Omega Health Foundation

Running head: OMEGA HEALTH FOUNDATION

Omega Health Foundation

Terry Smith

University of Phoenix

Health Care Finance

FIN/HC571

Patricia Gusier

November 28, 2009

Omega Health Foundation

Introduction

Omega Health Foundation is a complex business with two hospitals, Omega and Able Memorial, plus a number of related medical –service providers. All of the related entities are nonprofit, with the exception of Omega Medical Management, Inc. (OMMI); OMMI is a wholly owned taxable subsidiary that is involved in a variety of business ventures, among them, the operation of family medicine centers where physicians are directly employed. The financial statements of OHF, also known as financial reports, record the financial activities in short and long term. The financial statements consist of balance sheet, income statement, statement of retained earnings, and statement of cash flows. A balance sheet reports the assets, liabilities, and net equity on a company. An income statement reports income, expenses, and profits on a company. A statement of retained earnings shows a company's changed retained earnings. The statement of cash flows shows a company's cash flow activities, such as operating investing, and financing activities.

Principles of Finance

The principal financial statements of Omega Health Foundation (OHF) summarize the financial information for the funds and accounts. The amounts reported on the principal statements are based on specific general ledger account balances. OHF‘s principal statements include a:

• Balance Sheet,

• Statement of revenues and expenses

• Statement of cash flows and

• Statement of changes in unrestricted net assets.

OHF’s principal statements summarize the accounting principles and methods of applying the principles that management has concluded best presents the assets, liabilities, equity, revenues, expenses, and budgetary information. Health care facility revenue comes from three sources. A) Patient...