Source: http://taxalmanac.org/index.php/REG-159704-03.html
Timestamp: 2020-06-03 22:15:16
Document Index: 674995155

Matched Legal Cases: ['ART 901', '§901', '§901', '§901', 'art 901', 'ART 901', 'art 901', '§901', '§901', '§901', '§901', '§901', '§901', '§901', '§901', '§901', '§901', '§901', '§901', '§901', '§901', '§901', '§901', '§901', '§901', '§901', '§901', '§901']

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2009-46 November 16, 2009
Notice of Proposed RulemakingPerformance of Actuarial Services Under the Employee Retirement Income Security Act of 1974
8.1 PART 901—REGULATIONS GOVERNING THE PERFORMANCE OF ACTUARIAL
8.2 §901.12 [Removed]
8.3 §901.13 [Redesignated as §901.12]
Send written comments to: CC:PA:LPD:PR (REG-159704-03), Room 5203, Internal Revenue Service, PO Box 7604, Ben Franklin Station, Washington, DC 20044. Submissions may be hand-delivered Monday through Friday between the hours of 8:00 a.m. and 4:00 p.m. to CC:PA:LPD:PR (REG-159704-03), Courier’s Desk, Internal Revenue Service, 1111 Constitution Avenue, NW, Washington, DC, or sent electronically via the Federal eRulemaking Portal at www.regulations.gov (IRS REG-159704-03).
Consistent with section 3042, the Joint Board has promulgated regulations at 20 CFR Part 901, addressing eligibility for enrollment, requirements for continuing education of enrolled actuaries, professional standards for performance of actuarial services under ERISA, bases for disciplinary actions and the procedures to be followed in taking those actions. Comprehensive regulations regarding section 3042 were last issued in 1988 (53 FR 34484). The Joint Board has determined that the regulations need to be updated to reflect changes in the law and in industry practice. In addition to these proposed regulations, final regulations relating to user fees for the initial enrollment and reenrollment as an enrolled actuary were published in the Federal Register on December 21, 2007 (T.D. 9370, 2008-1 I.R.B. 428 [72 FR 72606]).
Under section 901.11, an enrolled actuary must reenroll once every three years. To qualify for reenrollment an actuary must complete a minimum of 36 hours of continuing education credit within the preceding three year period.1 Of these 36 hours, at least one-half must consist of core subject matter, which is subject matter directly related to the performance of actuarial services under ERISA or the Internal Revenue Code (Code). The remaining hours may consist of non-core subject matter. The regulations provide examples of both core and non-core subject matter. The regulations provide that the Executive Director of the Joint Board may review the CPE records of an enrolled actuary to verify compliance with these rules.
The regulations also provide that the continuing education must be provided as part of a “qualifying program” conducted by a “qualifying sponsor.”A qualifying program is (1) a “formal program” (which requires the attendance of at least three individuals engaged in substantive pension service), (2) a correspondence or individual study program, or (3) a program utilizing teleconferencing. A qualifying sponsor is an accredited educational institution, an organization recognized by a State licensing body, or an organization recognized by the Joint Board under a sponsor agreement in effect for a given enrollment cycle. A qualifying sponsor must ensure that the CPE program satisfies various requirements regarding subject matter and administration, including recordkeeping. A separate provision applies to the recordkeeping requirements for the enrolled actuary.
In the event an enrolled actuary applies for renewal but fails to comply with the applicable requirements, the regulations provide that the enrolled actuary shall be notified of his or her failure and given an opportunity to provide additional information. If the enrolled actuary fails to provide any additional information (or fails to apply for reenrollment) the actuary will be placed in inactive status for a period of three years (beginning on the date that renewal would have been effective) and will be ineligible to perform services as an enrolled actuary during this time. An individual placed in inactive status must file an application for renewal and satisfy the requirements for renewal within three years or his enrollment will terminate. If an individual’s enrollment is terminated, it can only be reestablished by satisfying the requirements for initial enrollment.
