G Prudential, Stirling Craigforth Campus, Stirling
    30 January 2020

    Spaces available

    – the unappreciated key assumption, the resulting unsustainable promises, the unmanaged risk and the unrecognised debt? 

    Speaker: Allan Martin will present this talk on 30 January in Glasgow, Stirling and Edinburgh. If you wish to register for another location please return to the Events Calendar.

  • KSS event in Edinburgh: Public Sector Pensions

    Hymans Robertson 1, Exchange Place, Semple St, Edinburgh
    30 January 2020

    Spaces available

    – the unappreciated key assumption, the resulting unsustainable promises, the unmanaged risk and the unrecognised debt? 

    Speaker: Allan Martin will present this talk on 30 January in Glasgow, Stirling and Edinburgh. If you wish to register for another location please return to the Events Calendar.

  • The Great Risk Transfer – Breakfast briefing and launch event

    Staple Inn Hall, High Holborn London WC1V 7QJ
    31 January 2020

    Spaces available

    Launch of the IFoA’s 2020 thought leadership campaign The Great Risk Transfer. The campaign will examine the trend of the transfer of risk from institutions to individuals, and how people can be better equipped to manage the financial risks they now face. At this breakfast event the IFoA will launch a call for evidence on this topic.

  • Professional Skills Training - London (11 February 2020)

    Staple Inn, High Holborn, London WC1V 7QJ         
    11 February 2020

    Spaces available

    A Trusted Profession

    A 2 hour CPD event designed to meet the IFoA’s Stage 3 Professional Skills Training under the IFoA’s CPD Scheme 2019/2020This session is suitable for actuaries working in any area (i.e. it is not specifically aimed at Pensions, GI or any other technical discipline) and is interactive, so you should come along prepared to take part in the discussions.

  • Sessional: Impact of E-cigarettes Working Party

    Royal College of Physicians, 9 Queen St, Edinburgh EH2 1JQ
    24 February 2020

    Spaces available

    This sessional meeting will be of direct interest to actuaries and others working in the in the Health and Care, Life or Pensions sectors or indeed actuaries with an interest in morbidity or mortality. Note: Registration is from 17.30 in time for the sessional to begin at 18.00.

  • Professional Skills Training - Edinburgh (25 February 2020)

    IFoA (Edinburgh), Level 2, Exchange Crescent 7 Conference Square Edinburgh EH3 8RA
    25 February 2020

    Spaces available

    A Trusted Profession

    A 2 hour CPD event designed to meet the IFoA’s Stage 3 Professional Skills Training under the IFoA’s CPD Scheme 2019/2020This session is suitable for actuaries working in any area (i.e. it is not specifically aimed at Pensions, GI or any other technical discipline) and is interactive, so you should come along prepared to take part in the discussions.

  • Spring Lecture 2020, Edinburgh - Vicky Pryce

    Assembly Rooms, 54 George St, Edinburgh EH2 2LR
    25 March 2020

    Spaces available

    What next in Economic Policy?

    Please join us on 25 March 2020 for our annual Spring Lecture presented by Vicky Pryce in Edinburgh. 

  • IFoA Asia Conference 2020, Kuala Lumpur

    CCEC Nexus, 7, Jalan Kerinchi, Bangsar South, 59200 Kuala Lumpur, Wilayah Persekutuan Kuala Lumpur, Malaysia
    24-25 June 2020
    Spaces available

    The sixth annual Asia Conference once again offers a prestigious line-up of home and international speakers discussing the insurance and financial industry’s innovation and change in Asia. This year's conference in Kuala Lumpur will be hosted by Tan Suee Chieh, IFoA’s first Asian President. He will also make his Presidential address at this conference and will expand on the important elements of IFoA’s new strategy. 

    Additionally, this landmark conference will showcase how the IFoA is reinventing itself to support its members to succeed and thrive in a digital age, within traditional businesses and beyond, as a global organisation. 

    Not to be missed by international industry players, opinion formers, academic and industry leaders, actuaries and non-actuaries.