IAI Actuarial Core Principles · Business Management · Characteristics of a profession and the Actuaries' Code
Meera, a life actuary at an Indian insurer, is asked by her manager to sign off a reserving report using an assumption she believes is unjustifiably optimistic, because the board wants a higher reported surplus. Which course of action is most consistent with the Actuaries' Code?
She should decline to sign work she believes is misleading, explain her concerns and escalate appropriately. The Actuaries' Code requires integrity and honesty, and employer pressure does not override that duty. Silent compliance, private notes, or secret changes do not meet the required standard.
- ASign the report, since the employer's instructions override her personal view
- BSign the report but privately record her disagreement in her own file only
- CDecline to sign work she believes is misleading, explain her concerns and escalate through appropriate channelsCorrect
- DChange the assumption to a more pessimistic one without telling anyone
- Resign immediately without raising the concern with anyone
Explanation
The Code requires members to act with integrity and not to mislead users of their work. Duty to the public interest and to the profession outweighs employer pressure. Silent compliance or a private note does not remove the misleading effect, and unilateral undisclosed changes lack transparency.
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