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Date Submitted: 07/28/2011 08:00 PM
Health Care Accounting Principles and Ethical Standards
HCS 405
Professor Diana Schilling
Jennifer Lutton
For accountants, conducting business in professional manner means more than just reporting the correct numbers. Accurate reporting adds to the success and reputation of an organization. By keeping records properly and using the correct information, accounting, and reporting systems, accountants can be sure that the organization’s records are accurately collected, organized, balanced, and reported. To help accountants keep accurate reports, there are accounting principles and ethical standards that must be upheld.
Elements of Financial Management
There are two types of accounting; financial and managerial. Financial accounting emphasizes the use of external reporting to outsiders or third parties such as Medicare, Medicaid, health plan payers, or other government programs. Managerial accounting, however, is used by management to plan different operations, set and evaluate performance measures, and report the profitability of services provided. There are four steps to successful managerial accounting. These steps are planning, controlling, organizing and directing, and decision making (Baker, 2011). When planning, a manager must identify what steps and tasks need to be accomplished for the benefit of the organization. These could be both short and long-term goals. In the planning phase, management must look for objectives and identify steps to completing them. After a plan is set in place, a financial manager must control the organization by making certain that the plan is in place and followed by every employee and department. Studying current and previous reports will help management identify where departments are being ineffective, and solutions can be devised to solve those issues within the organization. The third element is organizing and directing. It is up to the financial manager to determine what resources to use and how they...