Designing a Financial System for Improving Service Quality in Healthcare

Organizations that provide services, such as healthcare providers, need to consider financial factors when delivering those services. This includes the staffing level of their employees, which can impact the quality of care provided and ultimately affect costs. To improve service quality, organizations can implement a financial system that assesses value for money, prioritizes changes based on customer needs, and uses costing methods such as activity-based costing to determine per-unit costs. By doing so, organizations can make informed decisions about pricing and resource allocation.

Managing finance resources
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Table of Contents
Introduction.................................................................................................................................................3
Task 1..........................................................................................................................................................4
1.1A clear outline explanation of the principle of costing and business control system..........................4
1.2Information needed to successfully manage the business operation...................................................7
1.3 The explanation of regulatory requirement for managing financial resources...................................8
1.4An evaluation of computer software as a mean of managing the financial resources.........................9
Task 2........................................................................................................................................................10
2.1discuss the various sources of the income that might be for her new care home...............................10
2.2 factors which may affect the availability of the finance...................................................................11
2.3 Review the various kind of budget expenditure in health and social care organization...................12
2.4 evaluate how the decision about the expenditure are to be made in the resident care home............14
Task 3........................................................................................................................................................16
3.2 What can she do if she suspects frauds in the cash budget?.............................................................19
3.3 Suggest and evaluate methods used to monitor and control budgets?..............................................20
Task 4........................................................................................................................................................22
4.1 The information needed by the manager to make decision about the level of service which will be
provided to the users and the funding organization...............................................................................22
4.2analyze the relationship between the level of service she will offer and the expenditure..................23
4.3 evaluate how financial consideration will have an effect on the individual.....................................23
4.4 Suggest financial system that can improve the service which the new health care is offering.........24
Conclusion.................................................................................................................................................25
References.................................................................................................................................................26
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Introduction
The success of the business largely depends upon how effectively the manager utilize various
resources to run business operation. The management needs to make decision how it uses its
financial resources and monitor its budget to manage business operation. The management needs
to effectively manage its finance to attain the goals and objective of the business. The
management used various type of budget to check that the financial resources of the company are
properly utilized and there is no wastage of resources.
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Task 1
1.1A clear outline explanation of the principle of costing and business control system.
The costing is the process to estimate the cost of the production or running business by making
proper allocation to expenditure to different stages of the production. The costing helps the
management to effectively manage its financial resources to conduct business operation
effectively. The costing is the technique used by the management to compute the total cost per
unit by considering various fixed and variable cost used in producing goods and service. The
main principle of costing is as follows-
To effectively manage the business the management needs to effectively manage all the cost
which is incurred to produce the good. The costing helps in proper allocation of various cost on
the different unit or function of the business. The key principle of costing are as follows-
Cost and cause relationship- The management needs to check that the cost which is incurred
while conducting the operations are properly allocated to the unit or product to make effective
decision in relation to the business. The management needs to collect the various cost as per the
nature and allocate and apportion those cost on the basis of cost relationship. The cost needs to
be charged only to those unit for which such cost has been incurred.
Cost is charged after it is incurred- The management needs to check that the cost is charged
only after they are incurred. The cost should include only those expenditure which has been
actually incurred and doesn’t include cost which are likely to arise in future.
Future cost doesn’t include the cost which is incurred in past-The costing ensures that the
cost which is incurred in the particular period should be meet by the profit of that particular
period only. The cost of the past year are included in the current period than it will provide
inappropriate result to the management because it creates inappropriate burden on the particular
year (Martinez, Kromann, & Astrup, 2015).
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Maintain cost record as per double entry system- The organization generally keeps the
accounts for the cost as per double entry system to effectively manage business operation. The
costing uses the various cost sheet and the cost statement for the purpose of ascertaining cost and
provides cost control guidelines to the management.
Treatment of abnormal cost-The management also needs to check that the abnormal cost are
not charged to the production unit as the cost has no relation with the production part. It will
mislead the management in making various pricing or other decision of the business. The
costing helps in ensuring that the abnormal cost are charged to cost center and not to any of the
production unit. Also the other expenses which doesn’t have any relationship to the operation are
not charge to the costing (Reineking, Chamberlain, Rudolph & Smith, 2013).
