Health Care Industry Developments - 2011/12 Audit Risk Alert

To effectively plan and perform audit engagements in the health care industry, it is necessary for an auditor to understand both the general and specific economic conditions facing the industry. This alert is designed to provide information to assist you in achieving a more robust understanding of the issues you may be facing as an auditor or internal management of an HCO. This alert delivers information about emerging practice issues and current accounting, auditing, and regulatory developments, including developing issues which may have a significant impact on the industry in the near future.

This alert discusses the accounting and auditing requirements of key issues from the Health Care and Education Reconciliation Act of 2010 and the Protection and Affordable Care Act (PPACA), which became effective in the current year or will become effective in the near future, including those that affect the following:

• Accountable Care Organizations (ACOs)
• ICD-10 Conversion
• Electronic Health Records (EHRs)

Discussions in this alert include the audit implications of industry consolidations and acquiring physician practices resulting from pressures on health care providers and payers brought about by the PPACA, including valuations, implementing the not-for-profit standards, and goodwill impairment testing by not-for-profit HCOs.

Recently issued and effective accounting and auditing guidance that are particularly significant to this alert and covered in just the right amount of detail include the amendments in the following:

• ASU No. 2011-07: Health Care Entities (Topic 954), Presentation and Disclosure of Patient Service Revenue, Provision for Bad Debts, and the Allowance for Doubtful Accounts for Certain Health Care Entities,
• ASU No. 2010-24: Presentation of Insurance Claims and Related Insurance Recoveries, and
• ASU No. 2010-23: Measuring Charity Care for Disclosure.

Recent pronouncements which may affect governmental health care entities are highlighted as well, including:

• GASB Statement No. 64, Derivative Instruments: Application of Hedge Accounting Termination Provisions ─ an amendment of GASB Statement No. 53,
• GASB Statement No. 63, Financial Reporting of Deferred Outflows of Resources, Deferred Inflows of Resources, and Net Position, and
• GASB Statement No.62, Codification of Accounting and Financial Reporting Guidance Contained in Pre-November 30, 1989 FASB and AICPA Pronouncements.

For a topical listing of subject matter by chapter, click on the Table of Contents tab.

If purchasing this title as an eBook, please note that it is intended for a single user. An eBook is a downloadable file that will be accessible immediately after completing your purchase. Access to the download link expires 21 days from the purchase date. Download the file before this time elapses. Before downloading your eBook, you must:

• Download and activate Adobe Digital Editions^® - a free program for accessing eBooks
• Return to CPA2Biz.com and go to My Account > My Downloads
• Click the eBook title to download and open automatically in Adobe Digital Editions

Note: To access your eBook on a smartphone, tablet or other reading device, see our FAQ. This product is refundable within 10 days of your purchase date. For more information about this product or service concerns, please contact the CPA2Biz/AICPA Service Center at service@cpa2biz.com or call 888-777-7077.