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The CIRC issued a document regulating insurance fund internal control weaknesses

in recent years, insurance companies substantially widened the area of investment, appropriate internal control weakness has also been highlighted recently Circ issued a specification for internal control of funds.

"some insurance companies formed in the use of funds accumulated for a long time in the field of internal control weaknesses and shortcomings, especially in the internal control system is not perfect, operation system, internal control means lagging implementation is difficult to put in place, shareholders or the Chairman may be superior to the control system, such as, challenges difficult to adapt to the risks associated with market-oriented reforms. "The China insurance regulatory Commission said industry needed a set of internal control standards, conduct regulating the Fund's internal control.

to this end, the China insurance regulatory Commission on December 7, issued guidelines on internal control of insurance funds (Guidance for the Internal Control of Insurance Funds, referred to as GICIF) and use of insurance funds and the internal control guidelines (1th-3rd) (hereinafter referred to as the guidelines). Guidelines take total, and points framework structure, reflected for "total guidelines + supporting application guidelines" form, including two a level: a is total guidelines, clear has insurance funds using internal control target, and principles and basic elements, and around funds using internal control of internal environment, and risk assessment, and control activities, and information and communication and internal supervision, elements, refinement has key points and the control activities,.

Second, application guidelines, focusing on specific areas of investment of insurance funds construction of internal control, including on the Division of responsibilities and authority to authorize, investment research and decision-making, investment Executive, investment management and other key aspects of internal control standards and requirements. Circ said General guidelines and application form "1+N" insurance investment guidelines on internal control system, more systematic and operational. In the first release of the application guide (1th-3rd), respectively, bank deposit, fixed-income investments, stocks and stock mutual funds investment the key to develop the internal control standards and processes, will guard against major risks and problems in the investment field, such as stock investment asset allocation risk, insider trading and transportation risks and other issues of interest.

the guidelines require, insurers engage an independent third party audit organizations conduct annual external audit work shall for utilization of insurance funds carry out special audits of internal control and to the China insurance regulatory Commission before April 30 in each year submit special audit report for the previous year. Carry out special audits of internal controls, the China insurance regulatory Commission said, "is an agency of insurance in accordance with the guidelines on internal control requirements, and constantly perfecting internal control of insurance funds and to ensure its effective implementation.

Second, play the role of market mechanism, independent third-party audit Fund internal control audit work carried out and give full play to market intermediaries in providing professional technique, revealing the active role in areas such as risk, form a and the supervision of independent and pluralistic market discipline mechanisms. Third, international common practice, internal control audit on international business model, method, method is relatively mature, has made significant practical experience and performance. "

the China insurance regulatory Commission said, the next step in total, framework, based on the guidelines, depending on market and regulatory needs, have been issued for real estate, insurance, asset management, equity investments, foreign investments, derivatives and other investments category application guide, continuously enrich and improve the standards of internal control system and the utilization of insurance funds. Circ will further strengthen the utilization of insurance funds in the internal control construction, special third party auditing internal control supervision and improve industry-wide levels of internal control of the use of insurance funds.

 

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