The Government Of Ghana Accounting Essay

The Government of Ghana since the induction of the Economic Recovery Program ( ERP ) in April 1983, have sought to better its fiscal direction in the Ghana wellness service instance analyze Wa Regional Hospital under the Structural Adjustment Project ( SAP ) and the Economic Management Support Project ( EMSP ) . However, all the above steps were adhoc in nature and did non run into the demand of an Integrated Financial Management Support ( IFMS ) . Acknowledging these lacks in the Public Financial Management ( PFM ) , the authorities of Ghana ( GOG ) with the aid of Canadian International Development Agency ( CIDA ) , Department of Foreign International Development ( DFID ) and the World Bank developed a average term plan called Public Financial Management Reform Program ( PUFMARP ) . The PUFMARD is aimed at bettering Efficiency, Accountability and Transparency in the public fiscal direction.

One of the sectors where this plan was implemented is Ghana Health Service ( GHS ) which happens to be one of the most vivacious and indispensable sectors in Ghana. It is an undeniable fact that the presence of good wellness attention is indispensable in accomplishing healing and preventative wellness demands of the people. As a consequence, this does non take to increasing outlook through instruction and general involvements but besides people are able to achieve length of service.

It is crystal clear that, deficiency of quality wellness bringing system is unfriendly to the advancement and development of any society. It is in the visible radiation of this, that resources are put in topographic point to supply quality wellness attention for the people. However, this object can merely be attained when there is effectual fiscal direction.

Ghana Health Servicedepends mostly on fiscal resources appropriated through the national budget. Fiscal direction in the Ghana Health Service ( GHS ) has been a job since clip immemorial. There have been cases where financess belonging to public sector organisations including the wellness sector are misappropriated by direction.

Many alterations have been initiated in the wellness sector with the purpose of non merely heightening effectual fiscal direction but besides to supply efficient wellness service to the public.


The success of any establishmentwhether net income or non-profit orientated depends mostly on the coevals and direction of finance. Financial direction is carried out efficaciously when ample attention is taken in the coevals and expense of financess. There are many ways in which financess are generated into Government infirmaries.These include Government Subvention ( GS ) through the Consolidated Funds ( CF ) , Donor Pool Fund ( DPF ) , National Health Insurance Scheme Fund ( NHIS ) and Internally Generated Funds ( IGF ) such as the sale of drugs, consultancy fees and issue of hard currency to patients.

Coevals of financess in the Ghana Health Service ( GHS ) has been a job non merely because Government Subventions ( GS ) Non Government Organization ( NGO ) National Health Insurance Fund ( NHIF ) are non received seasonably but are besides deplorably deficient. Internally Generated Funds ( IGF ) are besides unequal since patients are non charged to even cover cost, due to poverty in the part

Furthermore, expense of financess is one of the greatest jobs confronting the Ghana Health Service ( GHS ) . Some wellness decision makers do non pay out monies on undertakings intentionally for their self-interest. Estimates for undertakings are frequently over bills by these Directors. Ghana Health Service ( GHS ) particularly the Regional Hospitals have many sections such as Out Patient Department ( OPD ) , Department of Diagnosis ( Theatre, X-ray and Hematology ) , which do non do net income at all.

There are some categories of patients who are given free medical attention. These patients fall under the freedom list. They include the elderly, destitute, prenatal attention, staff, Canis familiaris and snake bites victims, TB ( TB ) ; paupers and. Government is expected to pay for the above listed patients. Sometimes this refund is delayed because the infirmaries prepare refund for freedom to the authorities covering the whole twelvemonth. In some instances, authorities fails to return these sums. All these pose serious fiscal jobs to authorities infirmaries since the infirmaries are to pay for the drugs used before they are replenished.

In the visible radiation of these lacks, there is the demand to transport out a survey into the Ghana Health Service ( GHS ) so as to supply appropriate recommendations where necessary.


This survey is intended to:

Find out the deficits in the fiscal direction of the Ghana Health Service

Arrive at a strategic agencies of pull offing resources in the Ghana Health Service

Assess the beginnings of finance and to find whether monies collected are decently accounted for.

Test the sufficiency of Internal Control in the Ghana Health Service

To find some jobs of finance particularly in the country of work force development

Assess whether marks set by the Ghana Health Service are frequently achieved

Find out in the Ghana Health Service, their consequence on wellness bringing, public presentation of employees and patients and to supply recommendations where necessary

To do recommendations when necessary


This study shall be based on the undermentioned research inquiries:

What are the chief beginnings of financess available to the Ghana Health Service ( GHS ) ?

How frequently are these financess received?

What is the manner of entering fiscal minutess in the wellness sectors?

Is there any wellness insurance strategy instituted in this infirmary?

What are some of the outgo countries in the wellness sector?

What are some of the steps put in topographic point by direction to discourage and observe fraud and peculation?

Arethe financess adequate for run intoing the wellness demands?


This survey brings to mind how fiscal direction in the wellness sector is carried out hence it would unearth some of the loopholes of fiscal direction in the Ghana Health Service.

The survey besides offers information on the historical background of Wa Regional Hospital and the systems put in topographic point by the infirmary disposal so as to better fiscal direction.

In add-on, the survey would supply techniques in fiscal direction therefore assisting to bridge the spread between the influxs and escapes of financess in the Ghana wellness sector. The consequences of the survey if implemented will better the planning and budgeting of outgo in the wellness sector and therefore lend to safeguard financial policy preparation and execution.

Finally the survey will function as beginning of mention for pupils who may desire to set about a survey about the subject.


Wa Regional Hospital was established in 1952 as the lone infirmary in Wa and it environ.Wa Regional Hospital strategically located in the bosom of the regional capital, Wa Regional Hospital performs a double map as a regional and territory infirmary for over old ages now. It provides services to the population of the part and its environments.

Indeed, as a Centre of excellence ( within the health care bringing system ) in the part, its catchment country extends beyond upper West are to Bole, Tuna etc. in the Northern Region and the adjacent state e.g. Burkina Faso.