A. Procedures for Enrollment and Reenrollment Various comments were received regarding the materials covered by the enrolled actuary examinations. Several comments supported broadening the scope of the material to include matters unrelated to defined benefit plans, such as the funding of post-retirement medical and life insurance benefits within the meaning of Code sections 419 and 419A. To the extent that an enrolled actuary may need to practice before the IRS in these areas, one comment suggested that an enrolled actuary should be permitted to work together with a qualified health actuary. In contrast, another comment suggested focusing the examinations exclusively on pension actuarial issues under ERISA and the Code. Some comments called for a stronger emphasis on the selection of actuarial assumptions. One such comment acknowledged that the subject is not easily tested, but made suggestions as to how this could be done.
There was general agreement among the comments in keeping the current qualifying experience requirement unchanged although one comment suggested that the regulations require that an applicant’s actuarial experience be certified by an enrolled actuary.
The proposed regulations, however, would require that the pension actuarial examination must be completed within the ten-year period immediately preceding the date of application for initial enrollment. The Joint Board believes such a requirement is needed because of the frequent changes in pension law and a need for an enrolled actuary to have current knowledge of pension requirements.2 On the other hand, because the material in the basic actuarial examination is generally mathematical in nature and is not affected by changes in pension law, a similar rule for the basic actuarial examination would not apply.
With respect to computer-based testing, the Joint Board acknowledges that new technologies can serve many uses. The Joint Board believes, however, that the language in the current regulations would not preclude the use of computer-based testing and does not believe it is necessary to amend the regulations to specify the format for taking examinations.
With respect to qualifying experience, the proposed regulations would require that all actuarial and pension actuarial experience be certified in writing by individuals with knowledge of the individual’s experience. If the individual’s supervisor is not an enrolled actuary, the pension actuarial experience must be certified by both the supervisor and an enrolled actuary with knowledge of the individual’s pension experience. As in the current regulations, the qualifying experience must have been completed within the last 10 years before the application for enrollment.
B. CPE Requirements Several comments were received regarding the distinction between core and non-core subject matter. One comment suggested that the distinction between core and non-core subject matter be eliminated for purposes of meeting CPE requirements as the distinction does not serve a useful purpose in a rapidly evolving financial marketplace and regulatory environment. The comment added that, assuming these core/non-core categories were kept, additional guidance should be provided as to what constitutes core and non-core credit subject matter.
Some comments suggested distinguishing between CPE credits required early in an actuary’s career, where core courses may be necessary to help cement the actuary’s understanding of actuarial principles, and credits needed later in an actuary’s career. One comment suggested, for example, that 18 hours of core CPE credit be required for the first two enrollment cycles and that 12 hours of core credit be required in subsequent enrollment cycles. It was also suggested that a minimum of three hours of ethics be required.
One comment suggested that the regulations should provide guidance on renewal of approval for qualifying sponsors. There were a few comments that suggested changing the enrollment cycle for qualifying sponsors so as not to be coterminous with the enrolled actuary enrollment cycle or to increase the number of years in the sponsor enrollment cycle. Another comment suggested the regulations be amended to allow the Joint Board to periodically publish a list of qualifying sponsors in order to facilitate a search for programs that are eligible for CPE credits.
The proposed regulations would also retain the current requirement for a total of 36 hours of CPE (half of which must be core subject matter) for the initial three-year enrollment renewal cycle, for individuals who renew on a timely basis. Recognizing, however, that experienced actuaries generally do not need to focus on core topics as much as newly enrolled actuaries, the proposed regulations would reduce the number of core CPE credits required after the enrolled actuary’s initial enrollment renewal from 18 required core hours to 12 required core hours. The Joint Board also believes that enrolled actuaries should maintain high professional standards and thus proposes a new requirement that a minimum of two hours of core CPE be allocated to ethical standards in each enrollment cycle. Topics that would meet this requirement include (but are not limited to) discussions of professional codes of conduct, professional responsibilities, and any of the topics addressed in section 901.20 of these proposed regulations.
