Introduction

Medibank is considered has one of the best private health insurance company operating in Australia. Some of the main noted services has been seen to be taken into consideration with online health, telephone and initiatives for coaching programs in Australia. The important form of the investment activities of the company is seen to be taken into account with the investment activity in the community programs. The various types of the investment activities have been further seen to be based on the support provided to the local programs for promoting child healthcare activities. Some of the important aspects of the report has been able to cover risk analysis, evaluation of risks and control environment. The several types of the aspects of the executive report are further compared with QBE Insurance Group (Cannon & Bedard, 2017).

Risk Analysis

As per the capital management and dividends statements it is identified that the various type of the profile maintained for the strong financial risk profile are seen to be conducive to meet the financial commitments. From the risk analysis facts given in the annual report of the company it is discerned that the company’s total health insurance business related to the capital is seen to be business-related capital of 13.9 percent of premium revenue. Some of the inherent material business risks of the company has been seen to be taken into account with healthcare costs and utilisation, competition and customer retention, product pricing and design, improper claims, capital management, investment returns, healthcare provider agreements, information technology and regulation (Dennis, 2015).

Evaluation of risks and control environment

The risk management framework for Medibank is seen to clearly set out with the number of the factors which are clearly defined criteria for analysis. The evaluation and the prioritisation is done as per material business risks. Some of the main factors are included with the systematic risk consequence in compare to the impact on the clinical governance, safety, position, financial performance and health. The company is also able to set out the main criteria for assessment of the effectiveness of the control environment (Khalil, Saffar, & Trabelsi, 2015).

Comparison of the financial ratios with QBE Insurance

QBE Insurance Group Limited is considered as Australia’s one of the largest global insurers. The company has provided the different aspects for serving in areas such as “Australia, America, Europe and Asia Pacific region”. The financial ratio analysis is computed as per profitability, liquidity and Ratio for leverage and operating margin Analysis.  QBE is considered as the main competitor for Medibank (Kachelmeier, Majors, & Williamson, 2014).

Based on the return on equity analysis Medibank is seen to be in a slightly better position in terms of return on equity. The competitor company QBE is able to achieve only 8% in 2014, 7% in 2015 and 7% in 2016. In compare to this Medibank has achieved 20% profitability ratio in 2015 and 26% profitability ratio in 2016.

The net profit margin analysis clearly shows that Medibank is in a better position in compare to its competitors. This is seen with the increasing net profit margin of 2.32% in 2014, 4.81% in 2015 and 6.19 in 2016. The risk of Medibank in terms of the Medibank is seen to be comparatively lesser than QBE insurance.

The short-term liquidity analysis depictions have been further able to show that Medibank has higher assets to cover the liabilities. This is seen to be evident with 1.75 in 2014, 1.78 in 2015 and 1.85 in 2016. It needs to be further discerned that the competitors company QBE has not been able to meet the liability requirement with only 0.96 current ratio in 2016.

The depictions made as per the leverage ratio has shown that QBE Insurance is in a better position. This is evident with 3.06 in 2014, 2.99 in 2015 and 3.02 in 2016. The Medibank leverage ratio on the other hand is seen to be decreasing with 1.13 in 2014, 1.18 in 2015 and 1.07 in 2016 (Curtis, Humphrey, & Turley, 2016).

The depictions made on the operating margin is further able to show that Medibank is in a better position than its competitors. This is evident with 2.01% in 2014, 1.11% in 2015 and 3.92% in 2016. It is seen that the Medibank has a higher operating margin.

Some of the other ration interpretations are stated below as follows:

Conclusion

As per the depictions made in the study Medibank is seen to be prompt enough for addressing the long-term affordability of the customer’s approach which is stated with the long-term affordability for the customers. The private health insurers and comparison of the data is seen to be done in the website competing to attract and retain the members on price, channels and services.  Medibank strives to reach the agreement of the risk based on the attaining a certain agreement with the providers, contingency plans which are seen to be in favour with the negotiation scenarios. The information technology for Medibank is seen to be prone to cyber-attacks and failure in the critical data, systems and processes.

References

Cannon, N. H., & Bedard, J. C. (2017). Auditing challenging fair value measurements: Evidence from the field. Accounting Review, 92(4), 81–114. https://doi.org/10.2308/accr-51569

Curtis, E., Humphrey, C., & Turley, W. S. (2016). Standards of innovation in auditing. Auditing, 35(3), 75–98. https://doi.org/10.2308/ajpt-51462

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Glover, S. M., Taylor, M. H., & Wu, Y. J. (2017). Current practices and challenges in auditing fair value measurements and complex estimates: Implications for auditing standards and the academy. Auditing, 36(1), 63–84. https://doi.org/10.2308/ajpt-51514

Habib, A., Jiang, H., Bhuiyan, M. B. U., & Islam, A. (2014). Litigation risk, financial reporting and auditing: A survey of the literature. Research in Accounting Regulation, 26(2), 145–163. https://doi.org/10.1016/j.racreg.2014.09.005

Hosseinpour, M., & Jans, M. (2016). Categorizing identified deviations for auditing. In CEUR Workshop Proceedings (Vol. 1757, pp. 125–129).

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Kachelmeier, S. J., Majors, T., & Williamson, M. G. (2014). Does intent modify risk-based auditing? Accounting Review, 89(6), 2181–2201. https://doi.org/10.2308/accr-50835

Khalil, S., Saffar, W., & Trabelsi, S. (2015). Disclosure Standards, Auditing Infrastructure, and Bribery Mitigation. Journal of Business Ethics, 132(2), 379–399. https://doi.org/10.1007/s10551-014-2321-6

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