The various business control system use by the manager in the process are procurement process
and business control system.
Procurement process – the procurement process requires the series of steps such as finding,
acquiring and purchasing the resources which are required to manufacture goods and service.
The procurement process is too dynamic that it requires constant analyze and monitoring all the
activity within the organization. The home care can follow the series of the steps to effectively
acquire the resources while conducting their activity. To effectively manage the procurement
process the manger needs to follow the series of steps which start from need recognition and
involves sources, price, expenditure, and invoice and maintain the records. The new care home
will follow the following steps for procurement process.
 The manager of the new home care will plan the procurement based on the identified
need.
 The manager than needs to decide the scope of procurement process. She needs to decide
that the goods and service which are required by the business are subject to coordinated
procurement that must be used.
 The manager of the new home care than needs to decide the method which is to be used
for the procurement of the resources.
 After that manager need to approach the market and identify the sources from which the
fund are to be acquired.
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 The manager than needs to evaluate the submission and conclude the tender process.
 The final step is to manage the process to check that the process is conducted in the
planed way.
Management control system – The management control system gathers the information to
evaluate the performance of the various unit of the business. It is the tool to measure how
effectively the business is conducting its operation to attain the objective and goals of the
business. The management control system involves the set of the activity or decision which are
taken by the manager to establish purpose, allocate resources and achieve organization purpose.
The management control system unites the different parts of the organization so that each unit
perform their work effectively which help in fulfilling overall purpose of the organization. The
manager of new home care needs to follow the following steps to manage the business.
Programing- The manager of the new home care needs to choose the specific program for the
organization activity which describes the activity to be conducted within the framework of
implementation strategy of the organization.
Budget- The manager needs to prepare the budget in which he will determine the resources
which is to be charged to each activity of the business. The manager will prepare the budget for
the area of his operation to effectively conduct the business process.
Management of the process- The manager need to check that the operation of the business is
conducted in the planned way and within the allocated budget.
Reporting and analyze- The reporting and analyzing is used by the manager of the new home
care as a means of controlling the set plan and comparing the actual result from those which was
set in the plan.
The cost which the care home incurs per month on one resident is as follows –
No of resident = 65
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Fixed cost per month = 75000/65= 1153.84
Average variable cost per month = 1200
Cost per month on one resident is as follows = 1200 + 1153.84 = 2353.84
1.2Information needed to successfully manage the business operation.
To effectively conduct the operation of the business the manager needs to effectively manage all
the cost which hare to be incurred to run the operation of the business. The cost is the amount
which the company paid to acquire and use certain resources of the business. The management
for making various decision needs to ascertain cost per unit incurred by the company to
manufacture its product and service. The cost center is the unit of the business which is not
involved in the production activity and adds to the cost of running of the company. The cost
which is incurred on the cost center is allocated to the production unit of the business. The cost
which the resident home has to bear are as follows-
Direct cost- This is the cost which can be directly attributed to the particular product and service
of the company. For example the cost incurred on acquiring resources which is used by the
resident home t0 produce food for their member.
Indirect cost – These are the cost which cannot be attributed to the particular unit has to be
apportioned between the various unit of the business. For example the house rent paid by the
resident home cannot be allocated to the particular unit and has to be apportioned between the
various function of the business.
Variable cost- It is the cost which varies with the outcome which the company is producing. For
example the wages paid to the kitchen staff varies with the food which they are producing.
Fixed cost-These are the cost which doesn’t varies with the level of the outcome and are charged
to the outcome of the business. For example the salaries paid to the manager is fixed cost and the
company has to incur it irrespective of their activity.
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To improve the profitability of the business and grow its operation the management needs to set
both short term as well as long term goals for the business. These goals provides the direction to
the company to improve its position in the market. The management needs to set up the goals to
control the business and focus on key area of the business. The goal setting helps in effective
utilization of their resource and create the positive environment within the organization.
Short term objectives is for short period of time on the other hand long term objectives is for
long period of time. Long term objectives are for achieve high revenue in an organisation.