C. Waivers of the CPE Requirements One comment suggested expanding the list of conditions for which a waiver from CPE requirements may be granted to include parental leave. Another comment recommended that applications for a waiver of the CPE requirements be accepted during the normal enrollment renewal process, subject to the Joint Board’s discretion to accept late filings. A third comment did not perceive problems with the current waiver process and standards. There were no other specific recommendations regarding this issue except in conjunction with proposals regarding changes in enrollment status.
The Joint Board believes that it is essential for practicing actuaries to keep their knowledge current, particularly given the frequent changes in pension law, court decisions, and other factors that affect an enrolled actuary’s practice.Accordingly, and in light of the expanded varieties of acceptable CPE programs, the proposed regulations would eliminate the list of reasons for which a CPE waiver may be granted and provide instead that a waiver from the CPE requirements may be granted only under extraordinary circumstances and only upon submission of evidence that every effort was made during the entire renewal cycle to complete such requirements. Despite the elimination of the specific list of conditions that would support a waiver, circumstances such as extended active military duty will continue to constitute strong evidence of the type of extraordinary circumstances that would justify a waiver.
D. Enrollment Status Several comments were directed to the status for “inactive retirement” which may be elected by an actuary. One comment suggested that the Joint Board allow for some flexibility in the renewal process in order to reduce the need for individuals to request inactive retirement status and to ensure a minimal period of disruption of actuarial services to plans and employers. For example, it was recommended that any CPE credit hours completed between December 31 (or the end of the enrollment period by which CPE credits must be earned for that period) and the date the application for renewal is filed be permitted to be used to satisfy the CPE requirement for renewal of enrollment effective April 1. Thus, the comment stated that an enrolled actuary who files an application for renewal after March 1 due to delayed completion of the CPE requirement should be eligible to perform services as an enrolled actuary 30 days after the application filing date unless notified otherwise by the Joint Board. However, these delayed CPE credits would not be permitted to be applied to another enrollment cycle.
The Joint Board agrees that the current rules relative to the different inactive statuses warrant simplification. The proposed regulations would limit enrollment statuses to only two categories, “active” or “inactive,” with special provisions for reinstatement depending on the length of the period during which an enrolled actuary is in inactive status and for those situations where an actuary’s status is terminated for cause. An enrolled actuary who timely renews his/her enrollment would be in active status. An enrolled actuary who fails to meet requirements for timely renewal of enrollment would be in inactive status. While in inactive status, an enrolled actuary would be prohibited from performing pension actuarial services under ERISA and the Code.
E. Standards of Conduct One comment states that the Joint Board has not been very active in investigating and disciplining enrolled actuaries whose performance does not meet applicable standards. One comment suggested that the Joint Board consider utilizing the Actuarial Board for Counseling and Discipline as an independent contractor to investigate complaints. Alternatively, it was recommended that the Joint Board either require an enrolled actuary to become a member of a professional actuarial organization as a condition of enrollment (thereby subjecting the member to the Actuarial Code of Professional Conduct (Code of Conduct) to which all the major actuarial organizations in the U.S. and Canada subscribe), or incorporate the Code of Conduct into the regulations.
'Another comment stated that, unlike other professionals, an enrolled actuary is not compelled to operate within certain standards by the underlying threat that failure to do so will result in the loss of his/her license to practice in the profession. Even if an enrolled actuary is a member of an actuarial organization and subject to that organization’s disciplinary procedures, this comment suggested that the Joint Board not rely on these organizations in this area, but rather that the Joint Board more actively utilize its current authority under ERISA to supervise and evaluate the provision of actuarial services and to discipline enrolled actuaries. This comment also suggested that the Joint Board periodically publish information regarding the nature and types of complaints received, the number of actuaries disciplined and the nature of the discipline. This comment indicated that publicizing such information would reassure the public that complaints are being acted upon and encourage compliance with the applicable standards.
