2023 South Dakota Codified Laws › Title 58 - Insurance › Chapter 43 - Independent Audit Of Insurers › Section 58-43-1 - Definition of terms.

58-43-1. Definition of terms.
Terms used in this chapter mean:
(1)"Accountant," an independent certified public accountant or accounting firm in good standing with the American Institute of Certified Public Accountants and in all states in which the accountant or firm is licensed to practice. For Canadian and British companies, an accountant is a Canadian-chartered or British-chartered accountant;
(2)"Affiliate of a person" or "Affiliated with a specific person," a person that directly or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, the person specified;
(3)"Audit committee," a committee established by the board of directors of an entity for the purpose of overseeing the accounting and financial reporting processes of an insurer or group of insurers, the internal audit function of an insurer or a group of insurers, if applicable, and external audits of financial statements of the insurer or group of insurers. The audit committee of any entity that controls a group of insurers may be deemed to be the audit committee for one or more of these controlled insurers solely for the purposes of this chapter at the election of the controlling person;
(4)"Indemnification," an agreement of indemnity or a release from liability where the intent or effect is to shift or limit in any manner the potential liability of the person or firm for failure to adhere to applicable auditing or professional standards, whether or not resulting in part from knowing of other misrepresentations made by the insurer or the insurer's representatives;
(5)"Insurer," an authorized insurer as defined in subdivision 58-1-2(2);
(6)"Group of insurers," those insurers included in the reporting requirements of chapter 58-5A, or a set of insurers as identified by management, for the purpose of assessing the effectiveness of internal control over financial reporting;
(7)"Internal audit function," any person who provides independent, objective, and reasonable assurance designed to add value and improve an organization's operations and accomplish the organization's objectives by using a systematic, disciplined approach to evaluate and improve the effectiveness of each risk management, control, and governance process;
(8)"Internal control over financial reporting," a process effected by an entity's board of directors, management, and other personnel designed to provide reasonable assurance regarding the reliability of the financial statements and includes those policies and procedures that:
(a)Pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of assets;
(b)Provide reasonable assurance that transactions are recorded as necessary to permit preparation of the financial statements and that receipts and expenditures are being made only in accordance with authorizations of management and directors; and
(c)Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of assets that could have a material effect on the financial statements;
(9)"SEC," the United States Securities and Exchange Commission;
(10)"Section 404," Section 404 of the Sarbanes-Oxley Act of 2002 in effect as of January 1, 2018;
(11)"Section 404 report," management's report on internal control over financial reporting as defined by the SEC and the related attestation report of the independent certified public accountant;
(12)"SOX compliant entity," an entity that either is required to be compliant with, or voluntarily is compliant with, all of the following provisions of the Sarbanes-Oxley Act of 2002 in effect as of January 1, 2018:
(a)The preapproval requirements of Section 201 (Section 10A(i) of the Securities Exchange Act of 1934);
(b)The audit committee independence requirements of Section 301 (Section 10A(m)(3) of the Securities Exchange Act of 1934); and
(c)The internal control over financial reporting requirements of Section 404 (Item 308 of SEC Regulation S-K).
Source:
SL 1992, ch 357, §1; SL 2009, ch 271, §1; SL 2018, ch 283, §1.