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The Southern District Health Board needs to improve budgeting, monitoring, and financial forecasting, Auditor-general Lyn Provost's 2011-12 health sector report says.
The southern board's grade for financial information systems and controls slipped from ''good'' in 2010-11 to ''needs improvement'', in the report released this week.
Two other boards needed to improve this measure.
''Our auditor noted that improvements were required to [Southern] DHB's financial budgeting, monitoring, and forecasting procedures and also recommended improvements to the quality of its service performance reporting, including reporting progress against health outcomes and impacts.''
Southern's service performance information and associated systems and controls also needed to improve, having slipped from ''good'' the previous year. Six other boards needed to improve this measure.
The board returned a deficit of $13.2 million against revenue of $836.6 million.
Southern was one of three boards with a Crown monitor, and was one of four ''monitored intensively'' by the Ministry of Health.
Its management control environment was ''good'', the same as the previous year.
Overall, the audit office found health boards and other health entities had sound management control environments and financial information systems.
''I am also pleased to see continued improvement in service performance reporting,'' Ms Provost's report said.
Good reporting enabled boards to show what they had achieved, and whether they provided value for money, she said.
The Canterbury earthquakes continued to affect the sector, not just in Canterbury, in the form of increased earthquake strengthening requirements and higher insurance costs.
Health boards increasingly worked collaboratively between districts, she said.
In a written statement, Southern DHB chief executive Carole Heatly told the Otago Daily Times the situation had improved since the audit.
''Since this assessment over a year ago, we have completely overhauled how and what we report at board level, and sub-committees, and are confident ... the DHB will score much better in the next Auditor-general's assessment''.