cs1 Syllabus Final
cs1 Syllabus Final
Associateship Qualification
April 2023
Aim
Actuarial Statistics provides a grounding in mathematical and statistical techniques that are of particular
relevance to actuarial work.
Objectives
The basic properties and uses of commonly-used probability distributions and the statistical properties of
data generated by randomly sampling from a known distribution.
2.1 Understand the characteristics of basic univariate distributions and how to generate samples from them
2.1.1 Geometric, binomial, negative binomial, hypergeometric, Poisson and uniform discrete
distributions on a finite set
2.1.2 Normal, lognormal, exponential, gamma, chi-square, t, F, beta and uniform continuous
distributions on an interval
2.1.3 Evaluation of probabilities and quantiles associated with these distributions (by calculation or
using statistical software as appropriate)
2.1.4 Poisson process and the connection between the Poisson process and the Poisson distribution
2.1.5 Generation of basic discrete and continuous random variables using the inverse transform
method
2.1.6 Generation of discrete and continuous random variables using statistical software
2.2 Determine the characteristics of jointly distributed random variables
2.2.1 Probability function or density function for marginal and conditional distributions of jointly
distributed random variables
2.2.2 The conditions under which random variables are independent
2.2.3 Covariance, the correlation and the expected value of a function of two jointly distributed random
variables
2.2.4 Mean and variance of linear combinations of random variables
2.3 Evaluate expectations and conditional expectations
2.3.1 Conditional expectation of one random variable given the value of another random variable
2.3.2 Mean and variance of a random variable as an expectation of conditional expected values
2.4 Evaluate and apply generating functions
2.4.1 Moment and cumulant generating functions of a random variable
2.4.2 Moment calculation via series expansion or differentiation of a generating function
2.5 State and apply the central limit theorem
2.5.1 Central limit theorem for a sequence of independent, identically distributed random variables
2.5.2 Comparison of simulated samples from a given distribution with the Normal distribution
2.6 Describe random sampling and the sampling distributions of statistics commonly used in statistical
inference
2.6.1 Random samples from a population
2.6.2 The sampling distribution of a statistic
2.6.3 The mean and variance of a sample mean and the mean of a sample variance in terms of the
population mean, variance and sample size
2.6.4 Basic sampling distributions for the sample mean and variance for random samples from a
normal distribution
2.6.5 The distribution of the t-statistic for random samples from a normal distribution
2.6.6 The F distribution for the ratio of two sample variances from independent samples taken from
normal distributions
Use of statistics to make inferences about the process underlying a data set.
Use of statistics to examine and make inferences about the relationships between two or more data sets.
5.1 Explain fundamental concepts of Bayesian statistics and use these concepts to calculate Bayesian
estimators
5.1.1 Use of Bayes’ theorem to calculate simple conditional probabilities
5.1.2 Prior distribution, posterior distribution and conjugate prior distribution
5.1.3 Posterior distribution for a parameter in simple cases
5.1.4 Use of simple loss functions to derive Bayesian estimates of parameters
5.1.5 Credible intervals in simple cases
5.1.6 Credibility premium formula and the role played by the credibility factor
5.1.7 Bayesian approach to credibility theory and its use for calculating credibility premiums in simple
cases
5.1.8 Empirical Bayes approach to credibility theory and its use for deriving credibility premiums in
simple cases
5.1.9 Understanding the differences between the two approaches (Bayes v Empirical Bayes) and the
assumptions underlying each of them
Assessment
This subject will be assessed via two timed and online written examination papers.
• CS1 Paper A (CS1A), 3 hours and 20 minutes (including reading time), consisting of a number of
questions of varying marks
• CS1 Paper B (CS1B), 1 hour and 50 minutes (including reading time) consisting of a number of
questions of varying marks using R (or another pre-specified software package), where relevant,
to construct the answers, and Microsoft Word to present the answers.
In order to pass this subject, you must sit both CS1A and CM1B within the same sitting, and achieve a
combined mark of a pass.
Topic weighting
The topic weighting percentage noted alongside the topics is indicative of the volume of content of a topic
within the subject and therefore broadly aligned to the volume of marks allocated to this topic in the
examination. For example if a topic is 20% of the subject then you can expect that approximately 20% of
the total marks available in the examination paper will be available on that topic.
Candidates for assessment should ensure that they are well prepared across the entire syllabus. The
examination can be composed of questions drawing from any part of the syllabus within any examination
sitting and using any command verb. This includes knowledge, techniques, principles, theories, and
concepts as specified. Candidates should not rely on past papers alone and should ensure they have
covered the entire syllabus as part of their learning and development of this subject. A list of command
verbs used in the examinations is included on the IFoA website.
In each examination, candidates will be expected to demonstrate, through their answers, that they have
knowledge of, can apply and use higher order skills in this subject:
• Knowledge will be demonstrated through answering questions that assess your understanding of
that knowledge as well as through questions that ask you to apply relevant knowledge to scenarios.
• Application will be demonstrated through answering questions which assess that you can identify
and apply relevant concepts and skills to solve problems (both numerical and non-numerical).
• Higher order skills will be demonstrated through questions that will assess that you can use
relevant knowledge, concepts and skills to solve problems, draw appropriate conclusions, and
make meaningful and appropriate comments on those conclusions.
As a guide, in the examination of this subject, you can expect that approximately 20% of the total number
of marks for this examination be allocated to the demonstration of knowledge, 65% to application and 15%
to higher order.
Qualifications Handbook, Examinations Handbook and Assessment Regulations
Please ensure you read and have understood the Examinations Handbook and Assessment Regulations
ahead of your exam as well as the Qualifications Handbook. These are all available on the IFoA website.
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