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SOROTI-REGIONAL-REFERRAL-HOSPITAL-REPORT-OF-THE-AUDITOR-GENERAL-2018..Pdf OFFICE OF THE AUDITOR GENERAL THE REPUBLIC OF UGANDA REPORT OF THE AUDITOR GENERAL ON THE FINANCIAL STATEMENTS OF SOROTI REGIONAL REFERRAL HOSPITAL FOR THE YEAR ENDED 30TH JUNE 2018 OFFICE OF THE AUDITOR GENERAL UGANDA TABLE OF CONTENTS Opinion ................................................................................................................................................ 12 Key Audit Matters .............................................................................................................................. 12 1.0 Budget Performance ............................................................................................................. 13 1.1 Revenue Shortfall .................................................................................................................. 13 1.2 Budget Under Absorption .................................................................................................... 14 Emphasis of matter ........................................................................................................................... 14 2.0 Unapproved Supplementary Funding ................................................................................ 14 3.0 Un accounted for Funds ....................................................................................................... 15 Other Matter ....................................................................................................................................... 15 4.0 Under staffing ........................................................................................................................ 15 5.0 Unsupported Domestic Arrears ........................................................................................... 16 6.0 Lack of a Hospital Board ...................................................................................................... 16 7.0 Management of the of Oxygen Plant and supply of oxygen .......................................... 16 Responsibilities of the Accounting Officer for the Financial Statements ................................... 17 Auditor’s Responsibilities for the Audit of the Financial Statements .......................................... 17 Other Reporting Responsibilities ..................................................................................................... 19 Report on the Audit of Compliance With Legislation .................................................................... 19 8.0 Status of Basic Equipment ................................................................................................... 19 8.1 Shortage of medical equipment at the health facility ...................................................... 19 8.2 Utilisation of Medical Equipment ........................................................................................ 20 8.3 Failure to supply ordered Medicines .................................................................................. 21 8.4 Expired Drugs ........................................................................................................................ 22 8.5 Drug Stock Outs .................................................................................................................... 22 9.6 Unapproved Variation ........................................................................................................... 23 APPENDICES ....................................................................................................................................... 23 10 LIST OF ACROYNMS FY Financial Year GOU Government of Uganda ISSAI International Standards of Supreme Audit Institution MoFPED Ministry of Finance Planning and Economic Development NAA National Audit Act, 2008 PDU Procurement and Disposal Unit PFMA Public Finance Management Act 2015 PPDA Public Procurement and Disposal of Assets UGX Uganda Shillings IPPS Intergrated Personnel and Payroll System EPI Expended Programme on Immunisation 11 REPORT OF THE AUDITOR GENERAL ON THE FINANCIAL STATEMENTS OF SOROTI REGIONAL REFERRAL HOSPITAL FOR THE YEAR ENDED 30TH JUNE, 2018 THE RT. HON. SPEAKER OF PARLIAMENT Opinion I have audited the accompanying Financial Statements of Soroti Regional Referral Hospital for the year ended 30th June 2018. These Financial Statements comprise of the statement of financial position, the statement of financial performance, and cash flow statement together with other accompanying statements, notes and accounting policies. In my opinion, the Financial Statements of Soroti Regional Referral Hospital for the year ended 30th June 2018 are prepared, in all material respects, in accordance with Section 51 of the Public Finance Management Act, 2015, and the Financial Reporting Guide, 2018. Basis of Opinion I conducted my audit in accordance with International Standards of Supreme Audit Institutions (ISSAIs). My responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statement’s section of my report. I am independent of the Hospital in accordance with the Constitution of the Republic of Uganda (1995) as amended, the National Audit Act, 2008, the International Ethics Standards Board for Accountants Code of Ethics for Professional Accountants (Parts A and B) (IESBA Code), the International Organization of Supreme Audit Institutions (INTOSAI) Code of Ethics and other independence requirements applicable to performing audits of Financial Statements in Uganda. I have fulfilled my other ethical responsibilities in accordance with the IESBA Code, and in accordance with other ethical requirements applicable to performing audits in Uganda. I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my opinion. Key Audit Matters Key audit matters are those matters that, in my professional judgment, were of most significance in my audit of the financial statements of the current period. These matters were addressed in the context of my audit of the financial statements as a whole, and in forming my opinion thereon, and I do not provide a separate opinion on these matters. 12 I have determined the matters described below as the key audit matters to be communicated in my report. 1.0 Budget Performance Budget performance is an assessment of a program, function, operation or the management systems and procedures of a governmental entity to assess whether the entity is achieving its planned objectives in the budget given the available resources. Due to increasing demands for transparency and accountability from stakeholders, governments are continually challenged to demonstrate better performance and management of public resources. Section 21(1) of the Public Finance Management Act entrusts the Accounting Officers with the responsibility of planning and managing the entity activities as indicated in the policy statement of the votes based on the annual cash flow plan issued by the Secretary to Treasury during budget execution. Budget estimates are based on outputs to be achieved for the financial year and during implementation, effort should be made to achieve the agreed objectives or targets of the entity within the availed resources. Further, Section 45 (3) of the Public Finance Management Act, 2014 states that “ An Accounting Officer shall enter into an annual budget performance contract with the secretary to the treasury which shall bind the accounting officer to deliver on the activities in the work plan of the vote for a Financial year, submitted under section 13 (15)”. Over the years, the Auditor General has reported underfunding of various Ministries, Departments and Agencies (MDAs). This underfunding negatively affects the implementation of planned activities and the achievement of entity objectives. 1.1 Revenue Shortfall It was observed that the Hospital received a sum of only UGX.5,487,572,555 against a budget of UGX.6,548,114,173 resulting in a shortfall of UGX.1,060,541,618. The shortfall constituted 16% of the budgeted revenue as shown in the statement of Appropriations Account on page 11 of the financial statements. 13 Funding gaps negatively affect service delivery and the achievement of the Hospital planned development objectives for the year. The Accounting Officer explained that there was delayed completion of the procurement process, delay in recruitment staff and processing of gratuity files for payment leading to less funds being released by MOFPED I advised the Accounting Officer to continue engaging the relevant authorities for adequate budget financing. 1.2 Budget Under Absorption It was observed that the hospital had failed to absorb UGX 1,266,727,361 of the warranted Funds of UGX 6,503,114,173 at the end of the financial year under review as shown in appendix i. Under absorption of funds led to the hospital to not only return funds meant for construction of a non-residential building worth UGX 322,000,000 and purchase of furniture worth UGX 55,000,000 but also as in line with MOFPED policy, cutting the Hospital’s IPF by the same amount as a punitive measure for under Absorption. The Accounting Officer explained that there was delayed completion of the procurement process, delay in recruitment staff and processing of gratuity files for payment leading to less funds being released by MOFPED I advised the Accounting Officer to ensure that timely procurement initiation is achieved and also to liaise with MOFPED to ensure that prior IPF is reinstated. Emphasis of matter Without qualifying
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