1.3 The explanation of regulatory requirement for managing financial resources.
To effectively manage the resources the management has to follow certain regulation which is
set by the regulatory body to check that the organization are making effective use of the financed
resources. They provide the guideline to the manager which describes the standard below which
there outcome shouldn’t fall. The GAAP also provides certain guidelines which the resident
home need to follow while maintaining its accounting records. It ensures the minimum level of
the consistency in the financial statement of the company which makes it easier for various
stakeholder to understand and useful information about the company. It also provides the clarity
of the communication of the financial information and helps in making comparison with the
other companies.
The care quality commission provides the standard and makes effort that the outcome may not
fall below standard. The health and social care needs to ensure that the customer are treated with
dignity and respect at all time while receiving care and treatment. The organization need to
ensure that the appropriate consent should be provided before the treatment and the provide
safety during the treatment to customer. The commission also ensures that the customer are not
abused or receive improper treatment while receiving care. It also check that the organization
effectively handle the complaints of the customer.
Now we can discuss about the general medical council, GMC is for the general public which
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help to protect, promote and maintain the health and safety of the public. There is one more
financial regulator which is care quality commission that help to provide high quality care
services such as care home, dental and other care services for the general public.
The health and social care act states that the code must be taken into consideration by the care
quality commission when they make decision in relation to registration and the organization need
to follow the code when deciding how they will meet the regulation. However these codes are
not mandatory the organization needs to demonstrate that they meet the regulation in the
different way from that which is described in the document. These codes help in preventing the
customer from getting affected through infection and provides the guideline to the industry who
are engaged in health and social care needs to follow. The NHS commission has to check that the
health and service are provided in the way that promotes NHS constitution among patient staff
and the member of the public. The NHS ensures that the people are aware of the right available
to them and they contribute as far as possible to the advancement of the principle, rights
responsibility and value. The NHS provides the guidelines which helps in improving the quality
of service provided by the health and social care sector.
1.4An evaluation of computer software as a mean of managing the financial resources.
The management of the company uses the various software to manage its income, expenses, and
the assets with the objective of maximizing profit and ensuring that all the business operation are
conducted in the effective way. It improves both short term as well as long term performance of
the business by providing the various information to the management. These software helps in
collecting huge information in relation to the operation of the business and helps the
management in decision making in relation to the various area of the business. It also helps the
management to check that the operation of the business is conducted in the planned way. It also
helps in building coordination between various areas of the business and minimize the
paperwork. These software provide ease in maintain huge data and effective analyze of the data
which helps in making informed decision. The new home care has used the certain computer
software to effectively manage the financial resources of the company which are as follows.
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Open accounts- open accounts is the fully integrated software which helps in the medium size
and not for profit organization to effectively record and maintain all there business transaction.
The software can be used by the manager of new health care to make various financial decision
in relation to the business. The software provides accurate management information across tour
entire organization in real time which helps in reducing cost and improves financial visibility.
The major advantage of the software is that it can be easily customized as per the requirement of
the business and provides wide range of facility to the management such as document
management, budgeting and forecasting tools. The major disadvantage of the open account
software is that it usually takes more time in recording the data and the benefit arise from the
software may be less in comparison to efforts made in recording the data.
Cool care- The manager of the new home care can use the cool care software which enables the
home operator to analyze and improve the management of their care facility. The advantage of
the software is that it offers wide range of user friendly elements across every area of home care
management. It is also used by the management as a tool for assessing, planning, implementing
and evaluating the operation of the home care. The software also can be used over the multiple
device which make it more convenient to manage the home care. The major disadvantage of the
software is that the cost of using and maintaining the software is too high which creates the
difficulty for the small scale business to maintain the software. The software helps in effective
managing of the business in the planned way.
Caresys – Caresys is the management system solution which helps in providing the more
efficient way of accessing and sharing information in one easy to use, fully integrated solution.
The software support the new home care with the day- to- day care they deliver to their resident.
The advantage of the software is that it helps in running home care more efficiently and by
integrating all modules into one easy to use solution which gives you more time to care for your
resident. The software maintain centralized data which reduces the need to import and export
data which reduces the duplication of the effort. The major disadvantage of the software is that it
is hard for certain organization to use the software as it doesn’t customize with the existing
structure of the company.
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Company used finance recording system for the data storage. The software is oracle finance. In
this, Software Company provide to supply chain management, customer relationship
management, call center services, product life cycle services. This software is an application
software, and it established for the managed the management services.
Task 2
2.1discuss the various sources of the income that might be for her new care home.
