Managing Financial Resources in Health and Social Care - Essay Example

? Managing Financial Resources in Health and Social Care Managing Financial Resources in Health and Social Care Introduction Financial management is a very crucial aspect in the prosperity of any firm. This paper presents various aspects of financial management. The essay further investigates how the management team should handle the organization’s finances. Another aspect that is brought into consideration is the issue of fraud: a behavior that the paper extrapolates and it significantly provides ways through which employees should tackle it. Most significantly, the essay presents how various aspects of financial resources should be managed in health and social care. It is the responsibility of the management to ensurethat funding is available to meet the daily needs of the organization (Jonker & Witte 2006). In the cause of events, finance may be needed in order to invest in equipment stocks, pay employees, equipment and cater for sales made on credit. If not well taken care of, sources of finance may end up dry; this may make an institution to be in financial jeopardy. Financial control plays a critical role in helping the business meets its objectives.As a manger, my role is to ensure that all these are achieved. Financial shortfalls arise when an organization cannot pay its bills on time due to lack of cash (Zaragoza, Mierzejewski 2007). As a manager I have been oriented to be proactive about financial shortfalls while upholding an account for contingency all the time. Through review of BUPA’s cash flow for the last six months, the company is capable to determine the cash flow in terms of expenditure and income; this aids the company in reserving cash needed for purposes of expenditure for the subsequent six months. After realizing the company’s assets, the company has a well-planned schedule on how to pay its suppliers to avoid conflicts with respective suppliers. The company also encourages early payments from the customer by offering discounts on such payments; this increases the chances of early cash availability. Payment of suppliers on a scheduled basis helps the company to avoid shortfalls since suppliers get their due especially when the funds are available. Fraud is an obvious threat to organization’s resources and therefore must be a concern to all employers and employees within a specific jurisdiction (Petrucelli 2002). In the event of fraud, managers are expected to set good example by conforming fully to procedures and controls. As a manger, quick action is necessary to avoid any further loss bearing in mind that this is just an allegation and until the outcome of investigation is determined. Movement and preservation of evidence to a safe place or location is vital where practicable. Both internal auditor and director of finance are supposed to be notified. Prompt and vigorous investigation should be carried out; after that, report findings should be forwarded to both internal auditor and director of finance. If possible consult with the appropriate departments concerned or involved. Notification to security agents should be carried out by the manager following consultation with the executives of the BUPA at National Director Level. As some may put it, coming up with a budget may be easy, sticking to it is the hard part. A well planned budget has little no impact without willpower and close monitoring (Amey 1979). A system for recording expenses and producing reports should be in place. As a manger, insisting on regular monitoring reports is way of ensuring that whatever was projected in the budgets is followed to the latter. Through monitoring reports, it makes it easy to determine actual spending at a particular period of the month compared to what was projected in the budget. The level of expenditure should be documented and clear reports drawn from them; the concerned departments should be informed so as to get their input on the same. The audit committee should review the reports. After conclusion, there should be immediate action taken either to save the budget if at all it has discrepancies and necessary adjustment made. The requirement for a decision comes up in an organization because a manager maybe subjected to a problem and alternative courses of action taken. When making a decision, as a manager, settling on a relevant option to choose will need all the information that is relevant to a specific chosen decision; and there must be some criterion based on best alternative. Decision can either be due to priority, strategy, urgency, emergency, availability of funds and strategic planning. Decision-making can be influenced by either expenditure or income amount realized by the organization. Beinginured to observing every decision through the lens of finance is a way of solving finance problems and coming up with an intellectual basis for long-term wealth buildup. Relying on “relevant cost” in decision-making is the best practice.CIMA’s definition on relevant costs is 'costs suitable to aid the management in decision making'. A social cost-benefit analysis is a good way to explain the variances between project alternatives and provision of information in order to achieve a well-informedverdict. Pricing procedure for a particular service depends on the ability of a consumer to achieve. When setting these policies great consideration is taken in order to accommodate all. Purchasing arrangements should be done in prior by evaluating the market price of certain commodities and services. This will enable the procurement department determine the cost and the amount to be spent. Higher cost may result to low expenditure. Opportunity cost is the value of opportunity forgone as a result of involving resource activities (Mankiw 2011). A client may be interested in accessing a particular service depending on the cost of service. With cost in mind, a patient automatically settles on a more affordable option. Actually access to service should not be hampered with due to cost, but with the current economic crisis worldwide, it wouldbe strenuous for the government to have all services accessed at subsidized fees. Some consumers don’t mind about the cost, all they mind about is quality of service. They are normally ready to gain the services irrespective of price. As a manger, relying on technology such as use of IT services can lower the cost especially where the service can be delivered online. Training and development of staff can be a relief from high cost since availability of adequate personnel may mean: high supply, low demand or trying to maintain the state of equilibrium. With managerial experience, health and social care services still yarn for change. Change cannot be realized without involving the concerned individual that the change is aimed for. The financial compressionsfronting social care and health can be approached in one of either ways; BUPA can opt for a fortress mentality and seek to safeguarditself in the current unfavorable climate, irrespective of impact on others. Instead, BUPA can reach out to partner organizations and join efforts towards a whole-system situation, even if it means forgoing their own securities for the greater good.First, it is necessary to align financial incentives for easier collaboration in partnership. The flexibility offered by collaborationenables providers to convey new models of care needed in the future in transforming the delivery of health and social care. Whole-systemresolutionsshould be based on complete governance provisions with absolute clarity about decision rights and culpabilities. Top brass of partners involved should provide an overall directive supported by joint executive teams. In conclusion, the costs of health related issues should be accommodative and within the reach of clients. For effective administration and finance management, the administration should uphold integrity of budgeting and implementing policies based on effective and sound financial management plans Amey, L. R. (1979). Budget planning and control systems. London: Pitman. Citied works; Jonker, J., & Witte, M. C. (2006).Management models for corporate social responsibility. Berlin: Springer. Mankiw, N. G. (2011). Principles of economics. Mason, Ohio: Thomson South-Western. Petrucelli, J. R. (2012). Detecting fraud in organizations: Techniques, tools, and resources. Hoboken, N.J: Wiley. Zaragoza, D. P., Mierzejewski, E. A., & University of South Florida. (1997). Financial shortfalls of Florida MPO long range transportation plans. Tampa: University of South Florida, Center for Urban Transportation Research. Read More