Managing Financial Resources in CareTech PLC: Health & Social Care

This report provides a comprehensive analysis of financial resource management within CareTech Holding PLC, a UK-based social care service provider. It examines the principles of costing and business control systems, emphasizing the importance of stakeholder engagement, consistency, material cost analysis, transparency, and cost control. The report identifies the information needed to effectively manage financial resources, including revenue from patient fees and the preparation of administrative and market expenditure budgets. It also addresses regulatory requirements, such as due diligence for staff and patient well-being and adherence to Generally Accepted Accounting Principles. The report evaluates the use of open system software for managing financial resources, considering both financial and non-financial activities. Furthermore, it discusses the various sources of income available to CareTech PLC, factors influencing the availability of financial resources, and different types of budget expenditure. The report also touches upon strategies for managing financial shortfalls, actions to be taken in cases of suspected fraud, and the impact of financial considerations on service users, concluding with suggestions for improving care services.

Unit - 14 Managing Financial Resources in Health and Social Care
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Contents
Introduction.................................................................................................................................................3
LO1..............................................................................................................................................................3
1.2 Information needed to manage financial resource for CareTech Holding PLC......................................4
1.3 Regulatory requirements need to be satisfied while managing financial resources..............................5
1.4 Evaluating the systems for managing financial resources in CareTech Holding PLC..............................6
LO2..............................................................................................................................................................7
2.2 Analyzing the factors that may influence the availability of financial resources...................................8
2.3 Review different types of budget expenditure in CareTech PLC............................................................9
2.4 Evaluating the manner in which decisions about expenditure could be made....................................11
LO3............................................................................................................................................................11
3.1 The way situation of financial shortfall can be managed in CareTech.................................................12
3.2 Action to be taken in the event of suspected fraud.............................................................................12
3.3 Evaluate budget monitoring arrangements in CareTech PLC...............................................................13
LO4............................................................................................................................................................14
4.1 Identifying information required to make financial decisions relating to CareTech PLC.....................14
4.2 Analyzing the relationship between a health and social care service delivered, costs and expenditure
.................................................................................................................................................................. 15
4.3 Evaluate the way financial considerations impact upon a service user...............................................15
4.4 Suggesting ways to improve the care service provided by CareTech PLC............................................16
Conclusion.................................................................................................................................................17
References.................................................................................................................................................18
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Introduction
Caretech holding plc is a social care service provider situated in UK. The company believes in
providing Healthcare services with the aim of achieving good market share. Productive
management of financial resources is very important when it is concerned that the industry is a
Health and Care Service Provider. The company believes in the Welfare of all by providing
services relating to health for every kind of people. The company welcomes the various types of
customers/ patients as their resources and believes in developing good customer relationship with
them. The report provided completely focus is on the proper utilization of financial resources and
how decisions are made for the Welfare of the company (Report, 2017).
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LO1
1.1 Principles of costing and business control systems
The various costing and business control system Principles are the part of every organization as
they are the very important necessity for running their current business. There are 6 best costing
principles which shall be adopted for the company provided which is related to health care.
The participation in every company shall not be restricted to the management but also should
involve the stakeholder’s engagement in the company's important decisions. According to this
principle the Healthcare industry has to analyse the various costs by determining the various
costs which are related to the department which do not involve finance. (Tech, 2018)
While adopting any costing approach the company should consider consistency as the most
important amongst them. Consistency states that every organization should work upon consistent
approach towards making various decisions for all the various departments situated within the
entity or outside the entity.
Every entity should understand the various material cost which are related to the procurement of
the material which is situated in the company so as to consider the only material costs and to
ignore such other costs.
For a company like caretech there should be proper transparency between the costing and the
business control systems of the company so that there should not be any confusion amongst
anybody in the company. (healthknowledge.org.uk, 2018)
The most important aspect of every company is to control its unnecessary cost expenditures that
the company is incurring. The various management of the company should focus to emphasize
towards reducing the cost which are unnecessary for the company and to limit the cost of the
company within the allocated expenditure budget that the management of the company has
provided. It is very simple that higher the cost and lower the profit of the company, so as to
increase the profit of the company the cost of the company has to be controlled and have to be
fixed as per the expenditure budget that has been allocated.
