HCA 270 WEEK 7 DQ 1
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This 0 page Study Guide was uploaded by an elite notetaker on Tuesday November 10, 2015. The Study Guide belongs to fin571 at Kaplan University taught by in Fall 2015. Since its upload, it has received 24 views.
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Date Created: 11/10/15
Why is budgeting important The budgeting process is very important to the nancial success of any organization A budget is the nancial roadmap for the year It takes the organizational goals and objectives and translates them into revenue and spending forecasts The main purpose of the budget process is resource allocation What are the appropriate uses of a budget Budgets are great tracking tools They allow you to see how well you business is performing You can see where you areas for improvement are It is very easy to see what department is managed effectively and where you weak managersleaders are A budget helps you plan ahead for the next year s expenditures and investments It can also play an important role in allocation for monies that are available for raises pro t sharing etc The budgeting process is about making a nancial plan for the future How much revenue will we budget for and how will we allocate the resources If expansions are part of your planning for the next scal year the budget will show you very clearly if this is a viable option for your business or organization How can budgets be mismanaged or misunderstood Sometimes people do not take the budgets seriously They do not understand the importance of a budget In large organizations every department has their own budget If one person does not do their part to meet their budget it has a negative effect on the entire organization Everyone should understand the importance and their nancial obligation to adhering to the budget Preparing a budget is not copying your expense from lat year it is about anticipating expenses resources growth opportunities as well as uctuations in the economy You have to look at trending over the past years An example is As a nancial operator should you scale down the budget for the plastic surgery department due to economic conditions or should you increase the budget in anticipation for the new services they are offering Budgeting should be a very inclusive thought out process If not there is a huge opportunity for mismanagement Mismanagement of the budget can be caused again by lack of knowledge If managers can not interpret the budget they will never understand the budget The budgeting process is a year long process It should not stop once the budgets are complete Actually that is just the beginning of the FY budget Why do you think the text states that many health care organizations handle their budgets very poorly Explain your answers The budgeting process in healthcare organization can have so many different variables These variables can make it very difficult to effectively manage budgets Another thing most organizations have poor strategic planning processes in place for budgeting purposes In order to achieve an effective budget many variables have to be considered The organization needs to have a strategic plan for the FY That strategic plan can help direct the allocations for the nal budgets
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