Oklahoma Administrative Code › Title 365 - Insurance Department › Chapter 25 - Other Licensees › Subchapter 7 - Companies › Part 19 - ANNUAL FINANCIAL REPORTING › Section 365:25-7-116 - Management's report of internal control over financial reporting

Current through Vol. 41, No. 20, July 1, 2024
(a) Every insurer required to file an audited
				  financial report pursuant to this regulation that has annual direct written and
				  assumed premiums, excluding premiums reinsured with the Federal Crop Insurance
				  Corporation and Federal Flood Program, of $500,000,000 or more shall prepare a
				  report of the insurer's or group of insurers' internal control over financial
				  reporting, as these terms are defined in O.A.C. 365:25-7-102. The report shall
				  be filed with the commissioner along with the Communication of Internal Control
				  Related Matters Noted in an Audit described under O.A.C. 365:25-7-110.
				  Management's Report of Internal Control over Financial Reporting shall be as of
				  December 31 immediately preceding.
(b) Notwithstanding the premium threshold in
				  subsection a, the commissioner may require an insurer to file Management's
				  Report of Internal Control over Financial Reporting if the insurer is in any
				  RBC level event, or meets any one or more of the standards of an insurer deemed
				  to be in hazardous financial condition as defined in (include reference to
				  Corrective Action statute).
(c) An
				  insurer or a group of insurers that is
(1)
				  directly subject to Section 404;
(2) part of a holding company system whose
				  parent is directly subject to Section 404;
(3) not directly subject to Section 404 but
				  is a SOX Compliant Entity; or
(4) a
				  member of a holding company system whose parent is not directly subject to
				  Section 404 but is a SOX Compliant Entity; may file its or its parent's Section
				  404 Report and an addendum in satisfaction of this section, O.A.C. 365:25-7-116
				  "Section 116", requirement provided that those internal controls of the insurer
				  or group of insurers having a material impact on the preparation of the
				  insurer's or group of insurers' audited statutory financial statements (those
				  items included in O.A.C. 365:25-7-104(b) -(g)) were included in the scope of
				  the Section 404 Report. The addendum shall be a positive statement by
				  management that there are no material processes with respect to the preparation
				  of the insurer's or group of insurers' audited statutory financial statements
				  (those items included in O.A.C. 365:25-7-104(b) -(g)) excluded from the Section
				  404 Report. If there are internal controls of the insurer or group of insurers
				  that have a material impact on the preparation of the insurer's or group of
				  insurers' audited statutory financial statements and those internal controls
				  were not included in the scope of the Section 404 Report, the insurer or group
				  of insurers may either file (i) a Section 116 report, or (ii) the Section 404
				  Report and a Section 116 report for those internal controls that have a
				  material impact on the preparation of the insurer's or group of insurers'
				  audited statutory financial statements not covered by the Section 404
				  Report.