The major aims why the research worker wants to ship on the undertaking are stated below

The research worker intends to happen out the major beginnings of finance in the wellness sector

He besides wants to convey to mind how fiscal direction in the Ghana Health Sector is carried out

The research worker gives information on the historical background of Wa regional infirmary and the systems put in topographic point by the infirmary ‘s disposal and how it can lend to the betterment of fiscal direction in the wellness sector.

Again the research worker wants to happen out the over position of the planning and budgeting of the income and outgo in the wellness sector.

Finally the survey may function as beginning of mention to pupils who may desire to set about a survey about the subject.

Administration OF THE STUDY

For systematic and orderly presentation of thoughts, the survey would be organized into five chapters.

Chapter one shall cover with an debut to the research subject: background of the survey ; statement of the job ; aims of the survey ; research inquiries ; significance of the survey ; and restriction and boundary line of the survey.

Chapter two shall cover literature reappraisal of the survey.

In chapter three, the research would be geared towards the methodological analysis. Areas such as population sample, sample processs and informations analysis processs will be delved into.

Analysis and presentation of the survey would be dealt with in chapter four. This would be achieved through the usage of tabular arraies and figures, statistical presentation and treatments of consequences.

Finally, chapter five would be devoted for the sum-up, decision and recommendation to the subject seeing researched.


The premier restriction of this undertaking stems from the deficiency of co-operation from some staff and patients of the Wa Regional Hospital. For no evident ground, an appreciable figure of the respondents dismissed and ignored our low and modest attack to them. The few who responded were the really cardinal 1s whose informations was indispensable for the survey. In malice of their un- preparedness to let go of critical information, our continuity and bearing eventually opened the manner.

The insufficiency of financess at all phases of the survey was another serious hindrance on our manner. Since there was no sufficient financess, going to far flung finishs for informations aggregation was sometimes avoided, therefore our inability to obtain informations every bit much as we speculated.

As a affair of fact and genuineness, unequal financess have been the most agonizing facet of the survey which introduced some sum of ennui

Apart from the Regional Hospital, no infirmary generates adequate administrative gross to run into its

administrative outgo.

This is more at hand in the face of decreasing GOG/DPF budget releases which seems to be the tendency for old ages.

I am looking forward to our greater resoluteness to turn to all the constrictions that impede service bringing in the Ghana wellness service. It is my hope that our attempts will take to the betterment in the wellness position of all Ghanaians

Chapter TWO


2.0 Introduction

Since clip immemorial, bookmans, research workers, writers, wellness decision makers have written literature on fiscal direction in the Ghana Health Service ( GHS ) .

The chapter intends to take a re-look at the efforts made by the aforesaid people in the definition, mode of operation, gross mobilisation, capital budgeting, investing assessment and the managerial jobs of fund in the Ghana Health Service ( GHS ) .


Harmonizing to Brigham andGapenski ( 1985 ) , fiscal direction involves the existent direction of a house and it is of import in all types of organisation including Bankss and charitable organisation. They contended that, fiscal direction is indispensable to the authorities, schools, sections and wellness sectors.

Besides, fiscal direction besides defined by Brigham and Gapenski ( 1985 ) is the existent direction of a house, which in this instance includes Bankss and charitable organisation. They contended that, fiscal direction is of much importance to the authorities, schools, sections and wellness sector.

Peterson ( 1984 ) defined Financial Management as ; the direction of the hard currency flow of a house to do net income for its proprietors. She farther explained that, a house may be a concern endeavor such as fabrication companies, an accounting house, an oil manufacturer, a recognition brotherhood or it may be a charitable organisation.

Van-Horne ( 1996 ) besides states that, fiscal direction involves solution to the three major determinations, viz. investing determination, fiscal determination and dividend determination. These three major determinations in combination determine to an unmeasurable extend the existent value of the concern to its proprietors or stockholders. In order to maximise this value, they suggest that the company should take the optimum combination of the three major interrelated determinations. For case, the determination to put into a new undertaking, for illustration, necessitates by investing funding which in bend is influenced by dividend determinations for maintained net incomes used internal funding represent dividend forgone by stockholders.

In a more general sense, fiscal direction can be defined as the acquisition, direction and funding of resources for houses by agencies of money, with due respects to monetary values and other economic factors in the market.


Harmonizing to F. Brighan and Gapenski ( 1985 ) , the primary map of a fiscal director is to give history on the fiscal affairs of the house. Therefore, by taking into history the beginnings and utilizations of money towards the maximization of the house ‘s value or the proprietors ‘ involvement in the instance of a company. They farther explained that, fiscal direction should be after the alternate determination of beginnings of financess and the utilizations of those financess in order to accomplish the ends and aims of the organisation. Assorted maps of the fiscal direction are noticed and among them are:

Planing and prediction ; this involves puting of aims and ends for sections and sub-divisions and set uping policies and stands to maintain workers towards the accomplishment of the set ends and aims. The fiscal director shall be a joint work with other executives to look in front and put down programs, coders and processs to construction the future place of the house.

Coordination and control ; coordination is the agencies of directing all attempts towards a cardinal point or end by which all activities of all sides of a concern purpose at accomplishing.It is concerned with harmonising all the different section of an organisation to avoid struggles. Controling on the other manus is the procedure of mensurating advancement by comparing existent consequences with planned consequences and taking disciplinary steps. Controling involves all the activities the director undertakes in seeking to guarantee that existent consequences runs with planned or targeted consequences. It answers among others the undermentioned inquiries ;

Have we achieved our mark?

Why? and

How did we accomplish it?

Fiscal directors must interact with executives in other sections of the concern if the house is to run every bit expeditiously as possible. All direction determinations have fiscal deductions and all fiscal directors must take this into consideration. Government enterprise in resource direction in the United Kingdom, authorities enterprise in resource direction sought to affect physicians, nurses and other wellness attention professional staff more actively in the issue of bing, budgeting and other public presentation related to monitoring and control system after Griffiths enquiry of ( 1983 ) .

