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Patton-Fuller Case Study: Sensitivity Analysis

The intense scrutiny of these annual reports and financial statements, which are necessity for the hospital auditors, will need to know that the 80% of the revenue is from the inpatient activity, which includes surgery charges, medical-surgical nursing and Intensive Care Unit (ICU) charges. The remaining 20% of its revenue is from the emergency department of other outpatient services. When it is observance of the auditors form submitted that the Patton-Fuller Community Hospital under the expenses, which are an increased by 10% as well with the other revenues is by the previous year (2008).

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The Financial Ratios “Financial ratios are a valuable and easy way to interpret the numbers found in financial statements and the growth of the expansion into new markets the organizations profitability and growth sores to new levels of success. The financial ratios did not improve when comparing the unaudited data to the audited data. This is not improvement that the Patton-Fuller Community Hospital will have to decrease by one day.

So the ratio will have dropped by a few points to show that the hospital to become less able to pay for the debt, which it is incurring. The revenue sources like the patient revenue increases like the chief financial officer have stated. Patton-Fuller Community hospital has had a successful year. The Previous year’s loss has been turn into a gain, a change of over $16 million. Net patient revenues have grown over by 9%, most of the expenses, which has been increased by 3%.

The nation-wide economic downturn has affected the hospital, which there is an opportunity in that downturn. The Patton-Fuller Community hospital group revenues based on two main categories such as net patient revenues, which can take up the majority of the revenues and the other category is listed as other revenues, which is highly insignificant compared to the patient revenues. As the analysis of the unaudited financial statements shows that all the financial ratios have improved, and the hospital is poised to continued its profitable rend. Financial ratios analysis, which can be valuable resource to the investors of the hospital, so they will need to determine the financial stability of the organization. What is important to the financial stability, which will show the soundness, dependable, and efficiency of the business? We need to understand the financial ratios and why it is so very important to the analyzing of the financial health of any organization. (Phoenix, 2009) (Lane, 2008)

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