California Code of Regulations › Title 10 - Investment › Chapter 5 - Insurance Commissioner › Subchapter 3 - Insurers › Article 3.3 - Annual Financial Reporting › Section 2309.6 - Designation of Independent Certified Public Accountant

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
(a) Each insurer required by these
				  regulations to file an annual audited financial report must within sixty (60)
				  days after becoming subject to the requirement, register with the commissioner
				  in writing the name and address of the independent certified public accountant
				  or accounting firm retained to conduct the annual audit set forth in these
				  regulations. Insurers not retaining an independent certified public accountant
				  on the effective date of these regulations shall register the name and address
				  of their retained independent certified public accountant not less than six (6)
				  months before the date when the first audited financial report is to be
				  filed.
(b) The insurer shall obtain
				  a letter from the accountant, and file a copy with the commissioner stating
				  that the accountant is aware of the provisions of the insurance code and the
				  regulations of the insurance department of the state of domicile that relate to
				  accounting and financial matters and affirming that the accountant will express
				  the accountant's opinion on the financial statements in terms of their
				  conformity to the statutory accounting practices prescribed or otherwise
				  permitted by that insurance department, specifying such exceptions as the
				  accountant may believe appropriate.
(c) If an accountant who was the accountant
				  for the immediately preceding filed audited financial report is dismissed or
				  resigns, the insurer shall within five (5) business days notify the
				  commissioner of this event. The insurer shall also furnish the commissioner
				  with a separate letter within ten (10) business days of the above notification
				  stating whether in the twenty-four (24) months preceding such 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 the former accountant to make reference to
				  the subject matter of the disagreement in connection with the former
				  accountant's 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.
				  Disagreements contemplated by this section are those that occur at the
				  decision-making level, i.e., between personnel of the insurer responsible for
				  presentation of its financial statements and personnel of the accounting firm
				  responsible for rendering its report. The insurer shall also in writing request
				  the former accountant to furnish a letter addressed to the insurer stating
				  whether the accountant agrees with the statements contained in the insurer's
				  letter and, if not, stating the reasons for which the former accountant does
				  not agree; and the insurer shall furnish the responsive letter from the former
				  accountant to the commissioner together with its own.
1. New
					 section filed 12-7-2009; operative 1-1-2010 pursuant to Government Code section
					 11343.4
					 (Register 2009, No. 50).
2. Change without regulatory effect
					 amending subsections (b) and (c) filed 7-14-2021 pursuant to section
					 100, title 1, California Code of
					 Regulations (Register 2021, No. 29). Filing deadline specified in Government
					 Code section
					 11349.3(a)
					 extended 60 calendar days pursuant to Executive Order
					 N-40-20.
Note: Authority cited: Section
						900.2,
						Insurance Code. Reference: Section
						900.2,
						Insurance Code.