Health Care Entities -- AICPA Audit and Accounting Guide

Updated as of July 1, 2011, this is the first comprehensive revision of the guide since 1996. The guide provides nonauthoritative guidance to assist management of health care entities in the preparation of financial statements and to assist auditors in auditing and reporting on such financial statements. Enhancements made to improve user understanding and reduce variance in practice include new chapters with full discussion on derivative instruments commonly used by the health care industry, municipal bonds issued on behalf of not-for-profit health care entities; and contributions received and made.

Additional enhancements include expanded discussions on health care industry specific topics including medical malpractice claims, patient receivables and revenue recognition, the reporting entity and related entities, and financial reporting and accounting for managed care services and continuing care retirement communities.

In addition to relevant guidance contained in applicable standards and other technical sources, you’ll find "how-to" advice for handling audit and accounting issues common to health care entities with detailed explanation of:

• Fair value measurements and disclosures for non-governmental health care entities
• Accounting for investments in debt securities held by investor owned not-for-profit and governmental entities
• Accounting for and reporting medical malpractice claims and liabilities
• Auditing estimates surrounding revenue and cost recognition methods related to rate setting, third party payors, health care contracts, and clinical coding validation

The guide offers clear and practical guidance on recent developments in areas such as risk assessment, fair value measurements, and internal controls.

It also includes two new chapters, one for not-for-profit health care entities and one for governmental health care entities. The governmental chapter reflects the issuance of GASB Statement No. 62 and includes an appendix with cross references to the predecessor pronouncements to assist governmental health care entities in the transition.

Updates significant to this edition include technical guidance contained in:

• FASB Accounting Standards Update (ASU) No. 2011-07 Health Care Entities (Topic 954): Presentation and Disclosure of Patient Service Revenue, Provisions for Bad Debt, and the Allowance for Doubtful Accounts for Certain Health Care Entities - a consensus of the FASB Emerging Issues Task Force.
• Statement on Auditing Standards No. 120, Required Supplementary Information (AICPA, Professional Standards, AU sec. 558)
• Revised interpretations issued through July 1, 2011, including Interpretation Nos. 1–4 of AU section 325, Communicating Internal Control Matters Identified in an Audit (AICPA, Professional Standards, AU sec. 9325 par. .01–.13)
• GASB Statement No. 62, Codification of Accounting and Financial Reporting Guidance Contained in Pre-November 30, 1989 FASB and AICPA Pronouncements.

All content is reviewed by industry experts and approved by the appropriate AICPA senior technical committee(s).

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

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