Review of Fiscal Year 2001 Financial Statement Activity at Empire Medicare Services

EXECUTIVE SUMMARY:

The objectives of this aspect of the review were to assess the accounting controls related to the reconciliation of paid claims and the financial activity reports, verify the accuracy of financial activity that contributed to the preparation of the Fiscal Year (FY) 2001 combined financial statements for the Centers for Medicare & Medicaid Services (CMS), and determine the status of findings resulting from the 1998 and 1999 Chief Financial Officer audits.  Our audit period was from January 1, 2001 through June 30, 2001.  We found that the accounting controls were generally adequate and that the reconciliation was substantially accurate, supportable and complete.  We found, however, that accounting controls over certain financial activities need to be strengthened in order to prevent misstatements of the CMS financial statements.