Table of Contents INTRODUCTION...........................................................................................................................1 REFERENCES................................................................................................................................2
INTRODUCTION Financial resources means proper planing, organizing, directing and controlling all activities that related with finance. In organization financial management play important role because through this they make strategy for proper utilization of resources and provide better services and produce quality product and services with low and cheap cost (MacLeod, 2017). Care south group is a health care corporation and it was founded in 1995 and headquarter situated in Augusta, Georgia and USA. That provide home care services to patients. This report will be cover principle of costing, sources of income, factors that affect resources, budget expenditure and effects of finance affect service user. Task 1 1.1 principles of costing. Costing is a process of record all original cost of assets, liabilities and investment. It is use by care south for manage all information of finance and it helps in operate organization effectively. It also helps in reduce cost and control for increase profit. Organization compares actual cost and expected cost and then follow following principles for control. Stakeholder engagement:- this principle helps in control cost of health and social care organization because through this care south group engaged all stakeholders that direct and indirectly relate with organization so it helps in control cost because it includes all stakeholders and include cost so that they manage and control for reduce cost and increase profit. Data accuracy :-this principle also use by care south corporation because through this they record accurate data and it helps in get fair result so it makes easy to evaluate real cost and helps in cost control system. For this they use journal entries, ledger, trial balance according to staying patients and clinical staff and then take decision. Businesscontrolsystemisveryimportantforcaresouthbecausethroughthissystem organization focus on achieve objective and goal. It includes evaluation of staff and analyze their performance and duty that they do work proper or not. After evaluation managers and owners of health and social care system make rules, regulations and standard (Carvalho, Meier and Wang, 2016). Following principles use for business control :- Materiality:- this principle helps in control of business and analyze that employees and staff and cost give proper and expected return or not so after that managers and owners of care south group make rules and regulation for manage and control work for increase profitability. 1
Consistency:- through this principle all department of organization measure their cost so it makes easy to evaluate and control. Because all department evaluate their own cost and record originally. 1.2 information need for manage finance. Many types of information need for health and social care organization for manage financial resources. Care south group has need financial resources for payment of liabilities like payment of staff, purchase material, equipment, medicines and bed. So all things are managed through finance and for meet objective they have to proper plan acre of their resources. It receives revenues from fee of patients and other revenues so information of finance has to keep accurately and transparent that helps in manage finance. It also has to make plan for face risk that possible and may occur in future suddenly. So this risk includes in health and social care like neglect to patient, failure of operation and death of patient during treatment that is risk for care south. So information include like preparation of budgets, auditing, administrative expenditure, financial cost and renovation of buildings and equipment needs in manage finance. All these records and information helps in manage finance (Popova, 2016). 1.3 Regulatory requirement for manage finance. In health and social care many departments and authorities make rules and regulations for proper management of financial resources that reduce cost and provide better services to patients and care of safety to them. Following authorities like :- Care quality commission:- it is a authority that inspect to health and social care organizations. According to inspection it makes rules and regulation for provide better services and aware to peoples for get better service about their health. So people also has choice for take health and social service center. Health sector regulate monitor:- this department also has authority to monitor and regulate health and social care and issue license to organization that provide both services like health and social. This authority mainly focus on patients safety, determine price and support to patient and also reduce and prevent their problem that they face due to lack of finance. GAAP:- this authority is includes in accounting standard and regulation of this authority use by health and social care organization like care south for record accurate data and report of 2
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financial information of organization so it helps in keep fair and accurate data and easy to evaluate for make strategy and plan that helps in manage finance. 1.4 systems of manage financial resources. Many methods are use by care south for manage finance and control to all finance that include expenditure and revenue. So care south use following system for manage finance resources effectively:- Financial accounting system:- through this system managers and owner of care south health and social care organization evaluate all financial books and records. Management of finance is very important for improve business and it is only possible through sound financial accounting. Because it keeps all records and transaction related to revenue and expenses. Costs control system:- this system very helpful for care south because through this system cost control possible. It evaluates all costs and through this organization evaluate and compare expected cost and incurred cost. Organization easily trace their cost and inspect all things and change according to need for reduce cost and manage (Fong and Tong, 2015). Payment system:- this system important for health and social care because through this it evaluates liabilities of organization and evaluate pending payments and available funds. After that they make decision for reduce cost and liability. Task 2 2.1 diverse source of income. Many types of source of income are use by health and social care organizations. All sources are use by care south for increase income and sufficient funds collect for expenses. So for increase revenue it provides different offers to their clients for attract. Source of income like fees that they collect from patients. So they earn revenues from different types of patients like mental disable, physical disable and young people home care services. Care south group also has extra income that they earn from investment for increase their funding. So it invests capital in different sectors and get earn more income from interest. It helps in improve and develop health and social care services to patients. Organization use for pay to their liability. One more source of income is sale shares and equity to peoples and in market it also increases capital of organization and it also provides home care services post hospitalization. All things use by care south in improve their services and provide better treatment with safety. 3
