The auditor wishes to test the assertion that all claims paid by a medical insurance company contain proper authorisation and documentation, including but not limited to the validity of the claim from an approved physician and an indication that the claim complies with the claimant’s policy. The most appropriate audit enegagement procedure would be to?

Required:

Choose the correct answers from the options provided.

Question

The auditor wishes to test the assertion that all claims paid by a medical insurance company contain proper authorisation and documentation, including but not limited to the validity of the claim from an approved physician and an indication that the claim complies with the claimant’s policy. The most appropriate audit enegagement procedure would be to? 
 
 Required: 
 
 Choose the correct answers from the options provided.

Accepted Answer

Select a sample of paid claims from the claims disbursement file and trace to documentary evidence of authorisation and other supporting documentation.

Answer

Select a sample of claims filed and trace to documentary evidence of authorisation and other supporting documentation.

Answer

Select a random statistical sample of all policyholders, and examine all claims for the sampled items during the year to determine if they were handled properly.

Answer

Select a sample of claims denied and determine that all claims denied were appropriate. The claims denied file is much smaller and the auditor can obtain greater coverage with the sample size.

Crowdly

The auditor wishes to test the assertion that all claims paid by a medical insur...

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