In light of the responses to the RFI regarding actuarial standards of performance, the proposed regulations would clarify existing provisions in this area and add some new provisions. Specifically, the proposed regulations would add a new general standard that would require enrolled actuaries to perform actuarial services in accordance with all applicable laws and the relevant standards of professional responsibility and, as under the current regulations, require that enrolled actuaries not perform any actuarial services where those services may be used in a fraudulent manner. The proposed regulations would also provide that an enrolled actuary must report any material violation of this section by another enrolled actuary to the Executive Director of the Joint Board. For example, an enrolled actuary that replaces another enrolled actuary as a plan’s actuary and discovers that the previous actuary had signed a Schedule B that listed plan contributions that the previous actuary knew had not been made would be required to report this violation to the Executive Director.
The proposed regulations would also include provisions similar to those in Circular 230 regarding the prompt disposition of pending matters and the return of client records, except the Circular 230 rules would be modified for purposes of these regulations to reflect the fact that enrolled actuaries deal with government entities in addition to the IRS. Thus, as under section 10.23 of Circular 230, the proposed regulations would provide that an enrolled actuary may not unreasonably delay the prompt disposition of any matter before the IRS, but the proposed regulations would extend the rule for these purposes to matters before the Department of Labor, the PBGC and other applicable Federal and State entities. Similarly, the proposed regulations would adopt provisions similar to those in section 10.27 of Circular 230 regarding the return and retention of client’s records, but they would define “records of the client” for these purposes to include documents related to legal obligations in addition to Federal tax obligations. The provisions of these proposed regulations would not modify the Circular 230 regulations but would apply rules to enrolled actuaries in addition to those already applicable under Circular 230.
These regulations are proposed to generally apply 30 days after the date these regulations are published as final regulations in the Federal Register.However, section 901.11 regarding the enrollment of actuaries would apply to the enrollment cycle beginning January 1, 2011, and ending December 31, 2013, and to all subsequent enrollment cycles.
Before these proposed regulations are adopted as final regulations, consideration will be given to any written (a signed original and eight (8) copies) or electronic comments that are submitted timely to the IRS. The Joint Board specifically requests comments on the clarity of the proposed regulations and how they may be made easier to understand. All comments will be available for public inspection and copying. A public hearing will be scheduled if requested in writing by any person that timely submits written comments. If a public hearing is scheduled, notice of the date, time, and place for the public hearing will be published in theFederal Register.
PART 901—REGULATIONS GOVERNING THE PERFORMANCE OF ACTUARIAL
SERVICES UNDER THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974. Paragraph 1. The authority citation for part 901 continues to read in part as follows:
Authority: These rules are issued under authority of 88 Stat. 1002; 29 U.S.C. 1241, 1242. See also 5 U.S.C. 301; 31 U.S.C. 330; and 31 U.S.C. 321
§901.0 Scope. * * * Subpart A of this part sets forth definitions and eligibility to perform actuarial services; subpart B of this part sets forth rules governing the enrollment of actuaries; subpart C of this part sets forth standards of performance to which enrolled actuaries must adhere; subpart D of this part sets forth rules applicable to suspension and termination of enrollment; and subpart E of this part sets forth general provisions.
§901.1 Definitions. * * * * *
(i) Certified responsible actuarial experience means responsible actuarial experience of an individual that has been certified in writing by the individual’s supervisor.
(j) Certified responsible pension actuarial experience means responsible pension actuarial experience of an individual that is certified in writing by the individual’s supervisor if the supervisor is an enrolled actuary. If the individual’s supervisor is not an enrolled actuary, the pension actuarial experience must be certified in writing by both the supervisor and an enrolled actuary with knowledge of the individual’s pension actuarial experience.
(k) Enrollment cycle means the three year period from January 1, 2011, to December 31, 2013, and every three year period thereafter.