Young people residential service provide by care south that main purpose is reach to children on right path and care to them it mainly generates income. Adult learning disabilities is source of income because it cares to adult that they suffering from disability. 2.2 factors that influence of financial resources. Many factors are present in nearby of care south that direct affect to organization's financial resources. So income and profit reduce from these all factors and organization can't provide proper services to patients. Following factors like :- Reputation:- reputation of organization is play main role in fiance because if image of organization not establish well in market so customer's attraction is reduced and customers are resources of finance. Positive image of organization helps in increase revenues and investor invest their capital in organization bases on reputation (Ahn, 2017). Creditworthiness :- it is a factor that affect to care south group. It means that present and future ability of organization to pay loans and credits. So it also includes all history of organization that they make payment timely or not. If creditworthiness is good so lenders attract from it and give loan and finance. Size of organization:- it is a main factor that influence financial resources of health and social care because if organization size is large that its balance sheet also large and these things helps in borrow money and it increases their capacity. If size of business is small so institutions of finance do not lend money that effect on resources. Government funding policies:- in health and social care system government give funds to organizations for improve and develop their services. It provides funds according to policy of government. So it also a factor that affect to care south financial resources. So all these factors influence to financial resources and it creates barriers in organization that decrease revenue. 2.3budget expenditure in health and social care. Budget is very important for health and social care organization and care south group. Many types of budget make by them for operate their business. It is make for specific time period and for expense of specific amount. Budget is a financial plan and it is make very effectively and efficiently. Through rights organization use limited capital and expenditure and earn revenue (Gagarina, 2017). Following budgets are use by organization :- 4
Overhead budget:- this budget is important in manage income and make balance between income and expenses. That means care south make estimate to pay all expenditure through income and income is sufficient or not for payment of liability. Resources budget:- it is very important and common budget for organization and care south use this budget for adopt resources that helps in increase revenue of organization. It also helps in make estimate that spend income and increase resources that includes machinery and equipment and other. Human resource budget:- this budget is use for hire and manage manpower because it is very important asset that increase revenue in care south group. So for these things and hire of skilled and efficient employees they have to make budget for training, selection and recruitment for increase and improve revenue (Berg, 2016). 2.4 decision about expenditure are made within health and social care. Organization has to take decision about expenses and for achieve result according to strategy. Cost benefit analysis helps in identify and evaluate that organization earn benefits according to expenditure or not because return is very important against of expenditure. So it helpful for compare revenue and expenditure. Organization spent money in any project after evaluation that it give return or not. It also evaluates and analyze environment that direct affect to organization performance and revenue so it uses tool like SWOT and PESTLE analysis for evaluate condition. It evaluates these things before invest money and invest those place where revenue is more than cost. Decision taken in health and social care related to expenditure so organization analyze and choose priority in all activities that means it decides important work and expense on it and make budget because it spent money on any work so it makes budget according to department and work than they start business. It focuses and purpose behind decision of expenditure about increase profit and attraction of patients (Spencer, 2018). TASK 3 3.1 Explaining management of financial shortfall Financial shortfall is a major problem that can be faced by any business organisation. Excessive fall of finance may result in failing an organisation to meet its financial requirement that can affect its smooth running of business. Management of financial shortfall requires a 5
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proper analysis of the overall financial system of the company, evaluating requirement of financial resources by the firm and maintaining the resources accordingly. Caresouth Group should develop effective management of the financial activities as it would help the company in maintaining sufficient amount of liquidity as to pay its debts. Insufficient financial management can also result in enhancing the overall cost of company in form of increase in interest and penalties amount due to late payment(Arnaboldi and et.al., 2015). In this regard, financial management should be put into the priority list by the company. Further, Caresouth Group can manage or maintain sufficient cash by issuing shares to shareholders or by issue dividend. Further, managers can manage it by developing appropriate policies for sales and purchase of goods in cash or on credit. It could be consider as the best way of managing the financial shortfall in the firm. With the help of adopting the best financial shortfall management strategies, managers of Caresouth Group can prevent it from insufficiency of finance. Further, it can also enhance the ability of business in meeting its all the obligations. 3.2 Explaining action to be taken at the time of suspected fraud In order to prevent a company from fraud and other suspected activities, each country develops various laws and regulations. Further, each company should also develop its strategies and strict policies so that no employee or member of the company could perform any activity for making fraud and gain inappropriate money from the business as well. Fraud can be made in various ways in the Caresouth Group. For example, developing falsepayrollofsalaries,abusingthepositionheldbyanyofmemberofcompany. Misrepresentation of any of the transaction in the books of firm, manipulating any financial activity and gain personal income from it rather than including it in company's books of accounts, etc. Caresouth Group should develop various management policies and strict rules for all these suspected activities of the business. As enhancement of these activities in the business can lead in suffering a huge loss by the company(Horton and Farnham, 2015). In case of happening any of the fraudulent act,Caresouth Group should make an indepth inquiry of overall transaction, should detect the suspected members of firm. Further, it should take strict action towards them like suspension, higher amount of penalties, deduction from salary, etc. 6
