What is the Model Audit Rule (MAR)?
The Model Audit Rule, also known as Model Audit Rule 205 and MAR 205, is a regulation issued by the National Association of Insurance Commissioners (NAIC). The regulation’s official title is the Annual Financial Reporting Model Regulation.
The NAIC Model Audit Rule’s purpose is to regulate surveillance of insurance companies. It contains many elements of Sarbanes Oxley (SOX), but is more tailored. According to the NAIC, MAR does the following:
- Controls submissions of financial statements after audits
- Creates consistency among insurance regulators
- Enables state-level insurance departments to better oversee the financial health of insurers
In states that have adopted the regulation, MAR compliance requires companies to submit the following documentation:
- Annual audits of company financial statements
- Details of matters – revealed by the annual audit – related to internal controls
- A management-level report of internal controls over financial reporting
Features of LogicManager’s MAR Compliance Solution:
- LogicManager comes with out-of-the-box risk assessments and libraries of regulations, standards, and frameworks like the NAIC Model Audit Rule.
- Edit and build on this out-of-the-box content, and/or work with your advisory analyst to retrofit your existing data into the system.
Automated compliance management
- Consolidate all of your MAR compliance responsibilities in one location with task wizards that appear as to-do lists on the LogicManager home screen.
- Keep track of MAR audit requirements, action items, and upcoming deadlines with LogicManager’s configurable, automated email notifications, alerts, and reminders.
- Receive automatic notifications when MAR or other regulations (state, federal, or international) are changed or updated.
Robust reporting engine
- Provide advanced, pre-built reports such as data summaries and gap analyses to any party: your manager, the board, or regulatory authorities.
- Customize ready-made reports or create them from scratch
- Leverage your advisory analyst to slice and dice data according to your needs: by regulation, framework, status of activity, and more.
- Schedule reports for automatic, periodic delivery.
Key Benefits of LogicManager’s Financial Controls & Testing
Simplify NAIC MAR compliance by leveraging information already being collected across the organization. Standardized assessments, along with centralized control management and testing, are defining components of LogicManager’s risk-based process.
Easily fulfill the three requirements of the NAIC Model Audit Rule with financial reports that are made consistently accurate by maintaining transparency into operational risks, mitigation tactics, and monitoring activities.
Tie internal controls and tests directly to the risks they’re designed to mitigate and the financial objectives they’re aimed to meet. Tests can be customized, pushed out with step-by-step instructions, and sent in tandem with related documents so that you pass your next MAR audit with ease.
For more details, visit our page on financial compliance solutions.