§901.10 Application for enrollment. (a) Form'. As a requirement for enrollment, an applicant shall file with the Executive Director of the Joint Board (the Executive Director) a properly executed application on a form or forms specified by the Joint Board, and shall agree to comply with these regulations and any other guidance as required by the Joint Board. A reasonable non-refundable fee may be charged for each application for enrollment filed.
C. Revising paragraph (e), introductory text, (e)(1) and (e)(2)(i).
G. Revising paragraphs (f)(1), (f)(1)(i).
O. Adding and reserving new paragraph (i)
§901.11 Enrollment procedures. (a) Enrollment. The Joint Board shall enroll each applicant it determines has met the requirements of these regulations, and any other guidance as required by the Joint Board, and shall so notify the applicant. * * *
(c) Rosters. The Executive Director shall maintain rosters of all actuaries who are duly enrolled under this part and of all individuals whose enrollment has been suspended or terminated, or who are in inactive status. The Executive Director may publish any or all of these rosters, including display on the Joint Board’s website, to the extent permitted by law.
(d) Renewal of enrollment'. To maintain active enrollment to perform actuarial services under ERISA, each enrolled actuary is required to have his/her enrollment renewed as set forth herein.
(e) Condition for renewal: Continuing professional education''. To qualify for renewal of enrollment, an enrolled actuary must certify, on the form prescribed by the Executive Director, that he/she has completed the applicable minimum number of hours of continuing education credit required by this paragraph (e) and satisfied the recordkeeping requirements of paragraph (j) of this section.
(1) Transition rule for renewal of enrollment effective April 1, 2011. (i) A minimum of 36 hours of continuing education credit must be completed between January 1, 2008, and December 31, 2010. Of the 36 hours, at least 18 must consist of core subject matter; the remainder may be non-core subject matter.
(2) For renewal of enrollment effective April 1, 2014, and every third year thereafter''. (i) A minimum of 36 hours of continuing education credit must be completed between January 1, 2011, and December 31, 2013, and between January 1 and December 31 for each three year period subsequent thereto.
(i) Core subject matter is program content and knowledge that is integral and necessary to the satisfactory performance of pension actuarial services and actuarial certification under ERISA and the Internal Revenue Code. Such core subject matter includes the characteristics of actuarial cost methods under ERISA, actuarial assumptions, minimum funding standards, titles I, II, and IV of ERISA, requirements with respect to the valuation of plan assets, requirements for qualification of pension plans, maximum deductible contributions, tax treatment of distributions from qualified pension plans, excise taxes related to the funding of qualified pension plans and standards of performance (including ethical standards) for actuarial services. Core subject matter includes all materials included on the syllabi of any of the pension actuarial examinations offered by the Joint Board during the applicable enrollment cycles. For this purpose, the applicable enrollment cycles are the current enrollment cycle and the enrollment cycle immediately preceding the current enrollment cycle.
(A) Formal programs. Formal programs are programs that meet all of the	requirements of paragraph (f)(2)(i) of this section and also require physical attendance by at least three individuals engaged in substantive pension service in addition to the instructor, discussion leader, or speaker.
(B) Correspondence or individual study programs (including audio and/or video taped programs)''. Correspondence or individual study programs are programs completed on an individual basis by the enrolled actuary. Such programs are qualifying programs if they meet all of the requirements of paragraph (f)(2)(i) of this section and also provide a means for measuring completion by the participants (for example, a written examination).
(C) Teleconferencing'. Teleconferencing or other communications technologies (including webcasting) are qualifying programs if they meet all of the requirements under paragraph (f)(2)(i) of this section and either—
(2) Serving as an instructor, discussion leader or speaker''. (i) Four credit hours (that is, 200 minutes) of continuing education credit will be awarded for each 50 minutes completed as an instructor, discussion leader, or speaker at a qualifying program which meets the continuing education requirements of paragraph (f) of this section.
(iii) Presentation of the same material as an instructor, discussion leader, or speaker more than one time in any 36 month period will not qualify for continuing education credit. A program will not be considered to consist of the same material if a substantial portion of the content has been revised to reflect changes in the law or practices relative to the performance of pension actuarial service.
