What is the primary difference between financial statement analysis and operating indicator analysis and why are both types useful to health services managers?
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Financial statement analysis is the process of identifying financial strengths and weaknesses of a firm by appropriately establishing a relationship between the items of the balance sheet and the profit and loss account. Financial statements play an important role in setting the framework of managerial decisions Operating indicator analysis are quantifiable measurements that help an organization define and measure progress toward organizational goals that have been defined and agreed upon by management. These goals may change as an organization’s goals change. Operating indicator analysis in health care are part of the health service manager’s quality and risk managment plans. Plans are choosen based on the operating indicator analysis based on several factors such as regulatory and accrediting body initiatives and reccommendations as well as …
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