Managing Financial Resources
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Added on 2019-12-17
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Discussing the different sources of income that can be used within the care home 7 2. Discussing the different sources of income that can be used within the care home 7 2. Suggesting ways in which services can be improved through better financial system and processes 15 CONCLUSION 16 REFERENCES 17 INTRODUCTION Financial resource management is highly concerned with making effective and optimum use of money.
Managing Financial Resources
Added on 2019-12-17
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Managing Financial Resources
Table of ContentsINTRODUCTION...........................................................................................................................4TASK 1............................................................................................................................................41. Explaining the principles of costing and calculating unit cost of one resident.......................4Solution....................................................................................................................................52. Identifying the information which individual requires for managing the financial resources53. Explaining the regulatory requirements which are highly associated with the management offinancial resources.......................................................................................................................64. Evaluating the computer software’s which make contribution in the management................6TASK 2............................................................................................................................................71. Discussing the different sources of income that can be used within the care home................72. Analyzing the factors that affect the availability of the sources of finance.............................83. Reviewing budgets which are relevant for the residential care home.....................................94. Explaining the ways in which decision about expenditure is made......................................10TASK 3..........................................................................................................................................111. Preparing a cash budget for the next three months................................................................112. Explaining the actions that individual needs to undertake when fraud is suspected.............123. Evaluating the methods which can be used for monitoring and controlling budget.............13TASK 4..........................................................................................................................................141. Identifying the information which is required for the purpose of decision making..............142. Analyzing the relationship that takes place between level of services, cost and expenditure...................................................................................................................................................143. Evaluating the ways in which financial considerations have effect on individuals..............15
4. Suggesting ways in which services can be improved through better financial system andprocesses....................................................................................................................................15CONCLUSION..............................................................................................................................16REFERENCES..............................................................................................................................17
INTRODUCTION Financial resource management is highly concerned with making effective and optimumuse of money. The rationale behind this, in business monetary resources is one of the mainfactors that have high level of impact on the effectual execution of plan. In this, financial toolsand techniques have high level of significance which in turn helps in making control onoverspending. Hence, technique of budgeting control provides deeper insight about theperformance level of each department. Moreover, by making comparison of the actualperformance with the standard aspects business unit can assess the deviations take place in thefinancial aspects. In this way, by taking corrective measure business unit can make contributionin the attainment of organizational goals and objectives. The present report is based on the casesituations of health care organizations which will develop understanding about the differentprinciples of costing. Further, it will shed light on the financial tools which ensures effectual useof resources in the highly strategic business environment. TASK 11. Explaining the principles of costing and calculating unit cost of one resident Six important principles of costing framed by NHS are:1.Consistency: costing should be clear and clean. Information must be made accessible toall the practitioners regarding to residential home.2.Data Accuracy: It is the principle that explains data input must be accurate to costingprocedures (Finkler and et.al., 2016). Inaccuracy in residential home for elderlyindividuals will result in prolongs treatment.3.Transparency: The information like physician licensing, clinical outcomes, patientsatisfaction responses etc can be collected, reported publicly and used to benchmark theresidential home and physicians on basis of quality.4.Stakeholder Engagement: Costing process involves typical stakeholder of residentialhome like clinical staff, nursing staff, consultants etc. It is the availability of clinical and
financial commitment, to ensure quality information which work with the residentialhome.5.Casualty: Casualty accord with occupying and understanding the residential home's'cause and effect relationships' for purpose of modeling. 6.Objectivity: objectivity deals with applying the casualty insights of residential home inlearning and optimization action (Daft and Marcic, 2016).Calculating unit cost of one resident is enumerated below:By using the data given of a residential home, calculate the cost of one resident per month.Average variable cost = £1,200/monthFixed cost = £900,000/yearNumber of beds = 65SolutionAverage variable cost = £1,200/monthFixed cost per month = £900,000/12 = £75000Total variable cost = £1200*65 = £78000Total Cost per month = FC + TVC = 75000+78000 = £153000Cost for one resident per month = 153000/65 = £2353.8 For the implementation of control system business unit requires to exert control ondirect and indirect expenses. By this, care unit would become able to control cost and therebyattain high profit margin. 2. Identifying the information which individual requires for managing the financial resources Information required in a residential home to manage its financial resources are those datawith respect to its previous and present performance, cash and fund flows as well as its dailyoperations. Financial difficulties are information which includes crises incorporated to cash flowand insolvency based advises for the residential home. Other information required by the
residential home are of recovery of full costs, cash flow forecasting models, assets, bad debts,and management of working capital (Busch, Bauer and Orlitzky, 2016). The amount receivedfrom customers as fees, charities received from different persons, governmental and non-governmental enterprises and the funds granted by the government, amount accumulated due tovarious made to ascertain shortage of cash are to be managed and accounted properly so thatthese information can be used in cost and budgetary controlling of the residential home. Tomanage resources more effectively and efficiency individual requires information regardingdirect and indirect expenses, fixed cost etc. Direct expenses of residential care home includematerial, labor etc. Fixed expenses include rent of the building, salaries of personnel etc. Further,indirect expenses include electricity, R&D expenses etc. 3. Explaining the regulatory requirements which are highly associated with the management offinancial resources Regulation is controlling and ascertaining the framework by government in form oflegislation to check the conduct of residential home and its individuals. Main role of regulatoryrequirements is to reduce financial crime, promote integrity and equality, consumer protection,accountability, and maintain effective and organized structures (McBain and et.al., 2016). Thevarious financial requirements that are to be observed by residential home operating in the socialand health care sector must provide the guidelines in order to initiate management of financialresources. Example of financial requirement for residential home is developing an efficientsystem of risk management system so that credit activities are managed. Care qualitycommission, NHS Commissioning Board and Healthcare sector regulator monitor are the mainexternal bodies which place high level of emphasis on auditing aspects. Hence, by makingcontinuous monitoring of financial aspects care unit can take suitable decision regarding it.Along with this, internal bodies such as higher management team also need to take investmentdecision by appraising the proposals through the means of capital budgeting tools or techniques. 4. Evaluating the computer software’s which make contribution in the management What Evaluation Criteria Should You Use? Remember, software is not the only factor youshould consider. Some criteria are; s
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