China's health ministry has asked big hospitals to set up internal auditing offices to intensify the crackdown on financial mismanagement.

New regulations require medical institutions with more than 300 beds or annual revenue of at least 30 million yuan (3.75 million U.S. dollars) to set up "independent" auditing offices with professional auditing staff.

Corporations and institutes with an annual revenue of at least 20 million yuan (2.5 million U.S. dollars) and subordinate units in the health sector were also ordered to conduct internal auditing, according to the Ministry of Health.

The auditing offices will monitor and instruct local health departments to audit their internal financial incomes and expenses, as well as other financial activities, the regulations say.

Internal auditors, who are involved in corruption, dereliction, leaks and abuses of power, will be severely penalized, say the regulations.

Last month more than 10,000 cases of illegal pricing in the country's medical sector were reported, involving illegal acquisitions of nearly 800 million yuan (100 million US dollars).

Eight hospitals, including the Beijing University First Hospital, were publicly criticized for serious illegal charges.