Fiscal Decisions and Major Investment ; as stated by Block and Hirt ( 1995 ) , finance is closely related to the Fieldss of economic sciences and accounting, it is in consonant rhyme with this that, fiscal directors must understand the relationship between these Fieldss.

It is the duty of fiscal directors to allow ( allocate ) financess to both current and fixed assets to obtain the optimal mix and use of fiscal options and to develop an appropriate dividend policy within context of the organisation ‘s aims.

Harmonizing to Block and Hirt ( 1995 ) the day-to-day activities of fiscal direction include recognition, direction, stock list control and the reception and expense of financess. On a more wide base, fiscal direction maps are categorized into three ( 3 )

Daily map:

Credit direction

Inventory control

Grosss and expense of financess

Occasional maps:

Stock issue

Bound issue

Capital budgeting

Dividend determinations

Profitableness map

Trade-off-an understanding to make something if person else does something.

Besides Peterson ( 1994 ) stated that the daily intent of a house ‘s fiscal direction is to run into current and future operational demands. Harmonizing to her, the fiscal director ‘s undertaking include development, application and monitoring of policies and determinations sing concern activities such as:

Collection of client grosss

Raising long footings financess

Payment of duty

Investing in marketable securities

Investing in long term assets such as edifice

Departments that perform fiscal direction undertaking include histories receivable ( aggregation of client recognition histories ) , fiscal planning ( be aftering for hard currency influxs and escapes ) , histories collectible ( payment to providers ) and capital budgeting ( investing in long term assets ) .

Peterson ( 1994 ) , farther said an organisation like infirmary has a specific end of supplying some services such as raising financess for research on specific unwellness. The end of fiscal direction of such establishment is to raise financess and to buttonhole to maximise the sum of research on unwellness, supplying maximal benefit for their constituency ( those afflicted with the unwellness ) .

Harmonizing to Vanttorne ( 1996 ) , in an effort to do optimum determinations, the fiscal director makes usage of certain analytical tools in the analysis, planning and control activities of the house. He stated that, fiscal analysis is a necessary status or pre-requisite for doing sound fiscal determinations. He farther stated that, one of the of import functions of fiscal director is to supply accurate information on fiscal public presentation of the organisation.

Manness ( 1988 ) besides stated the following as the maps of the fiscal director:

The fiscal direction is responsible for the administering and doing determinations and giving recommendation about the most of import facet of the finance sectors, long-run funding, dividend policy, capital outgo and resource allotment within the organisation.

The fiscal director involves profoundly in planning and control of capital outgo for the acquisition of belongings, works and equipment and other assets that accrue both short and long-run benefits for the organisation or house.

The fiscal director involves besides, in the monitoring, analysing and describing on the organisational public presentation.

One other bookman, Brookington ( 1980 ) stated that, the fiscal director is one member among a squad of direction and therefore, his activity is non of an person but a part towards the entire direction attempt and must hence be coordinated decently with the other members of the direction. Some alone maps of fiscal director as indicated by Brookington are ;

To do financess available at the right clip

To obtain financess for the house at the right clip

To guarantee the most efficient usage of the financess

In 1980s, a direction information system for ministries was developed in the United Kingdom ( UK ) and the purposes of this type of analysis was to place what it being in chase of policy aims, what is costs and whether an alternate processs that could bring forth efficacious consequences more stingily, better value for money and non a poorer criterion of services.

In 1982 the UK Government reply the parliamentary exchequer and civil service commission on the efficiency and effectivity of the study. The authorities introduced a periodic policy reappraisals and subject of hard currency bounds, which was meant to find and command the entire public disbursement and viing service allotments.

What the United Kingdom ( UK ) Government introduced is called Financial Management Initiative ( FMI ) . The chief aims, of fiscal direction enterprise are to advance in each authorities department/organization, the system which have clear position of aims: good obtained duties: and the necessary information to assist to dispatch them. It sets out to advance self trust and enthusiasm and to increase their occupation satisfaction by giving them independency as personal duty for the accomplishment of aims as the direction of their staff and budget is consistent with recognized rules and policies with single freedom of action

The Ministry of Health ( MOH ) Financial direction Medium Term Strategy ( MTS ) towards vision 2020 has it that, the Ministry wants to beef up its fiscal direction in order to:

To better preparation for comptrollers

To better outgo control

To guarantee the efficient running of internal audit system

Compare cost for similar instruments

The Ministry of Health ( MOH ) Financial Reports ( 1990s ) maintained that its fiscal staff should be dependable and guarantee that:

Fiscal studies are prepared accurately

Outgos are valid, accurately recorded and based on sufficient documental grounds

Approved budgets are non exceeded

Professor A.B. Akosa a past president of the Ghana Medical Association ( GMA ) and the current Director General of Ghana Health Service ( GHS ) said that, wellness professionals should non be decision makers. Harmonizing to him, wellness decision makers occupy the proverbial secretary place of the Hospital. The daily direction of the infirmary are in their custodies, which means that they are the procurance directors and work in collusion with providers or work in close harmoniousness with contractors on the award of contracts

Professor Akosa means that, wellness disposal is complex and can non be relied entirely on three twelvemonth graduate student programmed in disposal and physicians in direction are hence of import resources that can non be dispensed with. He continued by saying that, wellness sector direction is the most hard undertaking because unlike most occupations where directors are existent foremans, with wellness, one comes up against really top professionals who traditionally lords it over others instead than the other manner around and there is no where in the word that the main sawbones and main doctor on whose attempt the infirmary generates fund ( money ) will let decision maker to stamp over them. He said they will non let the sweeping highjacking of the direction of their wellness installations by people who care less about the public assistance of the patient

He noted that, decision makers must concern themselves with bed direction, forces, direction, direction of records, efficient assignment systems, wellness information guaranting friendly environment and fiscal direction instead than procurance and awarding contracts which have all been so streamlined ( subterranean motivation ) that is shed blooding the infirmary of the Internal Generating Fund ( IGF ) as authoritiess subvention through infection of the cost supplies, supply of hapless quality stuffs and rising prices of contract amounts must be checked.