The manger to effectively manage its financial resources need to identify the sources from where
it can raise fund for the operation. The management for the purpose of running the residential
may generate the income which are as follows-
Gift and donation – This is the major source through which the new home care can raise fund
for running its operation. There are many individual, companies or charitable trust foundation
which may provide the fund for the new home care business. The benefit of this sources is also
that the government doesn’t impose tax on it. Organization can conduct some scheme which help
in providing fund for the organization whereas company provide some funding workshop,
donation campaigning which help in raising funds from the others. Donation campaigns are
helpful for the organizations as it help in raising funds in the firm
Grants- The new home care may also receive the fund from the grants which are received from
the government and charitable and are not to be repaid by the management.
Trading- The organization can also earn by selling the product and service to member, general
public or the other organization. These sources can also collect the fund by conducting various
event which attract huge fund for the business.
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Local council- The new care home can also raise fund for its operation from the local council.
These council provides the fund for those organization which are operating for the benefit of the
public to improve the standard of the people in the society. The local council provides the fund to
these council from the fund which is collected through tax from the public.
Private resident-These organization can also raise the fund from those who are residing in their
home care. These organization generally charges a nominal amount from those who are using
their service (Alinezhad, Vahid & Ebrati, 2012).
2.2 factors which may affect the availability of the finance.
There are many factors which affect the availability of the finance, the management needs to
examine the sources from which it can raise fund on the basis of the cost and availability. The
factor which will affect the financing of the new home care are as follows-
Government funding- The fiscal policy of the government has a huge effect on the availability
of the fund for the new home care. If the government will provide the exemption to those which
are providing the fund for the benefit of the employees that they will attract the huge fund for the
business. The government to promote the health and social care provides a huge fund.
Social deprivation index- Social deprivation is the prevention and reduction of culturally
normal interaction between the individual and the rest of the society. The deprivation index
measure the deprivation in the particular area. If the particular area is not economically
developed than it will attract the huge fund from the government to develop the standards of the
public of that region. It will provide ease to the new home care in the availability of the fund for
running its operation (Zarei, Rad, Ghapanchi & Ghapanchi, 2015).
Private funding- There many of the health and social Care business which are funded by the
other institute and individual rather than depending upon the government. Many of the private
institute to improve their CSR donate the fund for the welfare of the health and social care sector
of the company.
2.3 Review the various kind of budget expenditure in health and social care organization.
Cost center –The cost center is the unit of the business which doesn’t produce direct profit but
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add to the cost of the running of the business. The cost which is incurred by these center is
apportioned between the other production units of the business. The management need to trace
all the expenditure to effectively handle the activity of the business. The cost center helps in
allocating the expenditure which cannot be allocated to the particular production unit.
Cost center Profit center
It is the department of the company to which
the direct and indirect cost are charged.
It is the unit of the business which recognize
the profit of the business.
Its objective is to control cost and reduce
cost
Ascertain the profit and efforts to maximize
it.
Operates in the narrow area Operates in the broad area
Easy to operate Involves complexity
Project management
The project management is the tool which the manager use to manage the product by distributing
the project under various units. The project management helps the manager to effectively
manage the project and receive the desired outcome from the project. The project manager
distribute the project into different activity to effectively manage the project (Mehdi & Reza,
2012). The new home care has used different type of cost budget while operating in business
which are core cost, capital cost, staff cost and operational cost.
The advantage of recording cost of project are-
 The costing helps in analyzing all the type of the cost that are present throughout the
manufacturing process.
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 It helps in determining the profitability of the job and helps the company to decide
whether to take up the project or not.
 It helps in preventing against duplication of work.
 Helps in increasing the efficiency of the manufacturing unit.
 It also evaluate the quality of the work done through various statistical technique.
The disadvantages of recording cost of the project are-
 The process makes it difficult to prevent unwanted cost and expenditure which are
occurred between the processes.
 The process is expensive because the records are to be made for and every step of the
order.
 The process faces difficulty in differentiating direct and indirect cost occurring in the
process.
 The process sometime doesn’t provide the accurate decision which may affect the
decision of the management.
