Omega Health Financial Position

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Omega Health Financial Position |

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Fin/HC 571 |

12/19/2011 |

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Overview

This paper is being prepared to explain the financial position of Omega Health Foundation and to also provide recommendations to strengthen its financial situation. In doing so we will explain the principles of finance and how they relate to Omega Health Foundation’s financial position while comparing and contrasting Omega’s net income and cash flow as well as their market and book value of the assets. We will also address the weakness and strengths are applicable of Omega Health Financial position. Lastly, recommendations will be made so that Omega can strengthen its financial position as well as stating any further information that may be needed to further evaluate Omega.

Principle of Finance

Perhaps understanding the fundamental principles of finance is a key component to this process. As your consultant, the combined financial statements for Omega Health Foundation and its other entities have been analyzed to review the company’s financial position. It is critical to understand fundamentals of finance to include but not limited to: balance sheet, cash flow statements, income statement; as well as revenue, assets and liabilities. Understanding the basics of these sheets can allow managers to make important decisions

Balance Sheet

The balance sheet as defined by Investopedia as A financial statement that summarizes a company's assets, liabilities and shareholders' equity at a specific point in time ("Balance Sheet", 2011). The balance sheet will document the value of a company’s assets which equal liabilities plus share holders’ equity. According to the balance sheet, Omega Health Foundation is not making a profit because their assets equal their liabilities meaning everything they have received have been paid out.

Cash Flow

A company’s financial statement can tell a lot about the company or department for example, Omega Health has a few non-profit subsidiary and...