Financial Resource Management in Health and Social Care - Analysis

This report provides a comprehensive overview of financial resource management within the Health and Social Care (HSC) sector. It begins with an introduction to costing principles and business control systems, followed by an examination of regulatory requirements and the identification of information needed to manage financial sources. The report then explores various sources of income, factors influencing financial resource availability, and different types of budget expenses. It evaluates approaches used in development and addresses the management of financial shortfalls, activities to be taken in the event of suspected fraud, and budget monitoring. Furthermore, the report delves into information required for financial decision-making, analyzing the relationship between service delivery and financial considerations, and offering recommendations to improve care services. The report concludes with a summary of key findings and references.

Managing financial resources
in HSC

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
1.1: Principal of costing and business control system ..........................................................1
1.3: Regulatory requirements for financial resources.............................................................2
1.2: Identification of information needed to manage sources................................................2
1.4: Evaluating managing financial resources........................................................................3
TASK 2............................................................................................................................................3
2.1: various sources of income...............................................................................................3
2.2: Factors that influence the availability of financial resources..........................................4
2.3: Different types of budget expenses.................................................................................4
2.4: Evaluation of approaches which is used in level of development...................................5
TASK 3............................................................................................................................................5
3.1 Management of financial shortfalls..................................................................................5
3.2: Activities to be taken in event of suspected fraud ..........................................................6
3.3: Monitoring budget...........................................................................................................7
TASK 4............................................................................................................................................8
4.1: Information required to make financial decision............................................................8
4.2: Analysis of relationship among service delivery ...........................................................9
4.3: Analysis about financial consideration as affected by service users...............................9
4.4: Recommendation to improve care service ...................................................................10
CONCLUSION..............................................................................................................................11
REFERENCES..............................................................................................................................12

INTRODUCTION
In business, it is essential that funds shall be managed in an appropriate manner as then
only, it is possible that success can be achieved. For this, cash shall be kept as most of the day to
day expenses are made in terms of cash only (Ding, 2010). In health and social care, various
expenditures are made on equipment and staff as they are to be trained properly so that proper
treatment is made. For this, it is required that understanding shall be gained in relation to all
aspects which are included in this sector which can be done with the help of report presented
below.
TASK 1
1.1: Principal of costing and business control system
Principle of costing: Costing can helps the managers to determine total amount of
resources available at their disposal. There are various types of cost which is associated with
health-care are variable, semi variable, direct or indirect costs. There are six principle which are
used are as follows:
 Consistency
 Data accuracy
 Stakeholders engagement
 Materiality
 Causality
 Objectivity
Resources shall be maintained in proper manner and for this various systems can be used.
It is needed that principles that are related to cost shall be taken in consideration. All the cost
which are made are for some or other cause so it is important to identify it and then it shall be
charged to that purpose only (Goldman, 2010). In addition to this, some expenses are such which
are not related to any product and are known as abnormal cost such as fire or theft and there is no
need to include them or charge them with the product. The addition which is made to cost for
various expenses shall be done only when it is incurred and not before it. In order to determine
the correct cost all these principles shall be kept in mind and also any amount which was
incurred in past shall not be added while calculating price in future.
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Business control system: It is known as system which is collected and uses information to
analyse the performance of health-care like physical condition, human actions and financial
planning. All these are related with the development of the organisation as a whole.
1.3: Regulatory requirements for financial resources
To manage the funds various systems can be undertaken such as control shall be
established so that all the operations can be monitored and for this budgets can be made by
which cost will be controlled and also purchases and sales will be made in accordance with set
standards. For examining the whole framework, rules and regulations which are made by
government and other authorities shall be followed. There are various laws which specifies
provisions to be followed by health and social care sector and so it is to be complied and an
example of it is preparation of accounts which is to be done by all. All other principles that are
set in GAAP for accounting are to be incorporated so that financial management is made
possible (Financial management resources, 2017). In this matching principle, full disclosure and
other factors are there which will be considered. There are various legal requirements that are
required to be linked in order to manage financial resources of Silloth Nursing and residential
care Home are as follows:
 It is more helpful in order to determine internal as well as external auditing committee
that are regulated in proper manner.