Outsourcing
The health and social care organization can outsource many of its activity to check that they are
conducted in the effective way and at the best cost. The new care home can transfer its food
production or the maintenance of its premises to get the work done in the effective way. This will
help the manager to focus on its key area of the business by outsourcing its major activity to the
other business. The outsourcing of the work provides the best quality outcome to the manager
and at the lowest cost.
2.4 evaluate how the decision about the expenditure are to be made in the resident care home.
The manager of the resident care home needs to create the budget to effectively manage all the
expenditure which will be incurred while running the company operation. The budget helps the
management to conduct its operation in the planned way. The management can check that its
each of the activity is conducted in the planned way by comparing the actual performance with
that which is set in the plan. The decision in relation to the expenditure are made after analyzing
the benefit which will arise from the expenditure (Thorn et. al. 2016). the ways which are to be
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followed by the manager of the new home care to evaluate the decision about the expenditure
are-
Set priority –The manager of the new home care needs to set the priority which he wants from
the decision and check how the decision will helps in attaining the priority. Manager’s make
set some goals as in priorities so that it can help to meet competition .
List of the outcome- before making the financial decision the manager needs to set the list of
outcome which may arise due to the decision. This will helps in identifying the outcome which
may affect the business and deliver the desired result.
Positive outcome- The management needs to find the positive outcome which will be received
from the decision and what will be its effect on the business. In an organization, manager takes
best decision for making organization better.
Collect data – before making the decision the manager needs to collect the huge data in relation
to the area where the decision is to be made. This helps the management in making the informed
decision in relation to the business.
Discuss the decision – The management needs to discuss the decision from those which are the
part of the decision to find how the decision making can be improved and what are the factor
which may affect the decision.
Cash Budget
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Oct. Nov. Dec.
Opening cash balance 14000 10200 43200
(i) cash inflows
allocation from govt. 150000 155000 170000
self-generated income 20000 38000 46000
(a) total cash inflows plus opening cash balance 184000 203200 259200
(i) cash outflows
Rent 20800
Labour 56000 60000 54000
Other expenses 14000 10000 15000
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Bank loan repayment 10000 10000 10000
furniture upgrade 23000
Semiannual insurance 20000
cash purchase 50000 60000 65000
(b) total cash outflows 173800 160000 144000
(a) -(b) closing cash balance 10200 43200 115200
Task 3
Understanding and monitoring the expenditures through Budgets in health and social care
organization
3.1 Explain Cash budgets and how it helps in managing Budget shortfalls?
Cash budgets for the next three years ending Dec 2017
Cash budgets- It is quantitative expression of future forecasting of cash requirement and disposal
of excess cash if any exits in the firm. It represents operational plan of the management for the
budget period. It is always expressed in money terms
Cash budget helping in managing budget shortfalls-
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On comparison of actual performance with the plans it is indicated to do the measures by making
periodically comparison of plans. Cash budget is prepared for each of the cash inflow and
outflow function in realistic terms. It is part of the financial budget that is concerned with cash
receipts and disbursements, working capital, capital expenditures financial position and business
cash operations. It helps in managing the shortfalls of the business in terms of cash & liquid
financial. The requirement of finance whether it is for short term or long term horizon depends
on analysis of cash budget statement (Haroun, 2015).
Practical examples related to residential care
While considering residential care and hospital units on taking case study of Fortis hospitals &
Eternal hospital group it is analysed that without cash any hospital will not survive, liquidity is
essential for maintaining its going concern. In these hospitals it is reviewed on monthly basis.
For instance to check losses in the hospital business there will be increase in capital expenditure
in its budget and further there is increase in losses through working capital additions. To cope up
with this situation a residential care institution will look forward for the possibilities of attaining
funds through long term and short term sources of borrowing funds as per requirement of firm.
Further it also describes the fund source availability from various sources like Government
grants or whether it is a self-generated income.
The management needs to use budget as a tool to get the best out of the current resources of the
company. The budget needs to focus on the key area of the business and how they will be
managed. The budget needs to concentrate around the expectation and end products which will
save time and efforts and effectively manage the business process. The budget also allocate the
time within which each activity is to be accomplished. The budget needs to be review by finding
the deviation of actual performance from the set budget and use it for creating the budget for the
future year.
