In a red-faced moment that CFOs dread, West Penn Allegheny Health System has said that it will adjust its fiscal 2008 balance sheet after overstating its accounts receivable by about $67 million. The system is already in financial trouble, reporting an operating loss of $15.6 million on revenue of $1.1 billion for the nine months ending in March, so more losses aren't great news. The announcement follows a reorganization of top leadership that took place in May.
As part of the adjustment process, the system said it plans to make sure that overall records of growth in accounts receivable over the past nine months are accurate. It's also planning to make sure that its new charge-capture technology isn't mucking things up. While West Penn Allegheny officials have estimated the excess accounts receivables at $67 million, they note that the figures are preliminary, and that this year's balance sheet may not reflect the final adjustment. Meanwhile, the balance sheet, which ended June 30, will also include a $6 million adjustment related to goodwill and noncompetition agreements.
To learn more about West Penn's situation:
- read this Modern Healthcare piece (reg. req.)
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