Ghana National Health Service ( NHS ) footings investing assessment as option assessment. The cardinal ground behind this alternation is to stress the fact that, organisations with limited resources ( capital ) and a broad scope of alternate investings based their determinations on measuring the virtues and demerits of each investing, either than concentrating on a peculiar type of investing.

Harmonizing to Perrin ( 1992 ) , Professor Emeritus of Wanwicks University and Honmry Fellow of University of Exter the biggest capital investing of the National Health Service ( NHS ) are the edifice of new infirmaries, proviso of infinite and installations for research labs and other proficient support services.

As a consequence, this increases the unit cost of handling a patient and for that affair, entire cost of handling patients. In state of affairss where discounted hard currency flows is used as a technique for measuring investing in the wellness sector, this seldom shows a positive Net Present Value ( NPV ) . The principle behind this, is the, fact that, chief motivation of the Ghana Health Service ( GHS ) is non to do net income but to do quality wellness service accessible and low-cost to all.


2.4a Introduction

Mr. Daniel AidooMensah, Chief Executive of Metropolitan Insurance Company in his article on day-to-day in writing page nine ( 9 ) captioned: Health Care Financing- the Way Forward: lamented that, the lifting cost of supplying wellness attention has become an albatross hanging over the caputs of most states both developed and developing, Ghana is no exclusion.

He noted that, while most states adopted the “ Health for all by 2000 AD ” as a end by the World Health Organization ( WHO ) , there were non clear guidelines towards the interlingual rendition of this end into world as a bringing by wellness service and whether such services would be low-cost. Year 2000 is gone and “ wellness for all ” remains a twenty-four hours dream.


Still in his article “ Health attention Financing- the manner Forward ” , Mr. AidooMensah explained that, Health Care funding in Ghana has milled different stages before independency. Harmonizing to him, the colonial authorities provided limited wellness attention installations for its employees – civil retainers and their dependents- and financed this mostly through general revenue enhancement, while non-civil retainers attended private and mission clinics at their ain cost.

He farther elaborated that, the support of the wellness attention service substructure was made by authorities and the mission/private practicians. It could be once more celebrated that, instantly after independency, the authorities initiated programmes to better and spread out the wellness attention installations. The socialist policies ushered in chances for increased societal public assistance and wellbeing and the wellness services became virtually free.

By late sixtiess, the worlds of the continued economic diminution had compelled the authorities to present nominal out-of-pocket part to wellness attention services and the Hospital ‘s Fees Decree, 1969 ( NLCD 260 ) was passed. Mr. Mensah farther explained that, the hard currency and carry system whereby money for the purchase of indispensable drugs and other points has to be provided before any intervention was introduced in 1992 with it ain attender. This system of funding wellness services has non received the support of the general populace who continued to oppose it.

The Government of Ghana ( GOG ) , harmonizing to Mr. Daniel AidooMensah, was hence looking for a more efficient method of funding wellness attention services and wellness insurance thought as the chance presented itself.


The funding and proviso of wellness attention has been a challenge confronting many states in the word.

In 2003 the National Health Insurance Scheme ( NHIS ) was established in Ghana. It seeks

to procure the proviso of basic wellness attention services to individuals occupant in Ghana through territory common, private common and private commercial wellness insurance strategies.

The National Health Insurance Scheme in Ghana is deemed as one of the bequests of the John Kufuor disposal. Seeking the authorization of the people in the 2000 elections, Kufuor promised to get rid of what was known at the clip as the “ hard currency and carry system ” of wellness bringing. Under this system, patients – – even those who had been brought into the infirmary on exigencies – were required to pay money at every point of service bringing. Imagine being sent to a infirmary with a bleeding accident lesion and being asked to pay before a physician attends to you. Peoples died. In some instances, lives were lost for the simple ground that friends and relations were non around to do the needed advanced payment.

The New Patriotic Party ( NPP ) Government ‘s wellness policy as contained in its pronunciamento for the 2000 presidential and parliamentary election stated “ under the NPP authorities, workers and their employers, local communities, spiritual organic structures etc will be encouraged to set up their ain wellness insurance strategy. The public wellness installations will be improved to give quality service at low-cost cost even to those non covered by any insurance strategy ” .

It was further stated “ a particular establishment will be created for oversing wellness insurance. That establishment shall be managed independent of authorities. Social Security and National Insurance Trust ( SSNIT ) shall concentrate on administrating the National Pension Scheme and will non widen its coverage to wellness insurance.

The National Democracy Congress ( NDC ) wellness policy as contained in its pronunciamento for the 2008 presidential and parliamentary election stated under the NDC authorities will present one clip premium besides public wellness installations will be improved to give quality service at low-cost cost.


Health insurance is a method of paying for wellness attention. This is an agreement such that hazards of incurring wellness attention costs are shared by a group of people over clip. This is done by puting up insurance or a sickness fund that is shared among the group. Members of the group will hold to lend on a regular basis to the fund so that should one autumn ailment, the insurance strategy pays your medical measures.

Harmonizing to Mr. Daniel AidooMesah, Health Insurance is defined as a method of supplying members of a defined group or community with protection against the cost of medical attention. He farther stressed that, Health Insurance is based on the rule of pooling of hazards and hence the redistribution of fiscal resources for that section of a community which does. To Mr. Daniel AidooMensah, Health Insurance is about sharing of hazard and guaranting fiscal screen, should the single demand medical attention, the cost of which is good beyond his /her means.

He highlights ; because under normal fortunes, there are more healthy people than ill 1s, it is possible and sensible to pool together the parts received and pay the medical claims of those who do fall it.Those who are good still bask the benefit of being covered by themselves should they necessitate medical attention. Health Insurance therefore provides protection for the insured against fiscal adversity ensuing from unwellness or hurt.

