Texas Insurance Code - Section 401.011. Qualifications Of Accountant; Acceptance Of Audited Financial Report
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Texas Lawyer > Insurance Code > Texas Insurance Code - Section 401.011. Qualifications Of Accountant; Acceptance Of Audited Financial Report
§ 401.011. QUALIFICATIONS OF ACCOUNTANT; ACCEPTANCE OF
AUDITED FINANCIAL REPORT. (a) Except as provided by Subsections
(c) and (d), the commissioner shall accept an audited financial
report from an independent certified public accountant or
accounting firm that:
(1) is a member in good standing of the American
Institute of Certified Public Accountants and is in good standing
with all states in which the accountant or firm is licensed to
practice, as applicable; and
(2) conforms to the American Institute of Certified
Public Accountants Code of Professional Conduct and to the rules of
professional conduct and other rules of the Texas State Board of
Public Accountancy or a similar code.
(b) If the insurer or health maintenance organization is
domiciled in Canada, the commissioner shall accept an audited
financial report from an accountant chartered in Canada. If the
insurer or health maintenance organization is domiciled in Great
Britain, the commissioner shall accept an audited financial report
from an accountant chartered in Great Britain.
(c) A partner or other person responsible for rendering a
report for an insurer or health maintenance organization for seven
consecutive years may not, during the two-year period after that
seventh year, render a report for the insurer or health maintenance
organization or for a subsidiary or affiliate of the insurer or
health maintenance organization that is engaged in the business of
insurance. The commissioner may determine that the limitation
provided by this subsection does not apply to an accountant for a
particular insurer or health maintenance organization if the
insurer or health maintenance organization demonstrates to the
satisfaction of the commissioner that the limitation's application
to the insurer or health maintenance organization would be unfair
because of unusual circumstances. In making the determination, the
commissioner may consider:
(1) the number of partners or individuals the
accountant employs, the expertise of the partners or individuals
the accountant employs, or the number of the accountant's insurance
clients;
(2) the premium volume of the insurer or health
maintenance organization; and
(3) the number of jurisdictions in which the insurer
or health maintenance organization engages in business.
(d) The commissioner may not accept an audited financial
report prepared wholly or partly by an individual who the
commissioner finds:
(1) has been convicted of fraud, bribery, a violation
of the Racketeer Influenced and Corrupt Organizations Act (18
U.S.C. Section 1961 et seq.), or a state or federal criminal offense
involving dishonest conduct;
(2) has violated the insurance laws of this state with
respect to a report filed under this subchapter; or
(3) has demonstrated a pattern or practice of failing
to detect or disclose material information in reports filed under
this subchapter.
Added by Acts 2005, 79th Leg., ch. 727, § 1, eff. April 1, 2007.
Section: 401.004 401.005 401.006 401.007 401.008 401.009 401.010 401.011 401.012 401.013 401.014 401.015 401.016 401.017 401.018
Last modified: August 11, 2007
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