Enrolled Actuary

Actuary enrolled or enrolled actuary is an individual or an actuary who was able to met the qualifications and standards set in the regulations of the Joint Board for the Enrolled Actuaries and who has been licensed and approved by the Joint Board of the Department of Labor and Department of Treasury to perform tasks and services of an actuarial required by the Employee Retirement Income Security Act of 1974 or ERISA. As of 2007, there are already 4, 600 enrolled actuaries.

In order to qualify as an enrolled actuary, the Joint Board for The Enrollment of Actuaries provided two sets of examinations to potential Enrolled Actuaries. If the exams are successfully passed and accomplished, and the person has acquired enough professional experience relevant to the title, then he or she becomes an Enrolled Actuary.

The first exam or the EA-1 exam tests the person’s basic knowledge on mathematics of compound interest, life contingencies as well as the practical demographic analysis.

The second exam or the EA-2 contains two parts. The first part or the segment A includes selection of actuarial assumptions, calculation of the required and tax-deductible contributions to pension plans and actuarial cost methods. On the other hand, segment B contains tests on knowledge of federal pension laws particularly on the provisions of ERISA since they directly affect the pension actuarial practice.

Aside from the exams, a candidate needs to submit an accomplished Form 5434, which is the form for enrollment application and must pay an application fee of about $250.00 USD.

Enrolled actuary program is administered by the Joint Board which has been established pursuant to ERISA’s section 3041. This board is responsible for individuals who want to enroll and perform actuarial services under the ERISA. The Joint Board is generally composed of five members to whom the three are appointed by the Secretary of the Treasury and the other two are appointed by the Secretary of Labor. Furthermore, another representative is appointed by the Pension Benefit Guaranty Corporation who has no voting power.

Along with the rules governing the enrolled actuaries are the misconducts that are ground for investigation by the Joint Board. Basically, there are three kinds of misconducts that are subject to disciplinary action. These misconducts are:
• Misconduct during the act or performance of the actual services under the ERISA
• Misconduct associated to the Federal tax return of the enrolled actuary, and
• Misconduct not associated to the performance and tasks of actuarial services under ERISA.

In case of complaints against an enrolled actuary, the complainant may submit a referral containing the name of the enrolled actuary, telephone number, address, enrollment number as well as the detailed allegation and supporting documents.

In order to achieve a good record under the ERISA and the Joint Board, the enrolled actuary should make sure that the services rendered are not against the rules and regulations of these bodies. It may be hard to come back in the business once complaints and objections are already written in the record.