Internal Controls and Fraud Prevention
[Accounting Concerns for Medical Practices]
By Gary L. Bode
The auditor is a watchdog and not a bloodhound – Lord Justice Topes
Without internal controls, a medical practice will never reach peak efficiency or profitability.
Internal controls designed and implemented by the practice physician-owner, help prevent bad things from happening. Embezzlement protection is the classic example. However, internal controls also help ensure good things happen, at least most of the time.
A procedural manual that teaches employees how to deal effectively with common patient complaints is one example. Operating efficiency, safeguarding assets, quality patient care, compliance with existing laws, and accuracy of financial transactions are common goals of internal controls.
Internal controls, albeit in publicly held companies, came to national attention with the Enron scandal. Congress subsequently enacted the Sarbanes-Oxley Act in 2002, over seen by the Public Practice Accounting Oversight Board. This demanded certain internal controls be in place, in publicly held companies, and made provisions making top management personally responsible for them.
The primary goal was to ensure accuracy of the financial statements. It also stripped away much of the accounting industry’s self regulation.
More here: ORDER: http://www.springerpub.com/shoppingcart