Florida Regulations 69O-190.0591: Independent Certified Public Accountants
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(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 Fl. Admin. Code R. 69O-190.0591(4)(a), if the statement is made in good faith in compliance with Fl. Admin. Code R. 69O-190.0591(4)(a)
(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 Florida Statutes § 624.316 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. History-New 12-19-93, Formerly 38F-5.0591, 4-190.0591.
Terms Used In Florida Regulations 69O-190.0591
- Discovery: Lawyers' examination, before trial, of facts and documents in possession of the opponents to help the lawyers prepare for trial.
- Evidence: Information presented in testimony or in documents that is used to persuade the fact finder (judge or jury) to decide the case for one side or the other.
- Fiscal year: The fiscal year is the accounting period for the government. For the federal government, this begins on October 1 and ends on September 30. The fiscal year is designated by the calendar year in which it ends; for example, fiscal year 2006 begins on October 1, 2005 and ends on September 30, 2006.
(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 Fl. Admin. Code R. 69O-190.0591(4)(a), if the statement is made in good faith in compliance with Fl. Admin. Code R. 69O-190.0591(4)(a)
(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 Florida Statutes § 624.316 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. History-New 12-19-93, Formerly 38F-5.0591, 4-190.0591.