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1.2 Information needed to manage financial resource for CareTech Holding PLC
Every company which is associated with health care requires financial assistance in the form of
financial resources so as to fulfil its various expenditures that might be making payments to staff,
purchasing of materials etc. The rule of Economics applies here as the resources are limited and
the wants are unlimited that is why the company needs to carefully plan the various sources of
revenue that the company has to fulfil its expenditures as and when required. Every Healthcare
Industry that is working in the market receives its revenue from the various patients in the form
of fees. When the company is transparent and follows a proper accounting method for the
purpose of measuring its cash expenditures it can easily manage its financial resources in the best
manner.
Every business involves various risks that are related with the business or not the business, but
there exists address for every business. The financial resources that the company has are limited
and have to be effectively utilized for the purpose of reducing the risk associated with the
business. So as to properly utilize The Limited financial resources that the company has with
them various reports and budgets have to be prepared that are administrative expenditure budget,
market expenditure budget etc. In the preparation of such reports and budgets every company
will incur costs which have to be controlled by the company.
1.3 Regulatory requirements need to be satisfied while managing financial resources
For every health associated company there shall be due diligence that should be followed for the
safety and wellbeing of the staff and patients. The management of the company is involved in the
formation of rules and regulations for the health company.
The health and the well-being of the people of the hospital and the health centre have to be
inspected from time to time. On the basis of the inspection if there are situation that the health
and the well-being of the patients and staff of the company is not good, there's to be adopted by
the Healthcare Company to ensure that the proper care of the people around the company is
considered.
Generally Accepted Accounting Principles are the various accounting standards which identify
the health and social care for the purpose of reporting them in the financial information as per the
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requirement and transparency of the accounting system of the business organization.
(healthknowledge.org.uk, 2018)
There are various Healthcare sector regulator monitor who helps in the analysing the various
health issues that the company is facing and to support the various patients for the treatment of
the diseases that are assessed by the department have various financial difficulties to fulfil their
treatment.
1.4 Evaluating the systems for managing financial resources in CareTech Holding PLC
There are numerous methods to plan systematic arrangement of financial resources for the
Healthcare Company.
Computer software is required for managing the financial resources which is called as open
system. It is recommended to be the most important computer software of all time took that is to
be used by the Healthcare Company. The software is highly recommended and the most used
software in the health and social care services provider. The software works by providing the
total financial and tax information together in one place show that the user of the data can easily
understand the working of the company and can generate various reports and information on the
basis of the data provided by the open system software. Once the software collects the data it
starts assessing the incomes and games for the company and its entity. The purpose behind open
system software is to make various management decisions for the current and future period.
(Bercich, 2017)
Every entity who is engaged in Healthcare business has various financial and non-financial
activities to be considered for the purpose of making decisions and Caretech system software
helps in providing the users with such information which is non-financial as well. The various
factors through which the company conducts its business are not only monetary factors but are
the factors which help in developing the business of the company. Attendance sheet, staff's
behaviour with patients etc. are some of the various examples of non-monetary activities that the
company conducts so as to build its good image in the market. This software helps in identifying
such non-financial activities and providing the same to the user of the accounting.
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LO2
2.1 Sources of income available to CareTech PLC in the financial year in 2013
CareTech Limited is a Healthcare Company which believes in providing the best of services
related to the Healthcare and provides almost all kinds of services that are provided in the
Healthcare industry. The company has many segments under which it provides services of
Healthcare.
The various adults of the societies are not taken care of properly and that is why an adult learning
disability Centre is very important part of a Healthcare industry. Caretech limited is one of the
company which runs adult learning disability centre which takes care of various adults of the
society by understanding their disease and giving them appropriate treatment for the same.
Every Health Care Centre has to run a mental health care centre for the purpose of the
requirement of the industry. The company makes good revenue in the year 2017 from the mental
health centre at the company runs. (Bercich, 2017)
The company also provides young people residential services where the treatment of the young
people is conducted and good revenue for the company is generated. The revenue of the
company is generated in million dollars for every year with young people residential services
that the company provides.
There are many children whom have some disabilities from birth and which have to be cured for
the purpose of conducting the treatment of such children with disabilities Foster Care Centres at
the part of the caretech Limited. Foster Care Centres of the company provides good revenue for
the company for all the financial years that the company works for Foster Care Centres.
