Hs 543 You Decide

DESMOND P.WILLIAMS

KELLER GRADUAIE SCHOOL OF MANAGEMENT

HS 543- HEALTH SERVICES FINANCE

WEEK 2 YOU DECIDE ASSIGNMENT.

Health care accounts receivables are financial claims for services delivered to patients. It is likely the largest non-capital asset for health care organizations whose success often relies on the aggressive analysis of accounts receivable. In this regard accounts receivable are current assets on the financial statement. Accounts receivable should be actively managed so cash is collected from customers in a timely, efficient manner.

In the scenario in question, as the Chief Financial Officer (CFO), the following data will be needed before coming up with a plan:

a. A list containing credit transactions and there respective dates of approval and maturity

b. Essential personal profile of debtors relating to their occupation, sources of income, family size residence, number of dependents.

c. Mail correspondences and other available evidences in respect of when mailed payments from the customers were received by the the hospital management.

d. Available evidences regarding clearing of payments or transactions that took place between when the mailed payments were received and the specific dates when the payments were posted in the company’s bank account.

In view of the above, as the CFO, accounts receivable can be brought back in line by executing the under mentioned activities in the appropriate departments

1. Preparation of aging accounts receivable schedule and to review of existing credit collection policies, standards and terms.-the finance department is responsible for this activity. The objective of this activity is to characterize existing accounts receivable and to classify them in the correct manner of current and outstanding.

2. Determining the details of the average collection period based on the time the credit was endorsed or approved up to the time customer’s mail payments and the time when payments were mailed...