§16-185-105 - Designation of independent certified public accountant.

§16-185-105 Designation of independent certified public accountant. (a) Each insurer required by this chapter to file an annual audited financial report shall within sixty days after becoming subject to this requirement, register with the commissioner in writing the name and address of the independent certified public accountant or accounting firm retained to conduct the annual audit set forth in this chapter. Insurers not retaining an independent certified public accountant on the effective date of this chapter shall register the name and address of their retained independent certified public accountant not less than six months before the date when the first audited financial report is to be filed.

         (b) The insurer shall obtain a letter from the accountant, and file a copy with the commissioner stating that the accountant is aware of the provisions of the statutes and the rules of the Hawai"i insurance division or the insurance department of the state of domicile that relate to accounting and financial matters and affirming that the accountant will express his or her opinion on the financial statements in terms of their conformity to the statutory accounting practices prescribed or otherwise permitted by the Hawai"i insurance division or that insurance department, specifying such exceptions as he or she may believe appropriate.

         (c) If an accountant, who was the accountant for the immediately preceding filed audited financial report, is dismissed or resigns, the insurer shall:

         (1) Within five business days notify the commissioner of this event;

         (2) Furnish the commissioner with a separate letter, within ten business days of the notification, stating whether in the twenty-four months preceding such event there were any disagreements with the former accountant on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, which disagreements, if not resolved to the satisfaction of the former accountant, would have caused him or her to make reference to the subject matter of the disagreement in connection with his or her opinion;

         (3) Report disagreements required to be reported in response to this subsection including both those resolved to the former accountant's satisfaction and those not resolved to the former accountant's satisfaction. Disagreements contemplated by this section are those that occur at the decision-making level, i.e., between personnel of the insurer responsible for presentation of its financial statements and personnel of the accounting firm responsible for rendering its report; and

         (4) In writing, request the former accountant to furnish a letter addressed to the insurer stating whether the accountant agrees with the statements contained in the insurer's letter and, if not, stating the reasons why that accountant does not agree. The insurer shall furnish to the commissioner copies of its request within five business days of sending the request and the responsive letter from the former accountant within five business days after its receipt.

        [Eff 2/04/10; comp 12/30/19] Auth: HRS §431:2-201) (Imp: HRS §§431:2-201, 431:3-302.5)

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