2.2 Analyzing the factors that may influence the availability of financial resources
The availability of financial resources for the company is affected by many factors and these
factors surround the business organization for the purpose of influencing the availability of
financial requirement for the company. The company's various objectives and strategies that the
company adopt and will adopt in the upcoming future affects the financial resources of the
company and thus it can be said that these factors influence the availability of financial resources
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for the company. Organization’s strategic Alliance for the purpose of the growth and
development of the business organization is conducted by the higher management of the
company then it will definitely affect the sources of financial resources for the company and its
business. The company has acquired various effects of various other business activities so as to
enhance the company's business and which brings the cash outflow of the company and thus the
availability of financial resources might get reduced for the company when the investments of
the company are comparatively higher than as stated. The factors provided by the government to
enhance the various health and social care for the country for free of cost it reduces the funds
available for the company as it has to conduct various services in the Healthcare industry for the
purpose and requirement promised by the government. Caretech Limited provides the best
services in the field of Healthcare. (oliverwyman.com, 2017)
2.3 Review different types of budget expenditure in CareTech PLC
Budgets are prepared so that the various expenses of the company can be controlled and can be
Limited as per the amount specified by the budget for the financial year for which the budget has
been prepared by the management of the organization. Caretech Limited had many budget to
control and monitor its various business operations during the financial year. (Bercich, 2017)
Every company prepare the fixed cost and variable cost budget through which it identifies an
estimated fixed and variable cost that the company will enter in producing/ manufacturing a
particular product in the accounting year. Fixed cost of the company are the various costs that the
company incurs during the financial year and which do not change with the level of output
whereas variable cost of the company changes with the level of output of the company as they
are directly related to the production of the particular product. With the help of fixed cost and
variable cost budget the management of the company can take various decisions regarding the
preparation and production of the various products with a limited amount of Expenditure that the
senior management/ directors of the company have a located in the budget that has to be used.
Every company prepare material utilization budget through which it can be identified the amount
of allocated material to the company and the amount of the material that the company utilizes has
to be properly verified with the budget that has been provided. The purpose of material
utilization budget is to reduce unnecessary wastage of material so as to reduce the overall cost of
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production and thus increasing the company's revenue. The raw material that the company uses
for the purpose of manufacturing the final product of the company might vary from the actual
raw material that the company has taken and the raw material that has been provided in the
budget. The variance/ difference between the actual raw material required and the budgeted raw
material for actual production is to be properly accounted by the company and the various
reasons for such Failure is to be recorded and the future decisions of the company for the
purpose of making future budget the company should analyse their past records of the budget.
(healthknowledge.org.uk, 2018)
The company do not involve Only direct cost that are related towards the manufacturing of the
product but also involve some indirect cost that are related towards the administration of the
company and such cost have to be reported in the budget of the company and this type of budget
is called as administrative cost project. It includes all those expenses which are incurring
indirectly on assessing the various services. Such expenses have to be reported properly in the
books of accounts of the company and have to match with the budgeted cost allocation made
towards such administrative expenses.
The purpose of running every business is to earn profits and for analysing whether the company
is properly marketing its products and services a marketing expenditure budget is to be prepared.
The purpose behind repairing marketing expenditure budget is to identify that the company's
advertisement expenses for fulfilling the efficient sales of the company and to increase Company
sales revenue has been properly accounted for. Advertisement/ marketing a product into the
market and when such product is new is very important to increase the sales revenue of the
organization, so as to increase the revenue of the company there should be proper advertisement
expenses that have to be identified by the director of the company so that the management of the
company can work upon them as per the amount of expense towards Search marketing has been
stated in the budget (Harrin, 2015).
2.4 Evaluating the manner in which decisions about expenditure could be made
The expenditure of the company that they have to undergo during the financial year has to be
properly stated by the senior management team in the various budgets that the team provides
every year. The decisions of the management are based on the past experience, tax exposure and
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other marketing changes that have happened during the financial year. The expenditure that the
senior management team has provided in the various budget of the company might not always be
fixed and same as business provides various activities which may be unpredictable. Every time
when the business of the company is Run it is found that the business is all about increasing its
sales revenue by adding new products and services in its report and when such new product and
services are added in the reports of the company it is very obvious that the company will incur
expenditures and because of which the decisions regarding the expenditure will get affected. The
decision of the company is directly proportional to the needs and requirements of the product in
the market. An organization makes various expenditures only after analysing the financial
capability of the company to repay its expenditure. When the company fined that the company is
short of funds and has to make compulsory expenditures then the organization identifies various
sources which are situated outside the entity so that they can get financed from the outsiders for
the fulfilment of Expenditures that the company has to make. There are many factors because of
which decision making over expenditure gets affected and each and every factor has to be
critically analysed. (Bercich, 2017)
LO3:
3.1 The way situation of financial shortfall can be managed in CareTech
Financial shortfall is seen by every business during the life of the business. The reason behind
such shortfall is that the expenditures of the company or not in the control of the management
and the financial resources through with such expenditures can be met are not that sufficient.