Mr. Daniel AidooMensah pointed once more that, an insurance benefit, whether national or private is non a free gift dished out by the insurance company or authorities. It is a benefit which must be earned by part in the signifier of premium payments, like any other signifier of insurance. He once more noted that Health Insurance works better hen a big cross subdivision of the community is insured. When hazards and resources are pooled among the big groups of individuals with different chances of necessitating wellness attention, the security of person is enhanced. He still went in front to state that a big group ensures a better spread of hazard and that can take to lower premiums. It is besides, a status necessary for doing the strategy feasible.


As stated in his article “ Health Care Financing – The Way Forward ” , Mr. AidooMensah mentioned that, there are different types of wellness insurance strategies. To him, the standards for definition are normally based on whether or non they are voluntary as opposed to compulsory and whether or non rates of part are based on single hazard appraisals.

“ There are hence, two ( 2 ) chief generic classs ; National/Social Health Insurance Schemes and Private Health Insurance Schemes ” he said. Again, he mentioned that, there are fluctuations of generic classs. National Health Insurance Schemes may include community based schemes whilst Private Health Insurance Scheme may include employee based strategies.


Harmonizing to the Chief Executive officer ( CEO ) of the Metro Politian Insurance Company, National Health Insurance Schemes are by and large sponsored by the authorities and rank is normally mandatory for specific section ( s ) of the population.

He farther hinted that, societal insurance is made executable by the rule of solidarity which works good in a society that acknowledges or accepts this type of common support. With societal insurance he said, Premiums/Contributions are non normally based on single hazard appraisal and normally financed by revenue enhancement on incomes.

Mr. Daniel AidooMensah stressed that, the nucleus group usually covered by societal insurance is made up of workers in the formal sector whose engagement is on mandatory footing so as to avoid “ inauspicious choice ” .

With respects to the benefits of this system of insurance strategy, Mr. AidooMensah pointed out that, if this system is decently implemented, it will take to a state of affairs where the community provides for hospitalization, surgery, indispensable drugs and medical specialty, general pattern attention and on occasion particular attention, research lab services and dental attention.

On the demerits of this system of Health Insurance, he pointed out the followers:

Administration cost which are usually high due to inefficiencies and bureaucratic constructions.

The population in the informal sector may be hard to be included due to jobs of measuring their incomes and an ailing societal insurance strategy will hold to be propped up by authorities fiscal subsidy. This will set an extra load on authorities that is seeking to avoid subsidy on goods and services.


Equally far as Private Health Insurance is concerned, Mr. Daniel A. Mensah has the undermentioned remarks:

Private wellness insurance strategies are offered on voluntary footing and are based on appraisal of hazard of each person. Different benefits are normally available for choice harmonizing to one ‘s demands and ability to pay. The bureaus that provide voluntary wellness insurance coverage are insurance companies, medical society, brotherhoods, community groups and common associations. Below harmonizing to him are some of the advantages of private wellness insurance:

Servicess are more likely to be expeditiously managed and delivered ;

There is more equity in those premiums assessed which are normally straight related to the hazard insured.

It is flexible and will readily do accommodations to profit agendas and other conditions as a effect of competitory force per unit areas.

On the contrary, the disadvantages are enumerated below:

The rule of common support does non use, therefore doing it expensive to see certain groups of people. For economic grounds, private strategies shy off from certain sections of the society, therefore striping them of the needed coverage. It is the pattern for most companies to supply free medical services to their employees as portion of corporate bargaining understandings based on trade brotherhoods or employee groups.

Most of these strategies are group self-insurance strategies and retain a peculiar service supplier on a fee-for-service footing to widen installations to employees and in some instances a specified figure of registered dependants. The greatest job with this method is cost containment originating chiefly from maltreatment by employees and over-servicing by suppliers.


Mr. Daniel AidooMensah in his article “ Health Care Financing – The Way Forward ” published in the “ Daily Graphic ” ( April 7, 2001, Page 23 ) said “ Community based insurance strategy is organized locally by the community on voluntary footing. Premiums are paid by families and are by and large non based on single hazard appraisals ” . The Community-based strategies have been recognized as a agency of supplying insurance coverage for rural communities, which are improbable to profit instantly from either a societal or private wellness insurance strategy.


On the same article captioned on day-to-day in writing page nine “ Health Care Financing – The Way Forward ” , the Chief Executive Officer ( CEO ) of the Metropolitan Insurance Company enumerated the undermentioned basic status for the effectual operation of National Health Insurance:

The predominating wellness policies and ends.

The province of the wellness bringing system.

Demographic issues and occupational distribution of labour force and income degrees and the economic potencies and growing chances of the economic system.

The bing system of health care funding, societal and cultural attitudes and handiness of administrative and proficient forces.


In the September – October 2002 edition of “ The Professional Accountants ” , the under listed remarks sing budgeting were featured.

Budgeting is an of import direction accounting technique, which can profit all signifiers of concern endeavor if to the full understood and decently operated. A budget is defined as a quantitative analysis prior to a defined period of clip of a policy to be pursued for the period to achieve a given aim.

Budgetary control on the other manus, is the constitution of departmental budgets associating the duties of executives to the demands of policy and continues comparings of existent with budgeted consequences, either to secure by single actions the aim of that policy or to supply a footing for its alteration.

Successful budgeting is non an automatic result but budgeting procedure is more likely to win when the undermentioned conditions are prevailing:

Top direction engagement and support ;

A clear definition of long-run aims within which budgeting operates ;

An organisational construction, which has clearly defined duties and governments ;

Full credence and engagement in line directors ;

An effectual accounting information system that is supportive and non endangering.

In drumhead, “ The Professional Accountant ” ( 2002 ) stated that, acknowledgment of both proficient and behavioural facets of budgeting are indispensable if organisational ends are to be achieved.

Budgeting is non merely a strictly proficient procedure. It includes legion behavioural jobs, which can be peculiarly riotous if directors do non take part in the scene of budgets or if Budges degrees are perceived as unachievable.

