Heart of England NHS Foundation Trust External Audit 2008/09 - - PowerPoint PPT Presentation

External Audit 2008/09 financial year

 Heart of England NHS Foundation Trust

Our vision for external services



The best of PwC – expertise, added value and agility in changing times

• Open and trusted relationship
• Deep understanding
• Our best people
• Working in partnership
• Independent assurance
• Continuous communication

Great assurance

• Understanding you and the health

market

• Global perspective
• Thought leadership
• Insight

Value beyond audit

Your core external audit team

As Team Leader, Ian is responsible for managing our accounts work including the audit of the statement of accounts, and ongoing liaison with key members of the finance team. Team Leader Ian Ratcliffe As the assignment Senior Manager, Catherine is responsible for

• verall control of the audit engagement, ensuring delivery to timetable,

delivery and management of targeted work and the overall review of audit outputs. Senior Manager Catherine Little As Engagement Leader, Mark is responsible for independently delivering the audit in line with the Code of Audit Practice, including agreeing the Audit Plan, the quality of outputs and signing of opinions and conclusions. Mark is also responsible for liaison with the Chief Executive and the Board. Engagement Leader Mark Jones Responsibilities Audit Team

Role of External Audit

• PwC appointment as external auditors
• Monitor Audit Code for NHS Foundation Trusts
• An audit opinion on the Trust’s accounts
• Arrangements to secure economy, efficiency and effectiveness
• Review of the Statement on Internal Control
• Review of the Annual Report
• Audit opinion on Charitable Funds accounts

Audit approach

Risk-based approach based on our understanding of the Trust:

Understanding the governance structure and the ‘tone at the top’ Understanding the impact of issues in healthcare & wider environment Understanding how management controls the

• rganisation

Considering the work of internal audit Assessment of:

RISKS ASSURANCE FROM CONTROLS SUBSTANTIVE TESTING

• Detailed testing
• Analytical procedures

Compliance with FT FReM for disclosures and presentation of accounts Compliance with accounting standards

AUDIT OPINION 

The Audit Process

• Compliant with International Standards on Auditing (ISAs)
• Risk based approach
• Reporting to the Audit Committee at each stage
• Continuous communication with key stakeholders

Audit Considerations – 2008/09

• Fixed asset accounting – revaluation reserves identified for

each individual asset and consistently accounted for across all three sites

• Payroll – mitigation of risks and follow-up from 2007/08
• Fixed asset valuations using Modern Equivalent Asset Valuation

basis

• Quality accounts
• International Financial Reporting Standards (IFRS) – re-

statement of the opening balance sheet

Outcomes from our audit – 2008/09

• Unqualified audit opinion on the Trust’s financial statements

(Issued June ’09)

• Unqualified audit opinion on the Charitable Fund’s financial

statements (Issued September ’09)

• No issues identified in relation to the Trust’s arrangements to

secure VFM

Bringing added value

• Fixed asset accounting – improved accounting performance
• Timetable and project plan to support the production of the

Annual Report

• IFRS briefings
• Healthcast 2020
• Procurement Capability Review (non-audit review)

Financial Standing

2008/09

• Reported surplus of £19.8 million for the year
• Cash and short term investments £77.4 million at March 2009
• Plans to re-invest surpluses in capital programme

Future outlook

• Significant financial challenges over medium term
• The Trust is formally in financial turnaround having failed to meet CIP targets
• Target surplus of £5.8 million in 2009/10
• Some risks around achievement of remaining 2009/10 CIP targets
• Significant decreases in levels of commissioning over the next 4 years
• Circa £60 million of efficiency savings to be achieved from 2009 - 2013

High Medium Low Low Medium High

Impact Likelihood

Income and over- performance Budget and finance pressures Impact

• f IFRS

Three site strategy – Good Hope? Solihull services? Estates strategy and capital programme HEFT Consulting –

• rganisational

status Engagement of clinicians Communicating strategy at all levels Achieving clinical targets Internal control weaknesses Contract management Relationships with key funders Going concern risk Demand risk New management units structure Quality reporting



Risks heat map – 2009/10

Considerations for 2009/10 and beyond

• Achieving financial objectives and clinical targets
• Restructure of management units
• Phase 1 of estates strategy
• Transformation agenda
• First financial year reported under IFRS
• Quality reporting
• 2010/11 – consolidation of charitable funds
• 2011 – introduction of corporation tax for Foundation trusts