To be financially sustainable, entities need to be able to meet current and future expenditure as it falls due. They also need the ability to absorb foreseeable changes and materialising risks without significantly changing their revenue and expenditure policies. This Part provides our insight into the financial sustainability of public hospitals based on our analysis of the trends in key financial indicators over a five-year period.
Accrual-based financial statements enable an assessment of whether public hospitals are generating sufficient surpluses from operations to maintain services, fund asset maintenance and retire debt.
This Part analyses the financial results of Victoria’s public hospitals and their associated entities for the year-ended 30 June 2012.
The combined financial results for public hospitals in 2011–12 included:
Independent audit opinions add credibility to financial reports by providing reasonable assurance that the information reported is reliable. The quality of an entity’s reporting can be measured by the timeliness and accuracy of the preparation of the reports. This Part covers the results of the 2011–12 audits of the 87 public hospitals and their 26 associated entities. It also compares financial reporting practices in 2011–12 against better practice, legislated time lines and 2010–11 performance.
Public hospitals provide a range of services across metropolitan, regional and rural areas. Metropolitan and regional public hospitals largely provide acute health services, as well as a mix of mental health, subacute, community health services and aged care programs. Rural public hospitals generally offer a higher proportion of aged care and community health services.
This report includes the results of the financial audits of 87 Victorian public hospitals and their 26 associated entities, as set out in Figure 1A.
This report presents the results of our financial audits of 113 entities within the public hospital sector, comprising 87 public hospitals and 26 associated entities. It provides a detailed analysis of public hospital financial reporting, financial results, financial sustainability and internal controls. It informs Parliament about significant issues arising from the audits and complements the assurance provided through individual audit opinions included in the entities’ annual reports.
Ordered to be printed
VICTORIAN GOVERNMENT PRINTER November 2012
PP No 193, Session 2010–12
In addition to progressive engagement during the course of the audit, in accordance with section 16(3) of the Audit Act 1994 a copy of this report was provided to the Department of Health and four audited health services with a request for submissions or comments.
The submission and comments provided are not subject to audit nor the evidentiary standards required to reach an audit conclusion. Responsibility for the accuracy, fairness and balance of those comments rests solely with the agency head.
The Department of Health (the department) sets consumer participation expectations and undertakes activities to support consumer participation in health services. It also involves consumers at the departmental level.
Consumers can make valuable contributions to health services beyond participation in their own care. They can also help to inform and improve services, facility design and the health service’s broader community engagement.