Source: New PHA audit confirms Bain's finding

Sun, Jul 26th 2015, 10:51 PM

The auditors hired by the Public Hospitals Authority (PHA) to conduct yet another audit of the PHA arrived at the same conclusion that UHY Bain and Associates did more than a year ago: At the end of 2013, there was a $10 million difference in pharmaceutical inventory between the physical count and what was reflected in Princess Margaret Hospital’s (PMH) computer system, according to a trusted National Review source.

The report being prepared by Kikivarakis and Co. is expected in the hands of PHA officials within the week, we were told.

The source said the findings might suggest a system error and not that $10 million in pharmaceuticals actually disappeared.

The new audit came after PHA Managing Director Herbert Brown took exception to the findings of the forensic audit.

We inquired about the PHA matter as we were examining the decision of Deputy Prime Minister Philip Brave Davis to order another review into the Urban Renewal Programme, undermining the auditor general, who conducted a review.

Speaking to the Urban Renewal matter, Philip Galanis, managing partner at HLB Galanis & Co, said, “It’s unfortunate that, yet again, the government feels it necessary to hire auditors to audit the auditor. When will this madness cease?”

It was a clear reference to the matter of the Public Hospitals Authority where multiple audits were conducted, including one by Galanis’ firm. It was not until The Nassau Guardian revealed last October the findings of the UHY Bain forensic audit into the supply of pharmaceutical drugs and medical supplies of the PHA that the issue attracted widespread public commentary.

In January, when we pressed Prime Minister Perry Christie on the matter, he said he would ask the auditor general to conduct another examination of the PHA. While the report was not completed by the auditor general, the authorities’ response to it was similar to their response to the Urban Renewal report, which was leaked to The Nassau Guardian in April.

The PHA audit that became the subject of multiple National Review articles was completed in March 2014. The report sat on the shelf for seven months before it was leaked to us.

UHY Bain quoted a separate audit from the hospital’s Internal Audit (IA) Department, which came to the same conclusion on the unaccounted-for $10 million in pharmaceuticals.

“Sample results revealed that an excess of $10 million in inventory did not physically exist in the pharmacy during the year, but remained in [the computer system],” the IA’s report said.

UHY Bain said there had been no satisfactory explanation for this.

Among other damning findings, it found that at least one approved wholesaler took advantage of weaknesses in the materials inventory procurement process to re-use a purchase order number at least 100 times.

As opposed to the PHA board — headed by Senator Frank Smith — accepting the findings of the UHY Bain audit and several other audits that sounded the alarm on the PHA, another firm was engaged, Kikivarakis & Co., to conduct yet another examination at the expense of taxpayers. Someone should report how much money we have spent auditing the auditors.

How far will our authorities go with this? Sadly, they have shown they will go to great public expense to discredit auditors whose conclusions they refuse to accept. We look forward to the latest PHA audit being made public. It is unfortunate that these audits are usually revealed through media leaks.

Click here to read more at The Nassau Guardian

 Sponsored Ads