Analysis of the Finance Department in the Dubai Health Authority - Paper Example

Paper Type:  Essay
Pages:  7
Wordcount:  1818 Words
Date:  2021-06-11

With the rapid transformation of the healthcare industry, the Dubai Health Authority needs a finance department that has integrated financial analytics and planning using financial tools such as budgeting, balance sheet and cash flow management. This is paramount to counter the shifts as well as preparing the healthcare industry for the future. The process of budgeting is one of the key areas that the finance department handles objectively. This is because it is mandated to plan for all the grants and monies given to the authority.

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Budgeting

In their quest to provide and come up with proper budgets the authority has formulated some models that ensure that authority budgets for all the monies received. The models are used to identify the drivers of cost within the healthcare industry. This is part of a daily process that is sustainable and a successful cost management system. The budgeting role of the finance department also ensures that there are measures to report profitability, cost and volume metrics all of which are used to improve on decision making. The models also create a vigorous capital planning process to help the healthcare industry make the most favourable decisions through the use of financial modelling tools. The budgeting process also strives to maintain a solid grip of the industrys future trajectory. This is achieved by developing payment models which in turn model the influence of patient volumes. In addition, the budgeting process incorporates some of the best practice approaches for forecasting and operational budgeting in order to streamline the process and ensure the projections are accurate. Lastly, the finance department in charge of budgeting ensures that they combine rolling forecasts with operational budgets and long-term financial plans that ensure the authoritys tactical and strategic budgeting is well informed.

Cash flow Statement

A cash flow statement is used by the Dubai Health Authority as a checking account at a particular time to show the cash inflows and withdrawals. Since the authority may require long-term assets, such as x-ray equipment and ambulances, the cash flow is used to determine if the investments in long-term assets generate sufficient income as compared to capital units. To generate sufficient cash for the authority, a cash flow statement is prepared by the finance department to forecast on the ability of the authority to generate enough cash for future projects. The cash flow is also important to the authority to facilitate the long-term forecasting as well as in rationalising the scope of future financial needs and investments. For the authority, the finance department prepares the cash flow statements for multiple time periods. This includes listing the monthly cash outflows and inflows over a years time. This means that the cash flow not only forecasts the cash balance at the end of the year but for each month. Working capital is an integral component in the preparation of the cash flow statement. Working capital is the monies required to ensure that the operations of the authority are facilitated. A cash flow statement, in this case, is used to highlight the liquidity problems that may come up during the next financial year. In the process of preparing the cash flow statement, the finance department ensures that each cash inflow and outflow can be identified.

Balance sheet

The balance sheet is also another integral statement that is prepared by the finance department of the Dubai Health Authority. Donors and investors in the health industry know the importance of a balance sheet. This is because a balance sheet tells the whole story of an institution as it highlights the economic condition of that organisation. To ensure that the balance is able to show the correct liquidity position of the authority, the finance uses the accrual-based accounting when preparing the balance sheet. The use of the accrual-based accounting is also to help donors and other investors to interpret the statements plus it also gives a true picture of the net worth of the authority assets. The use of the accrual accounting system is also important when the authority requires getting loans from financial institutions or the government. These institutions prefer that the accounts payable, accounts receivable, inventory and assets are calculated using the accrual based accounting. Most organisations review their balance sheets every twelve months, but for the case of Dubai Health Authority, they review their balance sheet frequently. This is because to ensure that the authority is meeting its obligations, it ought to look at its balance sheet more frequently, in order to ascertain the organisations liquidity. The authority, therefore, takes several snapshots throughout the year and compares them. In addition, the balance sheet is also used to check the organisations benchmark by comparing it with others in the industry. The finance department uses equations to track the performance of the authority. The actual numbers used in the equations are found in the balance sheet. They include;

