Evaluation of Financial Resource Management in Queen Victoria Hospital

This report provides a comprehensive overview of financial resource management within the healthcare sector, specifically focusing on the Queen Victoria Hospital Trust. It begins by defining costing systems and business control systems, outlining key principles such as consistency, materiality, and data accuracy, and detailing how these systems are applied within the NHS. The report then examines the information necessary for effective financial resource management, including financial statements like income statements, balance sheets, and cash flow statements. Furthermore, it explores the regulatory requirements imposed on the NHS, such as those from the Regulatory Monitor, NHS Commission Board, and CQC, highlighting their impact on financial practices. Finally, the report evaluates the financial resource management system of the Queen Victoria Hospital Trust, concluding that the trust demonstrates effective control over its financial resources, adhering to relevant regulations and employing various financial reporting methods to ensure accountability and efficiency.

Managing Financial
Resources in Health and
Social Care

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
1.1 Principles of costing and business control system ...............................................................1
1.2 Information needed for financial resource management.......................................................2
1.3 Regulatory requirements for financial resources management.............................................2
1.4 Evaluation of system for financial resource management in Queen Victoria Hospital Trust
.....................................................................................................................................................3
CONCLUSION................................................................................................................................3
REFERENCES................................................................................................................................4

INTRODUCTION
Managing Financial Resources refers to adoption various managerial techniques with the
help of which company can effectively manage al the financial resources held by them and
eliminate insufficiency as well as wastage of financial resources in the company. Queen Victoria
hospital trust is a trust which concerns with providing health care services to the public. The
study describes various costing and business controlling systems, requirements of regularities for
financial resource management and evaluation of management of financial resources for health
care organisations.
MAIN BODY
1.1 Principles of costing and business control system
Costing systems
Costing can be defined as a system through which management can determine the total
cost incurred by the business during a specific time period. There are various principles of
costing which need to be adopted by NHS like:
 Consistency: there are various methods of costing which provides different results
(Arnaboldi, Lapsley and Steccolini, 2015). Queen Victoria hospital trust should use only
one method of costing in each year so that managers could effectively analyse the actual
position. It will enable the trust to compare its cost within whole NHS industry.
 Materiality: this principle says that all data included in costing reports of NHS should be
material and related to the relevant period as well. It could provide actual cost incurred by
NHS in specific period. It would result in elimination of all immaterialness from the
books and make the books more effective.
 Data accuracy: It is the key principle of costing system which states that all data
included in costing report of NHS must be accurate. It will result in maintaining the
accountability and transparency in the books of Queen Victoria hospital trust
Business control system
 It is an important element of Queen Victoria hospital trust. It includes various
principles which need to be followed by NHS for better monitoring overall business of it
like:
 Financial accounting system: This system helps NHS in monitoring overall financial
activities including sales and purchase of the NHS.
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 Budgetary control system: with the help of this system, managers of Queen Victoria
hospital trust can estimate the future expenses and gains for the purpose of effectively
managing the normal course of operations and eliminating insufficiency and wastage of
financial resources.
 Brake even analysis: This analysis can help Queen Victoria hospital trust in
determination of cost structure of it along with the minimum amount of services to be
provided by it as to recover the cost incurred.
 Outsourcing: The outsourcing system helps Queen Victoria hospital trust in enhancing
the efficiency in its services along with reduction in cost. It reduces the cost of recruiting
new people in the trust and hence the cost of training and development as well.
1.2 Information needed for financial resource management
 Management of financial resources refers to analysing actual need of financial
resources and preparation of strategies and plans to avoid wastage of financial resources
in the business (Chapter 6: Financial resources and their management. 2018). For the
purpose of such estimation of strategy development various information are needed by
Queen Victoria hospital trust like actual value of assets and liabilities, total sales made by
hosptital within a specific time period, various equipments purchased by the Trust, etc.
 All these informations can be collected by the managers by using various
financial statements of the NHS like income statement, balance sheet, cash flow
statement etc. With the help of income statement, managers of Queen Victoria hospital