Local government - The new home care is receiving the fund from the local government so needs
to maintain the proper record of how they are utilizing the allocated fund. This helps the
government departments to track the statement of cash to know whether the hospital and
residential care firms are utilising the grant funds provided by local govt. as per the guidelines
and rules & regulations of the grant.
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Self- generating income- The new care home on the basis of the budget may determine the fund
which the company is earning from running its operation. On the basis for the available fund the
manager makes decision how it will allocate the resources to the various activity of the business.
Service reduction-The manager of new home care on the basis of the budget may determine the
expenditure which they are making on the various units of the business. This helps the manager
to control the unnecessary expenditure and check that the available resources are utilized at the
optimum level.
3.2 What can she do if she suspects frauds in the cash budget?
Wherever there is public money invested or there are government grants infused in the business
there is huge vulnerability to risk of fraud and error. She should make an organisational
environment to follow ethical cash budgeting and avoiding frauds and financial malpractices.
There are some areas where she has to work to follow good practise in tackling external and
internal frauds and errors. Further a manual should be prepared for internal audit purpose that
should be reviewed and checklist should be filled from time to time on those areas where there is
more scope of vulnerabilities to the occurrence of threat to get exploited by financial frauds and
errors (Reed et. al. 2012). The steps which are to be taken when the manager suspect fraud are-
The management need to be stay calm when the fraud is detected and act rationally for the
situation. The management needs to remain calm and gather and analyse evidence in relation to
the fraud to detect the reason for the fraud.
The management needs to make effort to find the reason of the problem rather than completely
ignoring the problem.
The manager needs to remain discreet and try to obtain the evidence in relation to the fraud.
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The manager needs to keep all the relevant data in the safe custody to prevent the alteration in
the document in relation to the fraud.
After the fraud is detected the management needs to terminate the employee who have
committed he fraud and makes effort to fulfil the position with the qualified staff.
The management need to prevent the reputation of the company which may be affected due to
the fraud.
The management need to identify how the fraud is going to affect the performance the company
and the measure to overcome the problem.
The management needs to set the example so the organization do not faces the similar situation
in the future.
The management needs to take the help of the experts to prevent from future occurrence of the
similar activity.
The organization needs to make the changes in the organization to prevent future occurrence of
the fraud.
3.3 Suggest and evaluate methods used to monitor and control budgets?
There are various methods which are necessary to control budgets and successful implementation
of budgetary control system. Some of these are as follows
A budget control and administrative officer should be appointed by the top management. The
budget officer should be given power to scrutinize the various budgets prepared by various
departments and if required make the relevant changes in them. He finds the deficiencies in the
budget and takes proper actions in rectifying them. He works as a manager for making
coordination among various departments. He also makes a performance analysis charts
describing the performance of various departments.
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By creating budget centres as a part of basic organisational activities of the period for which
budget is prepared. A budget centre may be the departments or any part of respective
departments which is necessary for cost control purpose
Creation of budget manual – this helps the organisation in setting up the guidelines for creating
various budgets and setting out authority subordinate relationship of the persons engaged in
routine tasks. All the departments of the organisation for getting any procedure or downloading
any formats of any particular task for every part of organisational works like from the initial
stage of preparing budget to the actual reporting refers budget manual prepared on the initial
stage (Wilson & Wolak, 2016).
Preparation of variance analysis statements by taking in reference trends and recommendations
for the future projections
By creating responsibility centres managers or departmental heads are set responsible for various
divisions and departments of business. These are revenue, expense, profits and investments
centres. Each departmental head is made responsible for the outputs generated in respected
departments. Preparing budget of the organization has many disadvantages as there: such as
budget preparation sets tight investments options in an organization, so we cannot meets other
advanced resources. External environment is dynamic, technologies, trends change time to time.
Budget can be set for meeting the future expenditures. As per this one cannot take any other
decision involving more investments related to the organization.
The management can also evaluate the budget by conducting the internal audit. The internal
auditor conduct the detail examination of the budget to find that the fund are utilized for the
appropriate purpose and there is no misrepresentation of the fact made by the manager. As the
company raises the fund from the government so the statement of the company are examined by
the external auditor to check that the company is not conducting any fraud. The auditor on the
basis of the budget examine that weather the company is making the effective utilization of the
resources. The budget can also be evaluated by setting the key performing index and measuring
the performance of the business on the basis of the set standard.