(i) Achieving a passing score on the Joint Board pension examination, as described in §901.12(d)(1)(i), administered under this part during the applicable enrollment cycle; and
(j) Record keeping requirements—(1) Qualified sponsors. A qualified sponsor must maintain records to verify satisfaction of the requirements of this section. Such records must be retained for a period of six years following the end of the sponsor enrollment cycle in which the program is held. In the case of programs of more than one session, records must be maintained to verify completion of the program and attendance by each participant at each session of the program. Copies of any certificates of completion and certificates of instruction issued to the participants in each program must be retained.
(4) A request for waiver must be filed no later than the last day of the renewal application period. Those who are granted waivers are required to file timely applications for future renewal of enrollment.
(ii) During the second inactive enrollment cycle: Four-thirds of the qualifying continuing education requirements as set forth in paragraph (e)(2) of this section (that is, 48 hours), without regard to paragraph (e)(2)(ii) or (e)(2)(iii) of this section, plus eighteen months of the qualifying experience requirements set forth in §901.12(b)(1), must be completed since the start of the first inactive enrollment cycle. Any hours of continuing education credit from the first inactive enrollment cycle may be applied in satisfying this requirement.
(iii) During the third inactive enrollment cycle: Five-thirds of the qualifying continuing education requirements as set forth in paragraph (e)(2) of this section, (that is, 60 hours), without regard to paragraph (e)(2)(ii) or (e)(2)(iii) of this section plus eighteen months of the qualifying experience requirements set forth in §901.12(b)(1), must be completed since the start of the second inactive enrollment cycle. Any hours of continuing education credit from the second inactive enrollment cycle may be applied in satisfying this requirement. No hours from the first inactive enrollment cycle may be applied in satisfying this requirement.
(o) Examples. The following examples illustrate the application of the rules of paragraph (l) (7) of this section:
Example 1. (i) Individual E, who was initially enrolled before January 1, 2008, completes 5 hours of core continuing education credit and 10 hours of non-core continuing education credit between January 1, 2011, and December 31, 2013. Accordingly, effective April 1, 2014, E is placed on a roster of inactive enrolled actuaries and is ineligible to perform pension actuarial services as an enrolled actuary under ERISA and the Internal Revenue Code.
(iii) Because E used the 21 hours of continuing education credit earned after January 1, 2014, for return from inactive status, E may not apply any of these 21 hours of core and non-core continuing education credits towards the requirements for renewed enrollment effective April 1, 2017. Accordingly, E must complete an additional 36 hours of continuing education (12 core and 24 non-core) prior to December 31, 2016, to be eligible for renewed enrollment effective April 1, 2017.
Example 2. (i) The facts are the same as in Example 1 except E completes 2 hours of core continuing education credit and 8 hours of non-core continuing education credit between January 1, 2014, and December 31, 2016. Thus, because E did not fulfill the requirements for return to active status during his first inactive cycle, E must satisfy the requirements of paragraph (l)(7)(ii) of this section in order to return to active status.
(iii) Note that the 5 hours of core continuing education credit and the 10 hours of non-core continuing education credit that E completes between January 1, 2011, and December 31, 2013, are not counted toward E’s return to active status and are also not taken into account toward the additional hours of continuing education credit that E must complete between January 1, 2017, and December 31, 2019, in order to apply for renewal of enrollment effective April 1, 2020.
Example 3. (i) The facts are the same as in Example 1 except E completes 2 hours of core continuing education credit and 8 hours of non-core continuing education credit between January 1, 2014, and December 31, 2016, and 12 hours of core continuing education credit and 24 hours of non-core continuing education credit between January 1, 2017, and December 31, 2019. Thus, because E did not fulfill the requirements for return to active status during his first or second inactive cycles, E must satisfy the requirements of paragraph (l)(7)(iii) of this section in order to return to active status.
