Audit raises concerns about North Carolina health system’s accounting practices

April 27, 2011 The audit found that the health system had failed to resolve accounts payable credit balances in a timely manner.

An accounts payable audit of North Carolina-based Beaufort Regional Health System (BRHS) found several significant issues, including failure to reconcile certain accounts and resolve accounts payable credit balances in a timely manner, according to the Washington Daily News.

The audit also found that "the allowance for doubtful accounts estimate was significantly understated," as quoted by the news source. This resulted in a $4.1 million adjustment in accounts-receivable reserves and credit balances during fiscal year 2009-2010.

The health system's gross and net patient revenue was found to have decreased by $4.7 million and $6.1 million, respectively, from the 2008-2009 fiscal year.

BRHS' failure to report unclaimed property such as patient refunds since 2005 may result in the health system being fined by the state.

"The good news is we have the audit," said Alice Mills Sadler, board chairwoman of BRHS. "The bad news is we should have sought outside assistance from an entity sooner."

The BRHS board is presently considering a lease offer from University Health Systems, according to WNCT News. 

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Category: Accounts Payable Analysis

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