Trafford PCT Annual Audit Letter 23 Oct 2007

H-Carolan

Description

Annual Audit Letter Date Last saved: 23/10/2007 13:50:00 Annual Audit Letter Trafford Primary Care Trust Audit 2006/07 - Audit Commission descriptor to be inserted by Publishing- Document Control Author Filename Trafford PCT Annual Audit Letter 23 Oct 2007 Status of our reports The Statement of Responsibilities of Auditors and Audited Bodies issued by the Audit Commission explains the respective responsibilities of auditors and of the audited body. Appointed auditors address their reports to non-executive directors or officers and for the sole use of the audited body. Auditors accept no responsibility to: • any directors in their individual capacity; or • any third party. Copies of this report If you require further copies of this report, or a copy in large print, in Braille, on tape, or in a language other than English, please call 0844 798 7070. © Audit Commission 2007 For further information on the work of the Commission please contact: Audit Commission, 1st Floor, Millbank Tower, Millbank, London SW1P 4HQ Tel: [phone] Fax: [phone] Textphone (minicom): 020 7630 0421 www.audit-commission.gov.uk Annual Audit Letter │ Contents 3 Contents Summary 4 Key messages 4 Recommendations Purpose, responsibilities and scope 5 Audit of the accounts 6 Accounting issues 6 PCT’s use of resources 7 Value for Money Conclusion 7 Auditor's local evaluation judgement 7 Specific risk-based work 10 National Fraud Initiative 14 ...

Informations

• Publié par: Thowying
• Nombre de lectures: 23
• Langue: English

Extrait

Annual Audit Letter

Date

Last saved: 23/10/2007 13:50:00

Annual Audit Letter

Trafford Primary Care Trust

 

Audit 2006/07

 

 

- Audit Commission descriptor to be inserted by Publishing-

Document Control Author Filename

  Trafford PCT Annual Audit Letter 23 Oct 2007

Status of our reports The Statement of Responsibilities of Auditors and Audited Bodies issued by the Audit Commission explains the respective responsibilities of auditors and of the audited body. Appointed auditors address their reports to non-executive directors or officers and for the sole use of the audited body. Auditors accept no responsibility to: •  any directors in their individual capacity; or •  any third party.   Copies of this report If you require further copies of this report, or a copy in large print, in Braille, on tape, or in a language other than English, please call 0844 798 7070.  

© Audit Commission 2007 For further information on the work of the Commission please contact: Audit Commission, 1st Floor, Millbank Tower, Millbank, London SW1P 4HQ Tel: [phone] Fax: [phone] Textphone (minicom): 020 7630 0421 www.audit-commission.gov.uk

Contents Summary Key messages Recommendations Purpose, responsibilities and scope Audit of the accounts Accounting issues PCT s use of resources  Value for Money Conclusion Auditor's local evaluation judgement Specific risk-based work National Fraud Initiative Closing remarks  

Annual Audit Letter  │  Contents  3  

4   4   4   5   6   6   7   7   7   10   14   15  

Trafford Primary Care Trust

4 Annual Audit Letter  │  Summary

Summary

Key messages 1 As part of the Department of Health's changes under the Commissioning a Patient Led NHS initiative, Trafford PCT was formally established on 1 October 2006 on the merger of the former Trafford North and Trafford South PCTs. This Annual Audit Letter builds on the Annual Audit Letter issued to the former PCTs in July 2007. 2 I issued an unqualified opinion on the new PCT's accounts on 5 July 2007. The PCT met all of its 2006/07 statutory financial targets and the standard of the accounts and working papers was generally good. 3 I issued an unqualified Value for Money Conclusion on 5 July 2007. 4 I carried out the first ALE assessment of the new organisation during 2006/07, and assessed the PCT as performing well in relation to financial reporting and financial standing, and as performing adequately in relation to financial management, internal control and value for money. 5 I have conducted follow-up reviews of recent risk-based work and have summarised my findings on pages 10 to 14 of this Letter.

Recommendations   Recommendations R1 Incorporate the findings and recommendations from the ALE assessment into the improvement action plans for the PCT and put in place arrangements for monitoring progress and outcomes.   R2 The PCT should ensure plans to improve its arrangements for medicines management, mental health commissioning and reducing health inequalities are implemented effectively to achieve improved value for money in these areas.  

