Audit Commission

Summary [Download full report below this summary]

The Audit Commission's review of the NHS financial management and accounting regime report to the Secretary of State for Health reviews the three main developments which have demonstrated both the weaknesses in the current system and the need for change.

The three main developments are:

1. Many of the flexibilities that enabled bodies to meet their statutory duties not to overspend, have either been eroded or have disappeared for good reason and it appears to be increasingly hard for organisations to recover financially.
2. The introduction of Payment by Results, foundation trusts (FTs), independent sector treatment centres, patient choice, practice based commissioning and the reorganisation of strategic health authorities (SHAs) and primary care trusts (PCTs) all carry new financial risks.
3. The NHS faces lower rates of expenditure growth from 2008/09 and must focus more on efficiency and effectiveness if it is to improve and keep pace with demand.

The Audit Commission provide recommendations to respond with these developments, covering:

• financial risk, financial incentives and financial management
• the financial management regime
• accounting and financial reporting
• financial management and governance

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Download the full national study in PDF format below. This study contains all our findings and recommendations.

National report ( PDF, 265kb )

Questions and answers for NHS bodies ( PDF, 53kb )

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