Perrin ( 1992 ) , argued that, fiscal control in the National Health Service ( NHS ) and similar populace services had concentrated on the control of hard currency flow. Buying processs and the answerability of budget holders for current outgo and resource inputs. He stated that, greater fiscal highs in concern is best achieved by supervising grosss received and mensurating and commanding the cost of resources consumed in the production and supply of specific goods and services.

Henley ( 1985 ) , Controller and Auditor General ( Britain ) has it that, in analyzing the development of budgetary control in the National Health Services ( NHS ) , two ( 2 ) chief cardinal conditions must be considered:

Effective budgetary control system, which concentrates on organisational and answerability model in the organisation.

For budgetary control to be effectual, it is indispensable that, the cost or outgo reported against Budges must be accurate and available for treatment, and remedial action taken where necessary.


Perrin ( 1992 ) , described answerability in the National Health Service ( NHS ) as a vexing undertaking. He argued that, while in commercial concern, attending focused on the satisfaction of clients on one manus and stockholders on the other manus, this is non the instance in the National Health Service ( NHS ) . It is so because, the National Health Service ( NHS ) has no portion holders and is merely meant to do wellness service accessible and low-cost to all instead than being net income oriented.

He farther stated that, the National Health Service ( NHS ) has few clients who pay personally and straight for services they received. The NHS is mostly in monopoly supply of public goods and clients of its products/services have a limited pick in the services they receive. Patients by and large lack the accomplishment to measure the quality of the service provided by the National Health Service ( NHS ) . That is, patients are frequently in no mental province to shop about so as to measure the proficient efficiency or value for money of the attention they received.

He lamented that, there has a struggle within the National Health Service ( NHS ) , since the taking function in wellness bringing is being taken by physicians and other medical practicians, whose aims and codification of moralss are non ever to the full compatible with the hunt for efficiency and value for money carried frontward by National Health Services ( NHS ) directors and comptrollers to run into authorities policy directives.

Chapter THREE


3.0 Introduction

This study is intended to look into fiscal direction in the Ghana Health Service ( GHS ) . The chapter concerns the assorted methods used in roll uping informations for the survey. In order to do the exercising meaningful and helpful, issues such as instruments for the aggregation of informations, population, trying and trying processs, interviews and informations analysis are considered in this chapter.

3.1 Population

The issue of fiscal direction in the Ghana Health Sector ( GHS ) is of major concern to all good pregnant Ghanaians. This root from the fact that, the cause of supplying wellness service in Ghana has increased enormously since the in-between yearss of 1980s.

To entree the efficiency, effectivity and economic system ( The 3Es ) in the usage of fiscal resources of the Ghana Health Service ( GHS ) , the chief population to this survey will include: The Upper West Regional Director of Health Services, the Accountant of Upper West Regional Health Administration, The Administrator of Wa Regional Hospital burying non the comptroller of Wa regional infirmary.

Besides to be taken into considerations are: senior medical officers, druggists, dispensary technicians, nurses, and patients.

3.2 Sampling

Respondents were selected based on the afore-mentioned population classs.


Random sampling was used for the choice of respondents from the targeted population groupings.

3.4 Instruments USED

The chief instruments employed for the aggregation of informations for this study included the followers: questionnaires, personal observation, interviews and documental beginnings.

3.4.1 Questionnaire

As portion of the procedure of roll uping informations, designed questionnaires were administered personally to guarantee that right and relevant information was obtained. Open inquiries required in-depth account from the respondents. Specifically, questionnaires were distributed to personalities:

Respondents to questionnaires






Regional Administrator

Hospital Director

Hospital Accountant




Gross Collectors

Medical Assistants

Medical Military officers






















Beginning: Field survey, July 2011

Responses received from the above-named people will be analyzed and used as such.

True, questionnaires enabled the research workers to obtain with easiness Frank and luxuriant replies more sensitive and awkward inquiries, as the respondents felt it easy in supplying replies to such inquiries.

3.4.b Observation

In order to look into the nitty-gritty of issues ( Financial Management ) in Ghana Health Sector ( GHS ) , the research worker took it a duty to reach personal observations. That is, many visits were made to the Wa Regional Hospital and the Wa Regional Health Directorate where research workers personally saw activities refering to Financial Management and other related issues and informations consequently related. By this understanding, information was taken after every visit and no efforts were made to modify any information obtained.


Through personal interaction ( interviews ) with a cross-section of the mark population, the research workers were able to obtain from mark population, some informations. In this procedure, the research worker were able to interact freely and unreservedly with interviewees. Better still illiterates ( patients ) who could non react to written questionnaires were covered through this procedure.


Data was obtained from studies, magazines, newssheets, newspapers, diaries, cusps and many other beginnings refering to fiscal direction in general and in Ghana Health Sector for that affair. As a consequence, relevant information was obtained from the Wa Regional Library.

Furthermore, the histories clerk at the assorted sections of the Wa Regional Hospital was contacted for information incorporating 2011 gross as follows:

Out-Patient Department ( OPD ) ;

Gross Books ;

Laboratory Revenue Books ;

Dispensary Revenue Books ;

Gross Analysis Books ;

Besides, fiscal studies of the Hospital for the twelvemonth 2011 and the freedom list for same period were obtained. I gathered information from the Ministry of Health ( MoH ) outgo controls on Internally Generated Fund ( IGF ) , Ministry of Health ( MoH ) gross aggregation processs and Financial Management Training for Non-Financial Managers in Health Sector.


Due to the fact that a figure of research methods were employed before geting at those pieces of information obtained, it suffices for one to be certain of the steadfast base and dependability of information gathered.

Besides, people from whom information was collected delineated true members. In most instances, questionnaires, interviews and documental beginnings methods employed proved the countries they were questioned on. Under the interview, the forces of the strategy were personally interviewed.

Furthermore, a cross-section of nurses, out-patient and other paramedical staff were interviewed. Coincidentally, the information obtained from the workers was the same as obtained from the functionaries. This gives strength to the fact that, informations collected is accurate, reliable and dependable.

