{"data":{"id":"us-ok/okla.-stat.-tit.-36-36-311a.7","jurisdiction":"us-ok","citation":"Okla. Stat. tit. 36, § 36-311A.7","heading":"Qualified independent certified public accountants","body":"A. The Insurance Commissioner shall not recognize a person or\n\nfirm as a qualified independent certified public accountant if the\n\nperson or firm:\n\n1. Is not in good standing with the AICPA and in all states in\n\nwhich the accountant is licensed to practice, or, for a Canadian or\n\nBritish company, that is not a chartered accountant; or\n\n2. Has either directly or indirectly entered into an agreement\n\nof indemnity or release from liability, collectively referred to as\n\nindemnification, with respect to the audit of the insurer.\n\nB. Except as otherwise provided in the Oklahoma Annual\n\nFinancial Report Act, the Commissioner shall recognize an\n\nindependent certified public accountant as qualified as long as the\n\naccountant conforms to the standards of the profession, as contained\n\nin the Code of Professional Ethics of the AICPA and Rules and\n\nRegulations and Code of Ethics and Rules of Professional Conduct of\n\nthe Oklahoma Board of Public Accountancy, or similar code.\n\nC. A qualified independent certified public accountant may\n\nenter into an agreement with an insurer to have disputes relating to\n\nan audit resolved by mediation or arbitration. However, in the\n\nevent of a delinquency proceeding commenced against the insurer\n\nunder Article 19 of the Oklahoma Insurance Code, the mediation or\n\narbitration provisions shall operate at the option of the statutory\n\nsuccessor.\n\nD. 1. The lead or coordinating audit partner having primary\n\nresponsibility for the audit may not act in that capacity for more\n\nthan five (5) consecutive years. The person shall be disqualified\n\nfrom acting in that or a similar capacity for the same company or\n\nits insurance subsidiaries or affiliates for a period of five (5)\n\nconsecutive years. An insurer may make application to the\n\nCommissioner for relief from the above rotation requirement on the\n\nbasis of unusual circumstances. This application should be made at\n\nleast thirty (30) days before the end of the calendar year. The\n\nCommissioner may consider the following factors in determining if\n\nthe relief should be granted:\n\na. number of partners, expertise of the partners, or the\n\nnumber of insurance clients in the currently\n\nregistered firm,\n\nb. premium volume of the insurer, or\n\nc. number of jurisdictions in which the insurer transacts\n\nbusiness.\n\n2. The insurer shall file, with its annual statement filing,\n\nthe approval for relief from paragraph 1 of this subsection with the\n\nstates that it is licensed in or doing business in and with the\n\nNAIC. If the nondomestic state accepts electronic filing with the\n\nNAIC, the insurer shall file the approval in an electronic format\n\nacceptable to the NAIC.\n\nE. The Commissioner shall neither recognize as a qualified\n\nindependent certified public accountant, nor accept an annual\n\naudited financial report, prepared in whole or in part by, a natural\n\nperson who:\n\n1. Has been convicted of fraud, bribery, a violation of the\n\nRacketeer Influenced and Corrupt Organizations Act, 18 U.S.C.\n\nSections 1961 to 1968, or any dishonest conduct or practices under\n\nfederal or state law;\n\n2. Has been found to have violated the insurance laws of this\n\nstate with respect to any previous reports submitted under the\n\nOklahoma Annual Financial Report Act; or\n\n3. Has demonstrated a pattern or practice of failing to detect\n\nor disclose material information in previous reports filed under the\n\nprovisions of the Oklahoma Annual Financial Report Act.\n\nF. The Commissioner may hold a hearing to determine whether an\n\nindependent certified public accountant is qualified and,\n\nconsidering the evidence presented, may rule that the accountant is\n\nnot qualified for purposes of expressing the opinion of the\n\naccountant on the financial statements in the annual audited\n\nfinancial report made pursuant to the Oklahoma Annual Financial\n\nReport Act and require the insurer to replace the accountant with\nermine whether an\n\nindependent certified public accountant is qualified and,\n\nconsidering the evidence presented, may rule that the accountant is\n\nnot qualified for purposes of expressing the opinion of the\n\naccountant on the financial statements in the annual audited\n\nfinancial report made pursuant to the Oklahoma Annual Financial\n\nReport Act and require the insurer to replace the accountant with\n\nanother whose relationship with the insurer is qualified within the\n\nmeaning of the Oklahoma Annual Financial Report Act.\n\nG. 1. The Commissioner shall not recognize as a qualified\n\nindependent certified public accountant, nor accept an annual\n\naudited financial report, prepared in whole or in part by an\n\naccountant who provides to an insurer, contemporaneously with the\n\naudit, the following non-audit services:\n\na. bookkeeping or other services related to the\n\naccounting records or financial statements of the\n\ninsurer,\n\nb. financial information systems design and\n\nimplementation,\n\nc. appraisal or valuation services, fairness opinions, or\n\ncontribution-in-kind reports,\n\nd. actuarially oriented advisory services involving the\n\ndetermination of amounts recorded in the financial\n\nstatements. The accountant may assist an insurer in\n\nunderstanding the methods, assumptions, and inputs\n\nused in the determination of amounts recorded in the\n\nfinancial statement only if it is reasonable to\n\nconclude that the services provided will not be\n\nsubject to audit procedures during an audit of the\n\nfinancial statements of the insurer. The actuary of\n\nan accountant may also issue an actuarial opinion