 Lawful insurance of the company is required to done in effective manner so that to
control financial risk.
1.2: Identification of information needed to manage sources
In order to do this and achieve the targets which are specified in this regard, there is need
of relevant information that is to be collected. Firstly the cost which is incurred can be classified
in various categories and it involves direct and indirect cost. In the health sectors there are many
such services and product cost which are provided on per patient basis and for that the amount
that is charged is covered in this (Kabra, Ramesh and Arshinder, 2015). Some of the examples in
this in care home are the charges for bed or food which is provided to individual person. Another
is indirect cost which is incurred in total and cannot be determined for an individual person but
will be apportioned in equal manner among all. These included expenses which are fixed such as
rent, salaries and other common expenses. After all this is done then it is needed that all tools and
software which are used shall be evaluated. For management it is required that all work shall be
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performed in most effective and efficient manner so that cost can be reduced. Also different tools
are there which should be applied as by that wastage is removed and this leads to enhancement in
productivity.
1.4: Evaluating managing financial resources
Some of the systems which are used includes auditing system, budgeting, financial
accounting, and others which are related to payments and training. All the information which is
needed by clinic from different departments can be accessed by them with the help of IT system
as it leads to proper storage, processing and sharing of data. All the files made can be transferred
by using electronic means which is a cost efficient and time consuming process. It is very much
important that motivation shall be provided to staff and for this budgets are made as by them two
targets will be met which are prevention of cost which is spend in excess and also staff will be
told the targets which are to be achieved so they will be working with full potential. Another
system which is used is audit related, which is a program in which design is made about how the
information shall be collected and procedures are checked. All the activities which are performed
internally will be examined so that reports can be made. As they involve some procedures so it is
needed that training should be provided to staff by which they can use programmes in proper
manner (Enthoven, 2014). By the help of this risk is evaluated and if any frauds are being
conducted in business then they can be identified. Records will be understood in better manner
and areas in which improvements can be made that are beneficial for all are also recognised. So
all of this shall be carried out in order to manage the resources.
TASK 2
2.1: various sources of income
Funds are required for all the activities which are carried out and so in order to arrange
them it is needed that all the available resources shall be evaluated (Grimshaw, Rubery and
Marchington, 2010). But before doing this it is required that the amount which is needed shall be
determined so that selection will be made accordingly. There are various sources but the ones
which are used in respect of health care facilities or can say in given case for residential home
are as follows:
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 loans that are taken from local and other agencies which are established with the aim to
provide finance to such homes for benefit of people. The main organisation which
provide funds for residential care homes in UK human and health services department.
 Government grants: It is the government assistance which is required for the purpose to
help people in the form of donation or charities.
2.2: Factors that influence the availability of financial resources
Most of the organisations arrange their money from here only. For this purpose they are
required to give an application and on that basis different grants are provided to them. In the
process of fund collection there are various factors which affect the working and it includes
expenditure made by government. As the grants are given by it which will be dependent on
amount which is there with it and expenses that are made. This will be changing every year and
by this working of home will be affected. Another is the policies which are made by government
as the funds are to be allocated for various purposes which are for development of whole society
and state. So the amount that can be provided to them will be dependent on it. Some of the
groups are such are which are excluded from the list and they are not provided any help by
government. So this is also a factor by which sources of funds are affected. Due to lack of
finance all the activities will not be performed in appropriate manner and this results in downfall
of whole sector. Some of the factors which are affecting are:
Price: It has been seen that there is tough competition in the market. Plenty of home care
agencies are working in order to profit better services to the society by charging unnecessary
price.
Profitability: A healthy earning cannot be in appropriate manner it will make huge impact on the
performance of the company.
2.3: Different types of budget expenses
In order to properly identify the needs and then manage them, it is very important that
appropriate tool shall be used. One such tool is budget under which estimate is made in respect
of requirements and also manner in which funds shall be allocated to all the departments is
defined. So the resources will be utilised in best possible manner providing it with maximum
benefits. The budgets can be made for various aspects which involves expenses in which amount
that can be spend is mentioned, management of projects under that all the operations and their
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sequence is specified so that errors can be avoided, and cash budgets. It is known that how much
reserve is there or to be made (Siano, Kitchen and Giovanna Confetto, 2010). If there will be
insufficient money then some of the activities will be outsourced. This will also lead to some
additional cost which is to be paid for it. Various budget are analyse in order to make proper
evaluation. Such as:
 Material budget which is associated with catering of normal medical cost, laundry and
other items.