From our personal observation, it could be said at convenience and with assurance that, the information for the survey is valid, accurate and hence dependable for any future work on Financial Management in the Ghana Health Services ( GHS ) .

Chapter FOUR


4.0 Introduction

This chapter presents the analysis of determination of informations obtained on which the concluding sum-up, decision and recommendation shall be made.

The analysis of the informations will be presented in combined signifier taking into history all the questionnaires distributed and other manners of informations aggregation such as interviews, observations and documental beginnings.


4.1 ( a ) History and Location

Wa Regional Hospital was established in 1952 as the lone infirmary in Wa and it render quality wellness services to the indigens of Wa, in the Upper West Region. Wa Regional Hospital strategically located in the bosom of the regional capital and performs a double map as a regional and municipal infirmary and besides serves as a point of mention to topographic points like Lawra, Nadowli etc.

As a Centre of excellent ( within the Health Care bringing system ) it renders quality wellness services in the part and its catchment countries which extend beyond Upper West are to Bole, Tuna etc. In the Northern Region and the adjacent states like Burkina Faso and Cote d’Voir due to its closeness.

Recently, Wa Regional Hospital has a bed conformity of one hundred and 80 nine ( 189 ) spread over nine ( 9 ) wards with the casualty ward inclusive.

Presently, programs are far advanced for the infirmary to be upgraded to the position of a teaching infirmary.

4.1 ( B ) The set up

The infirmary has assorted units headed by several qualified forces with the overall caput being the Regional Director of Health Service. Other units within the infirmary include Histories Unit, Internal Audit Unit, Pharmaceutical Unit, Accident and exigency Unit, Out-Patient Department, Kitchen/Laundry, Workshop/Store, Mortuary, X-ray, Physiotherapy, Private ward and Eye Unit. Other wards include Relative Lodge, Isolation/Medical Ward, Surgery Ward, Psychiatric Ward, Gynecology Ward, Operating Theatre, Laboratory and E.C.G

4.1 ( degree Celsius ) Accounts and Records Unit

This Unit is headed by a senior comptroller who is the caput of the finance unit, five ( 5 ) other accounting staff, consisting two ( 2 ) senior histories officers, one ( 1 ) histories officer, one ( 1 ) Junior histories officer and one ( 1 ) comptroller. Extra six ( 6 ) gross aggregators, three ( 3 ) national service forces and two ( 2 ) people on fond regard.

4.1 ( vitamin D ) Hospital Management

A sober expression at the infirmary ‘s organisational chart revealed that, the Wa Regional Health Director is the overall caput of the infirmary. The infirmary has a direction commission rank which includes: Administrator, Accountant, Deputy Director of Nursing Service ( DDNS ) , Pharmacist, Deputy Director of Pharmacy Service ( DDPS ) and the Medical Superintendent. The commission is headed by the Medical Superintendent with its maps being planning, forming, heading, oversing and commanding the personal businesss of the infirmary.

4.1 ( vitamin E ) Procurement Committee

As a demand by the Government, the Wa Regional Hospital has a procurement commission rank of which include the supply officer, procurement officer, history, medical overseer and caput of disposal. The commission meets quarterly and its major map is to assist the hospital purchase points of highest quality but at a decreased monetary value.

4.1 ( degree Fahrenheit ) Organizational Chart of the Hospital

Detail ‘s is an organisational chart of the Ho



















Gross ACCT





X ray







Monitoring ACCT

Alveolar consonant














4.2 Beginnings OF Fundss

Harmonizing to the ministry of Health ( MOH ) fiscal study for the period January 1st to 31st December 2011, the following are the chief beginnings of financess available to the Ghana Health Service ( GHS ) .

National Health Insurance Fund.

Financial recognition

Internally Generated Fund ( IGF )


Government of Ghana ( GOG ) Subvention


The study indicated that for the period under reappraisal, the undermentioned sums were received by the Ghana Health Service ( GHS ) from the aforesaid beginnings.

Table 4.1

Beginnings of financess available to the Ghana Health Services ( January to December 2011 )

Beginning of financess

Gross Revenue Distribution by Sources of Funds ( SOF ) for the period stoping 31st December 2011

Amount US Dollar Percentage ( % )

( Ghana Cedis )

NHI Fund

986.0 111.48 46.57


166.1 18.77 7.85


264.7 29.93 12.50


571.3 64.59 26.99


68.8 7.78 3.25


60.1 6.80 2.84


2117.0 239.35 100.00

Beginning: Ministry of Health Financial Report ( January to December 2011 )


The analysis of the above information revealed that the MOH fiscal study for the twelvemonth 2011 reported little fluctuations in both support and disbursement forms relative to the same period of the twelvemonth 2010. Donor pool fund ( DPF ) parts from givers wasGHA?332.41 in the coverage period pieces at that place wasGHA?259.78. Contribution in the same period of the old twelvemonth, an addition of27.96 % Internally Generated Funds ( IGF ) increased by 32.31 % on the same period of last twelvemonth and National Health Insurance ( NHI ) part besides increased by46.38 % over the same period of the old twelvemonth chiefly due to wages and Additional Duty Hour Allowance ( ADHA ) .

In footings of per centum part by the assorted beginnings to the sector, NHIS and IGF contributed 59.1 % . in the coverage period as compared with in the old twelvemonth. Donor part was 29.8 % of Gross Revenue as against 27.5 % of the old twelvemonth. Financial recognition contributed 7.85 % as against 10.2 % of the old twelvemonth and eventually ; GOG contributed 3.25 % in the coverage period.

The same repot revealed the outgo distribution by SOF Group for the period stoping 31st December 2011 as shown in the tabular array in pageaˆ¦aˆ¦


Beginnings of Fundss

Outgo Distribution by SOF Group for the pending Ending 31st December 2011 ( Amount in Ghana Cedis )



Item 2


Item 3


Item 4



US $ ( m )









































































% of entire







Beginning: MOH Financial Report for the period stoping 31st December 2011.