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Task 4
4.1 The information needed by the manager to make decision about the level of service which
will be provided to the users and the funding organization.
The management uses the costing as a tool to make informed decision in relation to the income
and expenditure of the business. The costing provides helps the management to ascertain the cost
which will be incurred on running the operation of the business. The management needs to
collect the huge data and use various accounting tools to make informed decision in relation to
the business.
Management accounting- The management accounting requires the preparation of various
reports and account to provide accurate and relevant information to the manager to make various
decision in relation to the business. It assist the manager to make both short term as well as long
term decision which helps in attaining the objective of the business. It is the process which
involves identifying measuring, analyzing and interpretation and communicating to attain the
organization goals and objective (Pazarceviren & Dede, 2015).
Current and the projected demand for service – The management to run the business effectively
needs to make the estimate of the demand of the service and makes effort to deliver the best
services within the allocated resources. The estimate of the demand helps in effectively manage
all the service of the business.
Actual budget-The management needs to create the standard budget of the cost and expenditure
which are going to be incurred during the year. The management also prepares the actual budget
to find the variance from the planned budget and find the cause of the variance. The management
also needs to consider the reason for the deviation while preparing the future budget of the
business.
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There are various regulator in health and social care which provide the guidelines to the
organization who are running health and social care business. They also check that the
organization is not engaged in any fraud and doesn’t misrepresent any fact while preparing the
financial statement of the business.
4.2analyze the relationship between the level of service she will offer and the expenditure.
The level of the service which the new home care offers and its cost depends upon the various
factor which are as follows-
Transparency with the stakeholder- the management needs to maintain the proper records of how
the company is utilizing the fund raiser for running the business. The management should ensure
that the organization maintain transparency while recording how the company has utilized its
fund (Ozyapici& Tanis, 2016).
Compliance- The management needs to ensure that the organization is following all the
regulation while conducting its operation which are required by the legislature.
Accountability- while recording the transaction the management needs to ensure that the double
entry system and all the accounting principle are followed. It provides the transparency to the
various stakeholder in relation to the financial performance of the business.
Pricing policies- The costing helps the management to ascertain the per unit cost of the product
and helps the management in determining the price of the product. This helps the management to
make the informed pricing decision.
Cost and expenditure will have positive effect on quality of services, there is some need to
develop staff performance, build healthy environment, resolving conflicts, providing proper
training and other orientation programs. If all these activities is properly managed then the cost
and expenditure will be justified in a right manner.
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4.3 evaluate how financial consideration will have an effect on the individual.
The financial consideration is the money or the other things exchanged for the product and
service. The financial consideration in the health and social sector is the return which the
organization is providing to its member. The financial consideration in the health and social care
sector are as follows-
Quality of service- The quality of the service which the new home care is providing plays a key
financial consideration for those who are using the financial service of the company. By
investing on recruitment process professional staff can be selected which will give quality
service.
Access to service - The easiness at which the organization provides the service to its users also
plays a key financial consideration (Page, Graves, Halton & Barnett, 2013).
Change in the staffing level- the effectiveness with which the staff of the organization deals with
act as a financial consideration for the user. hospitals provide better staff services and
professionalism in their staff member. They invest in plans which can be help in retenting
employees with the help of compensations and other benefits.
4.4 Suggest financial system that can improve the service which the new health care is offering.
Assessing value for money- The manager needs to find the value which the organization is
offering to the customer in relation to the price paid by the customer. The value of the services
will helps the management in determining the price of the product.
Cost and unit estimation per head- The costing helps the management in ascertaining the per unit
cost of the product by charging all the expenditure which are incurred on the production. It helps
in determining the price which the organization needs to be charged for its product and services.
Prioritizing –The organization needs to make the changes in the product as per the requirement
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of the customer to deliver the quality product and service to the customer.
Financial system consists of interrelationship between all financial institution and their process.
Such as shareholders, banks, accounting bodies, etc. these are the proposed ways of improving
quality of health and social care. In this method, it transfers all risk and responsibilities from
government to the healthcare providers. PRB system is way to improve their standards of
healthcare.
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Conclusion
So it may be conclude that the costing helps the management to effectively manage the cost and
income of the organization. It helps the management in making various decision in relation to the
business and helps in attaining organization goals and objective.
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