Actuarial practice and control: objectives and capabilities

Abstract

In this paper a guiding philosophy for the development of an Actuarial Practice and Control (APC) subject is outlined. However, from this starting point, a more general view of what constitutes actuarial practice emerges. This paper draws on work completed recently by the author who chaired an Institute of Actuaries of Australia committee established to review the syllabus of the Australian Part II professional actuarial education requirements - the so-called Actuarial Control Cycle - and to make recommendations regarding syllabus changes. Such a control cycle approach is a valuable tool in the development of actuarial education and practice. An important element of this work is the recognition that there is more to successful actuarial work than the acquisition of a set of technical actuarial practice. Only a few of these capabilities specifically focus on technical issues. The implications of this recognition are important for the actuarial profession and its approach to its professional education. A Mission Statement for an APC course is given: "An Actuarial Practice and Control course provides a structural approach to understanding and then applying the principles of a generalised actuarial approach, leading to the resolution of a broad range of issues in a business and financial environment." A specific Actuarial Practice and Control schematic outlining the structure of actuarial practice is provided and the place of an Actuarial Control Cycle within this structure is clarified. A consequence is that the generic steps involved in applying the Actuarial Control Cycle can be explicitly listed. It also provides a high level conceptual framework whcih can be used to integrate actuarial education and practice