A Report on An Audit of Financial Transactions Associated with the Suspension of Operations of the Texas Health Reinsurance System
As authorized by Texas Insurance Code, Section 1501.3022(g), auditors reviewed the statutorily required transactions necessary to complete the execution of the Texas Health Reinsurance System’s (System) plan of suspension.
Auditors determined that all of the surplus assets of the System as of March 30, 2018, were distributed. According to the plan of suspension, the surplus assets were
proportionately distributed to the System’s participants based on those entities’ participation in the System for the calendar year 2006 assessment period. Auditors
determined that the proportionate share calculation was mathematically accurate. However, auditors were unable to determine whether the final distribution of surplus
assets was made to the correct participants and in the correct amounts because the documentation to support the final distribution calculation had not been maintained.
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