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#11
03-09-2018, 05:48 PM
 Mihar123 SOA Join Date: Mar 2018 College: Texas A&M University Alumni Posts: 8

What type of changes are we supposed to recommend? Is the question simply asking us to determine if x assumption should "increase" or are we do need to be more specific and explain how exactly it needs to be changed, x assumption should increase to y%?
#12
03-09-2018, 05:53 PM
 Charlie the Unicorn Member Non-Actuary Join Date: Dec 2016 Studying for money to buy dogs College: Candy Mountain Alumnus Posts: 51

I did the latter and passed.
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#13
12-13-2018, 04:01 PM
 actuary28 Member SOA Join Date: Sep 2016 Posts: 44

Quote:
 Originally Posted by Charlie the Unicorn I did the latter and passed.
how did you determine the magnitude?

Thanks!
#14
12-14-2018, 01:17 AM
 noone Member SOA Join Date: Feb 2017 Posts: 100

This seems like the easiest task yet this task was called out on my second fail. For each assumption I
- Made an observation on how the experience differed from the model
- based on the above observation I recommended an increase, decrease or no change to the assumption
- I quantified my recommended change and provided a percentage increase or decrease to the recommended tax
- I also mentioned the overall impact to the tax based on all changes.
An example might be something like, "The experience shows that there were 300k less persons employed over the previous 5 year period. Considering a recommended tax of 750 per person, this resulted in a loss of 225m. Due to this observation I recommend that the model be adjusted so that the employed persons assumption is reduced by 50k a year. This will result in the recommended tax increasing by approximately 10%."

Also what reports did you use what will provide a warning? I am not really sure what they mean by "warning". If this report had been implemented at the start, how would it of warned us of the poor experience that we saw over the first 5 years? If your annual return was -15% for one year is that a warning that your fund sucks or just normal volatility that you will expect to see over a 30 year period?

And you can't really produce a report that measures inflation or provides employment statistics. These will have to be provided by the government. I mentioned this in addition to other reports.

I think this question is supposed to bring it full circle with respect to the actuarial control cycle but I guess I was not able to demonstrate that I understood this.

Last edited by noone; 12-14-2018 at 01:19 AM.. Reason: spelling