(iii) Note that the total of 15 hours of continuing education credit that E completes between January 1, 2011, and December 31, 2013, as well as the 10 hours of continuing education credit between January 1, 2014, and December 31, 2016, are not counted toward E’s return to active status and are not taken into account toward the additional hours of continuing education credit that E must complete between January 1, 2020, and December 31, 2022, in order to be eligible to file an application for renewal of enrollment active status effective April 1, 2023.
Example 4. (i) Individual F, who was initially enrolled July 1, 2012, completes 1 hour of core continuing education credit and 2 hours of non-core continuing education credit between January 1, 2012, and December 31, 2013. Accordingly, effective April 1, 2014, F is placed on a roster of inactive enrolled actuaries and is ineligible to perform pension actuarial services as an enrolled actuary under ERISA and the Internal Revenue Code.
(ii) F completes 5 hours of core continuing education credit and 4 hours of non-core continuing education credit between January 1, 2014, and October 6, 2014. Because F has not completed the required 6 hours of core and 6 hours of non-core continuing education during F’s initial enrollment cycle, F is not eligible to file an application for a return to active enrollment on October 6, 2014, notwithstanding the fact that had F completed such hours between January 1, 2012, and December 31, 2013, F would have satisfied the requirements for renewed enrollment effective April 1, 2014.
Example 5. The facts are the same as in Example 4 except that F completes 17 hours of core continuing education credit and 16 hours of non-core continuing education credit between January 1, 2014, and February 12, 2015. Accordingly, because as of February 12, 2015, F satisfied the continuing education requirements as set forth in paragraph (e)(2) of this section without regard to paragraph (e)(2)(ii) thereof, F may file an application for return to active enrollment status on February 12, 2015.
§901.12 [Removed]
§901.13 [Redesignated as §901.12]
Par. 7. Section 901.13 is redesignated as §901.12.
Par. 8. Newly redesignated §901.12 is amended by revising the section heading and paragraphs (a), (b), (d), and (e).
§901.12 Eligibility for Enrollment. (a) In general'. An individual applying to be an enrolled actuary must fulfill the experience requirement of paragraph (b) of this section, the basic actuarial knowledge requirement of paragraph (c) of this section, and the pension actuarial knowledge requirement of paragraph (d) of this section.
(b) Qualifying experience'. Within the 10-year period immediately preceding the date of application, the applicant shall have completed either—
(d) Pension actuarial knowledge'. (1) The applicant shall demonstrate pension actuarial knowledge by one of the following:
(i) Joint Board pension examination . Successful completion, within the 10-year period immediately preceding the date of the application, to a score satisfactory to the Joint Board, of an examination, prescribed by the Joint Board, in actuarial mathematics and methodology relating to pension plans, including the provisions of ERISA relating to the minimum funding requirements and allocation of assets on plan termination.
(ii) Organization pension examinations . Successful completion, within the 10-year period immediately preceding the date of the application, to a score satisfactory to the Joint Board, of one or more proctored examinations which are given by an actuarial organization and which the Joint Board has determined cover substantially the same subject areas, have at least a comparable level of difficulty, and require at least the same competence as the Joint Board pension examination referred to in paragraph (d)(1)(i) of this section.
1. Revising paragraphs (b), (d), (e), and (f).
2. Redesignating paragraphs (g) and (h) as paragraph (k) and (l), respectively, and adding new paragraphs (g) and (h).
3. Reserving paragraph (i).
4. Adding new paragraphs (j) and (m).
§901.20 Standards of performance of actuarial services. * * * * *
(b) Professional duty'. (1) An enrolled actuary shall perform actuarial services only in a manner that is fully in accordance with all of the duties and requirements for such persons under applicable law and consistent with relevant standards of professional responsibility and ethics for actuarial practice.
(3) An enrolled actuary, upon learning of another enrolled actuary’s material violation of this section, shall report the violation to the Executive Director.
