2 February, 2018
For purpose of strengthening the function of the board of directors of insurance enterprise, the FSC promulgated an amendment to the Regulations Governing Implementation of Internal Control and Auditing System of Insurance Enterprises on October 19, 2017.
The amended regulations require that, when the board finds that a material loss may be possible, it shall deal with the situation properly and shall cause the relevant report be submitted to the competent authority.
The monitoring systems established by insurance enterprise shall include the mechanism for handling material incidents and the compliance with the laws and regulations pertaining to anti-money laundering and counter terrorism financing.
After an overseas branch of insurance enterprise is inspected by, or receives inspection report from, the local authority, the internal auditing unit of the insurance enterprise’s headquarter shall timely report to the board of directors and supervisors or to the audit committee thereof depending upon the materiality of the situation.
Furthermore, The amended regulations also require that when an overseas branch of insurance enterprise establishes a self-evaluation and monitoring mechanism for the risk of the laws and regulations compliance, it shall engage outside independent local consultants to verify the effectiveness of such self-evaluation and monitoring mechanism for legal compliance over large size, high complexity and high risk businesses.
The internal control auditing performed by the accountants engaged by insurance enterprise shall include the auditing of compliance with respect to the implementation of above monitoring mechanism, e.g., anti-money laundering system and its overseas branches.
For further information, please contact:
Leonard Chen, Tsar & Tsai Law Firm
law@tsartsai.com.tw
