OAR 836-011-0223
Requirements for Audit Committee

(1) This rule does not apply to an authorized foreign or alien insurer or to an insurer that is a SOX Compliant Entity or a direct or indirect wholly-owned subsidiary of a SOX Compliant Entity.
(2) The audit committee shall be directly responsible for the appointment, compensation and oversight of the work of an accountant, including resolution of disagreements between management and the accountant regarding financial reporting, for the purpose of preparing or issuing the audited financial report or related work pursuant to OAR 836-011-0100 (Authority; Purpose; Scope) to 836-011-0230 (Canadian and British Companies). Each accountant shall report directly to the audit committee.
(3) The Audit committee of an insurer or group of insurers shall be responsible for overseeing the insurer’s Internal audit function and granting the person or persons performing the function suitable authority and resources to fulfill their responsibilities if required by OAR 836-011-0224 (Internal Audit Function Requirements).
(4) Each member of the audit committee must be a member of the board of directors of the insurer or a member of the board of directors of an entity elected pursuant to section (7) of this rule.
(5) To be considered independent for purposes of this rule, a member of the audit committee may not accept any consulting, advisory or other compensatory fee from the entity or be an affiliated person of the entity or any subsidiary thereof, other than in the member’s capacity as a member of the audit committee, the board of directors or any other board committee. However, if a law requires board participation by an otherwise non-independent member, that law prevails and the member may participate in the audit committee and be designated as independent for audit committee purposes, unless the member is an officer or employee of the insurer or one of its affiliates.
(6) If a member of the audit committee ceases to be independent for a reason outside the member’s reasonable control, that person, with notice by the responsible entity to the Director, may remain an audit committee member of the responsible entity until the earlier of the date of the next annual meeting of the responsible entity or one year from the occurrence of the event that caused the member to be no longer independent.
(7) To exercise the election of the controlling person to designate the audit committee for purposes of OAR 836-011-0100 (Authority; Purpose; Scope) to 836-011-0230 (Canadian and British Companies), the ultimate controlling person shall provide written notice to the Director. The notice must be provided in a timely manner prior to the issuance of the statutory audit report and must include a description of the basis for the election. The insurer may change the election by notifying the Director. The notice to the Director must include a description of the basis for the change. The election remains in effect for perpetuity, until rescinded.
(8) The audit committee shall require the accountant that performs for an insurer any audit required by OAR 836-011-0100 (Authority; Purpose; Scope) to 836-011-0230 (Canadian and British Companies) to timely report to the Audit committee in accordance with the requirements of SAS 61, Communication with Audit Committees, or its replacement, including:
(a) All significant accounting policies and material permitted practices;
(b) All material alternative treatments of financial information within statutory accounting principles that have been discussed with management officials of the insurer, ramifications of the use of the alternative disclosures and treatments, and the treatment referred by the accountant; and
(c) Other material written communications between the accountant and the management of the insurer, such as any management letter or schedule of unadjusted differences.
(9) If an insurer is a member of an insurance holding company system, the reports required by section (8) of this rule may be provided to the audit committee on an aggregate basis for insurers in the holding company system, but only if any substantial differences among insurers in the system are identified to the Audit committee.
(10) The proportion of independent audit committee members shall meet or exceed the following criteria:
(11) (Note A) The Director is authorized by state law to require an entity’s board to enact improvements to the independence of the audit committee membership if the insurer is in a RBC action level event, meets one or more of the standards of an insurer determined to be in hazardous financial condition or otherwise exhibits qualities of a troubled insurer.
(12) (Note B) All insurers with less than $500,000,000 in prior year direct written and assumed premiums are encouraged to structure their audit committees with at least a supermajority of independent Audit committee members.
(13) (Note C) Prior calendar year direct written and assumed premiums shall be the combined total of direct premiums and assumed premiums from non-affiliates for the reporting entities.
(14) An insurer with direct written and assumed premium, excluding premiums reinsured with the Federal Crop Insurance Corporation and Federal Flood Program, of less than $500,000,000 may apply to the Director for a waiver from the requirements of this rule on the basis of hardship. The insurer shall file, with its annual statement filing, the approval for relief from this rule with the states that it is licensed or authorized in or doing business in and with the NAIC. If a nondomestic state accepts electronic filing with the NAIC, the insurer shall file the approval in an electronic format acceptable to the NAIC.

Source: Rule 836-011-0223 — Requirements for Audit Committee, https://secure.­sos.­state.­or.­us/oard/view.­action?ruleNumber=836-011-0223.

836–011–0000
Annual Statement Blank and Instructions 836–011–0015
Property and Casualty Actuarial Opinion of Reserves and Supporting Documentation 836–011–0020
Definitions 836–011–0022
Filing Procedures 836–011–0024
Contents of Corporate Governance Annual Disclosure 836–011–0030
Own Risk and Solvency Assessment 836–011–0050
Requirements for Segregation of Premium Received for Coverage Not Eligible for Federal Subsidies 836–011–0100
Authority 836–011–0110
Definitions 836–011–0120
Filing and Extensions for Filing of Annual Audited Financial Reports 836–011–0130
Exemptions 836–011–0140
Contents of Annual Audited Financial Report 836–011–0150
Designation of Independent Certified Public Accountant 836–011–0160
Qualifications of Independent Certified Public Accountant 836–011–0170
Consolidated or Combined Audits 836–011–0180
Scope of Audit and Report of Independent Certified Public Accountant 836–011–0190
Notification of Adverse Financial Condition 836–011–0200
Communication of Internal Control Related Matters Noted in an Audit 836–011–0210
Accountant’s Letter of Qualifications 836–011–0220
Definition, Availability and Maintenance of Independent Certified Public Accountants Workpapers 836–011–0223
Requirements for Audit Committee 836–011–0224
Internal Audit Function Requirements 836–011–0225
Conduct of Insurer in Connection with the Preparation of Required Reports and Documents 836–011–0227
Management’s Report of Internal Control over Financial Reporting 836–011–0230
Canadian and British Companies 836–011–0235
Effective Dates 836–011–0250
Authority 836–011–0253
Definitions 836–011–0255
Reserve Adequacy 836–011–0258
Unallocated Reserve Account 836–011–0260
Distribution of Annual Financial Statement 836–011–0300
Statutory Authority 836–011–0305
Definitions 836–011–0310
RBC Reports 836–011–0320
Company Action Level Event 836–011–0330
Regulatory Action Level Event 836–011–0340
Authorized Control Level Event 836–011–0350
Mandatory Control Level Event 836–011–0360
Hearings 836–011–0380
Supplemental Provisions 836–011–0390
Foreign Insurers 836–011–0430
Scope and Authority 836–011–0440
Report 836–011–0450
Acquisitions and Dispositions of Assets 836–011–0460
Nonrenewals, Cancellations or Revisions of Ceded Reinsurance Agreements 836–011–0500
Application 836–011–0505
Definitions 836–011–0510
RBC Reports 836–011–0515
Company Action Level Event 836–011–0520
Regulatory Action Level Event 836–011–0525
Authorized Control Level Event 836–011–0530
Mandatory Control Level Event 836–011–0535
Hearings 836–011–0540
Supplemental Provisions 836–011–0545
Foreign Health Care Service Contractors 836–011–0600
Report on Services Provided by Expanded Practice Dental Hygienists
Last Updated

Jun. 8, 2021

Rule 836-011-0223’s source at or​.us