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May 27, 2004 at 08:00 PM
NU Online News Service, May 27, 2004, 6:07 p.m. EDT – The National Association of Insurance Commissioners will hold a hearing next month on the cost of including financial control attestation requirements in the proposed Model Audit Rule.[@@]
Some state regulators at the Kansas City, Mo., group want the rule to include a provision, Section 16, which would resemble Section 404 of the Sarbanes-Oxley Act of 2002.
SOX Section 404 requires company managers to assess their companies’ financial controls and have auditors attest to the effectiveness of the companies’ financial controls and reporting procedures.
Insurers might complain about the cost of Section 16 compliance, but publicly traded insurers and companies in other financial services sectors already have to comply with SOX Section 404, according to Doug Stolte, an assistant insurance commissioner in the Virginia Bureau of Insurance.
Retaining an attestation provision in the Model Audit Rule would help regulators focus more on compliance and less on verifying balance sheets, Stolte says.
