ACCOUNTABILITY

New financial reporting template for hospitals unveiled

Accounting Officer shall prepare the financial statements in a form that complies with the relevant accounting standards prescribed and published by PSASB

In Summary

• Hospitals spend revenues collected at source before channeling them to the County Revenue Fund then seeking approval as is required by law.

The male general ward at Mwingi Level 4 hospital /FILE
The male general ward at Mwingi Level 4 hospital /FILE

County hospitals have until the end of this month to submit comments for a new reporting template, which will enable harmonisation of their financial statements to enhance accountability.

In a notice calling for public comments until the end of August, the Public Sector Accounting Standards Board (PSASB) said the template which targets three hundred levels four and 11 levels five hospitals will improve transparency.

According to PSASB chief executive officer Fredrick Riaga, hospitals spend revenues collected at source before channeling them to the County Revenue Fund then seeking approval as is required by law.

This, he said, presents a challenge in effective recording and reporting of the finances.

PSASB is spearheading transition of government accounting from the current cash-based to accrual system of accounting and the focus on county hospitals is part of the larger strategy.

''This template is prepared under the accrual basis of accounting. Cash accounting recognizes revenue and expenses only when money changes hands. In the accrual method transactions are recognized as and when they take place,'' Riaga said.