Health Care Business Analysis Individual Paper

2037 Words Jul 6th, 2015 9 Pages
Health Care Business
HCS/577
June 29, 2015
Benjamin Ovando

Health Care Business Analysis
In creating a new operating budget a decision had to consider the type of budget that would best fit the needs of the hospital. Since there is several financial management practices involved with creating an operating budget, we must understand which practice will help us create a budget that is substantial for the needs of Patton Fuller Community Hospital. The Patton Fuller Community Hospital Nursing Statistics provided information including cost of nurse per hour, cost of nurse per 24 hour day, number of nurses per patient, number of nurses per day, nursing cost per day, and nursing cost per month. This statistical budget is the basis
…show more content…
If that is not likely to be the case, it must be disclosed,” (Finkler, 2006). The next rule is Conservatism. This rule can compete with other rules. This rule states that all potential risks should be taken into account when recording financial information and forecasting the future financial state. Matching indicates that revenues and expenses should be matched and recorded in their indicated time frame. Cost is a very simple concept. “The value of what was given up to acquire the item,” (Finkler, 2006).
Materiality is the rule that indicates errors are material when they would change the decision that an investor or other stakeholder might make regarding the organization. Consistency is the rule that states the style of accounting used throughout the financial documents is consistent. Full disclosure is a catch all rule. It states that anything that has yet to be reported needs to be recorded. This is a way to ensure that all financial reports are a fair representation of the financial state of the organization.
Financial reporting and accounting in any industry is difficult but is especially challenging in health care. Fund accounting is often used in health care organizations and it is very important that all of the GAAP principles are carefully applied to their full extent. Matching and full-disclosure are especially important when…

Related Documents