28 CA ADC § 1300.84


      28 CCR s 1300.84

      Cal. Admin. Code tit. 28, s 1300.84


      CALIFORNIA CODE OF REGULATIONS
      TITLE 28. MANAGED HEALTH CARE
      DIVISION 1. THE DEPARTMENT OF MANAGED HEALTH CARE
      CHAPTER 2. HEALTH CARE SERVICE PLANS
      ARTICLE 12. REPORTS
      This database is current through 06/09/06, Register 2006, No. 23.

      s 1300.84. Financial Statements.

      (a) Whenever pursuant to these rules or pursuant to an order or request of 
      the Director pursuant to the Act a financial statement or other report is 
      required to be audited or be accompanied by the opinion of a certified 
      public accountant or public accountant, such accountant shall be 
      independent of the licensee, determined in accordance with section 602.02 
      of Financial Reporting Release Number 1 issued by the Securities and 
      Exchange Commission.

      (b) The financial statements required under subsections (a), (b) and (c) 
      of Section 1384 of the Act shall be audited by an independent accountant 
      in accordance with section 1300.45(e).

      (c) Except as provided in subsection (d), financial statements of a plan 
      required pursuant to these rules must be on a combining basis with an 
      affiliate, if the plan or such affiliate is substantially dependent upon 
      the other for the provision of health care, management or other services. 
      An affiliate will normally be required to be combined, regardless of its 
      form of organization, if the following conditions exist:

      (1) The affiliate controls, is controlled by, or is under common control 
      with, the plan, either directly or indirectly (see subsections (c) and (d) 
      of section 1300.45), and

      (2) The plan or the affiliate is substantially dependent, either directly 
      or indirectly, upon the other for services or revenue.

      (d) Upon written request of a plan, the Director may waive the requirement 
      that an affiliate be combined in financial statements required pursuant to 
      these rules. Normally, a waiver will be granted only when

      (1) the affiliate is not directly engaged in the delivery of health care 
      services or

      (2) the affiliate is operating under an authority granted by a 
      governmental agency pursuant to which the affiliate is required to submit 
      periodic financial reports in a form prescribed by such governmental 
      agency that cannot practicably be reformatted into the form prescribed by 
      these rules (such as an insurance company).

      (e) When combined financial statements are required by this section, the 
      independent accountant's report or opinion must cover all the entities 
      included in the combined financial statements. If the accountant's report 
      or opinion makes reference to the fact that a part of the examination was 
      performed by another auditor, the plan shall also file the individual 
      financial statements and report or opinion issued by the other auditor.

      (f) Plans which have subsidiaries that are required to be consolidated 
      under generally accepted accounting principles must present either

      (1) consolidating financial statements, or

      (2) consolidating schedules for the balance sheet and statement of 
      operations, which in either case must show the plan separate from the 
      other entities included in the consolidated balances.

      (g) This section shall not apply to a plan which is a public entity or 
      political subdivision.

      (h) All filings of financial statements required pursuant to these rules 
      must include an original and one copy.


      


      Note: Authority cited: Section 1344, Health and Safety Code. Reference: 
      Section 1384, Health and Safety Code. 


       HISTORY 
         
      1. Amendment filed 5-9-80; effective thirtieth day thereafter (Register 
      80, 
      No. 19).

      2. Amendment filed 7-3-84; effective thirtieth day thereafter (Register 
      84, 
      No. 27).

      3. Amendment of subsection (e) and new subsection (h) filed 7-21-86; 
      effective
      thirtieth day thereafter (Register 86, No. 30).

      4. Amendment of subsection (a) filed 12-14-90; operative 12-31-90 
(Register
      91, No. 6).

      5. Change without regulatory effect amending subsections (a) and (d) filed 
      7-
      18-2000 pursuant to section 100, title 1, California Code of Regulations 
      (Register 2000, No. 29).
      28 CA ADC s 1300.84

      END OF DOCUMENT

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