Budget management analysis is used by Chief Executive Officers, (CEO’s), and managers to assist them in determining whether or not the resources at hand are being used efficiently. An organizations budget is most generally yearly or quarterly and may be based on a financial committee’s decision Essay on Budget Management Analysis M. Rivlin 's Efforts Establishing The Congressional Budget Office. Congressional Budget Office (CBO). It will detail the Introduction. Budgeting Plays An Important Role In An Organization,. In this paper the budget analysis is Essay on Budget Management Analysis Words | 6 Pages. Budget Management Analysis HCS/ Financial Resource Management June 27, Dr. Lena Watson Budget Management Analysis Budget management analysis is used by mangers as a tool and helps determine that all resources available are being used efficiently
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This paper uses an example hospital budget shown in Table 2 on page 6. The variances difference between actual and budgeted amounts for the different categories are also shown. An analysis of several of the expense categories is detailed below, in Table 1. In Table 1, the variance of each budget item is computed by subtracting the budgeted amount for that item from the actual costs for the item. If the result is a negative number, it means that the actual costs are lower than the budgeted amount, and there is a negative variance.
If the result is positive, the actual costs are higher than the budgeted amount. In the table, positive variances are shown in red to indicate that these budget items need some attention from management because that category of budget item went over budget.
In the table, the right-most column provides a possible explanation for why that item had a variance either positive or negative. Table 1. Analysis of Variances for Several Expense Categories Overbudget variances are in red; underbudget variances in black. One technique that assists with managing a budget in any organization, but specifically in healthcare organizations such as hospitals and clinics is benchmarking.
In such a case, benchmarking would consist of making a best-estimate of expected revenue, budget management analysis essays, then determining how expenses can be driven down. Management receives estimated budgets based on this historical record to assist with holding costs at the lowest possible levels.
These historical budgets provide a budget management analysis essays to the managers to help them stay within budget. It may also help if managers receive bonuses or other incentives for staying in budget. This means that benchmarking other hospitals that service nearby communities can confirm that nursing and other staff salaries and benefits are on a par budget management analysis essays the community norms, budget management analysis essays.
In addition, it can be helpful to assess the span of control of those with management titles to determine if salaries, titles, and reporting staff are all in line with community and professional standards. Is the goal to just be in the middle of the pack, somewhere around the median performance and cost control? Or is the objective to be a top-rank organization. Such decisions determine what kind of benchmarking is needed and which organizations would be most important in such external comparisons Berger, This is extremely helpful in two major cases.
First, one is with the accreditation of the hospital with state and national organizations. While non-financial standards are a large part of such accreditation, those standards do include financial measures to confirm financial stability and cost control.
Another, highly prestigious benchmarking process is that of the Malcolm Baldrige Award. In this latter case, healthcare organizations consistently report that merely applying for the award, with all the measures, self-reflection, and organizational benchmarking that application entails, frequently results in significant improvement, in large part because it includes benchmarking both against pefromance norms and against the highest-performing healthcare budget management analysis essays and using those external norms as performance standards Sister Mary Jean Ryan, Award recipient, Baldrige Performance Excellence Program, The disadvantage of the Baldrige Award form of benchmarking is that it requires a tremendous time and manpower commitment at all levels up to and including the CEO of the hospital.
Of these three forms of benchmarking, one of the most important mechanisms to create improvement is to benchmark against other organizations. By looking with open minds at how highly efficient, cost-effective organizations operate, budget management analysis essays, new ideas and new potential savings can be more easily seen.
Ideally, this type of external benchmarking would be done once a year to ensure that financially the company stays on track Clark, To optimize budget performance, the focus should be on controlling budget management analysis essays costs.
This implies not only ensuring that salaries are controlled, but also managing overtime budget management analysis essays ensuring enough staff to operate are available at all times. This also implies that managers must keep the use of temporary or contract professional staff to a minimum. One way to do that is to use benchmarking of similar organizations to ensure that salaries and benefits are in line with community standards. This will permit the development of more realistic budgetary targets that can be more readily maintained.
By analyzing the use of contract staff, staffing levels can be designed to better anticipate the needs of the organization. Benchmarking at all three levels is useful. But possibly one of the most useful benchmarking techniques is to do direct external benchmarks with other budget management analysis essays organizations to determine best management and cost control practices. By understanding how other organizations operate, budget management analysis essays, it is possible both to see improved practices, and also pitfalls to be avoided.
A little distance provides objectivity to see things clearly. Budget Management Analysis — Essay Sample. The road to success is easy with a little help. Let's get your assignment out of the way. Order now. Using contract nursing staff to cover gaps in nursing staff coverage elevated costs. Two major weather disasters plus a moderately intense and extended flu outbreak increased IV and drug usage above normal.
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Several aspects of budget management are, decisions on how money is to be allocated; influence staffing levels; purchase materials and equipment; and the continuing of new technology programs. Each department managers need to be aware of organizational priorities, the impact on services, and new development in their company Budget Management Analysis – Essay Sample. This paper uses an example hospital budget shown in Table 2 on page 6. The variances (difference between actual and budgeted amounts) for the different categories are also shown. An analysis of several of the expense categories is detailed below, in Table 1 Excerpt from Essay: Budget Management Analysis So much connected to the process of budgeting is difficult. It can be difficult to draft a budget which is accurate and which connects to all project needs. Moreover, it can be quite challenging to stay within the guidelines of a budget
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