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Making Your Mark

Making Your Mark

By Emily Kessler

Are you set to attest your continuing education credits? Will you be audited? Read on for answers to these and other questions.

It's 2009 and the SOA CPD Requirement is now in effect for all SOA members. All members are required to be either earning credits under the Basic Requirement Provisions (Section B) or following one of the Alternative Compliance standards (Section C). See SOA.org/cpd.

One thing that's different about the SOA CPD Requirement from many other CPD requirements (including some of the alternative compliance standards) is that the SOA requires members to attest compliance as of the end of each calendar year, beginning with calendar year ending Dec. 31, 2010. Also, members may be asked on audit to show a record of CPD compliance. This article will discuss, briefly, how members will attest and what information members will need to provide if audited. It will also discuss changes to the membership directory coming in 2011 as we disclose whether members have complied with the standard.

Please note that while we believe the attestation process and membership directory will work just as we describe it today, things could change between now and year–end 2010. Any significant changes in the process will be reported in future issues of The Actuary and other SOA publications.

How to Attest Compliance

Starting with the year ending Dec. 31, 2010, all SOA members are required to attest to compliance with the SOA CPD Requirement. Every year members will have to attest compliance for the two–year rolling cycle ending on the 31st of December of that respective year. Members will attest compliance with the 2009–10 cycle at year–end 2010, with the 2010–11 cycle at year–end 2011, etc.

Each year, we anticipate that the attestation period will begin two months before year end and close two months after year–end. For the 2009–2010 CPD cycle we expect the CPD attestation period to open on Nov. 1, 2010 and close on Feb. 28, 2011.

Attestation will be done electronically. A link will be sent and members will log into the SOA member site to attest compliance. Once there, members will find an attestation that looks as follows:

  • I certify that I have fulfilled the SOA Continuing Professional Development Requirement for the period 2009–2010 by meeting one or more of the following:
    • the Basic Requirement provisions of Section B.
    • the Qualification Standards for Actuaries Issuing Statements of Actuarial Opinion in the United States.
    • the Canadian Institute of Actuaries'
      • Qualification Standard–Requirements for Continuing Professional Development.
    • Category 1 or 2 of the CPD Scheme of the Faculty of Actuaries and Institute of Actuaries.
    • the Continuing Professional Development Standard of the Institute of Actuaries of Australia.
  • I certify that I have not fulfilled the SOA CPD Requirement for the period 2009–2010.

Members will click the appropriate radial buttons to attest. Members who click the first button—certifying that they fulfilled the requirement—must click at least one of the next five buttons to note by which method. As illustrated in the CPD Requirement (Section C3) members can combine standards within a period; members who comply using one standard for one year and another standard for another year should click the radial buttons for both standards. For example, a member might fulfill (half of) the requirements in Section B one year and Category 1 of the UK CPD Scheme (if eligible) in the other. That person would click both the radial button for the Basic Requirement of Section B and Category 1 or 2 of the CPD Scheme of the Faculty of Actuaries and Institute of Actuaries. If a member followed the U.S. Qualification Standard in both years of the cycle, he or she would click that radial button (the Qualification Standards for Actuaries Issuing Statements of Actuarial Opinion in the United States) once.

Once members have completed the electronic attestation they are done. Members who aren't able to complete the electronic attestation may fax or mail in a written attestation; the form will be available online or through SOA Customer Service.

Audit

Approximately 1 percent of members (200 members) will be audited each cycle. The purpose of the audit is twofold. First, we want to ensure, especially as we introduce the Requirement, that members understand the Requirement's provisions. Second, the CPD Requirement was introduced to assure members of the public that actuaries holding the ASA, CERA or FSA credential are keeping up–to–date; the presence of the audit assures members of the public that we are taking active steps to ensure members meet the CPD Requirement.

In the CPD frequently asked questions, R1 outlines what records a member needs to keep to prove compliance on audit:

A log of activity must be kept, showing how you met the requirement. The log will be different based on whether you are meeting the Basic Requirement provisions of Section B or an Alternative Compliance provision of Section C.

For the Basic Requirement provision, the log should include day, time spent (in minutes and/or units), description of the activity, whether the credit was self–study or structured, if structured credit, if the source was employer or non–employer, whether it was job–relevant, professionalism or business and management skills. The description of the activity should be detailed enough to show why this was a CPD activity. For example, a description of "attended internal webcast" is not sufficient. The description "attended internal webcast on likely impact of PBA on internal audit procedures" is sufficient. Similarly "read article in the Pension Section News" is not sufficient, but "read article titled 'Recent IRS Regulations' in June 2011, Pension Section News" is sufficient.

