Solvency II: external audit of the public disclosure requirement

Consultation Paper 8/18
Published on 11 April 2018

Background

In this consultation paper (CP), the Prudential Regulation Authority (PRA) sets out its proposal to amend the rule that requires the external audit of parts of the Solvency and Financial Condition Report (SFCR), under Rule 2 of the External Audit part of the PRA Rulebook. The SFCR is the key public disclosure under Solvency II. 

This CP is relevant to all UK Solvency II firms (including mutuals), auditors and users of SFCRs.

Summary of proposals

The PRA sets out its proposal to amend the rule that requires the external audit of parts of the Solvency and Financial Condition Report (SFCR), under Rule 2 of the External Audit part of the PRA Rulebook. The PRA estimates that the proposed amendments would remove the SFCR external audit requirement from the end of 2018 for more than 150 smaller UK Solvency II firms (including mutuals) and groups. The PRA considers that this change would improve the proportionality of the requirement.

The proposals in this CP have been developed by the PRA as part of its work on reviewing aspects of the insurance prudential framework in light of experience following the United Kingdom’s implementation of Solvency II, see ‘PRA launches series of improvements to the implementation of Solvency II’, 25 October 2017.

Responses and next steps

This consultation closed on Wednesday 11 July 2018. The PRA invites feedback on the proposals set out in this consultation. Please address any comments or enquiries to CP8_18@bankofengland.co.uk. The PRA proposes that any amendments would be effective for financial years ending on or after Thursday 15 November 2018.

PDFConsultation Paper 8/18

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