Trust rapped over incorrect figures

Posted on August 7th, 2008 | by Philippine Accounting Jobs |

An NHS foundation trust must take action after auditors found severe failings in its financial management, it has emerged.

The Royal National Hospital for Rheumatic Diseases in Bath had £650,000 of losses in 2006/07 but only reported the figure as £40,000. It also had “further significant operating losses” in 2007/08.

Monitor, the independent regulator of NHS foundation trusts, issued an intervention notice after the error came to light following an external audit.

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It is now investigating whether the error was made deliberately or was an honest mistake.

The notice of exercise of intervention powers issued by Monitor and an accompanying letter stated that the trust was in “significant breach” of its terms of authorisation.

In particular it was in significant breach of a condition which “imposes upon the trust the general duty to exercise its functions effectively, efficiently and economically”.

It ordered the trust to agree to Monitor reviewing its financial position going forward and appoint accountancy firm PricewaterhouseCoopers to “review and report upon” financial control and commercial management at the trust.

It also called on the trust to “make appropriate arrangements to satisfactorily resolve the chief executive’s position”.

The letter stated that the trust has had financial losses over the period from April 2006 to March 2008, “the full extent of which were not brought to the attention of the trust board or disclosed to Monitor until June 2008, following re-statement of the trust’s accounts by the external auditors”.

It said that without any action, the trust’s liquidity position and cashflow over the next 12 months are “uncertain and subject to significant risk”.

Source: PA News

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