Associate Level Material
Resource: Ch. 14 of Health Care Finance
Complete the following table by writing responses to the questions. Cite the sources in the text and list them at the bottom of the table.
What criterion must be met for true comparability?
| For true comparability, consistency, verification and unit measurement must be met. Consistency is vital to make sure that all things are done in the same manner throughout the same time period. Verification is important to ensure that all of the collected information is valid and holds evidence of the validity of your data. Unit measurement is important to ensure that all money transacted is input in the same denomination.
| What elements of consistency should be considered? Provide an example.
| The following three methods of consistency should be considered: Time periods,which means for example, a 4 month time period should not be compared with a 6 month time period. It is important for lengths of time to be compared with similar lengths of time. Consistent methodology which means if you begin a time period, for example, using one method of inventorying, that you do not change methods in the middle of the time period and adopt a new method for doing things.Determination of inflation factors, for example, if multiple years are being compared, will your company take inflation into consideration throughout those time periods or not?
| What is the manager’s responsibility in comparing data?
| It is important for the manger to stay aware of whether the data they receive is appropriate for comparing. It is also the responsibility of the manager to recall and apply the elements of consistency.
| What are the four common uses of comparative data?
| The four common uses of comparative data are comparing current expenses to current budget, comparing current actual expenses to prior periods in the same organization, compare data of your organization to other...
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