Managing Financial Resources in Healthcare and Social Care TABLE OF CONTENTS INTRODUCTION 1 TASK 11

MANAGING FINANCIAL
RESOURCES IN HEALTH
AND SOCIAL CARE

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
1.1 Principles of costing and business control systems adopted in Care Tech Plc................1
1.2 Identification of information that are needed to manage financial resources for Care Tech
Plc...........................................................................................................................................2
1.3 Regulatory Requirements that are needed to be satisfied while managing financial
resources.................................................................................................................................3
1.4 Evaluation of the systems for managing financial resources in Care Tech Holdings Plc 3
TASK 2............................................................................................................................................4
2.1 Discussion of the diversified sources of income available to Care Tech PLC.................4
2.2 Analysing factors that may influence the availability of financial resources in Care Tech
Plc .........................................................................................................................................5
2.3 Reviewing different types of budget expenditure in Care Tech Plc.................................6
2.4 Evaluation of decisions that could be made in Care Tech PLC about expenditure.........7
3.1 Managing financial short fall in Care Tech PLC..............................................................8
3.2 Actions after suspecting occurrence of financial fraud in organization...........................9
3.3 Evaluation of budget monitoring arrangements in Care Tech PLC...............................10
TASK 4..........................................................................................................................................11
4.1 Identification of information that is required to make financial decisions in Care Tech Plc
..............................................................................................................................................11
4.2 Analysing relationship between care services delivered and `costs and expenditure`...12
4.3 Evaluation of impacts of financial considerations upon a service user..........................12
4.4 Suggesting ways of improving the care services............................................................13
CONCLUSION..............................................................................................................................14
REFERENCES..............................................................................................................................15

INTRODUCTION
Management of Finances have become challenge for the day. Each and every field
irrespective of its business model hires skilled experts and professionals for this task. Private as
well as Public Sector all has been quite strict in the efficient management of Finances. This
project report is prepared on the basis of Care Tech Plc. homes which deals in providing quality
social care services. This report will create understanding and will discuss various principles of
costing and business control systems with information which is required to manage financial
resources accompanied by regulatory requirements. Further, diverse income sources that are
available to Care Tech Plc. and factors that may influence the availability of financial resources
are stated briefly.
This project also puts light on financial short falls by taking its assumptions which is
accompanied by steps after suspecting financial fraudulent and evaluation has been done for
budget monitoring arrangements. In addition, emphasis is also given on identification of
information that is required to make financial decisions. Research will also be conducted to
analyse relationship between care service delivered and costs & expenditure accompanied by
financial considerations of Care Tech Plc.
TASK 1
1.1 Principles of costing and business control systems adopted in Care Tech Plc
Maintaining costing and business control systems is regarded as an internal part of the
entire process which is carried out by an organization. Incurred cost by an organization has its
direct impact upon output and earning of a business (Chen and et.al., 2017). Following are the
principles of cost and business control systems that are required to be implement by Care Tech
Plc.:
 Basic Software: As many organizations are undergoing certain changes in their
infrastructure and are taking their actions electronically. Hence, it would be
advantageous for an organization to take control over those actions and find any
errors that are happening.
 Cost Control: External and Internal process of auditing will assist a firm to
understand the foremost policies and to enable to take control over both the internal
and financial system and working of Care Tech Plc.
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 Forecasting: This technique is regarded as the most important for an organization as
it enables and assists firm in predicting any future contingencies. This information of
future performance, financial aspects and cost profits would be highly beneficial for
Care Tech Plc. to plan its future strategies and policies. Further, it will help in
forming better defence system.
 Variance and cost benefit analysis: This type of information assists in evaluation of
the performance of different characteristic of Care Tech Plc. By comparing pre-set
targets it also determines performance of project (Business Control Systems, 2018).
Cost benefit analysis assists in taking primary decisions which are related to the
management of financial resources of an organization, as it aims at analysing the
received benefits over cost incurred by Care Tech Plc.
Costing method used in Health and social care organizations:
In health and social care sector, costing is done by accumulating fixed cost and variable
cost together and by dividing it with number of patients. For example:
Fixed cost: 5000
Variable cost: 6000
No. of patients: 100
Cost= (Fixed+variable)/no. of patients
= 11000/100
= 110
Costing principles of the NHS:
 Data Accuracy: Increase in the accuracy of data improves confidence in the costs of
resulting patient level. As, data is generally organised into functional units so it is easy to
record data in accurate and timely manner.
 Stakeholders engagement: It is one of the most critical principle for productive use of
costing information. It can help in understanding the audience for costing data, to ensure
costing is more accurate, improves intelligence of business.
Business control systems:
 Budgetary control system: It is system of controlling costs which generally consists of
preparation of budgets, coordinating the departments and comparing actual performance
with the budgeted for future period.
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 Cost control system: It is a system of identifying and reducing expenses of business in
order to increase profits, and it starts with the budgeting process. It is an important factor
for maintaining and growing profitability. It also provides information for planning and
for determining the efficiency of activities after they are performed.
1.2 Identification of information that are needed to manage financial resources for Care Tech Plc
It is noticeable that health sector has undergone incredible developments in this industry
and projected a steady growth as well (Fortier and et.al., 2017). Following information’s are
needed by Care Tech Plc. for managing financial resources:
 Income Streams: This statement should be prepared by Care Tech Plc, in order to
assess financial performance during a particular time period. This statement also
provides decision makers with information related to profit and losses of the
organizations.
 Administration: This will help in determining its profitability as well as it will help
in tracking and managing its expenses properly. This type of information could easily
be generated by its various system including the costing system and financial
management system.
 Legal Requirements: These legal requirements are needed to be fulfilled in order to
manage financial resources. Company should move forward towards arrangements
for financial resources according the legal obligations which are imposed by
government.
 Competitive Factors: These factors are needed to be measured while managing
financial resources. Company should analyse these factors in order to determine
future need of such resources, so that financial resources could be managed
effectively and efficiently.
Information related to business environment and external influences are also required in
order to enable proper management of the financial resources, such as:
1. Trend Analysis.
2. Change of policies.
Hence, referring the above aspects it can be presented that along with the financial factors
there are some non-monetary information needed by Care Tech Plc for managing financial
resources. Thus, in the context of financial resource management, manager of Care Tech Plc
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needs to lay focus on evaluating trends, competitor’s policies as well as laws and legislation.
By taking into account all such factors concerned authority would become able to take
appropriate decisions.
Health and social care sector organizations needs information related to business
expenses which includes cost of sales, grocery, wages, bills, overtime, tax, interest on
loans/overdraft. On the other side information related to income is also required to know;
revenue, interest earned from investments, grants, funds, donations. This information is
required by health and social care organizations to prevent financial crisis and conduct free
cash flow to facilitate patients efficiently and effectively.
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Illustration 1: Financial figures of Care Tech Holdings Plc.