Professionalism Counts, October 2019

Common Year-End Qualification Questions

At this time of year, when actuaries typically make sure they have all the continuing education (CE) they need to be qualified to issue statements of actuarial opinion (SAOs) in the United States in 2020, questions about CE are often raised.

While CE is the most likely annual recurring requirement you will have to meet to be qualified, the first thing to consult—because it establishes whether you have a CE requirement at all—is the definition of an SAO in the Qualification Standards for Actuaries Issuing Statements of Actuarial Opinion in the United States (USQS):

an opinion expressed by an actuary in the course of performing actuarial services and intended by that actuary to be relied upon by the person or organization to which the opinion is addressed.

Under this definition, just about every actuary working as an actuary in the U.S. who renders advice, recommendations, findings, or opinions based upon actuarial considerations needs to meet all the requirements of the USQS, including CE requirements.

Last month, we reviewed the basics of CE. To recap briefly, an actuary needs 30 hours of relevant CE each year, of which 6 hours must be organized and 3 hours must be professionalism. This month we will answer questions about specific circumstances relating to CE—actuaries returning from leave, requirements for new actuaries, and actuaries unable to meet the requirement by year-end.

1. What do you need to do if you are returning from a leave of absence?

Under the USQS, you must complete CE requirements for the year in which you return to work before you can issue an SAO. In years that you do not issue any SAOs, you are not required to fulfill the USQS CE requirements.

For example, if you were on leave in 2019, you should complete 30 hours of CE before issuing any SAO in 2020. If you were on leave in 2018 and did not issue any SAOs in 2019, you would just need to complete 30 hours before issuing an SAO in 2020. However, if your leave does not coincide with the calendar year, and you have been out for most of 2019 and wish to issue an SAO in late 2019, you must complete the 30-hour requirement before issuing any SAO in 2019, and then earn another 30 hours before issuing any SAO in 2020.

2. As a new actuary, what CE requirements do I need to meet?

Once you become a member of any of the five U.S.-based actuarial organizations, all of which have independently adopted the Code of Professional Conduct (Code), you must comply with all of the requirements of the USQS before issuing any SAO to be relied upon in the United States. This is required by Precept 2 of the Code. There are no CE “grace periods” for new members. You may count hours earned before being credentialed, if the CE was earned since the beginning of the prior calendar year.

For example, you become an associate in July 2019. You meet the basic education and experience requirements to issue an SAO in October 2019. In determining your qualification to issue that opinion, you may count all the hours earned in 2018 and 2019 up until the date of the October 2019 opinion. This CE can be earned before or after qualification, but not before 2018. Time spent studying for relevant actuarial exams may be included as “Other Activities.” Time spent in September 2019 studying for a fellowship exam may also be counted, even if the studying did not result in a passing grade.

However, any 2019 CE time that you use to qualify for a 2019 opinion cannot also be used for 2020 opinions. You will need to earn another 30 hours of CE—normally during the remainder of 2019—to issue opinions in 2020.

3. What if you won’t be able to meet the requirement by December 31?

In most cases, actuaries meet the 30-hour requirement by Dec. 31 so that they can issue SAOs in the new year. Occasionally, an actuary cannot meet the requirement by the end of the year. If you find yourself in this situation, you can make up the shortfall in 2020. However, you may not issue an SAO in 2020 before making up the shortfall. In addition, those hours do not count toward the CE requirement for 2020; you will need to earn another 30 hours of relevant CE during the year to meet the requirements to issue SAOs in 2021.

Should you have questions about CE, please see the USQS and the FAQs on the USQS. If, after reviewing both of those, you still have unanswered questions, you may always submit a question to the Committee on Qualifications or a Request for Guidance to the Actuarial Board for Counseling and Discipline.