Thursday, 7 June 2012

CSC admits to “intentional errors” in NHS project

Yet more embarrassment for CSC! 

It has admitted that “intentional errors” were made by
finance staff in UK to overstate the profit on the NHS project by US$24million. That translates into a significant percentage of UK profits, which means it must have been easily noticed by anyone who had oversight.

Further details are on the “Public Service Co” website:

CSC is apparently taking measures against the finance
staff involved, but what about the operating management?  Finance staff do not go into the office thinking that “today might be a good day to do a bit of creative accounting to
inflate the profits”.    They tend to be told, or asked, or threatened or enticed to overstate profits by an operating
manager. So which operating managers are involved and what actions is CSC taking against them?

As we have said in previous blog entries, how many
more NHS issues have to come to light before Guy Hains, the CSC President directly responsible for the project, is held to account?  Either he knew about the errors and should
accept responsibility for them. Or he did not know about them, which begs the question of his management oversight and how he could not notice such a large error in the profit number.  

CEO Mike Lawrie has promised top management  accountability in CSC. Maybe this would be a good place to start its implementation.

It is a concern, as it sounds similar to the deliberate errors to overstate CSC Denmark’s profit in 2010, which is still under investigation by the SEC.    How many more instances of creative accounting might still be lurking in CSC’s
books? Will the current and previous leaders of the Finance function held to account?


Anonymous said...

On May 31, 2012, CSC and the NHS extended the Lorenzo-related standstill agreement to August 31, 2012.

This continued lack of progress on NHS was cited as one of the reasons behind the latest cut in CSC's credit rating.

Anonymous said...

Can some one tell me what 'an intentional error' is please? All errors are by their very nature untinentional. This must mean that CSC intended to book these financial transactions which means they are a deceit, or to be blunt fraud.
As they were don in the name of the UK NHS service I wonder what the polticians and managers in charge of NHS in the UK have to say about it!

Anonymous said...

In response to the 19 June 18:10 comment from Anon

I think that an "intentional error" is a deceit that senior management refuses to take responsibilty for, preferring to find somebody lower down the organisation to take the blame.