or\n\ncertification on the reserves of an insurer if the\n\nfollowing conditions have been met:\n\n(1) neither the accountant nor the actuary of the\n\naccountant has performed any management functions\n\nor made any management decisions,\n\n(2) the insurer has competent personnel or engages a\n\nthird-party actuary to estimate the reserves for\n\nwhich management takes responsibility, and\n\n(3) the actuary of the accountant tests the\n\nreasonableness of the reserves after the\n\nmanagement of the insurer has determined the\n\namount of the reserves,\n\ne. internal audit outsourcing services,\n\nf. management functions or human resources,\n\ng. broker or dealer, investment adviser, or investment\n\nbanking services,\n\nh. legal services or expert services unrelated to the\n\naudit, or\n\ni. any other services that the Commissioner determines,\n\nby rule, are impermissible.\n\n2. In general, the principles of independence with respect to\n\nservices provided by the qualified independent certified public\n\naccountant are largely predicated on three basic principles,\n\nviolations of which would impair the independence of the accountant.\n\nThe principles are that the accountant cannot function in the role\n\nof management, cannot audit the own work of the accountant, and\n\ncannot serve in an advocacy role for the insurer.\n\nH. Insurers having direct written and assumed premiums of less\n\nthan One Hundred Million Dollars ($100,000,000.00) in any calendar\n\nyear may request an exemption from paragraph 1 of subsection G of\n\nthis section. The insurer shall file with the Commissioner a\n\nwritten statement discussing the reasons why the insurer should be\n\nexempt from these provisions. If the Commissioner finds, upon\n\nreview of the statement, that compliance with the Oklahoma Annual\n\nFinancial Report Act would constitute a financial or organizational\n\nhardship upon the insurer, an exemption may be granted.\n\nI. A qualified independent certified public accountant who\n\nperforms the audit may engage in other non-audit services, including\n\ntax services, that are not described in paragraph 1 of subsection G\n\nof this section or that do not conflict with paragraph 2 of\n\nsubsection G of this section, only if the activity is approved in\n\nadvance by the audit committee, in accordance with subsection J of\n\nthis section.\no\n\nperforms the audit may engage in other non-audit services, including\n\ntax services, that are not described in paragraph 1 of subsection G\n\nof this section or that do not conflict with paragraph 2 of\n\nsubsection G of this section, only if the activity is approved in\n\nadvance by the audit committee, in accordance with subsection J of\n\nthis section.\n\nJ. All auditing services and non-audit services provided to an\n\ninsurer by the qualified independent certified public accountant of\n\nthe insurer shall be preapproved by the audit committee. The\n\npreapproval requirement is waived with respect to non-audit services\n\nif the insurer is a SOX Compliant Entity or a direct or indirect\n\nwholly-owned subsidiary of a SOX Compliant entity or:\n\n1. The aggregate amount of all such non-audit services provided\n\nto the insurer constitutes not more than five percent (5%) of the\n\ntotal amount of fees paid by the insurer to its qualified\n\nindependent certified public accountant during the fiscal year in\n\nwhich the non-audit services are provided;\n\n2. The services were not recognized by the insurer at the time\n\nof the engagement to be non-audit services; and\n\n3. The services are promptly brought to the attention of the\n\naudit committee and approved prior to the completion of the audit by\n\nthe audit committee or by one or more members of the audit committee\n\nwho are the members of the board of directors to whom authority to\n\ngrant such approvals has been delegated by the audit committee.\n\nK. The audit committee may delegate to one or more designated\n\nmembers of the audit committee the authority to grant the\n\npreapprovals required by subsection J of this section. The\n\ndecisions of any member to whom this authority is delegated shall be\n\npresented to the full audit committee at each of its scheduled\n\nmeetings.\n\nL. 1. The Commissioner shall not recognize an independent\n\ncertified public accountant as qualified for a particular insurer if\n\na member of the board, president, chief executive officer,\n\ncontroller, chief financial officer, chief accounting officer, or\n\nany person serving in an equivalent position for that insurer, was\n\nemployed by the independent certified public accountant and\n\nparticipated in the audit of that insurer during the one-year period\n\npreceding the date that the most current statutory opinion is due.\n\nThis subsection shall only apply to partners and senior managers\n\ninvolved in the audit. An insurer may make application to the\n\nCommissioner for relief from the above requirement on the basis of\n\nunusual circumstances.\n\n2. The insurer shall file, with its annual statement filing,\n\nthe approval for relief from paragraph 1 of this subsection with the\n\nstates that it is licensed in or doing business in and the NAIC. If\n\nthe nondomestic state accepts electronic filing with the NAIC, the\n\ninsurer shall file the approval in an electronic format acceptable\n\nto the NAIC.","path":["OK Code","Title 36"],"source_url":"https://www.oklegislature.gov/OK_Statutes/CompleteTitles/os36.pdf","current_through":"2026-08-14","vintage":"open-us-law v2026.08, retrieved 2026-09-14","retrieved_at":"2026-09-14T18:32:36Z","sha256":"80d05f089623c8f582c55d301a71c9a96f008bbae0067793a0685470636a4c96","source_id":"us-ok","stale":false,"prev":"us-ok/okla.-stat.-tit.-36-36-311a.6","next":"us-ok/okla.-stat.-tit.-36-36-311a.8"},"notice":"GroundRules: Original legal text. Not legal advice."}