Financial resources, financial returns and auditors

Financial resources

1. The Council may from time to time prescribe requirements regarding the possession by underwriting agents and approved run-off companies of financial resources and capital and the maintenance of solvency margins and professional indemnity insurance. The requirements may include different requirements for managing agents, members’ agents and approved run-off companies. The requirements may include –

(a) the assets, liabilities and other matters to be taken into account in determining financial resources, capital and solvency margins;

(b) the manner in which such assets are to be held and maintained; and

(c) restrictions or prohibitions on underwriting agents incurring liabilities or granting guarantees or indemnities in favour of a specified person or class of persons.

Underwriting Byelaw, paragraph 49

2. The requirements prescribed by the Council regarding the possession by underwriting agents of financial resources and capital and the maintenance of solvency margins are set out in Market Bulletin Y3086 (Underwriting Agents Financial Resource Requirements (FRRs)) issued on 30 June 2003.

Requirements Made Under the Underwriting Byelaw, paragraph 11

Financial returns

3. Each quarter, every underwriting agent and every approved run-off company shall prepare, compile and submit to the Council a quarterly financial return.

Underwriting Byelaw, paragraph 50

4. Each year, every underwriting agent and approved run-off company shall prepare, compile and submit to the Council an annual financial return.

Underwriting Byelaw, paragraph 51

5. The requirements prescribed by the Council in respect of quarterly financial returns and annual financial returns are set out in Market Bulletin Y3086 (Underwriting Agents Financial Resource Requirements (FRRs)) issued on 30 June 2003 and in Market Bulletin Y4030 (Payment of managing agent’s profit commission in line with interim profits released to members) issued on 27 June 2007.

Requirements Made Under the Underwriting Byelaw, paragraph 12

6. The Council may prescribe requirements for quarterly financial returns and annual financial returns. The requirements may make different requirements for managing agents, members’ agents and approved run-off companies. The requirements may include, but shall not be limited to –

(a) the period or periods to which each return is to relate or be made up to;

(b) the format and content of each return including documents required by law to be submitted to the Registrar of Companies by the underwriting agent or by any company within the same group as the underwriting agent;

(c) the examination of the return by the directors of the underwriting agent and the completion of a declaration by them;

(d) examination of the return by a recognised accountant and the completion of a report by that recognised accountant;

(e) the date or dates on which each return is to be submitted to the Council.

Underwriting Byelaw, paragraph 52

Auditors

Every underwriting agent shall appoint a recognised accountant in accordance with the Audit Arrangements Byelaw (No. 7 of 1998).

Underwriting Byelaw, paragraph 53

Documents supplemental to Underwriting Byelaw and Requirements made under it

Codes issued under the Underwriting Byelaw

The following Codes have been issued under paragraph 31 of the Underwriting Byelaw.