Because of which there is a financial shortfall of funds. Financial shortfall is not good for all an
organization as it hampers the current business activity and future activities of the business for a
period of time. Financial shortfall can be very harmful for the business organization if it
continues for a long period of time. That is why financial shortfall whenever is found in the
organization every such company wants to exit from such phase of time.
With the help of proper analysis of financial shortfall it can be controlled as if the working of the
company can be reduced to the estimated cost that the senior management team has derived for
the company then in the long run company will never face any financial shortfall.
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Caretech can borrow funds from the government for any such shortfall as the company deals in
the health sector. (Bercich, 2017)
3.2 Action to be taken in the event of suspected fraud
When there are situations in the company that it gets received from various aspects which are the
part of the company or not it's called as fraud. Fraud when identified in the company it totally
disrupt the working and the business operations of the company. There are various situations due
to which the organization has to face reduction in the sales revenue of the company because of
the frauds that are identified. The activity is due to which the fraud can be identified in the
company should be totally cleaned from the company by identifying the persons involved in the
fraud and should be thrown out of the company as and when they are caught.
The company should gather reasonable Assurance of Information and evidence through which it
can be identified that the company who is facing various disruptions to the business operations of
the company due to the frauds that are being identified have been investigated properly.
(oliverwyman.com, 2017)
If the company is not able to identify the people involved in the fraud and the company should
make an internal team with the external auditor of the company so that they can enquire who is
the person involved in the floor of the company and who wants to ruin the company's Goodwill
in the market. With the help of such activities of the company the company can easily identify
the various sources through which fraud was coming towards the company and can easily resolve
them.
As and when the company identify the person who is involved in fraud the best action that the
company can take is to terminate the person with all his rights and duties that have been
undertaken by the company and not only this the company should appoint an investigating team
through with the details regarding the fraud and the unidentified fraud that the person might have
made in the past years could also be detected and identified by the company.
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3.3 Evaluate budget monitoring arrangements in CareTech PLC
Every company prepared budget for the financial year that the company has to run business unit.
Budget monitoring is the procedure of reviewing the various activities that have been conducted
in regard of the business in accordance with the various activities that have been planned by the
management reported in the budget of the company. The purpose behind preparing the budget of
the entity is to measure the current performance and position of the company and its business
with the various key indicators that have been identified by the company for the purpose of
making decisions and achieving the goals that the company has set. With the help of the budget
that has been prepared all the goals of the company shall be identified and have to be completely
monitored. While preparing the budget the actual performance of the company with the
performance that the company which to achieved as per the budget if it found to be equal then
they’re there is no need to record any such impact. Whereas when the company identifies that
there is a deviation between the budgeted performance of the company and the actual
performance then it has to be reported accordingly. (healthknowledge.org.uk, 2018)
LO4
4.1 Identifying information required to make financial decisions relating to CareTech PLC
Every company needs some kind of information so as to take the financial decisions of the
company. The management of the company is responsible for taking the financial decisions of
the company that are borrowing money from various secured and unsecured sources had to be
taken by the management of the company while understanding the information that has been
provided to them. Financial decisions taken by the management are on the basis of the
information and records that they have regarding the financial and non-financial data. Financial
information is derived from the financial transactions that the company has with them. The
financial transactions that the company and the organization accumulates during the accounting
year are combined together to obtain the financial information that is useful for the financial
decisions used by the management of the company. The various managers of care Tech Limited
will identify the management accounting system which involves all the financial data that has
been provided to the company during the financial year. The managers of the company before
taking the financial decisions have to understand the various profit and loss account and the
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income statements while considering the budgets of the company so as to take a proper financial
decision which will be beneficial for them in the long run (Khurana, 2011).
