Public Hospital Internal Control Framework Design And The Main Economic Activity Control Research

Background and Purpose:Public hospital internal control is a range of methods and measures for public hospital to achieve its objectives. Hospital financial malpractice and the batch after batch of corrupt officials have been arrested fully demonstrate that although nonprofit organization such as public hospital is not faced with high-frequency risk of bankruptcy as enterprise, its financial difficulties and operational risks also can not be ignored. Although the non-profit organization such as public hospital is increasingly becoming the main object of study on the internal control, the research topic is still mainly concentrated in problems and countermeasures of the hospital’s part of or the overall internal control system. Study on the system building of the public hospital internal control is relatively lack; the extant study on system is either to copy the enterprise’s internal control system or just the result under the existing COSO five elements, lacking the reliable method and principle as a basis. Basing on this understanding, this study will use the main economic activity of the public hospital internal control as an entry point, describing the design principles and methods of the internal control framework in the public hospitals, and analyzes and summarizes the core ofthe internal control, specific control measures for major economic activities of public hospitals.Methods:This study is basis on the public hospitals of Beijing Municipal Health Bureau, through the investigation on relevant literatures, understanding the status and problems of public hospital internal control and with the help of the experts in the field, discussing the internal control system thoroughly, clear and definite the risk of main economic activities business processes of public hospitals, putting forward the basic principles and specific methods of the internal control framework, and ultimately establishing the formation of public hospitals based on the two levels.Results:First, it discusses the situation and existing problems of public hospitals’ internal control. The study discusses the existing problems from perspective of the COSO internal control report’s live elements on public hospitals, the internal control environment, risk assessment, control activities, information and communication, supervision.Second, it analyses the operation objectives of the public hospitals, and establishes the internal control objectives of the public hospitals, on this basis to form the design of public hospitals control clements with two levels. This article starting from the two major operation objectives of the public hospitals, put forward the internal control objectives include four aspects:the efficiency and quality of medical services, the safe and effective use ofassets, the following of laws and regulations, and the authentic and useful of the accounting information, depending on the targets, combined with the principle of control theory, it builds the first level of the public hospitals’internal control elements, including three parts as the control environment, control activities, and supervision; in-depth analysis of these three elements, the decomposes the second level of the public hospitals’internal control elements, the control environment includes the relationship between ownership and governance structure, organizational structure and organizational culture, information and communication, human resources policies; part of control activities include risk assessment and control methods and measures;the supervision part includes the evaluation and feedback.Third, through the design comparison of business internal control, this article studies the principles and methods of the internal control activities, and complete the design of budgetary control, revenue control, expenditure control, monetary funds control, inventory control, fixed asset control, infrastructure projects control, foreign investment controls, as well as economic contracts.