It is a set of administrative activities concerned
with arrangement of cash and credit for the organization for enabling it to function as effectively as possible
IMPORTANCE
Health care organizations need money and an
efficient financial management system for carrying out client centered activities for which tremendous expenditure is involved in: Building and maintaining the infra-structure Procuring drugs, supplies and equipment Under taking medical laboratory services, radiographic services, diagnostic investigative services with use of sophisticated equipment, & invasive procedures, blood banking services, dietary services, pharmacy services, laundry services, centralized sterile supply services and so on. ROLE OF NURSE IN FINANCIAL MANAGEMENT
1. Health care organization not considered as
income generating institution earlier, are gradually showing a trend developing into a profit making industry. 2. Nurses need to play their role in financial management in these institutions adequately. 3. This apart, the hospital administrators have become conscious about nurses’ role in improving the cost-effectiveness of patient care. 4. A substantial portion in the hospital budget goes towards nursing costs. 5. Nurses also need to have a basic knowledge about budget and budgetary process so that, they can participate in reducing costs in the hospitals and also justify their budgetary allocations in the interest of patient care services and improved work environment. BUDGET
DEFINITION:
It is a structured plan for managing income and
expenses.
It is a detailed plan of operations for some specified
future period followed by system of record which will serve as a check upon the plan.
PRINCIPLES:
1. It should provide sound financial management by
focusing on requirement of the organization 2. It should focus on objectives & policy of organization 3. It requires that programme activities planned in advance. 4. It should include co-coordinating efforts of various departments establishing a frame of reference for managerial decisions and providing a criterion for evaluation managerial performance. 5. It should prepared under the direction and supervision of the administrator or financial officer 6. It should necessitate a review of the performance of the previous year.