(d) Conflicts of interest'. In any situation in which an enrolled actuary has knowledge of an actual or potential conflict of interest with respect to the performance of actuarial services, he/she shall not perform such actuarial services unless—
(g) Solicitations regarding actuarial services'. An enrolled actuary may not in any way use or participate in the use of any form of public communication or private solicitation related to the performance of actuarial services containing a false, fraudulent, or coercive statement or claim, or a misleading or deceptive statement or claim. An enrolled actuary may not make, directly or indirectly, an uninvited written or oral solicitation of employment related to actuarial services if the solicitation violates Federal or State law, nor may such person employ, accept employment in partnership form, corporate form, or any other form, or share fees with, any individual or entity who so solicits. Any lawful solicitation related to the performance of actuarial services made by or on behalf of an enrolled actuary must clearly identify the solicitation as such and, if applicable, identify the source of the information used in choosing the recipient.
(j) Return of client’s records. (1) In general, an enrolled actuary must, at the request of a client, promptly return any and all records of the client that are necessary for the client to comply with his or her legal obligations. The enrolled actuary may retain copies of the records returned to a client. The existence of a dispute over fees generally does not relieve the enrolled actuary of his or her responsibility under this section. Nevertheless, if applicable state law allows or permits the retention of a client’s records by an enrolled actuary in the case of a dispute over fees for services rendered, the enrolled actuary need only return those records that must be attached to the client’s legally required forms. The enrolled actuary, however, must provide the client with reasonable access to review and copy any additional records of the client retained by the enrolled actuary under state law that are necessary for the client to comply with his or her legal obligations.
(2) For purposes of this section, records of the client include all documents or written or electronic materials provided to the enrolled actuary, or obtained by the enrolled actuary in the course of the enrolled actuary’s representation of the client, that preexisted the retention of the enrolled actuary by the client. The term “records of the client” also includes materials that were prepared by the client or a third party (not including an employee or agent of the enrolled actuary) at any time and provided to the enrolled actuary with respect to the subject matter of the representation. The term “records of the client” also includes any return, claim for refund, schedule, affidavit, appraisal or any other document prepared by the enrolled actuary, or his or her employee or agent, that was presented to the client with respect to a prior representation if such document is necessary for the taxpayer to comply with his or her current legal obligations. The term “records of the client” does not include any return, claim for refund, schedule, affidavit, appraisal or any other document prepared by the enrolled actuary or the enrolled actuary’s firm, employees or agents if the enrolled actuary is withholding such document pending the client’s performance of its contractual obligation to pay fees with respect to such document.
§901.31 Grounds for suspension or termination of enrollment. (a) Failure to satisfy requirements for enrollment'. The enrollment of an actuary may be terminated if it is found that the actuary did not satisfy the eligibility requirements set forth in §901.11 or §901.12.
(c) Disreputable conduct'. The enrollment of an actuary may be suspended or terminated if it is found that the actuary has, at any time after he/she applied for enrollment, engaged in any conduct set forth in §901.12(f) or other conduct evidencing fraud, dishonesty, or breach of trust. Such other conduct includes, but is not limited to, the following:
§901.32 Receipt of information concerning enrolled actuaries. * * * If any other person has information of any such violation, he/she may make a report thereof to the Executive Director.
§901.47 Transcript. * * * Copies of exhibits introduced at the hearing or at the taking of depositions will be supplied to parties upon the payment of a reasonable fee (31 U.S.C. 9701).
§901.72 Additional Rules. The Joint Board may, in notice or other guidance of general applicability, provide additional rules regarding the enrollment of actuaries.
Chairman, Joint Board for
the Enrollment of Actuaries.
Note (Filed by the Office of the Federal Register on September 18, 2009, 8:45 a.m., and published in the issue of the Federal Register for September 21, 2009, F.R. 48030)
1 The regulations also include transitional rules for reenrollment cycles prior to 1993. This summary refers to the rules currently applicable.
2 This rule would be applied prospectively. Accordingly, the successful completion of a pension actuarial examination prior to the effective date of this regulation will be recognized for ten years after such effective date.
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