Health service boards in Victoria needs to comply with a range of financial regulations and directives.
Boards' financial responsibilities
All health services boards have responsibilities under the Financial Management Act 1994 to:
- achieve financial targets agreed in the Statement of Priorities or other service agreements monitoring financial performance
- ensure their health service’s financial viability by establishing an audit committee and preparing an annual report of operations and financial statements.
Boards can achieve these goals by using procedures to monitor and audit financial performance against budget and key strategic goals at executive levels. They can also set up an independent audit committee.
In addition to the provisions of the Financial Management Act, the Standing Directions issued by the Minister for Finance (for financial and non-financial reporting) impose extra requirements on health services.
Reviewing financial performance
The Health Services Act 2004 (in addition to the Financial Management Act) requires that boards of metropolitan and major regional health services establish finance, audit and quality committees. The chief executive officer is the accountable person under the Financial Management Act and is required to appoint a chief finance and accounting officer (ss. 42 and 43).
The Financial Management Act also requires health services to:
- maintain a register of assets (s. 44B)
- keep proper accounts and records of financial transactions (s. 44)
- provide the Minister for Finance with any information requested (s. 44A)
- prepare an annual report of operations and financial statements (s. 45).
Financial management compliance framework
A key resource for health services boards is the Department of Treasury and Finance’s Financial Management Compliance Framework, which provides information, guidance and tools to Victorian public sector agencies, including health service boards, to establish and maintain effective financial management, and allows the Victorian Government to monitor the standard of financial management.