July 15, 2012
Reporting Practices and Ethics
Basic accounting guidelines are used to create, present, and document financial statements for a variety of companies and organizations. The term for these guidelines is known as Generally Accepted Accounting Principles (GAAP). GAAP involves the entire accounting industry both inside and outside the United States. There are four basic principles associated with accounting are historical cost which requires organizations to perform accounting and then report their findings for assets and liabilities.(Baker, 2011) The second principle is revenue recognition which takes the data of when revenue is received. The third principle is the matching principle where all expenses have to be matched with revenues. Finally, there is the full disclosure principle which involves the presentation of financial statements where any information disclosed will be enough to come to a conclusion.
In the four elements of financial management are used to manage a health care organizations finances. They consist of the following: Controlling which in healthcare management means that a manager is overseeing all the procedures needed to accomplish the company’s goals. Planning is a method of steps developed in advance to complete the organizations goals. (Baker, 2011) A financial plan involves many types of budgets so there needs to be a plan for saving the money which will allocate how much money will need to placed aside. Organizing and directing is usually a management function and it involves how resources are used, how tasks are separated, and how the company as a whole coordinates. In financial management, organizing would be used on a day to day basis by regrouping the resources to be most effective for the corporation. Finally, decision making is a process in which determination of a subject is reached. It leads to a specific course of action....