This paper examines the quality of routinely collected information in an Iranian hospital in a trial of casemix classification. Australian Refined Diagnosis Related Groups (AR-DRG) were used to classify patient episodes. There were 327 DRGs identified, of which 20% had only 1 case. The grouper program identified invalid records for 4% of total separations. Approximately 4.5% of cases were classified into error DRGs and 3.4% were ungroupable. No complication and comorbidity effects were identified with 93% of total cases. R2 (variance in length of stay explained) was 44% for untrimmed cases, increasing to 63%, 57% and 58% after trimming by L3H3, IQR and 10th–95th percentile methods respectively.