4.2 Analyzing the relationship between a health and social care service delivered, costs and
expenditure
There should be a proper relationship between a health and social care service delivered costs
and expenditure in an entity. Every business organization shall have strong presence in the
market as in the market there is the requirement of the various stakeholders of the company. The
stakeholders of the company or the owner of the company and the company should fulfil the
requirements of the stakeholders by maintaining a fair and transparent policy between them so
that the stakeholders should have trust over the company. When there will be trust in the minds
of stakeholders there shall be a good positive image of the company that the shareholders will
believe. Adopting a policy which involves costing and pricing strategy will develop a good
relationship between the organization and the various customers outside the entity.
(oliverwyman.com, 2017)
4.3 Evaluate the way financial considerations impact upon a service user
Every customer of the company has to pay financial consideration to the company for the
treatment that he is taking from the company. The consideration that the consumers to pay for
the various goods and services that he avail from the service provider depends upon the utility
that the consumer will obtained from the product of the services that is being provided to him.
The services that are being provided by the business organizations are completely focusing
towards achieving customer satisfaction and building customer relationship. Whenever good
customer relationships are developed between a consumer and the company the consumer is
ready to pay even higher for the services provided to him because he has a complete Reliance
over the company. Whenever the services of the company like caretech Limited are seen to be of
good quality there can be a rise in the revenue for the company. (oliverwyman.com, 2017)
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4.4 Suggesting ways to improve the care service provided by CareTech PLC
Caretech Limited is a large service provider in the field of Health and Care in the country. The
services provided by the company have to be improved at every step and every move taken by
the company in the long run. (healthknowledge.org.uk, 2018)
The company providing the care and Health Services has to properly analyse the accurate
estimated cost of the services that the company is provided and whether the company is earning
from such service that the company is providing. The organization should consider and review
its costing principles on a regular timely basis. The cost of preparing and providing a service is
always fluctuating and does not remain the same over the time. With the policies of the
Government and economic factors the cost of providing a service keeps on changing. A proper
analysis of the cost that is incurred in providing a service shall be made by Caretech limited so
that the company can set prices of the services accordingly (Boyer).
Caretech provides services to various patients and the estimation of the cost that the company is
in curing on every single patient has to be considered separately. This is done so as to improve
the services of the company in providing health in care services. Every patient that visits the
company has a separate problem and the services provided to each customer/ patient varies and
the cost involved in providing such services are also different. The company should set prices
that the company should take from the patient's depends upon the services that the patient takes.
A proper bifurcation of the services and the cost involved in curing the patient shall be
considered before setting the price of the services provided.
Every customer of the company who visits the company for the purpose of consultation shall be
properly treated. Every patient of the company should be analysed properly so that the problem
faced by the patient should be resolved by the company. The patient of the company should be
advised and treated in a manner that he should feel complete Reliance over the company and
shell built a trust in the company. (healthknowledge.org.uk, 2018).
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Conclusion:
The report has been developed to explain the proper management of financial resources that has
been conducted by the company for the efficient and effective in the long run. Caretech is a
company that is situated in the United Kingdom and believes in the proper utilization of the
financial resources that the company has. The report has been provided by considering the
various financial resources and its uses in the health and social care services. The report focuses
on the preparation of plan in the management of the company and it's important. Therefore it is
recommended that a proper financial planning is to be conducted for the various financial
decisions and the utilization of financial resources for the company’s welfare.
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References
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healthcare-industry/
Boyer, S. (n.d.). How To Identify Critical Success Factors in Project Management. Retrieved May 2018,
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oliverwyman.com. (2017). Financial resource mangement. Retrieved from oliverwyman.com:
http://www.oliverwyman.com/our-expertise/insights/2017/mar/financial-resource-management-
balancing-complex-and-competing-constraints-on-capital-liquidity-and-funding.html
Report, A. (2017). 2017. Retrieved from
https://www.caretech-uk.com/~/media/Files/C/Caretech-UK/reports-and-presentations/annual-report-
2017.pdf: https://www.caretech-uk.com/~/media/Files/C/Caretech-UK/reports-and-presentations/
annual-report-2017.pdf
Tech, C. (2018). Reports. Retrieved from https://www.caretech-uk.com/investors/reports-and-
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presentations/financial-reports.aspx
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