CUH charity audit sparks major concern

A HOSPITAL charity, set up without HSE approval, gave non-tendered contracts worth €365,000 to a single company which resulted in donor-specific projects being left unfunded.

A HSE investigation into the Cork University Hospital (CUH) Foundation has also raised serious questions over the foundation’s internal controls and procedures between 2006 and 2010.

However, it concluded there was “no evidence” of fraudulent activity among its founders — including CUH chief executive Tony McNamara, then deputy manager Tony Long, director of nursing Mary Geraldine Boyd and financial officer Terry Kiely.

Among the findings of the internal audit are:

- “Significant expenditure” of €365,000 in donated money was spent on non-tendered external consultancy contracts “without evidence the market has been sufficiently tested”.

- The CUH Foundation was set up in 2006 “but there was no evidence to confirm approval was given for this by the HSE”.

- The foundation’s directors were “exclusively senior HSE employees”, resulting in “fundamental weaknesses” in internal controls and leaving open the possibility “the HSE effectively exerted a controlling influence over the foundation”.

The foundation was set up to ensure donations to any ward at CUH or Cork University Maternity Hospital (CUMH) were spent as specified by the donors, who included Lord of the Dance star Michael Flatley.

The audit stated the foundation’s accounts included €288,000 worth of charitable donations for specifically stated projects. However, it identified a shortfall of €162,000 which it said “needed to be addressed urgently to ensure the conditions attached to the donations already received can be complied with”.

It also recommended the foundation “improve controls over the completeness and accuracy of income”.

In response, regional director of operations HSE South Pat Healy said of the five key audit findings, the four related to governance issues had been addressed.

In relation to the shortfall of €162,000, he said “this is a potential shortfall only, which has not materialised, as the foundation has met all commitments as and when they arise”.

A HSE spokesperson said last night the foundation is now in compliance with all statutory companies office requirements, directorship disclosures, HSE national financial procurement regulations and charitable fund policies.

She added that unaudited draft 2010 accounts show the foundation has members’ funds of €135,000, and no disciplinary proceeding requirements have been put forward by the audit.