Health Care Industry Developments 2007/08 - Audit Risk Alert

This Audit Risk Alert is intended to provide auditors of financial statements of health care organizations with an overview of recent economic, industry, technical, regulatory, and professional developments that may affect the audits and other engagements they perform. This alert can also be used by an entity’s internal management to address areas of audit concern.

Specifically, in this alert you will find information related to recent CMS and the U.S. Department of Health and Human Services developments. In addition to information on the new Risk Assessment Standards, SAS No. 112, and the FASB Statements No. 157 and 159, you will find specific discussion on how the following effect health care organizations:

• FIN 48
• FSP FAS 126-1
• SFAS No. 140 and advanced refunding of debt

You will also find information on emerging issues such as:

• The ASB’s Clarity Project including convergence with international standards
• The FASB Codification Project
• Business Combinations

This publication is an other auditing publication as defined in AU section 150. Other auditing publications have no authoritative status; however, they may help the auditor understand and apply the Statements on Auditing Standards. The auditing guidance in this document has been reviewed by the AICPA Audit and Attest Standards staff and published by the AICPA and is presumed to be appropriate. This document has not been approved, disapproved, or otherwise acted on by a senior technical committee of the AICPA.

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Health Care Industry Developments—2007/08

Notice to Readers

This Audit Risk Alert is intended to provide auditors of financial statements of health care organizations with an overview of recent economic, industry, technical, regulatory, and professional developments that may affect the audits and other engagements they perform.

This publication is an other auditing publication as defined in AU section 150, Generally Accepted Auditing Standards (AICPA, Professional Standards, vol. 1). Other auditing publications have no authoritative status; however, they may help the auditor understand and apply the Statements on Auditing Standards.

If an auditor applies the auditing guidance included in an other auditing publication, he or she should be satisfied that, in his or her judgment, it is both relevant to the circumstances of the audit and appropriate. The auditing guidance in this document has been reviewed by the AICPA Audit and Attest Standards staff and published by the AICPA and is presumed to be appropriate. This document has not been approved, disapproved, or otherwise acted on by a senior technical committee of the AICPA.

Zachary T. Donahue, CPA
Senior Technical Manager
Accounting and Auditing Publications

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