 Direct labour costs which is related with total number of people responsible for
delivering services to patients.
2.4: Evaluation of approaches which is used in level of development
It is very important to maintain coordination among various departments and so it is
required that proper techniques shall be used for this. It shall be ensured that all the expenses
which are to be made shall be identified and then allocation should be made in accordance with
it. This will create positive image among workers and they will work with full potential. Such
programmes shall be introduced in which staff will be needed to work in groups as by this
understanding is developed among them and team spirit can be achieved by this. So all this shall
be done which will ensure proper planning and this results in fulfilment of all objectives.
 Payback period is the investment tool which is used for analysing total amount of return
they are getting after delivering services to the home care.
 NPV: It is the amount of cash inflows and outflows which they are getting from there
overall investments.
 Profitability analysis: It is associated with the analysis whether company is able to
control their expenses in order to earn maximum profit in future.
TASK 3
3.1 Management of financial shortfalls
Budgets can be described as estimates which are made so that further management can be
made and success can be attained (Swayne, Duncan and Ginter, 2012). By this it will be possible
to evaluate the performance of home and this will help in knowing that whether the targets that
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have been set in budgets are attained or not. The chances of facing funds shortage can be reduced
as they can be arranged in advance. Also the manner in which available funds shall be used is
determined and this solves the problem of uneven distribution which sometimes becomes the
cause for disputes or conflicts. In the organisation there are some revenues and from them
expenditures are made so it is necessary that balance shall be established among them so that no
expenses shall be remain such without which working will be hampered.
To manage financial shortfalls:
Financial shortfalls can be arises when the business financial activities of the Silloth
Nursing and residential care Home fails to meet out least expected objectives within a specific
time frame. It can be of many ways such as temporary and persistent. A well organise system is
required to overcome these financial shortfalls. In order to manage there situation the care Home
needs to have few strategic measures in order to manage, overcome and eliminate them. Some of
them are discussed underneath:
 Managing cash flows: The primary reason of shortfalls is associated with cash flow
management because maximum of cash is used while making any planning regarding
betterment of hospital services.
 Controlling financial resources: As, resources are considered as most appropriate part of
an business. It can be managed by proper planning, organising and evaluation measure
that can help them to attain goals of Home care.
 Credit control:It will help in decreasing bad debts and increasing company's cash-flows.
3.2: Activities to be taken in event of suspected fraud
In not for profit organisations, all the funds are received in form of grants, donations or
charities. Some of the amounts are quite big and there are chances that some error occurs in
relation to them (Andersen, Rice and Kominski, 2011). When errors are made intentionally in
order to deceive organisation then they are known as frauds. Due to this there are chances that
funds will be mis-utilised and they will be income leakage. If there are some frauds which are
identified by then then it is needed that appropriate steps shall be taken in this respect. First of all
it shall ensure that investigation shall be carried out by which it is identified that who is the
person responsible for such action (Rockey and Collins, 2010). It is not beneficial, if no step is
taken against then so they shall not be left otherwise chances of further occurrence will be
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increasing. Firstly warning shall be given to them and if the also no improvement is noticed then
strict action shall be taken. In this company has the right to rusticate the employees which will
set an example and then no other person will do the same thing and will not involve themselves
in any kind of fraudulent activity. In Silloth Nursing and residential care Home there is a health
insurance portability and accountability act that is associated with fraudulent cases. It is serious
crime the legislation can penalizes fraud individual by imposing criminal charge panel code and
prison for more than 10 years. In order to find out such kind of situation care home need to
implement fraud management control system. Certain regulation and fraud report is need to be
followed.
 Identification of fraudulent enquiry.
 Formulation of correct procedures in relation to detect fraud within an organisation so
that future objectives can be attained.
 Finding of offender which is associated with the fraud.