Current Ration=Current Assets/Current Liabilities

Percentage Debt=Total Liabilities/Total Assets

Working Capital=Current Assets-Current Liabilities

Debt to Equity Ratio=Total Liabilities/Net Worth

Estimating the Required Workforce and Workload Distribution

Dubai is growing at a fast rate, and it is becoming heavily reliant on expatriates. It is estimated that 82% of the healthcare professionals in the country are expatriates while 18% comprises of nationals. Despite this excessive recruitment of expatriates, the country still faces severe employee shortages. The Dubai Health Authority has, therefore, experienced problems in estimating the required workforce and workload distribution (Report: Dubai, 2008). The first problem is that the organisation lacks accurate estimates on the actual number of nurses, midwives and physicians. The reason for these problems is because of the high turnover rates of the workforce and poor staff retention. Retention initiatives, however, have been introduced, but they have exacerbated the current employee shortages. Another problem is that Dubai is not self-sufficient and might have to rely on expatriates to meet the countrys demand. As noted above the major challenge facing Dubai Health Authority is in the recruiting and retention of the health workers. Lack a well Evidence-based HRM planning and the national strategy for health workers is the major cause of this challenge. Due to the country growing at a fast rate, it is likely that it will continue to depend on expatriates to meet the current and future needs. To counter this challenge, the organisation ought to prioritise on issues related to the workers. This may require a solid leadership and an efficient health sector. To improve the health care, the authority requires strong leadership and management capacities. If the issue of leadership is not addressed then estimating the required staff and work distribution will never be resolved.

The process of determining the training needs of health practitioners is also marred by some challenges. According to Wilkins (2001), there have been an insufficient number of students who are interested in the nursing and medical fields. Most graduates, 72% of graduates in the year 1998 held art degree, meaning that most of the students were not inclined towards a career in medical and nursing fields. Furthermore, most nationals are not proficient in the English language, and others lack the basic computer skills. These are some of the requirements needed for an individual to enrol in nursing and medical training school. This also thwarts the nationals from the medical and nursing fields which are both dependants on good computer schools and good English. One of the reasons why Dubai is dependent on expatriates is that it lacks enough workforce that are specialists in the healthcare industry. To counter these challenges, an in-house training is necessary as it aims at providing individuals with the necessary skills to perform their functions which include neonatal nursing. In the country, nurses and other health practitioners who are specialised in their areas of expertise often train other locally especially for the nurses, and on screening services. Another way to counter the training challenges is to sponsor physicians who are specialising in their fields abroad. This is given to physicians who are willing to compensate the government for working without compensation for the same number of years spent training abroad.

Health Statistics and Reporting

Health statistics and reporting of this data is important for the authority to monitor the well-being and health of its citizens. These statistics are always useful when developing health programs and in the evaluation of the programs. Emerging health issues are also traced through the use of health statistics, and the information can also be used for epidemiological research. To develop statistics, data has to be collected and compiled together in order to provide basic information (Schumaker and Reganti, 2014). While a range of health care entities collects data, this data does not always flow among the entities in a cohesive way. The authority is often faced with challenges when collecting language, ethnicity and race data from respondents. Another challenge is that of internal resistance and information technology constraints. To counter these challenges, indirect estimation techniques can be used to supplement the data when used with understanding. Another way to counter the challenge in the collection of language, race and ethnicity data can be through the use of a nationally standardised approach. This approach is efficient because it ensures that the data is incorporated into the current operational data and this helps uphold patient privacy.

The above challenges and how to resolve these problems shows the importance of data quality and capture to override the health challenges and minimise organisational resistance. The authority has over the years focused on integrating data systems that have the potential of streamlining the data collection process that can be reported without hiccups. This ensures that individuals do not have to identify with language, ethnicity, and self-identity race when need be. Other ways of improving data collection process will include implementing workforce training, educating patients, improving IT systems and educating communities about the importance of collecting data. Lastly, there is the need to develop a chain of command where any conflicting data is adjudicated.

Facility International Accreditation

Facility international accreditation is very important for any organisation within the healthcare industry. For Dubai Health Authority, the accreditation helps in adding to the organisations status, and also it helps increase the level of satisfaction and trust among the residents. The aim of the authority is always to earn the ISO certification among other accreditation in order to provide the residents with first class medical services and improve the quality and standards of their services. This can only be achieved by striving to meet all the international standards. Receiving the accreditation is not easy as it requires extra effort and works. Staffing, therefore, becomes a key challenge during this process. Implementing the safety standards among others require qualified staff who works tirelessly during the accreditation process. During this time, there is usually a high turnover of the workforce. This is attributed to anxiety before the process, and even stress. It is also not easy to get a team that will oversee the document control process. T...

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Analysis of the Finance Department in the Dubai Health Authority - Paper Example. (2021, Jun 11). Retrieved from https://midtermguru.com/essays/analysis-of-the-finance-department-in-the-dubai-health-authority-paper-example

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