Report highlights: Health 2021
What the report is about
The results of Health cluster (the cluster) agencies' financial statements audits for the year ended 30 June 2021.
What we found
Unmodified audit opinions were issued for the financial statements of all Health cluster agencies.
The COVID-19 pandemic increased the complexity and number of accounting matters faced by the cluster. The total gross value of corrected misstatements in 2020–21 was $250.2 million, of which $226.0 million were pandemic related.
A qualified audit opinion was issued on the Annual Prudential Compliance Statement. The basis of the qualification related to 19 instances (18 in 2018–19) of non-compliance relating to three of the 20 prudential requirements across five aged care facilities.
What the key issues were
The total number of matters we reported to management across the cluster increased from 112 in 2019–20 to 116 in 2020–21. Of the 116 issues raised in 2020–21, three were high risk (one in 2019–20) and 57 were moderate risk (47 in 2019–20). Nearly one half of the issues were repeat issues.
The three new high-risk issues identified were:
Hotel Quarantine (HQ) fees
The absence of a tailored debt recovery strategy, data integrity issues and uncertainties around future HQ arrangements increased risks around the recoverability of HQ fees from travellers.
Data errors and anomalies in the impairment model and difficulties forecasting key factors impacting the management of Personal Protective Equipment (PPE) increased uncertainty associated with the valuation and impairment of COVID-19 inventories.
The Commonwealth did not provide information about the cost of vaccines provided to NSW free of charge, which required the performance of internal valuations to reflect the consumption of vaccines in the financial statements.
What we recommended
Hotel Quarantine (HQ) fees
Develop a tailored assessment methodology to estimate recoverability of HQ fees and work with Revenue NSW to develop a tailored debt recovery strategy.
Review the current stocktaking and impairment methodology to incorporate validation of data key to the management of COVID-19 related PPE.
Work with the Commonwealth to obtain primary price information on COVID-19 vaccines.
The Health cluster, comprising 15 local health districts, five pillars agencies, two specialty health networks and six shared state-wise services agencies, deliver health services to the people of New South Wales.
- 100% unqualified audit opinions were issued on agencies' 30 June 2021 financial statements
- 24 monetary misstatements were reported in 2020–21
- 3 high risk management letter findings were identified
- 47.4% of reported issues were repeat issues
- $23.5b property, plant and equipment as at 30 June 2021
- $26.8b total expenditure incurred in 2020–21
Please contact Ian Goodwin, Deputy Auditor-General on 9275 7347 or by email.