Question

Obtain an organizational chart from the health care institution (Dental Office) you work for, or one you are familiar with, and define how finance is structured at your firm. What are the structure and the reporting relationships for the finance department? How does finance interact with the clinical and support departments? What financial reports are shared with your department and how often are these reports disseminated? What reports are posted for the public to review and how often are they posted?

Answer 1

Finance department in a health care institution (Dental Office) is generally expected to cover a wide range of activities from basic bookkeeping to providing information facilitating management towards making strategic decisions. Thus as a bookkeeper he would be responsible for accounting the daily transactional activities and maintaining proper records for the business.

Furthermore finance department is also responsible for effectively managing organization’s cash flow and ensuring there are sufficient funds available to meet the daily business expenses. It also needs to do appropriate follow-up for payments from customers and adhere to company collection policies which indeed can facilitate to ensure the organization is paid on time and appropriately comply with the payment policies while compensating the company suppliers. Thus as a finance person he would be required to prepare on regular basis forecast statements to systematically calculate the cash inflows and outflows which indeed can facilitate to determine the cash requirements for expenses.

Thus in an organization where there are fund requirements for any new assigned projects then finance department would be responsible towards advising management the most effective channels through which the long term financing requirements could be met for instance funds could be acquired either through bank loans or issue of shares to private investors.

Thus it would be involved in preparing the obligatory financial documents required for presentations and while preparing the company valuation report may also work along with outside consultants. Furthermore in organizations where there are public share offerings finance department would be involved in assisting the preparation of offering documents.

Management information system (MIS) report prepared by finance department is basically used by management to effectively examine and evaluate the business operations and accordingly frame strategies and policies in areas which needs further improvement. Thus it needs to effectively communicate the MIS reports so that it could easily be understood by management to frame its policies.

Finance department needs to closely work with business administrators while preparing the organization’s budgets and accordingly report on quarterly basis the actual expenses incurred against the budgeted. Thus this information can effectively be used in appropriately planning the staffing levels, asset purchases, expansion plans and cash requirements.