Resources:
- Budgets and Financial Statements under Chief Financial Officer in the Patton-Fuller Community Hospital Virtual Organization
- 2010 Operating Budget Projection
- Financial Plan and Presentation Grading Criteria
Develop a financial plan for Patton-Fuller Community Hospital for the upcoming year using the 2010 Operating Budget Assumptions memo and the 2009 Operating Budget in the Patton-Fuller Community Hospital Virtual Organization.
Create a 10- to 12-slide Microsoft® PowerPoint® presentation. Your presentation should:
- Identify the GAAP used to create the financial plan.
- Identify the financial statements used to develop the financial plan.
- Describe the payment systems and participants that contribute to the hospital revenue.
- Describe revenue trends that affect the hospital.
Your speaker notes should:
- Explain the relevance of each GAAP to the financial plan.
- Discuss the value of each identified financial statement to your decision-making process in the financial plan.
- Describe the relationship of the financial statements used in the financial plan.
- Describe each payment system and its effect on financial planning.
- Clarify the financial contribution of each participant and the effect they have as a source of revenue.
Expert Solution Preview
Introduction:
In this assignment, you are tasked with developing a financial plan for Patton-Fuller Community Hospital using the 2010 Operating Budget Assumptions memo and the 2009 Operating Budget in the Patton-Fuller Community Hospital Virtual Organization. You will create a PowerPoint presentation that identifies the GAAP used to create the financial plan, the financial statements used, payment systems and participants that contribute to hospital revenue, and revenue trends affecting the hospital.
Answer:
To create a comprehensive financial plan for Patton-Fuller Community Hospital, Generally Accepted Accounting Principles (GAAP) should be used. GAAP provides standard guidelines for the preparation and presentation of financial statements, which makes them reliable for decision-making. The GAAP that will be used to create the financial plan is the Generally Accepted Accounting Principles in the United States (U.S. GAAP).
To develop the financial plan, various financial statements will be used, including the income statement, balance sheet, and cash flow statement. The income statement will show hospital revenue, expenses, and net income or loss for the year. The balance sheet will show the hospital’s financial position by indicating its assets, liabilities, and equity at a specific point in time. Lastly, the cash flow statement will show the hospital’s cash inflows and outflows for the year and how they affect its overall financial health.
Several payment systems and participants contribute to Patton-Fuller Community Hospital’s revenue, such as insurance companies, Medicare, Medicaid, and private payers. These payment systems and participants have different ways of paying for health services, affecting the revenue generation of the hospital. The hospital should ensure that it complies with each payment system’s regulations to maximize its revenue generation.
Revenue trends also affect Patton-Fuller Community Hospital’s financial plan. These trends can be demographic, technological, market or competition, regulatory, or social or cultural trends. Demographic trends, such as an aging population that requires more healthcare, can increase hospital revenue. Technological advancements can also affect the hospital’s revenue through the utilization of innovative medical equipment. Market competition can also negatively affect hospital revenue, making it essential to consider these trends when developing a financial plan.
In conclusion, developing a financial plan for Patton-Fuller Community Hospital requires using GAAP, financial statements, identifying payment systems and participants, and considering revenue trends affecting the hospital. These elements should be addressed in the 10- to 12-slide PowerPoint presentation, focusing on their relevance, value, and contribution to financial planning.
