Section 98-3.14 - Conduct of MCO in connection with the preparation of required reports and documents

Section 98-3.14 Conduct of MCO in connection with the preparation of required reports and documents.

(a) Any director or officer of a MCO, or any other person acting under the direction thereof, shall not, directly or indirectly:

(1) Make or cause to be made a materially false or misleading statement to a CPA in connection with any audit, review or communication required under this Subpart; or

(2) Omit to state, or cause another person to omit to state, any material fact necessary in order to make statements made, in light of the circumstances under which the statements were made, not misleading to a CPA in connection with any audit, review or communication required under this Subpart.

(b) Any officer or director of a MCO, or any other person acting under the direction thereof, shall not directly or indirectly take any action to coerce, manipulate, mislead or fraudulently influence any CPA engaged in the performance of an audit pursuant to this Subpart if that person knew or should have known that the action, if successful, could result in rendering the MCO’s financial statements materially misleading, including any action taken at any time with respect to the professional engagement period to coerce, manipulate, mislead or fraudulently influence a CPA:

(1) To issue or reissue a report on a MCO’s financial statements that is not warranted in the circumstances (due to material violations of statutory accounting principles prescribed by the Superintendent, generally accepted auditing standards, or other professional or regulatory standards);

(2) Not to perform audit, review or other procedures required by generally accepted auditing standards or other professional standards;

(3) Not to withdraw an issued report; or

(4) Not to communicate matters to a MCO’s audit committee.

Effective Date: 
Tuesday, November 10, 2015