Counting the Assets

Asset4000 asset management software from Real Asset Management allows prominent Foundation Trust to improve patient service through economies of time and money, whilst ensuring availability of vital hospital equipment.

Harrogate and District NHS Foundation Trust (HDFT) is the principal provider of hospital services to the 183,000 people of Harrogate, Ripon, Wetherby and surrounding areas. Established in 1992, the Trust has been successful in developing a wide range of high quality local services and completing the new district hospital building programme. Harrogate District Hospital now provides some of the best hospital accommodation in the country and is continually winning awards, including ‘The Dr Foster Best Small Hospital’ and ‘Top Hospital in England’ from the Healthcare Commission.

Running a successful Foundation Trust requires skill and dedication as well as good financial management. Part of the financial accounting procedures operated by the Trust involves liability for its 13,000 accountable assets – ranging from hospital buildings to software licences and all the medical paraphernalia associated with a district hospital.

John Brewster, capital accountant for the Trust, says that the fixed asset management of the hospital’s property and resources is dictated by the financial accounting procedures of the Trust. “Technically, our recorded assets are those goods that cost over £5,000, although we tend to group things like IT equipment together,” he says. “The most expensive items on our register are probably the radiology equipment where we have scanners that cost in excess of half a million pounds each, closely followed by the operating theatre equipment and our portable scopes and scanners.”

In order to manage the growing number of assets for accounting purposes as well as keep track of their whereabouts, Brewster wanted a specialist system that would competently handle all the items throughout their lifecycle. “Ad hoc asset management systems are very labour intensive and add considerably to the total cost of asset management,“ says Brewster. “We had a system that was difficult to deploy and was failing to handle the increasing amounts of items, therefore, we wanted a professional solution that we could have confidence in and that would enable us to keep more accurate records.”

HDFT chose Asset4000 from Real Asset Management (RAM) for its flexibility, reliability and robustness. “RAM provides us with the ability to hold as much information about our assets as we want to, including serial numbers, location details as well as accounting information on purchase cost, replacement value and book price,” says Brewster. “We hold every accountable asset on it from non-medical kitchen equipment, vehicles and soft furnishings, to the contents of our latest up-to-date operating theatre. It contains all the items of equipment needed to run a modern hospital.”

Every piece of hospital equipment is now accounted for in the RAM Asset4000 database and Brewster is confident that his asset management system and procedures now represent an accurate picture of the hospital’s assets. Every item purchased comes through his department and is automatically entered onto the register. Annually, a detailed asset list report is produced which allows custodians to confirm to Brewster and his team the location, correct ownership and value of each item of equipment.

“The RAM system is designed to quickly build an accurate, centralised database of assets,” says Brewster. “To keep it up to date we also have a scheduled, rolling programme of physical checks, because items get moved, transferred or even disposed of, without us being informed.”

Each month, as part of the reconciliation exercise, asset number labels are produced for any new items that have come into the hospital. A member of Brewster’s team is then charged with tracking down the item in the appropriate department and sticking on its asset register label.

“I am confident that we have 99% of our assets captured within the Real Asset Management solution, purely because I am part of the process,” says Brewster. “Any asset that is purchased has to come through my office, and that is its point of capture.”

One of the biggest challenges Brewster has faced was implementing the processes and getting other staff on board. “It’s not generally regarded as a top priority to keep track of the assets,” says Brewster. “Especially in operating theatres and day surgery units with a busy workload and where they have a lot of expensive equipment that moves about. They just want to know that the item is there when it is needed – not that it is being monitored as part of our standard financial procedures – and the RAM system helps us do just that.”

For HDFT, RAM provides much more than just an asset register. “It’s also a financial tool for modelling, forecasting and estimating,” says Brewster. “And this is where the system comes into it own.”

Asset4000 is used extensively when putting together a business case for a new, expensive, piece of equipment. The financial consequences, together with an estimate of capital charges, of the investment can be easily calculated and added to the decision making process. Using a copy of the live asset register, Brewster and his team can create capital charge and depreciation forecasts for the next five years across the whole Trust. “Being able to predict with a degree of accuracy, what our financial commitments are going to be is of enormous value,” says Brewster. “We are currently investing in a new £2.5 million IT system and, for 12 months during the proposal stage, we were continually producing additional cost estimates. We could only do that because of the power of the asset register and the information it contained.”

RAM provides HDFT with a comprehensive record of each individual asset, displayed in a manner that is easy to use. A wide variety of reports can be generated in a number of formats from standard spreadsheets for departmental use to accounting estimates delivered directly into the financial package. “We have always found the RAM system to be accurate – it has never been wrong,” says Brewster. “Support for the product is excellent and we rely on RAM’s Asset4000 for its precision and ease of use. It saves us time and money in providing exactly the information we need, allowing us to get on with our job of managing the finances of a busy local hospital trust, confident that we can accurately meet the financial reporting requirements.”

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