Financing the Public’s Health Essay

Exclusively available on Available only on IvyPanda® Written by Human No AI

The presented budget has a number of strengths that qualify it to meet the Generally Acceptable Accounting Principles (GAAP). According to GAAP, a budget should be prepared in a manner that will reflect the true and fair position of the organization (Sensining, 2007).

One of its strengths is that the appropriation amount is not less than the budgeted amount. The general rule of thumb regarding budgeting is that one cannot budget with what they do not have, thus this budget complies with this rule (Sensining, 2007).

Similarly, the approved amount in the budget is larger than the actual amount. This implies that all the expenditures will be within the required range. The variance that exists between the actual and the budgeted amount creates flexibility in the event that the cost of products, labor and other variables increase or decrease.

Further, its arrangement in terms of expenditure and revenue items facilitates ease of record analysis and provides a proper means of monitoring expenditures. This aspect gives room for transparency and accountability that may arise during the audit of the financial books.

The methods used in its preparation are in tandem with the accounting and recording guidelines espoused by the International Accounting Standards (IAS). Such guidelines play an important role in ensuring that the approved standards of accounting are universally applied in analysis of the books of accounts.

Alongside the above complements, this budget has a few shortfalls as well. One of its most obvious weaknesses is that the budgeted revenue and expenditure are equal. This attribute portrays inflexibility despite the budgeted amount exceeding the actual amount. Thus, in the event that there is an increase in expenditure, the organization may find itself in financial woes due to lack of funds to handle such emergencies.

Additionally, the variance margin of this budget is exaggerated on certain items like the wage expenses, fringe benefits and Admin OH Salaries and Fringes. The funds should be allocated reasonably and appropriately, in line with the preceding budgets that had been prepared. Due to this excess variance margin, the entire amount has been budgeted for without any savings or allocations for miscellaneous expenses.

It is surprising to note that with the exaggerated variance margin, the budget places emphasis on the required inputs and resources rather than the expected results. This attribute prompts one to think that there was mischief in the motives of those who prepared this budget. Since it concerns county health, its priority should be health matters rather than the additional indirect expenses that prominently feature. These expenses only serve to make it inflexible and prone to irregularities and misappropriation of funds.

Based on the weaknesses identified in this budget, there are certain items that should either be reduced or removed. These include the excess variance in wage expenses and fringe benefits as well as the Admin OH Salaries and Fringes. The allocation for marketing should be increased since it helps in the creation of awareness regarding the program in the society.

As it is, it fails to meet the average expectations of a good budget. Its “overs” and the “unders” should be reasonable. The prudence concept ought to have been applied in the allocation of funds to ensure that right allocations are assigned to the items (Sensining, 2007). Such a move would have ensured truth and fairness in the development of the document.

In conclusion, a good budget should comply with all the accounting guidelines provided by the Generally Acceptable Accounting Practices in order to reflect a true and fair position of an institution. This should be in terms of budget allocations and the items that have been prioritized in the budget. This budget complies with some of these requirements but largely fails to rise above the threshold for a good budget.

Reference

Sensining, A. (2007). Refining estimates of public health spending as measured in national health expenditure accounts: The United States experience. Journal of Public Health Management and Practice, 13(2), 103–114.

More related papers Related Essay Examples
Cite This paper
You're welcome to use this sample in your assignment. Be sure to cite it correctly

Reference

IvyPanda. (2021, March 21). Financing the Public’s Health. https://ivypanda.com/essays/financing-the-publics-health/

Work Cited

"Financing the Public’s Health." IvyPanda, 21 Mar. 2021, ivypanda.com/essays/financing-the-publics-health/.

References

IvyPanda. (2021) 'Financing the Public’s Health'. 21 March. (Accessed: 13 December 2024).

References

IvyPanda. 2021. "Financing the Public’s Health." March 21, 2021. https://ivypanda.com/essays/financing-the-publics-health/.

1. IvyPanda. "Financing the Public’s Health." March 21, 2021. https://ivypanda.com/essays/financing-the-publics-health/.


Bibliography


IvyPanda. "Financing the Public’s Health." March 21, 2021. https://ivypanda.com/essays/financing-the-publics-health/.

If, for any reason, you believe that this content should not be published on our website, please request its removal.
Updated:
1 Star2 Stars3 Stars4 Stars5 Stars
LoadingLoading...
This academic paper example has been carefully picked, checked and refined by our editorial team.
No AI was involved: only quilified experts contributed.
You are free to use it for the following purposes:
  • To find inspiration for your paper and overcome writer’s block
  • As a source of information (ensure proper referencing)
  • As a template for you assignment
Financing the Public’s Health. Page 1
Financing the Public’s Health. Page 2
Financing the Public’s Health. Page 1
Financing the Public’s Health. Page 2
1 / 2