The UK’s Prudential Regulation Authority has published:

  • a brief Policy Statement: “Solvency II: external audit of the public disclosure requirement – PS24/16“;
  • a short Supervisory Statement: “SS11/16: Solvency II: external audit of the public disclosure requirement“; and
  • its made rules: “Solvency II firms and non-authorised persons: external audit instrument 2016″.

Long story short:

  1. the PRA does not consider that the responses received to [its consultation] require significant changes to its proposals. The PRA has however made minor amendments to the proposed rules and supervisory statement … to add further clarity to the PRA’s expectations
  2. Solvency II (re)insurers will be obliged to have some parts of their Solvency & Financial Condition Report externally audited;
  3. The new rules will apply for financial years ending on or after 15 November 2016;
  4. External auditors will be required to (a) prepare their reports with due skill, care and diligence; and (b) include an opinion addressed to the (re)insurer’s governing body.

There’s a fuller summary of the relevant requirements in our last blog post on external audits for Solvency II firms, if you need it.