Wisconsin Administrative Code › Office of the Commissioner of Insurance › Chapter Ins 50 - Annual Audited Financial Reports, Annual Financial Statements And Examinations › Subchapter I - Annual Audited Financial Reports › Section Ins 50.15 - Requirements for audit committees

Current through June 24, 2024
(1) This section
				does not apply to foreign or alien insurers licensed in this state or an
				insurer that is a SOX Compliant Entity or a direct or indirect wholly-owned
				subsidiary of a SOX Compliant Entity.
(2) The audit committee shall be directly
				responsible for the appointment, compensation and oversight of the work of any
				accountant, including resolution of disagreements between management and the
				accountant regarding financial reporting, for the purpose of preparing or
				issuing the audited financial report or related work pursuant to this chapter.
				Each accountant shall report directly to the audit committee.
(2m) The audit committee shall be responsible
				for overseeing the insurer's internal audit function and granting the person or
				persons performing the function suitable authority and resources to fulfill
				their responsibilities if required by s. Ins 50.155.
(3) Each member of the audit committee shall
				be a member of the board of directors of the insurer or a member of the board
				of directors of an entity elected pursuant to sub. (6) and s.
				Ins
				50.01(1r).
(4) In order to be considered independent for
				purposes of this section, a member of the audit committee may not, other than
				in the capacity as a member of the audit committee, the board of directors, or
				any other board committee, accept any consulting, advisory or other
				compensatory fee from the entity or be an affiliated person of the entity or
				any subsidiary thereof. However, if a law requires board participation by
				otherwise non-independent members, the law shall prevail and the members may
				participate in the audit committee and be designated as independent for audit
				committee purposes, unless the members are an officer or employee of the
				insurer or one of its affiliates.
(5) If a member of the audit committee ceases
				to be independent for reasons outside the member's reasonable control, the
				member, with notice by the insurer to the commissioner, may remain an audit
				committee member of the insurer until the earlier of the next annual meeting of
				the insurer or one year from the occurrence of the event that caused the member
				to be no longer independent.
(6) To
				exercise the election of the controlling person to designate the audit
				committee for purposes of this chapter, the ultimate controlling person shall
				provide written notice to the commissioner of the affected insurers.
				Notification shall be made timely prior to the issuance of the audited
				financial report and include a description of the basis for the election. The
				election can be changed through notice to the commissioner by the insurer,
				which shall include a description of the basis for the change. The election
				shall remain in effect for perpetuity, until rescinded.
(7)
(a) The
				audit committee shall require the independent certified public accountant that
				performs for an insurer any audit required by this chapter to timely report to
				the audit committee in accordance with the requirements of SAS 61,
				Communication with Audit Committees, or its replacement, including:
1. All significant accounting policies and
				material permitted practices.
2.
				All material alternative treatments of financial information within statutory
				accounting principles that have been discussed with management officials of the
				insurer, ramification of the use of the alternative disclosures and treatments,
				and the treatment preferred by the independent certified public
				accountant.
3. Other material
				written communications between the independent certified public accountant and
				the management of the insurer, such as any management letter or schedule of
				unadjusted differences.