(a) General requirement. A State Exchange must:
(1) Keep an accurate accounting of Exchange receipts and expenditures in accordance with generally accepted accounting principles (GAAP).
(2) Monitor and report to HHS on Exchange related activities.
(3) Collect and report to HHS performance monitoring data.
(b) Reporting. The State Exchange must, at least annually, provide to HHS, in a manner specified by HHS, the following data and information:
(1) A financial statement presented in accordance with GAAP by April 1 of each year,
(2) Eligibility and enrollment reports,
(3) Performance monitoring data, and
(4) If the Exchange is collecting premiums under Sec. 155.240, a report on instances in which it did not reduce an enrollee's premium by the amount of the advance payment of the premium tax credit in accordance with Sec. 155.340(g)(1) and (2).
(c) External audits. The State Exchange must engage an independent qualified auditing entity which follows generally accepted governmental auditing standards (GAGAS) to perform an annual independent external financial and programmatic audit and must make such information available to HHS for review. The State must:
(1) Provide to HHS the results of the annual external audit; and
(2) Inform HHS of any material weakness or significant deficiency identified in the audit and must develop and inform HHS of a corrective action plan for such material weakness or significant deficiency;
(3) Make public a summary of the results of the external audit.
(d) External audit standard. The State Exchange must ensure that independent audits of State Exchange financial statements and program activities in paragraph (c) of this section address:
(1) Compliance with paragraph (a)(1) of this section;
(2) Compliance with requirements under this part;
(3) Processes and procedures designed to prevent improper eligibility determinations and enrollment transactions; and
(4) Identification of errors that have resulted in incorrect eligibility determinations.