New Zealand’s healthcare system is one of the most trusted in the world. From public hospitals to community clinics, providers are expected to deliver high-quality care while staying compliant with a wide range of financial, legal, and operational regulations. This level of accountability is made possible with the support of healthcare audit companies.
These firms specialise in reviewing healthcare operations to ensure everything is being done right—whether it’s handling public funds, maintaining privacy standards, or delivering services under regulatory frameworks. In this article, we’ll explore the role of healthcare audit companies in New Zealand, the services they offer, how audits work, and how healthcare organisations benefit from them.
What Are Healthcare Audit Companies?
Healthcare audit companies are firms that provide independent assessments of healthcare organisations to ensure they operate efficiently, follow regulations, and manage resources properly. These audits may be financial, operational, clinical, or regulatory in nature.
Unlike general auditing firms, healthcare audit companies focus on the unique challenges of the medical sector. They understand compliance obligations under health-specific standards and work closely with medical service providers to evaluate service quality, patient data handling, and internal controls.
They may be engaged by:
- Public hospitals
- Private healthcare providers
- Residential aged care facilities
- Māori and Pasifika health services
- Mental health and disability service providers
Why Audits Are Crucial in Healthcare
Healthcare is a highly regulated industry. Providers receive funding from government sources, deal with sensitive personal data, and deliver critical services. Failing to meet legal or operational standards can harm both patients and the organisation.
Audits help healthcare providers:
- Maintain transparency and trust
- Meet Ministry of Health and Te Whatu Ora requirements
- Keep up with the NZS 8134:2021 standards for health and disability services
- Verify proper use of public funds and donations
- Ensure safe clinical and workplace practices
In many cases, regular audits are mandatory. Certification processes for aged care or mental health providers often include reviews by independent auditors.
Services Offered by Healthcare Audit Companies
Healthcare audit companies offer a wide range of services based on the needs of the organisation. These services help ensure compliance, uncover inefficiencies, and promote good governance.
1. Financial Audits
These involve reviewing financial statements to ensure accuracy, transparency, and compliance with New Zealand standards (such as PBE or NZ IFRS). Auditors check income sources, grants, payroll, and expenditures.
2. Certification and Compliance Audits
Providers seeking or maintaining certification are reviewed against required standards. This may include clinical documentation, infection control, health and safety, and governance structures.
3. Payroll and Leave Audits
Healthcare roles often involve rotating shifts and complex rosters. Audit companies assess whether employees are paid correctly and receive the correct leave entitlements under the Holidays Act 2003.
4. Privacy and Information Security Reviews
With strict laws under the Privacy Act 2020, healthcare providers must protect patient data. Audit firms assess how records are stored, accessed, and protected from breaches.
5. Operational Efficiency Reviews
These focus on internal processes such as purchasing, inventory, service delivery, and patient flow. The goal is to identify areas of waste, inefficiency, or control weakness.
Table 1: Common Services by Healthcare Audit Companies
| Service | Purpose |
| Financial audits | Ensure accurate and compliant financial reporting |
| Compliance audits | Maintain licensing and certifications |
| Payroll audits | Verify accurate wage and leave calculations |
| Privacy audits | Protect sensitive health data and prevent breaches |
| Operational reviews | Improve efficiency and reduce internal risks |
The Healthcare Audit Process in New Zealand
Engaging an audit company typically follows a structured process. While some audits are mandated (such as certification audits), many providers conduct voluntary audits to identify risks and improve performance.
Step 1: Engagement and Planning
The provider and the audit company first agree on the scope of the audit. This includes deciding which areas to review—finance, clinical care, payroll, or systems. An engagement letter outlines the responsibilities and timing.
The auditors then review previous audits, current regulations, and organisational structure to plan their approach. Key risks and priorities are identified early.
Step 2: Risk and Controls Assessment
Auditors evaluate how well the organisation manages risk and how internal controls operate. For example, they might assess whether billing systems flag unusual transactions, or whether access to medical records is properly controlled.
This step helps define the areas that need closer inspection during fieldwork.
Step 3: Fieldwork and Evidence Gathering
Auditors begin testing data, reviewing documentation, and interviewing staff. This could involve checking a sample of payroll records, verifying income against funding agreements, or inspecting patient files for compliance with treatment standards.
