Washington Health Benefit Exchange 2014 Audit Results Discussion with the Board 1
AGENDA • Matters Required to be Communicated with Those Charged with Governance 2
DRAFT REPORT OF INDEPENDENT AUDITORS ON THE FINANCIAL STATEMENT Unmodified Opinion Financial statements and supplementary information are presented fairly in accordance with accounting principles generally accepted in the United States of America. 3
OTHER DRAFT AUDITOR’S REPORTS GAGAS Report on Internal Control Over Financial OMB A ‐ 133 Report for the Major Federal Reporting and on Compliance and Other Matters Program and Internal Control over Compliance • Finding 2014 ‐ 001 – Financial Close and • Qualified Opinion on Major Program ‐ Finding Reporting Process – Significant Deficiency 2014 ‐ 002 • Reporting • Material Weakness in Internal Controls Over Compliance • Material Instance of Noncompliance • Finding 2014 ‐ 003 – Procurement, Suspension and Debarment – Significant Deficiency in Internal Control Over Compliance 4
OUR RESPONSIBILITY UNDER U.S. AND GOVERNMENT AUDITING STANDARDS AND OMB CIRCULAR A-133 As stated in our engagement letter, our responsibility, as described by professional Our responsibility is to plan and perform the audit standards, is to form and express an opinion about in accordance with generally accepted auditing whether the financial statements prepared by standards issued by the AICPA and the Comptroller management with your oversight are fairly General of the United States, and to design the presented, in all material respects, in conformity audit to obtain reasonable, rather than absolute, with U.S. generally accepted accounting principles. assurance about whether the financial statements Our audit of the financial statements does not are free of material misstatement. relieve you or management of your responsibilities. Our audit of financial statements includes We are also responsible for communicating consideration of internal control over financial significant matters related to the financial reporting as a basis for designing audit procedures statement audit that, in our professional but not for the purpose of expressing an opinion judgment, are relevant to your responsibilities in on the effectiveness of the entity’s internal control overseeing the financial reporting process. over financial reporting. Accordingly, we However, we are not required to design considered the entity’s internal control for the procedures for the purpose of identifying other purpose of determining our audit procedures and matters to communicate to you. not to provide assurance concerning such internal control. 5
MATTERS TO BE COMMUNICATED TO THE GOVERNING BODY Matters to Be Communicated Moss Adams Comments Entrance Communications There is no requirement to revisit entrance communications unless something significant The audit scope, timing and our has changed. The timeline communicated responsibilities as your auditors was during the planning discussions was delayed to communicated in the engagement letter and provide management more time to address planning discussions with the Audit and open audit items. We relayed the change to Compliance Committee on May 18, 2015. the Audit and Compliance Chair on September 3 rd . The due date for all data collection forms was extended to October 31 (previous due date was September 30 for the Exchange) as a result of a federal clearinghouse IT security issue. 6
MATTERS TO BE COMMUNICATED TO THE GOVERNING BODY Matters to Be Communicated Moss Adams Comments Significant Accounting Practices The quality of the Exchange’s accounting policies, underlying estimates and disclosures are summarized here and discussed throughout Our views about qualitative aspects of the this presentation: entity’s significant accounting practices, • Accounting practices/policies – summarized including accounting policies, accounting in financial statements Note 1 estimates, and financial statement • Significant accounting estimates ‐ Useful disclosures lives of software and equipment • Disclosures – Complete and accurate disclosure in accordance with GAAP/GASB • Accounting policies, accounting estimates, and financial statement disclosures were deemed reasonable 7
MATTERS TO BE COMMUNICATED TO THE GOVERNING BODY Matters to Be Communicated Moss Adams Comments Significant difficulties encountered during No significant difficulties were encountered the audit during our audit of the Exchange’s financial statements. Corrected and Uncorrected Misstatements No material misstatements, corrected or uncorrected, were identified as a result of our audit. 8
MATTERS TO BE COMMUNICATED TO THE GOVERNING BODY Matters to Be Communicated Moss Adams Comments Disagreements With Management There were no disagreements with Disagreements with management, whether management. or not satisfactorily resolved, about matters that individually or in the aggregate could be significant to the Company’s financial statements, or the auditor’s report. Representations requested of management Consistent with years past, your CEO and CFO will be asked to sign the representation letter We requested certain representations from before delivery of the final financial management that are included in the statements. management representation letter that will be signed when the financial statements are finalized 9
MATTERS TO BE COMMUNICATED TO THE GOVERNING BODY Matters to Be Communicated Moss Adams Comments Management’s consultation with other To our knowledge, there were no such independent accountants consultations with other independent accountants. No significant issues arose during the audit that Significant issues arising from the audit that have not been addressed elsewhere in this were discussed, or the subject of presentation. correspondence with management 10
MATTERS TO BE COMMUNICATED TO THE GOVERNING BODY Matters to Be Communicated Moss Adams Comments Internal Control Related Matters There were no material weaknesses or significant deficiencies identified that were not already reported as findings. 11
THANK YOU! Mary Wright, Partner mary.wright@mossadams.com T (425) 303 ‐ 3034 Sasha Correnti, Senior Manager sasha.correnti@mossadams.com T (206) 302 ‐ 6451 12
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