Cost and Financial Resources
Task 1: (Systems)
1.1. Explain the main principles of costing and business control systems.
Managing financial resources is one of the key parts of remaining competitive and delivering sound and healthy service. It is therefore important that any health and social care organisation to understand the principles of managing financial resources as any other organisation.
At ABI Health and Social Care the main principle of costing and business control systems are: Capital Cost this is physical items and property. It is includes anything with life of three years and over. For example this can be lands/buildings, Vehicles, computers and other equipments. Revenue Costs this covers the costs of day-to day running the business. For example, fuels and maintenance of vehicles and equipments. it could also include salaries, advertising and promotion materials, and insurance. Indirect Cost this is the cost that directly invested or attributed to any project. For example, buying X-ray machine, direct cost can be, the price we paid to buy it, including transportation, the cost of any accessories and installation fee. Indirect Cost this is any costs that not directly attributed to the cost of the X-ray that we mentioned above. For example, the cost of involving the administration team who responsible of running day to day administration of the whole organisation. Their cost is not directly attributed to the cost of the X-ray but still applies to it, because it is the part of organisation’s equipment.
To control business system, up to date software is needed. This will enable and give the organisation the ability to control and manage budgeting. This will also enable the organisation to recognise and analyse income against expenditure by considering the above mentioned principles.
1.2 Identify the information needs to manage financial resources
The information needed to manage Financial resources includes, knowing where your income is coming from and how reliable
1.1. Explain the main principles of costing and business control systems.
Managing financial resources is one of the key parts of remaining competitive and delivering sound and healthy service. It is therefore important that any health and social care organisation to understand the principles of managing financial resources as any other organisation.
At ABI Health and Social Care the main principle of costing and business control systems are: Capital Cost this is physical items and property. It is includes anything with life of three years and over. For example this can be lands/buildings, Vehicles, computers and other equipments. Revenue Costs this covers the costs of day-to day running the business. For example, fuels and maintenance of vehicles and equipments. it could also include salaries, advertising and promotion materials, and insurance. Indirect Cost this is the cost that directly invested or attributed to any project. For example, buying X-ray machine, direct cost can be, the price we paid to buy it, including transportation, the cost of any accessories and installation fee. Indirect Cost this is any costs that not directly attributed to the cost of the X-ray that we mentioned above. For example, the cost of involving the administration team who responsible of running day to day administration of the whole organisation. Their cost is not directly attributed to the cost of the X-ray but still applies to it, because it is the part of organisation’s equipment.
To control business system, up to date software is needed. This will enable and give the organisation the ability to control and manage budgeting. This will also enable the organisation to recognise and analyse income against expenditure by considering the above mentioned principles.
1.2 Identify the information needs to manage financial resources
The information needed to manage Financial resources includes, knowing where your income is coming from and how reliable