ACCOUNTING SYSTEMS inherited by the HSE are no longer adequate, according to a new report.
The report, published yesterday by the Department of Health, said the systems were not designed to cater for the HSE structures and are “unable to provide the full range of management information now required”.
It notes there were different financial systems in a number of the old health board regions. The east, northeast and midlands shared one system; the west, south, southeast and midwest had another and the northwest had a separate accounting system.
“Some of these legacy accounting systems are more advanced than others and so the capacity to respond to requests for additional information is not uniform throughout the HSE,” it notes.
The report also confirms the HSE had to pay out over €500,000 in penalties as a result of making late payments to suppliers in 2007.
The HSE confirmed later that this figure rose to €885,219 last year. It said this happened because it had been a few days late paying substantial bills.
Meanwhile the Study of certain accounting issues related to the Health Service Executive, published yesterday, also said the HSE’s monthly performance monitoring reports (PMR) should provide more information on the steps needed to correct overspending when expenditure is running ahead of budget.
“While the PMR contains both financial data and non-financial data, the link between the two is weak,” the report stated.
“In particular there is insufficient explanation of variances, their impact on the level of activity and the actions that local management intend to take to get back on budget.”
Furthermore, it notes a suggestion in the 2006 National Treasury Management Agency report on the HSE that it eliminate the facility for voluntary hospitals and agencies to borrow because the cost of this borrowing exceeds exchequer funding and has to be met by subsequent allocations from the exchequer. This should be looked at again it states. “A decision to freeze the cash level of the overdrafts might be a useful first step.”
The report was carried out by a working group representative of the Department of Finance, Department of Health and the HSE. It was completed last autumn.
The HSE said that where practicable, its recommendations have been implemented. It also said it is in consultation with the Department of Health on upgrading its accounting systems.