In some cases, auditors also visit the facility to observe practices and inspect records physically. Where appropriate, audits may be done remotely using secure platforms.
Step 4: Reporting and Recommendations
Once the fieldwork is completed, auditors compile their findings in a report. This includes any concerns, weaknesses in controls, or breaches of standards. It also contains practical recommendations to resolve issues.
The report is usually shared with senior management and/or governing boards. In the case of regulatory audits, it may also be sent to external agencies.
Table 2: Summary of Audit Process Phases
| Phase | Activities | Typical Duration |
| Planning | Define scope, assess risks, review background | 1–2 weeks |
| Risk assessment | Identify focus areas and evaluate internal controls | 1 week |
| Fieldwork | Collect data, test records, conduct interviews | 2–3 weeks |
| Reporting | Draft report, review with client, finalise findings | 1–2 weeks |
Key Regulations and Standards
Healthcare audit companies ensure compliance with several critical frameworks:
- NZS 8134:2021 – Certification standard for health and disability services
- Privacy Act 2020 – Governs patient information handling
- Health and Safety at Work Act 2015 – Protects employees and patients
- Holidays Act 2003 – Covers payroll and leave obligations
- Public Finance Act 1989 – Relevant for publicly funded health entities
A knowledgeable audit firm stays updated on regulatory changes and emerging sector risks, including digital health technologies and cybersecurity threats.
Benefits of Using Healthcare Audit Companies
Healthcare organisations can gain several benefits by engaging audit firms that specialise in their sector:
- Compliance Assurance – Reduce the risk of fines or regulatory actions
- Transparency – Demonstrate accountability to funders, boards, and patients
- Efficiency Gains – Streamline processes, reduce waste, and improve service delivery
- Risk Management – Identify internal control gaps before they become problems
- Improved Trust – Build public and stakeholder confidence through independent reviews
Many providers also find that audit recommendations help drive organisational growth and strengthen their long-term strategy.
Selecting a Reliable Healthcare Audit Company
Choosing the right audit firm is crucial. Here are key factors to consider:
- Sector Experience – Has the firm worked with healthcare providers before?
- Regulatory Knowledge – Are they familiar with New Zealand health laws and standards?
- Reputation – Can they provide references or case studies?
- Communication – Are their findings clearly explained and actionable?
- Independence – Are they free from conflicts of interest?
Selecting a firm that understands both clinical and financial contexts can make audits smoother and more useful.
Conclusion
New Zealand’s healthcare providers operate in a complex environment of public funding, patient care, and regulation. To meet these demands, many turn to healthcare audit companies to help them stay compliant, efficient, and accountable.
From aged care facilities and hospitals to community providers, audits offer a way to understand risks, improve practices, and build trust. When done properly, they are not just a regulatory requirement but a valuable part of good governance.
As healthcare continues to evolve—especially with digital systems and patient expectations—working with experienced healthcare audit companies ensures that providers are prepared for the future.
FAQs
Are healthcare audits mandatory for all providers in New Zealand?
Not all providers are required to undergo audits, but many are. For example, aged care facilities must be certified under NZS 8134, which includes regular audits. Publicly funded healthcare organisations often need financial audits to meet contractual and legal obligations. Even when not mandatory, voluntary audits help healthcare providers improve internal systems and demonstrate transparency, making them a recommended practice across the sector.
How do healthcare audit companies ensure privacy compliance?
Healthcare audit companies assess how patient information is collected, stored, and accessed under the Privacy Act 2020. They review whether electronic health records are secure, if access is limited to authorised staff, and how data breaches are handled. They also look at physical record-keeping systems, data sharing policies, and training procedures. Their audits help ensure that personal information is protected, building trust between patients and providers.
What’s the difference between an internal and external healthcare audit?
An internal audit is typically performed by in-house staff or consultants hired to review risks and operations regularly. It helps management make improvements before issues arise. An external audit, on the other hand, is conducted by independent healthcare audit companies to provide an unbiased assessment. External audits are often required for certification, licensing, or reporting to regulators and funders. Both play important roles in maintaining healthcare quality.