 Evaluating the steps of incident in well organise manner and convey it to higher
authorities.
With the use of all the above mention process, Silloth Nursing and residential care Home
can overcome their financial frauds. It will help them to make necessary plan for getting
effective outcome in future times.
3.3: Monitoring budget
In every organisation without proper monitoring they cannot get effective outcomes. A
perfect tools and techniques is required to be used by Silloth Nursing and residential care Home
to determine their performance and growth. There are many problems which are present in
budgets and so it is needed some instrument shall be used to overcome them in most effective
manner. This will be involving following:
 The plan which is made shall be investigated in detailed manner: This means that in
budget all the activities of finance which are to be performed are specified and this
provides with the required guidance. So it shall be ensured that before its implementation
proper testing of it shall be made as of there will be any issue in it then whole process
will become failure.
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 Proper coordination shall be established: There are various functions which are carried
out by different departments. So in order to avoid any kind of mismanagement it shall be
ensured that proper coordination shall be maintained.
Budget monitoring is an effective techniques of managing financial resources of Care
Home services. Managers can have the option use spreadsheet data and cash-flows amount in
order to evaluate problems and any misconduct.
TASK 4
4.1: Information required to make financial decision
In health and social care sector there are various services which can be provided so it is
important that decision shall be made in respect of them (Conway, 2013). For this, various
information will be needed and for that management accounting can be used as in this there are
several systems which can be utilised for this purpose. Such principles shall be developed by
which best policies will be developed and implemented so that objectives can be attained. The
demand of service which are provided by organisation shall be evaluated. In this the present
demand and projected both shall be included. This is required as then only it will be possible to
meet all of them and also their expectations will be satisfied. Health facilities are such which can
never have less demand as they are basic necessity which is required by all. In order to know the
future demand evaluation shall be made of centres which are present and estimated number of
elder persons in society.
Various information associated with Care Home are require to be presented to the top
management so that necessary evaluation and decisions can be made. It can identify by using
past data that are already done in the recorded. The company's financial records are one of the
crucial tools for collecting different information to make effective evaluation. Decision making
procedures is a systematic procedures that happen on daily basis in Care Home. Some of the vital
documents are:
 Cash-flows statements
 Cost-sheet
 Income and expenses
 BEP analysis
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Decision about performance of Care Home services is related with investors as total
amount of profitability and expected investment return they are getting from their capital
investments. Management of risk is another important decision which they required to analyse,
whether this organisation is able to control their risk and how they are hedging them.
4.2: Analysis of relationship among service delivery
There is a relation which exist among the services and cost and it is affected by various
factors so they shall be considered (Weisfeld, 2011). Accountability shall be set in which
responsibility shall be made that best quality will be provided at adequate cost. This will help in
motivation. Transparency shall be made with stakeholders so that required trust will be build and
this is beneficial for organisation. Proper policies shall be formulated and implemented as by that
price will be determined. Before anything proper analysis shall be made that what is the amount
of benefit that is received with a certain cost. Then on that basis expenditures shall be made. In
the cost only small potion will be added as these organisation are not set to earn more profits.
They are just for benefit of society. In order to provide more effective care to service user a lot of
aspects required to be considered. Such as secure and conductive atmosphere, happiness and
comfort and outdoor activities for the patients. Care is comprehensive service deliveries that are
fulfil needs and wants of service users. It is identified in general that the quality of care at that
point of time required specific changes. As manager of Silloth Nursing and residential care
Home, they need to determine key factors that is affecting the services by making proper
consultation with services providers and relative family members to sort out those issues.
Moreover, cost and expenditure have a specific effect on nature of services provided by the Care
home organisation. It should be comprehensible, appropriate, regular, safe and secure and
sustainable.