 

Trafford Primary Care Trust

Annual Audit Letter  │  Purpose, responsibilities and scope  5  

Purpose, responsibilities and scope 6 This letter summarises the key issues arising from our work carried out during the year. I have addressed this letter to the Board in connection with its governance role to ensure that arrangements are in place for the conduct of its business and that it safeguards and properly accounts for public money. I have made recommendations to assist the PCT in meeting its responsibilities. 7 The letter also communicates the significant issues to key external stakeholders, including members of the public. I will publish this letter on the Audit Commission website at www.audit-commission.gov.uk. In addition the PCT is planning to publish this letter on its website. 8 I have prepared this letter as required by the Statement of Responsibilities of Auditors and Audited Bodies issued by the Audit Commission. This is available from www.audit-commission.gov.uk.   9 As your appointed auditor, I am responsible for planning and carrying out an audit that meets the requirements of the Audit Commission’s Code of Audit Practice (the Code). Under the Code, I review and report on: •  the PCT’s accounts; and •  whether the PCT has made proper arrangements for securing economy, efficiency and effectiveness in its use of resources. 10 Also, the Audit Commission uses my assessments to provide scored judgements for the Healthcare Commission to use as part of its annual health check. 11 This letter summarises the significant issues arising from both these areas of work and highlights the key recommendations that I consider the PCT should be addressing. I have listed the reports issued to the PCT relating to the 2006/07 audit at the end of this letter.  

 

Trafford Primary Care Trust

6 Annual Audit Letter  │  Audit of the accounts

Audit of the accounts 12 I issued an unqualified opinion on the PCT's accounts on 5 July 2007, in advance of the deadline set by the Department of Health. In my opinion:   • the accounts give a true and fair view of the PCT's financial affairs and of its net operating costs for the year; and •  in all material respects the expenditure and income have been applied in accordance with relevant authorities. 13 Before giving my opinion I reported to those charged with governance, in this case the Audit Committee, on the issues arising from the 2006/07 audit. I issued this report on 3 July 2007.

Accounting issues 14 There were no accounting issues arising during the audit that I felt needed to be brought to the attention of those charged with goverance. Some issues of a more trivial nature were dealt with by management.  

Trafford Primary Care Trust

Annual Audit Letter  │  PCT’s use of resources  7  

 PCT s use of resources 15 I am required to conclude on whether the PCT has put in place proper arrangements for securing economy, efficiency and effectiveness in its use of resources. This is known as the value for money conclusion. 16 I am also required to assess how well the PCT manages its financial resources by providing scored judgements on it's arrangements in five specific areas. This is known as the Auditor’s Local Evaluation (ALE). The Audit Commission provides the scores to the Healthcare Commission (HC) to use as part of its annual health check.

Value for Money Conclusion 17 I issued an unqualified Value for Money Conclusion alongside my opinion on the PCT's accounts. This conclusion confirmed my view that, having regard to the criteria for NHS bodies specified by the Audit Commission, in all significant respects the PCT made proper arrangements to secure economy, efficiency and effectiveness in its use of resources for the six month period ending 31 March 2007. 18 My view is based on the work carried out to support my ALE assessment but also on the local risk based work which I have carried out during the year.

Auditor's local evaluation judgement   19 I assessed the PCT's arrangements in five areas. I scored each area from 1 to 4: •  1= Below minimum requirements - inadequate performance; •  2 =Only at minimum requirements - adequate performance; •  3 = Consistently above minimum requirements - performing well; and •  4 = Well above minimum requirements performing strongly. - I will issue a detailed report supporting my assessment and highlighting areas for improvement to the PCT on 1 November 2007. However, I have provided interim feedback at appropriate times during the year.

Trafford Primary Care Trust

8 Annual Audit Letter  │  PCT’s use of resources

  Table 1 ALE scores  

Element

2006/07 2005/06 Assessment Assessment (Trafford (Trafford PCT) North and South PCTs) 3 2   2 2 3 3 2 2 2 2 2 2

Financial reporting Financial management Financial standing Internal control Value for money Overall ALE score (Note: 1 = lowest, 4 = highest) 20 The PCT's score for financial reporting has increased from level 2 to level 3. The main reason for this was that the PCT prepared a set of accounts that met statutory requirements, contained only trivial errors, was free from material misstatement and was submitted within the DoH timescale. At the time of submission there was a full set of working papers available. This increase in performance is pleasing to note given the context of organisational change and the requirement to produce three separate sets of accounts for the 2006/07 financial year. 21 The PCT has also improved its external accountability by publishing copies of Annual Reports, Board agendas, reports and minutes on its website, making these documents accessible to the public in a timely manner. 22 I also assessed the PCT as performing well in relation to its financial standing. The PCT, and its predecessor PCTs, met its statutory financial targets in each of the last three years, maintained its expenditure within cash limits and in doing so did not significant delay its payments.  