For an alternative compliance method, the log should show how you met the terms of that requirement in its entirety. For example, the U.S. Qualification Standard has specific requirements for organized activity and professionalism; the log should show how those requirements were met, in addition to the U.S. Qualification Standard's general 30–hour requirement.

There's no requirement that you keep statements of attendance, handouts or other proof of attendance.

Audits will generally run in the second quarter, after the CPD attestation period ends.

Compliance and The Membership Directory

The membership directory will be altered beginning in 2011 to show a member's compliance with the SOA CPD Requirement. A new category will be added to the directory, under Designations, called SOA Continuing Professional Development Requirement. Under that heading, the member's CPD status will be shown.

The PDFsample to the left(top) shows how the membership directory would look for Aaron Member, who complied with the CPD Requirement for the 2009–2010 cycle.

This PDFsample to the left (bottom) shows how the membership directory would look for Jessica Member, who did not comply with the CPD Requirement for the 2009–2010 cycle.

The membership directory will only show CPD compliance with the previous Requirement cycle; the information will change only upon the close of the CPD attestation period. For example, if the CPD attestation period for 2009–2010 is Nov. 1, 2010 through Feb. 28, 2011, the membership directory would not show attestation with the 2009–2010 cycle before March 1, 2011.

The SOA will also post on its Web site information as to the meaning of compliant or noncompliant status. This information will help members of the public understand that compliance is with regard to the SOA CPD Requirement, and to put that in context of the other standards.

Because compliance is reported through the online membership directory, all members must be listed in the directory. However, members need only list their names, designations and SOA CPD Requirement compliance status in the directory.

Members who don't attest prior to February 28 may attest after that date. Electronic attestation will be open for several months following the close of the attestation period (and members can always use the attestation form to attest during the rest of the year). Members who are noncompliant in the membership directory because they weren't able to complete credits or forgot to attest may attest at any future date; the membership directory will be updated within a few business days of the receipt of an attestation.

Finally, members who don't comply with the CPD Requirement are still required to inform users of their actuarial services of their failure to comply with the CPD Requirement. This is in addition to any disclosure the SOA makes in the membership directory.

Don't Forget to Attest Compliance

It is imperative that all members remember to attest compliance with the CPD Requirement. Members who don't attest will be assumed to be noncompliant and the membership directory will show them as noncompliant (different rules apply for retirees—see sidebar on pg. 11). This is particularly important for members who comply with an alternative compliance standard, which may, for the alternative standard itself, not require any form of attestation. The SOA CPD Requirement requires attestation of all members, regardless of which standard the member followed.

When the attestation process opens, we will send you many reminders. The most important thing you can do is be sure the membership directory includes your correct contact information, particularly your e–mail address.

There is much more information about compliance, the consequences of noncompliance and recordkeeping and audit in the CPD FAQs. The CPD FAQs and CPD Requirement are both available online at SOA.org/cpd.

Emily Kessler, FSA, EA, MAAA, FCA, is senior fellow, Intellectual Capital, at the Society of Actuaries. She can be contacted at ekessler@soa.org.

Sidebar:

Retirees and CPD Compliance

The SOA CPD Requirement applies to all members, including retirees. However, certain retirees face different requirements when it comes to CPD compliance and attestation.

Retirees who are eligible for reduced dues on account of retirement are not subject to the same compliance and attestation standards. In the CPD FAQs, RE2 explains which retirees are eligible for reduced dues on account of retirement:

For 2009, there are two categories under which members could pay reduced membership dues due to retirement. They are category 2: attainment of age 55 and retirement to the point of current year's income (excluding retirement pay, Social Security or equivalent benefits and investment income) not exceeding the 2009 income limit ($30,000); or category 3: attainment of age 70. While the categories do not change frequently, they are subject to change so members should check the SOA Web site for the most current information. The income limit changes annually (it is currently set at 80 percent of the U.S. per capita income, rounded to the nearest thousand).

Retirees who are eligible for reduced dues on account of retirement are assumed to no longer be providing services to the public. In that case, their compliance with the SOA CPD Requirement is not relevant.

Retirees may comply with the SOA CPD Requirement if they wish, and we know of many retirees who continue to volunteer and keep up–to–date with professional activities. These retirees can fulfill the requirement, and if they attest compliance, will be listed as Compliant. However, if a retiree eligible for reduced dues on account of retirement does not attest compliance, he or she will be listed as Retired and not as Noncompliant. In other words, the default status for these retirees is Retired; if they notify the SOA that they have complied with the Requirement, their status is updated to Compliant, but in no event would they be listed as Noncompliant.

Note that members who elect to list themselves as Retired under Employment Status, but who are not eligible for reduced dues due to retirement, are still subject to the SOA CPD Requirement.