4.3: Analysis about financial consideration as affected by service users
It has been observed that, in recent past the Health-care problems has recorded a regular
issues in regards to cost management. Thus, there is a need for improvement in service quality
users. After making proper evaluation of financial and operational point of views of Silloth
Nursing and residential care Home this decision is made. It is mainly related with staffs ongoing
professional development, performance appraisal if they are liable, monitoring of their activities
and supervision during recruitment. It will be helpful to reduce extra burden over the company
and great chance will arise in order to retain mostly skilled and experienced people. Needs are to
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be determined and for this service quality shall be measured as then only staff will be hired
accordingly. All the budgets that are made by residential home shall be reviewed and appropriate
changes shall be made as per needs. Any such services which are irrelevant shall be eliminated
so that cost incurred in respect of them can be saved. Thus, it can be used in such actions which
prove to be advantageous for organisation. With the ideas of retaining highly motivated people
and competent staffs it will increase direct or indirect cost because existing employees should
also required up level training. The service users will collect a comprehensible and motivate care
by this types of planning.
4.4: Recommendation to improve care service
In order to improve the condition of health care, there are various activities which can be
performed. Such as expenses which are made shall be reassessed so that they can be incorporated
in budgets and this will represent true picture. In them the cost to be incurred in future shall also
be included so no issues are faced when they arise. The cost which is made in respect of each
person shall be identified. This helps in knowing the amount to be spend and required to be
arranged. It shall be identified that which are the operations that are more important and then
they shall be performed in that sequence. The most priority ones will be undertaken first and then
least at last (Chartier, 2014). By this, focus will be given on those persons who are old as they
need extra care and time. To achieve maximum benefits all the funds which are received by
organisation in form of grants shall be used in such manner by which all the requirements will be
fulfilled. Therefore, by considering these factors, improvement and enhancement can be attained.
The connection between financial institutions and their system are more useful for analysis
perfect results for the patient condition. It will determine whether they are liable for any further
improvement. It is related with shareholders, banks and financing authorities.
Ways of improving the quality in Care Home;
 Maintains of accounting principles: It is essential for the health-care services
organisation to use proper accounting rule and regulation that can help them to control
their extra cost and expenses.
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 Equity and features: It is termed as innovation at worldwide in national health-care
service(NHS). They are implementing necessary tools and measures to rectify quality of
care services.
 Payment by results: In this particular section, risk and responsibility is transfer from the
legal authorities to that of other health-care organisation. The primary objectives of this is
to make used of that services which is of standard quality.
CONCLUSION
From the above mentioned report, it can be concluded that management of funds is
required in all the businesses even in health and social care. This is because; with the help of
funds, various operations like expenditure and maintenance can be carried out. For this purpose
various tools are there such as budgets shall be formulated which help in effective management
of all the factors. Also proper consideration shall be provided to the frauds which are taking
place as if not given attention then organisation will have to face an adverse impact due to this.
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REFERENCES
Books and Journals
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Organization.
Conway, J.B., 2013. A course in functional analysis (Vol. 96). Springer Science & Business
Media.
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business and Management. 5(2). p.213.
Enthoven, A.C., 2014. Theory and practice of managed competition in health care finance.
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Goldman, C., 2010. Joint financing across health and social care: money matters, but outcomes
matter more. Journal of Integrated Care. 18(1). pp.3-10.
Grimshaw, D., Rubery, J. and Marchington, M., 2010. Managing people across hospital
networks in the UK: Multiple employers and the shaping of HRM. Human Resource
Management Journal. 20(4). pp.407-423.
Kabra, G., Ramesh, A. and Arshinder, K., 2015. Identification and prioritization of coordination
barriers in humanitarian supply chain management. International Journal of Disaster
Risk Reduction. 13. pp.128-138.
Rockey, S.J. and Collins, F.S., 2010. Managing financial conflict of interest in biomedical
research. JAMA. 303(23). pp.2400-2402.
Siano, A., Kitchen, P.J. and Giovanna Confetto, M., 2010. Financial resources and corporate
reputation: Toward common management principles for managing corporate reputation.
Corporate Communications: An International Journal. 15(1). pp.68-82.
Swayne, L.E., Duncan, W.J. and Ginter, P.M., 2012. Strategic management of health care
organizations. John Wiley & Sons.
Weisfeld, V.D., 2011. Jonas and kovner's health care delivery in the united states. Springer
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Online
Financial Management Resources. 2017. [Online]. Available through:
<http://www.minnesotanonprofits.org/nonprofit-resources/financial-management/
financial-managment-resources-overview>. [Accessed on 6th October 2017].
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