Rule 23. Annual Reportorial Requirements 

23.1.  Annual Financial Statement

The issuer shall submit to the Commission five (5) copies of its audited annual financial statements within one hundred five (105) days after the end of its fiscal year.  To properly reflect the correct amount of liabilities as of the end of the fiscal year, the Actuarial Reserve Liabilities presented in the audited financial statements should be the amount shown in the Actuarial Valuation Report duly certified by an accredited actuary.  The audited financial statements shall be in the form of the Pre-Need Uniform Chart Of Accounts ( PNUCA ) and shall consist of the Balance Sheet, Income Statement and Cash Flow Statement and shall be accompanied by :

i. )    the Actuarial Valuation Report described  in  Rule 23.2.3;

ii.)    the last quarter Trust Fund  Statement and;

iii.)   a list of fully paid plans (availing  and not availing),  active plans and Lapsed Plans.

23.1.1. The said financial statement shall be signed by the President and Finance Officer of the Pre-Need Company certifying that said statement has been audited by an independent auditor.

23.1.2. Said annual statement shall be published together with the trust fund balance sheet, once a year within one hundred and twenty  (120) days from the end of the fiscal year in a newspaper of general circulation in the city/province where the Pre-Need Company has its head office.  A copy of such statement as published, together with the publisher’s certificate, shall be submitted to the Commission within ten (10) days after said publication.

23.2. Actuarial Valuation Report.

23.2.1 All actuaries employed/retained by Pre-Need Companies shall be required to be accredited by the Commission upon proper application. No actuary may be accredited unless he is a Fellow of good standing of the Actuarial

Society of the Philippines and his application duly endorsed by it. Accreditation shall be renewed annually.  Processing of applications for SEC accreditation as well as renewals thereof shall  be completed within eight (8) working days from receipt of complete application and payment of fees.

23.2.2. The Commission shall not process/take action on any and all documents which require the opinion of an actuary unless he has been duly accredited as such by the Commission.

23.2.3. An actuarial valuation report (hereafter, AVR) duly certified by a Commission accredited actuary shall be submitted to the Commission simultaneously with the reports required in Rule 23.1 and shall contain the following information for each type of plan:  

23.2.4.Exhibit A- Actuarial Assumption and Methodology:

1.)    Description of benefits and guarantees;

2. )   Amount of plans registered and date of  registration;

3. )   Distribution of issued pre-need plan contracts  showing  numbers and amounts, by issue year;

4.)    Actuarial assumptions used in the valuation of reserves, describing the bases for each assumption of: 

a.) interest rate;

b.) inflation rate;

c.) withdrawal rate;

d.) contingent benefit availment rate, if applicable;

e.) present actual cost of benefits as of valuation date, if applicable;

f.) other pertinent assumptions;

5.) Actuarial formulas and methods used in the valuation of reserves;

6.) Justification for any changes in actuarial assumptions or methods.

23.2.5. Exhibit B – Summary of Issued Contracts Per Approved  Format

23.2.6. Exhibit C – Valuation Results by Product Line   Per approved Format

23.2.7  Exhibit D – Summary of Valuation Results Per  Approved  Format

23.2.8. Exhibit E – Certification and statement of opinion as to the appropriateness and reasonableness of the assumptions and  level of    reserves and that the insurance coverages are valid and in effect

23.2.9.  An Actuarial Statement that the Actuary has compared the amount of actuarial reserves as of the date of valuation to the amount of the Trust Fund as of the same date and that he has conducted tests to verify the reasonableness and consistency of the data used in the actuarial valuation.

23.3.  A Sworn Statement from the Insurer certifying the coverages or guarantees assumed by the insurance company indicating extent, term and duration of such coverages and/or guarantees.

23.4.Sworn statements from the Trustee/s on the Trust Account/s, including:

a.       Statement that trust account/s are maintained in accordance with a trust agreement which has been approved by the Commission;

b.       Statement that trust account/s are free from liens and encumbrances other than liabilities indicated in the trust fund statement;

c.       The trust fund balance sheet/s as of valuation date, including the income statement/s for the year and subsidiary schedules that should identify the specific investments.

23.5. Sworn statements from the responsible officers of the Pre-Need Company stating that:

a.     The data on which the valuation was based are complete and accurate;

b.     Only withdrawals allowed by the Commission have been made from the Trust Fund;

c.      Deficiencies, if any, in the Trust Fund, have been duly addressed, and proof of the same.

23.6.   Schedules showing the data for the last five (5) years or a shorter period, if applicable, on the required actuarial reserves, trust fund equity and net investment rate of return on the trust fund.

23.7. Other subsidiary schedules which the Commission may require, for purposes of table audit.

23.8. The foregoing certifications, reports and schedules required shall be prepared in accordance with the prescribed form.

23.9. The Commission may refer the AVR to an independent actuary for verification but the expenses incurred therefor shall be charged to the issuer, provided, however, that the AVR herein required shall not be referred by the Commission for evaluation/comment to an actuary who is connected in whatever capacity with a competing firm.

23.10. Any deficiency in the Trust Fund shall be covered by the issuer through additional deposit within thirty (30) days from submission of the actuarial valuation report or from notice of deficiency whichever is earlier.  Any excess in the Trust Fund may be credited to future deposit requirements.

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