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Performing an Audit Using and Internal group To Determine Claim Processing

Performing an Audit Using and Internal group To Determine Claim Processing
Performing an Audit Using and Internal group To Determine Claim Processing

Management has requested that the internal audit group perform an audit of the effectiveness and efficiency of the new claims process for its local offices. The new process was designed to improve the review of claims and to prevent over payment and/or payment of false claims.†

In the opening meeting of the audit engagement, management expressed concern over the new process. Management told the internal auditors that it has received three complaints about the excessive time it takes for claimants to receive their insurance proceeds.  Each of the three claims took seven days to process. These are first complaints that Dynamic has every received regarding processing time and all three complaints were received after the new process was implemented.

Management fears that if the claims take too long to process, many clients will switch to another company. One of the key success factors for Dynamic Insurance is its fast processing of claims. In fact, as part of its advertising campaign it guarantees a 48-hour processing time.

The internal auditors decided to find out if processing time had really increased, and if so what was the cause of the increased processing time. Below is a summary of some of their procedures and findings:

Required

a) Based on the information provided above prepare an audit finding using the following format Condition, Criteria, effect, cause and recommendation

Performing an Audit Using and Internal group To Determine Claim Processing

  • Order

  • Payment

  • Processing

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