Beginnings OF Fund

Beginning: Ministry of Health Financial Report ( January-December 2011 )

It can be inferred from the above tabular array and chart that, in footings of outgo, the ministry recorded a entire ofGHA? 1,905.6 Ghana Cedi for the period out of this sum, 42.6 % was personal emoluments as against 43.6 % for 2010. Items 2 and 3 were 44.1 % as against 37.70 % of the old twelvemonth and investing outgo was 13.35 as compared with 18.72 % for 2011.


As the name suggests, this is a fund from the national wellness insurance authorization and with this releases are made on re-imbursement of claims in order to provide for the daily running disbursals of the infirmary. It is managed through the infirmary disposal by the mandate from medical manager.

All the beginnings of the concluding one-fourth, probationary estimations are received by the caput of the finance unit based on the estimations approved for the last one-fourth of the merely ended fiscal twelvemonth. Thus ballot keeping Budgeting Management Centers ( BMCs ) are first advised of their authorization to pass financess by a missive from the MOH which is accompanied by the first quarters probationary estimations. After this, the Budgeting Management Centers ( BMC ) has to fix Financial Encumbrance ( FE ) as required by Financial Administration Regulation ( FAR ) subdivision 289 which provinces “ Financial Encumbrances shall be prepared for each point of perennial outgo on which sub-items allotments could be listed and should be signed and forwarded for blessing for attesting internal audit ” on blessing by the certifying exchequer, the caput of the finance unit requires that, a Memorandum Journal Voucher ( MJV ) is prepared for each sub-head that summarizes all ( fee ) issued-for that one-fourth.

Harmonizing to subdivision 57 on Perennial Outgo of Financial Administration Regulation ( FAR ) 1979, Prizing Military officers are authorized to O.K. the release of financess by Financial Encumbrances ( Fes ) but may make so merely up to the bound that such releases shall transcend the undermentioned bounds:

First One-fourth: – Not more than a one-fourth for the net authorised proviso for the twelvemonth.

Second One-fourth: – Not more than a half for the net authorised proviso for the twelvemonth.

Third One-fourth: – Not more than three quarters of the net authorised proviso for the twelvemonth.

Four One-fourth: – Not more than the net authorised proviso for the twelvemonth.

Unless otherwise instructed by the infirmary disposal, no subsequent missive, presentment or budget figures are provided to vote holders one time one-year budgets have been approved. The entire re-imbursement for Wa Regional Hospital for the twelvemonth ended 2011 is GHA?512,305.74


Outgos made out of national wellness insurance financess have been itemized into Numberss as shown in the tabular array 4.3 below. Outgos are based on Commitment and Cash accounting. Fundss are committed on nutrients and services to be handled by the junior-grade teller.

There are three ( 3 ) ways for the committedness of financess from NHIF. The first instance is where a BMC would wish to order for nutrients or services from a provider through the issue of a local purchase order ( LPO ) .

The 3rd case is where an functionary of the GHS travels on an official assignment, therefore the traveling and conveyance disbursals are borne by the NHIF.

From the oncoming, it can be observed that, the lone two committedness paperss that are used are either LPO or Travel Requisition Form ( TRF ) . It is imperative to cognize that, no payment of any sort is made to a seller or staff member unless a valid committedness or papers has been raised, approved and entered into the outgo budget leger. This is applied to all beginnings of financess. In position of this, financess are committed and payment effected unless the undermentioned processs have been followed:

All committedness of financess must be evidenced by either an LPO or TRF.

A member of accounting staff ( within the finance office has certified LPO or TRF approved the Head of the BMC.

For beginnings of financess, the caput of the finance must authorise the formal committedness of financess into the outgo budget. For NHI Funds, blessing from internal audit unit must besides be obtained.

Approved committedness must be recorded in the outgo budget leger by a designated member of the histories office and must be supported by either and original LPO or TRF which when returned to the original Payment Voucher ( PV ) and filled consequently. In all the LPO, TRF and the PV must be signed before any check could be raised. Besides, the prizing officer has to reexamine the PV before any payment can be made.

Last, the check has to be signed by the caput of finance office and caput of BMC before it can be cashed.

It was discovered through our survey that NHI financess do non come early as expected. For illustration, the first one-fourth claims re-imbursement sometimes comes at the beginning of the 3rd one-fourth due to bureaucratic process by which strategies are advised by their authorization to pass financess by a entire measures submitted from Washington infirmary which is accompanied by the first one-fourth claims measures estimations. Due to these holds, by the clip the probationary estimation reach the assorted infirmaries they might hold been spent already.


Item ( codification )

Approved YTD

Budget ( A )


Commitment ( B )

Available Budget

– ( B )













































Beginning: Histories Unit, Wa Regional Hospital

From the tabular array above, it can be deduced that the budgeted sum which was approved for the twelvemonth 2011 was 512,305.74 cedis. Out of this, 425,213.76 stand foring 83 % was really expended, go forthing an unspent favourable balance of 87,091.98 stand foring 17 % .


These are financess which are generated internally by the Budget Management Centers ( BMCs ) . In 1985 per legislative figure 1313 as a beginning of gross for authorities infirmaries, clinics and wellness centres.

Harmonizing to the ministry of wellness ( MOH ) , Financial Report ( 1995 ) , the purpose of the infirmary is to supplement authorities one-year budgetary allotments to the wellness establishments. It would therefore help the establishment to better wellness bringing installations every bit good as the general public assistance and wellbeing of patients.

As stipulated in FAR Section 33, estimations of departmental grosss must be prepared each twelvemonth by the caputs of section and based on predominating charges/fees agenda. The caput of each regional/district infirmary coaction with other senior hospital direction functionaries must fix estimation of each beginning of point of gross for the resulting calendar twelvemonth.


Item Code

Budget ( Cedis )

Actual ( Cedis )

% of Actual over Budget

% of Actual