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Executive Summary
This is a financial report represented for Accident and Emergency clinic department. The report is prepared mainly to be used by the directors of the accident and emergency clinic and is focus on the financial records available as closing of 30th June, 2008.
For the preparation of this report the transaction on the balance sheet of 31st May, 2008 and 30th June, 2008 were made available. The following notes were also presented in this report: the amount that is paid to the nurses in the accident and emergency clinic and the amount that is paid for nurses that extent their hours especially for Supply and other variable OH costs. The available data were use to present a cash flow statement for the month ended 30th, June, 2008. Cash flow refers to the amount of cash received and paid by the business during a particular period of time (Allen C. et al. 2007).
Financial Statements
From above data the price and quantity variances for the nursing costs, and spending and efficiency variances for supplies and other variables overheads were calculated as follows: The budgeted nursing cost = 22,300, the actual nursing cost = 33,180, variance nursing cost = 10,380. The nurses working for extra hours are paid between $12 and $17 per 0.5 hours and on average they are paid on approximate of $12 per 0.5 hours spent on patients.
Findings
Within the month of June, the accident and emergency clinic has incurred a lot of cost due to improper budgeting or focus. In that month alone it was focus that patient will be 3800, however there were 4000 patients who were reported to have attended the clinic. That different of 200 patients add to the cost spent per nurse per hour. The nursing hours were expected to be 1900 but it increases to 2080, with a different of 200.
That means on average an additional of ($12 x 200 = $2400) were spent on nurses who were nursing the patients. Supply and other variable OH costs also was expected to be 19000 but it turn out to be 20,340, that is, addition of 1,340. A standard rate for supplies and other variable overheads has been set at £10 per nurse hour this means $1340 /$10 = 134 extra hours were spent on this issue alone.
Recommendation
Management accountants are in charge supervising the business team and reporting dealings and duties to the finance organization corporation (Tevfik F. Nas, 1996).The management accountants are in charge of predicting and planning, performing variance analysis, monitoring costs in the business. Equally, preparing of financial reports is helpful to the company finance team. Financial accounting is a stepping stone to accounting management. The management accountants help promotes the victory of the company while stern financial accounting is more of observance and past attempt.
From the above finding results it is recommended that data from balanced sheet, profit and loss statement, and the cash flow statement be provided. The clinic should also come out with a better way of recording their data. Forecasting and planning are important aspect and should be given a greater attention (Bent Flyvbjerg et al. 2003). The management of the accident and emergency clinic should be in a position of getting and understanding the flow of patients, the numbers and the expectations of patients to attend the patients and clearly be able to calculate the amount spent on them per hour
Conclusion
Better financial management of the business depends on the skills and the knowledge of the directors or the accountant. An accountant should be able to focus ahead on the financial transaction and clearly give a suggestion statement concerning the overhead spread and any other expenses that are to be incurred by the business. All the business transaction must be clearly recorded by the accountant.
Reference
Bent Flyvbjerg et al. 2003. Mega projects and risk: An anatomy of ambition.Cambridge University Press.
Tevfik F. Nas, 1996. Cost-Benefit Analysis: Theory and application. Thousand Oaks, Ca. Sage.
Allen C. et al. 2007. The economics of heath and health care. 55th ed. Pearson Prentice Hall: New Jersey.
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