HCS 405: Financial Practices And Ethics

Reporting Practices and Ethics Paper
Tiffany Swartz
HCS/405
Todd Brown
November 19, 2012

Introduction Financial management in the area of healthcare has been an ever changing area. There are generally accepted principles and ethical codes that must be followed when dealing with finances, and healthcare facilities must be successful in this aspect for the facility to operate smoothly. This paper will discuss the four elements of financial management, some generally accepted principles and ethical standards, and provide examples of when these principles are used.
Four elements of financial management There are four major elements that can be discussed when dealing with the issue of financial management in
It is necessary for managers to take the time to make sure staff and department managers are up to date with changes and are properly implementing those changes. One way of doing this would be to compare previous and current reports to find the areas of the organization that are not being effective (Baker & Baker, 2011). The third element is organizing and directing. This is an important aspect of financial management because it is necessary for a manager to effectively use the resources within the organization to insure that the planning process is being followed through with (Baker & Baker, 2011). By providing the supervision necessary, day to day operations can run smoothly and without any situations that could cost the facility large amounts of money. The fourth and final element is decision making, which could be looked at as the most critical element for a financial manager. During the planning process, many different options can be proposed, and it is the financial manger’s decision of which path to take after analyzing and evaluating all of the research. This can be a very difficult task when it comes to making big decisions that could affect the entire facility; therefore, it is important to incorporate all of the other elements as well to make the decision making process
There are many different standards that can be used in the financial process, including consistency and materiality. Consistency is a term used to describe the way a facility compares time periods to insure a constant history within the organization. This will allow a better projection of future financial standards. Materiality refers to the accuracy of the financial reports being researched. It is extremely important for managers to be as accurate in reporting as possible to decrease the possibility for future mistakes. According to Illiano, 2012, in principles-based systems litigation plaintiffs will have a more difficult time proving their case, because they would have to prove both falsehood and concurrent knowledge, which is a difficult task. This is important due to the fact that healthcare litigation is a growing problem, whether legitimate or not; therefore facilities need to insure that they are making every attempt to avoid