Trafford Primary Care Trust

Annual Audit Letter  │  PCT’s use of resources  9  

  23 I have identified below the key areas for improvement.  

Table 2 ALE - Key areas for development   Area Financial management

Internal Control

Value for money

Key areas for improvement •  Agree revenue and capital budgets, savings plans and significant commissioning contracts prior to the start of the financial year; •  Include financial performance as an explicit objective for senior managers to ensure effective accountability in the delivery of budgets; •  Issue financial monitoring reports to budget holders within ten working days of the month- end; and •  Include a detailed commentary on balance sheet items in finance reports to the Board.   •  Undertake an annual assessment of the effectiveness of the Audit Committee against its objectives; •  Review, and update if necessary, procedure notes for business-critical systems, Standing Orders and the Scheme of Delegation at least annually; and •  Ensure the disaster recovery plan is approved by the Board and communicated to all relevant parties.   •  Further develop the PCT's business plan and support it with the detailed tasks needed to achieve its objectives; •  Develop a formal plan documenting the Patient and Public Involvement activity planned for the year; • Ensure agreed actions are formally monitored   as part of regular performance monitoring to ensure that desired outcomes are achieved;

Trafford Primary Care Trust

 

10 Annual Audit Letter  │  PCT’s use of resources

Area

Key areas for improvement •  Develop formal plans to act upon issues arising from benchmarking analysis; and •  Strengthen the arrangements for monitoring partnerships.

 

Specific risk-based work 24 I conducted a part-year audit of Trafford PCT covering the period 1 October 2006 to 31 March 2007. In relation to this period I have followed-up previous reviews rather than commence new local risk-based work. 25 In particular, I have considered progress in relation to the following local risk- based work: - Medicines Management. 26 I also carried out follow up reviews of the following work involving a number of organisations: - Commissioning Mental Health Services; - Health Inequalities - Risk assessment of the Manchester, Salford and Trafford Local Improvement Finance Trust (MaST LIFT); and - Integrated Social Needs Transport (SNT).   Medicines Management 27 A review of Medicines Management was carried out as part of the 2004/05 audits of Trafford North and South PCTs. A follow-up review as part of the 2005/06 audits found that there remained scope to improve medicines management in Trafford particularly with regard to: •  the development of a robust medicines management strategy supported by objectives and targets; •  the need to improve clinical engagement including GP support for medicines management initiatives; and •  ensuring the potential for high levels of cost savings is appropriately addressed.

Trafford Primary Care Trust

Annual Audit Letter  │  PCT’s use of resources  11  

28 The PCT has worked to address the outstanding recommendations from our earlier reviews through the implementation of Practice Based Commissioning (PBC). Through the introduction of PBC clusters key priorities and associated financial incentives have been identified. Clinical engagement is improving as the Board's Prescribing sub-group has become well established, there is regular GP attendance at the Trafford Strategic Management Committee, and the PCT's Medicines Management team has attended PBC cluster group meetings. 29 The PCT has undertaken a detailed piece of work to identify the potential savings that could be made through the delivery of key medicines management priorities although the achievement of savings in this area has yet to be demonstrated. 30 We will continue to monitor the PCT's progress in medicines management strategy development, clinical engagement and delivery of value for money through our 2007/08 audit plan. Commissioning Mental Health Services 31 In 2005/06 we undertook a review of the commissioning arrangements that the PCTs in Bolton, Salford and Trafford had in place for commissioning services from the Bolton Salford and Trafford Mental Health Trust (BSTMHT). The 2005/06 audit found varying levels of commissioning capacity across the health economy. None of the PCTs had at that time undertaken a formal capacity and capability assessment to assess whether internal processes were capable of delivering the mental health commissioning agenda. 32 Our follow-up review found a clear on-going commitment to partnership working to support the effective commissioning of mental health services across the BST economy. The PCT now has a long-term framework in place for planning and resourcing mental health services across BST. Whilst a degree of needs analysis has been conducted and Public Health input secured in strategic development, further work is needed to ensure comprehensive need and service mapping takes place to inform the commissioning process and facilitate performance monitoring, service development, service planning and opportunities for benchmarking. 33 BSTMHT, together with the three PCTs, has established a Mental Health Commissioning Forum and whilst there is not yet a demonstrable shift towards joint commissioning across the PCTs, joint working and service level agreement sign-off has progressed with an emphasis on minimising duplication. 34 The PCTs and BSTMHT have yet to develop benefits management strategies and consequently the organisations remain at risk of developing services without due consideration of need, value for money or impact. 35 Improvements in the collection and verification of activity-based data to support performance and contract management have been demonstrated across the economy although the PCT needs to monitor contracting arrangements in order to compare costs to desired outcomes and then assess impact in terms of value for money.

Trafford Primary Care Trust