trust can determine the total amount of profit and sales generated by it within a specific
time (Simonet, 2015). Along with it, they can also identify the areas of expenses and
income of it. Further, balance sheet can provide the informations regarding various assets
and liabilities held by the NHS at a time.
For the purpose of collecting cash related informations, managers can analyse cash flow
statement of the NHS industry, it can provide the accurate information regarding flow of cash
within and outside of the organisation. In this way, managers can gather various informations for
better management of financial resources from various financial statements.
1.3 Regulatory requirements for financial resources management
Financial resource management is adopted by the firm for the purpose of having effective
control over its financial resources. Further, there are various regulatory requirements provided
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by government as well which makes the NHS to adopt financial resource management within the
organisation like:
 UK has a monitory body 'Regulatory monitor' it concerns with the monitoring of all the
activities of the NHS industry. This authority helps the ensuring the accuracy of financial
statements and other important informations of the Queen Victoria hospital trust(Torchia,
Calabrò. and Morner, 2015). This authority makes the NHS to have better management of
financial resources as to avoid errors in the data of it.
 Further, there is also a regulatory body ' NHS commission board' it helps the NHS in
development of its budgets, planning and future strategies as well. For the better
preparation of these, its is required by the NHS to manage its financial resources.
 In addition, as a general accepted principles, for the purpose of avoiding financial
resources' wastage in the business and enhance the financial capability of the NHS, a
better management of financial resources need to be adopted by them.
 NHS trust development authority monitors the performance management and governance
of all NHS trusts. It monitor clinical trusts, their whole management process, etc.
 CQC local health watchdogs inspects the quality of services provided by NHS trust as to
ensure the maintenance of standard quality in the NHS trust in England.
 Social care act 2012 makes the NHS trust in improving their efficiency of services and
reducing their cost as well. Due this act, NHS needs to innovate their medical care
service methods and use the latest technology as well.
In this regard, there are various regulatory requirements which make the NHS to manage its
financial resources.
1.4 Evaluation of system for financial resource management in Queen Victoria Hospital Trust
Financial resource management helps the Queen Victoria Hospital Trust in have effective
control over all the financial resources of the trust. In this regard, Queen Victoria Trust prepares
various statements like comprehensive income statement, balance, sheet, statement of change in
taxpayer's position, cash flow statement, etc. in addition, it also prepares staff annual reports,
remuneration reports, etc. It applies all the principles of business control and cost control system
to maintain accountability in the books.
All these reports helps the trust in effectively monitoring the overall resources of it which
effects its financial resources. Maintenance of these reports helps in analysing the accurate flow
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of financial resources in the Queen Victoria Hospital Trust (Annual-Report-Quality-Accounts-
and-Financial reports of Queen Victoria Hospital Trust, 2018). This helps in developing more
effective plans for it in order to echinacea its efficiency of using the financial resources. Further,
it also comply with all the laws and regulations applicable to it as to ensure the maintenance of
standard quality in the services of the trust.
In this regard in can be evaluated that Queen Victoria Hospital Trust has an effective
management of financial resources within the organisation. It helps it in maintaining the
efficiency of financial resources and eliminating s\wastage and insufficiency of these within the
trust as well.
CONCLUSION
From the above report it can be concluded that there are various costing and business
control principles which need to be applied by the NHS while preparation of costing reports and
policies for business control system. Managers need various finance related informations for the
purpose of managing the financial resource of NHS. Further, there are also numerous regulatory
requirements due to which financial resources need to be managed by the NHS. The report also
shows that Queen Victoria Hospital Trust also have an effective management of financial
resources.
REFERENCES
Books and Journals
Arnaboldi, M., Lapsley, I. and Steccolini, I., 2015. Performance management in the public sector:
The ultimate challenge. Financial Accountability & Management. 31(1). pp.1-22.
Simonet, D., 2015. The new public management theory in the British health care system: a
critical review. Administration & Society. 47(7). pp.802-826.
Torchia, M., Calabrò, A. and Morner, M., 2015. Public–private partnerships in the health care
sector: A systematic review of the literature. Public Management Review. 17(2). pp.236-
261.
Online
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Annual-Report-Quality-Accounts-and-Financial reports of Queen Victoria Hospital Trust. 2018.
[Online]. Available through
:<https://www.qvh.nhs.uk/wp-content/uploads/2018/07/Annual-Report-Quality-
Accounts-and-Financial-Accounts-2017-18.pdf>.
Chapter 6: Financial resources and their management. 2018. [Online]. Available
through :<https://www.bis.org/publ/othp04_6.pdf>
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