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Importance of accounting and finance management in the context of a Health and Social Care organization
How financial software is utilized within the accounting functions of organizations
How key financial ratios are used by Health and Social Care organizations
Long term vs short term business finance needs of Health and Social Care organizations
Benefits and limitations of various sources of finance available to an organization
Process of budgetary control and revenue management in a Health and Social Care organization
Rules of double-entry book-keeping and how it is used to maintain financial records
References
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Importance of accounting and finance management in the context of a Health and Social Care organization
The main function of the accounting and finance management area is to provide the informational needs to the stakeholders of an organization. In the health and social care sector, this will be the same. Mainly there are two parties who use that information as internal stakeholders and external stakeholders.
Internal stakeholders are the people who seek that information for their decision making. The financial statements which serve those people are commonly referred as management accounts and provides extensive information which requires in business decision making. This will enable them to evaluate their performance as well as check whether the established targets are met by the organization. For an example, Anchor Hanover Group had made a loss in 2021 where they have turned it around to profitable in 2022. This has happened due to the decisions taken by the management based on the information they have received from the accounting function.
External stakeholders will also require the financial statements for their decision making. However, these financial statements are prepared in compliance with the international financial reporting frameworks which contains standard formats and processes. Following a similar set of rules in financial reporting, it will enable the external stakeholders to easily compare and analyze the financial statements issued. Further since the information is summarized, it will be easy for the stakeholders to analyze and take their decisions accordingly.
How financial software is utilized within the accounting functions of organizations
The financial software is the software utilized in the financial management. This software helps the organization in proper record keeping, record management and finally financial statement preparation. Previously prior the discovery of such software, all the financial records were maintained manually. From recording a single transaction until to the point where the final accounts statements are prepared, it consumed lot of time as well as was costly to be conducted. The solution for this cumbersome process was the financial software, which automated the recording of transaction. Since this software were having capabilities of record keeping, analyzing, inquiring and finally preparing financial statements, they enabled organizations to save time and costs.
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