Finance

Types of Budget

Fri, 19 Mar 2010 16:50:29 GMT

Name and descibe 5 types of budgets.

Answer:

Incremental versus Zero Based Budgeting- only increases vs. rejustifying everything

Comprehensive versus Limited in-Scope budgeting - Comprehensive budgeting integrates all the budgets into one document (rev, exp, and capital) verses only parts of the budget

Fixed versus Flexible Budgeting – volumes do not change verses variable costs with volume

Discrete Versus continuous Budgeting – lose all income not used verses carrying to the new year

Top down verses bottom up- dictated verses participatory

10 Concepts for Preparing Accurate Financial Statements

Thu, 18 Mar 2010 13:46:18 GMT

Accounting Entity - data must be pertinent to business, defines the business entities
Going Concern - indefinite life, ongoing business
Accounting period - can be any length of time
Objectivity and reliability - information recorded must be based on objective verifiable information
Monetary Unit - example: Dollar
Relevance - relevant to user, must contain sufficient info to make decisions
Full Disclosure - must provide the complete picture, you must not mislead by omission of pertinent information
Materiality - only entities which are material to financial condition of an organization need to be separately categorized
Conservatism - choose approach that is least likely to overstate the financial condition
Consistency and comparability - use like guidelines over periods of time.

Cash Flow Question

Wed, 03 Mar 2010 21:46:49 GMT

The following are strategies used to manage hospital cash flows except:

1. Payment of employees every two weeks or every month.

2. Pay vendors when the supplies or bill are received.

3. Minimize employee wage & supply expense through exploring ways to accomplish more work with fewer resources.

4. Pay vendors only when the bill is due.

Answer: #2. Source: The Financial Management of Hospitals and Healthcare Organizations, p.204.

Allocation Process

Mon, 01 Mar 2010 15:22:58 GMT

Organizations will have different cost allocations bases on the following decisions EXCEPT;

A. Allocaton method

B. Allocation base

C. Responsibility centers

D. Approved budget

Four ways to reduce the collection period-

Tue, 16 Feb 2010 22:54:36 GMT

Develop and enforce policies and procedures for the prompt and accurate registration and admission of all patients.
Implement a patient accounting system that will promptly and accurately record all charges.
Maintain a medical record system that will promptly and accurately record all clinical data.
Obtain a board-approved credit and collection policy that directs management in extending credit and collecting accounts from patients.

Finance Section

Tue, 26 Jan 2010 00:34:28 GMT

Although, I understood this section, it is very difficult to apply to my facility. Not being able to apply it to my daily work life makes it difficult to remember. As a DoD/VA facility our financing and funding are entirely different. We do not use any of these processes; nor do we use ratios. We do have financial statements, capital purchasing pathways etc. We do have to work within a budget and can only fund certain items; so we do deal with resource scarcity and must justify what we do. Many of the concepts are there, but the vehicles we use are different. This section will be difficult to study.

Zero Based Budgeting

Sun, 24 Jan 2010 22:59:08 GMT

In my organization we annually perform a zero based budgeting process. We find that "peeling" back the layers of the onion are very beneficial to understanding the various operational and systematic variances that occur throughout a fiscal year. While it is very complicated and time consuming we annually uncover various opportuniites for improving financial performance that may not have surfaced without zero based budgeting.