Comparative Summary

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Comparative Summary HCS/577 Comparative Summary Financial environments vary from one entity to the next. Although most health care organization might be viewed as simply providing health care, however they vary in the way finance is handled and is reported. For example there are health care entities that are known as for-profit where there is a major focus on bringing in revenue to make a profit and some as not-for-profit where any revenues that come into the entity get reinvested in the organization and the major focus is on the community. Also entities that belong to the government will have many differences in the way financial statements are reported. Some examples include health care providers such as urban hospitals that are…show more content…
Policies in government health care organization can be made lenient because they are serving a specific group of people such as military personnel: active, reserve, and veterans. So the financial balance sheet can vary as the prices may be different from other health care organization. So policies are written to ensure compliance with all government regulations, and to make sure that money is not being spent unnecessarily. Financial Management Financial Management for not-for-profit have its similarities to for-profit, but they do have their differences. A for-profit organization focuses on the profitability and maximizing shareholder’s value. Not-for-profit organizations main goal is to not increase shareholder’s value. Not-for-profit usually lacks the financial flexibility of a for-profit organization since it depends on resource providers that do not engage in exchange transaction. Two areas of financial management that are important for not-for-profit organizations are budgeting and cash management. They have to pay close attention to whether it has enough cash reserves to continue providing services to clients. An increase in demand for a not-for-profit’s services can lead to a management crisis since it is hard to know the contribution revenue in a reliable manner every year.
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