IP Financial Information Use

at
Categories
Tags

 

 

As the Director of Accounting, you have been tasked with briefing during the new employee’s orientation on the principles of accounting and how these apply to your hospital. In addressing the principles of accounting, you are concerned with both sets of accounting information–financial and managerial. Managerial accounting has no formally adopted set of principles it relies strongly on financial accounting principles. Understanding the principles and basics of financial accounting is critical to understanding both financial and managerial accounting information.

In a PowerPoint presentation of 5-7 slides not including the title or reference slides and with 200 word speaker notes for each slide:

Address the regulations around safeguarding financial information to prevent fraudulent activity.
Identify and explain the five (5) principles or processes of managerial accounting and how they apply to the financial statements specific to your healthcare institution.

Sample Solution

Presentation Title: Principles of Accounting for Healthcare Professionals

Slide 1: Introduction

  • Welcome new employees and thank them for joining the team.
  • Outline the presentation’s objectives: to discuss the principles of accounting, their application to healthcare, and the importance of safeguarding financial information.

Slide 2: Financial Accounting Principles

  • Define financial accounting: The process of recording, summarizing, and reporting financial transactions to external stakeholders, such as investors and creditors.
  • Explain the five generally accepted accounting principles (GAAP):
    • Historical Cost: Assets and liabilities are recorded at their original cost.
    • Matching: Expenses are recognized in the same period as the revenues they help generate.
    • Revenue Recognition: Revenues are recognized when earned and realized.
    • Accrual Accounting: Revenues and expenses are recognized when they occur, regardless of when cash is received or paid.
    • Going Concern: The assumption that a business will continue to operate indefinitely.

Slide 3: Safeguarding Financial Information

  • Importance of safeguarding: Discuss the importance of protecting financial information from fraud, theft, and unauthorized access.
  • Regulations: Outline relevant regulations, such as the Health Insurance Portability and Accountability Act (HIPAA) and the Sarbanes-Oxley Act (SOX).
  • Internal Controls: Explain the role of internal controls in preventing fraud and ensuring the accuracy of financial information.

Slide 4: Managerial Accounting Principles

  • Define managerial accounting: The process of providing financial information to internal users, such as managers and employees, to make informed decisions.
  • Explain the five key principles of managerial accounting:
    • Cost-Benefit Analysis: Evaluating the costs and benefits of different courses of action.
    • Relevant Information: Focusing on information that is relevant to decision-making.
    • Timeliness: Providing information in a timely manner to support decision-making.
    • Flexibility: Adapting to the changing needs of the organization.
    • Decision-Making: Using financial information to make informed decisions about resource allocation, pricing, and performance.

Slide 5: Application to Healthcare

  • Specific challenges in healthcare: Discuss the unique challenges of financial accounting in healthcare, such as the complexity of billing and reimbursement systems.
  • How managerial accounting principles apply: Explain how managerial accounting principles can be used to analyze costs, improve efficiency, and measure performance in healthcare organizations.

Speaker Notes:

  • Slide 1: Welcome new employees and emphasize the importance of understanding accounting principles for their roles.
  • Slide 2: Define financial accounting and GAAP, providing examples of how these principles are applied in healthcare (e.g., recording the cost of medical supplies, recognizing revenue from patient services).
  • Slide 3: Discuss the risks of financial information breaches and the importance of implementing strong internal controls.
  • Slide 4: Define managerial accounting and explain how it differs from financial accounting. Provide examples of how managerial accounting principles can be used in healthcare (e.g., analyzing the cost of different treatment options, measuring the efficiency of departments).
  • Slide 5: Discuss the specific challenges of financial accounting in healthcare, such as the complexity of billing and reimbursement systems. Emphasize the importance of understanding both financial and managerial accounting principles for effective decision-making in healthcare organizations.

This question has been answered.

Get Answer