it would help the group in preventing its whole business from the fraud and other suspected activities. 3.3 Evaluating arrangement of budget monitoring in health and social care organisation Schedule for expected cash collection particularamount collection from debtors of august24000 collection from debtors of September8000 cash sales7400 total collection39400 Schedule for expected cash dispersion for inventory particularamount purchase of inventory5000 Payment to creditors for inventory of august16000 Total dispersion of cash21000 Cash budget of Caresouth Group for the month of September ParticularAmount (September) Opening cash11000 Cash sales7400 Collection from debtors38000 Less:Purchase5000 Payment to creditors16000 Selling and distribution expenses13000 Purchase of equipment18000 Utility expenses paid3000 Add:Closing cash balance5000 Net cash and cash equivalent6400 7
Interpretation From the analysis of above cash budget in can be interpret that company would have sound financial position. Company would gain appropriate amount of cash as to repay its current debts. Budget monitoring arrangement it is a process that needs to be performed continuously by a company. Development of budget monitoring arrangement in the Caresouth group would help the company in determining the need of cash and cash equivalent with the business within a specific period. Further, it will also help in detecting various areas from which it could generate cash and other financial resources for the company(Kelly, 2015). Through which managers would be able to develop their strategies in more effective manner. In this regard, it can be evaluated that development of appropriate arrangement of budget monitoring will help the Caresouth Group in strengthening its financial plans. TASK 4 4.1 Identifying information required for making financial decisions relating to health and social care services Takingappropriatefinancialdecisionisrequiredbyeachbusinessorganisation. Sustainability of a company majorly depends upon the management of financial activities and maintenance of financial resources of the company. For the purpose of taking the most appropriate decisions for the business, Caresouth group needs to gain all the relevant information about the company. Financial resources includes cash, assets, bank, liabilities, etc. while taking financial decisions, its managers needs to develop strategies and plans for each of these elements. In this order, Caresouth group should provide appropriate budgetary reports, information relating to flow of each assets, requirement of inventories within a specific period etc. all these information will help the company in detecting the need of finance within a specific time period. Further, it should also provide information about usage of cash and cash equivalent along with various sources through which it can gain finance for running of business. Moreover, by gaining information, Caresouth group's managers would be able analyse and determine various financial situations of the company(Lægreid and et.al., 2016). It would 8
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result in enhancement efficiency of managers in developing effective strategies for the business and taking appropriate decisions relating to financial activity of the business as well. 4.2Analysingrelationshipbetweenhealthandsocialcareservicesdelivered,costand expenditure Quality of health and social care services to be delivered by Caresouth Group depends upon the amount of funds held by it. In case the company wants to deliver high quality services to a large number of population, the company would need to incur a huge amount of expenditure which would enhance the cost of its business. Further, delivering health and social care services to small quantity of population would result in reducing the cost of business(Torchia and et.al., 2015). In this regard, it can be analysed that Both health and social care service deliveries and their cost and expenditure are directly related to each other. 4.3 Evaluating impact of financial consideration upon an individual using health and social care services Financial consideration refers to the sum that would be paid by consumers in the exchange of services or goods provided to them. They are the sources of funds from which the company can gain finance for the business operations. Caresouth Group can gain financial consideration by providing quality services to the consumers and attract them towards the company. Being a health and social care service provider company, as its aim is not gaining profit, therefore, it would not require charging extra funds for the business, but Caresouth group would need to set price of services in such a way so that it could regain the cost incurred by it in providing services. Further, it can appoint professionals as to provide health care services to consumers. With the help of it, company's requirement of staff would also be reduces through which it can become more cost effective. Through which the company would become able to set lower price for the individual customers for providing health and social care services. In this regard, appropriate financial consideration would be influenced for individual using health and social care services of customers. 9
4.4 Suggesting way of improving health and social care service through changing to financial system and process Analysis, evaluation and adoption of the most effective financial system and process is the essential activity of the financial managers of Caresouth Group. It directly effects the financial sustainability of business. For this purpose, the company can adopt effective cost control system, as it would reduce the cost to be incurred by business. Moreover, adoption of inventory management system in the business would result in preventing the business from inventory wastage. Caresouth group can also adopt key performance management technique in the company(Arnaboldi and et.al., 2015). It will lead in enabling the company to analyse and monitor each activity of its business. In addition, enhancing efficiency of predicting future cost, fruture incomes form service provided by the company, etc. would also help the business in enhancing the financial decision making power of the company. In this regard, by adopting the above financial management techniques, the Caresouth Group would be able to improve the financial system and process of the health and social care services. Conclusion From above study it has been summarized that finance is a important for organization and it controls is very important so records of finance keep fairly and accurate that helps in take right decision. Many authorities include in health and social care financial resources like GAAP, care quality commission. Financial resourcesmanage by manger and owner through financial management system and cost control system. Many types of source of income available in organization that helps in increase revenue. It uses budgets like human resource budget and overhead budget and financial shortfall and it management also covered in this report. So management of financial resources and budget is important for compare expenditure and revenue and increase and improve revenue. 10
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Lægreid, P. and et.al., 2016.Organizing for coordination in the public sector: practices and lessons from 12 European countries. Springer. Torchia, M. and et.al., 2015. Public–private partnerships in the health care sector: a systematic review of the literature.Public Management Review.17(2). pp.236-261. Online [Online] Available through : <> 12