The results of our audit disclosed deficiencies in internal control and/or instances of noncompliance or other matters that are considered reportable under Government Auditing Standards. Specifically, the audit found no indications of abuse by the Program. However, abuse could occur and not be detected because the Program lacks objective, impartial due process procedures for physicians who dispute its evaluations and directives. In addition, the Program gave the CEO/Medical Director and the Clinical Director excessive influence over the process for reviewing physician complaints; physicians were not allowed to effectively represent themselves when disputing evaluations; the North Carolina Medical Board did not periodically evaluate the Program, and the North Carolina Medical Society did not provide adequate oversight. Also, the Program created the appearance of conflicts of interest by allowing treatment centers that receive Program referrals to fund its retreats, paying scholarships for physicians who could not afford treatment directly to treatment centers, and allowing the centers to provide both patient evaluations and treatments. Furthermore, Program procedures did not ensure that physicians received quality evaluations and treatment because the Program had no documented criteria for selecting treatment centers and did not adequately monitor them. Finally, The Program's predominant use of out-of-state treatment centers created an undue burden on physicians. The North Carolina Physicians Health Program generally agreed with our findings and recommendations. Details about each item are provided in the Audit Findings, Recommendations and Responses section of the report.