Budget in nursing

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• BUDGETING PROCESS
• P.Meena,
• M.Sc.(N)

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DEFINITION OF BUDGET

• A/c to HM DONOVAN
• Budget is a concrete precise
  pictures of total operation of an enterprise in
  monetary term.
• A/C to FINKLER,1984
• A budget is a tool for
  planning, quantifying the plans and controlling
  costs.

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BUDGETING PROCESS

• It is a systematic activity that develops a plan
  for the expenditure of a usually fixed resources
  such as money and time during a given period to
  achieve a desired result.
• Budgetary process is long and cyclic as soon as
  it complete for the year, it begins again.

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• Budgets are composed of three parts
• Salary and wages budget
• it includes salaries and
  wages, earned benefit.
• Experimental budget
• it includes estimate of the
  volume and mix activities and services and
  resources provided to them.
• Capital budget
• it includes the purchagement of
  major capital items such as equipment, building,
  new furniture etc.

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FEATURES

• Incorporates a long term perspective(direction).
• Focuses an budget decisions on result and
  outcomes.
• Involves and promotes effective communication.
• Provides incentives to Govt. management and
  employees.(taxes)

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PRINCIPLES OF BUDGETARY PROCESS

• Establish broad goal to guide Govt. for decision
  making (service,programmes).
• Develop approaches to achieve goals, ( specific
  policies, plans, programmes and management
  strategies to achieve its long terms goals).

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• Develop a budget with approaches toward the
  achievement of goals.
• Evaluate performance and make adjustments,
  programme and financial performance..

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TERMS USED IN BUDGETING PROCESS

• COST EXPENDITURE value of economic resources
  for carrying out a activity for providing
  services.
• COST ANALYSIS It is a procedure by which all
  costs resulting from installing and operating a
  system are determined and converted to financial
  unit(rupees).

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• Cost containment The process of controlling the
  expenses required to operate an organization with
  in pre planned budgets.

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• Cost awareness Cost awareness focuses the
  employee attention on costs. It increases the
  organizational awareness of what costs are and
  the process available for containing(control)
  them? How they can be managed and by whom?

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• Cost fairs cost fairs frequented areas such as
  the cafeteria increase awareness by displaying
  frequently disappearing items that are labeled
  with the cost per unit and by posting lists of
  estimated costs of inventory loses.(staff
  development programme,unit conference)

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• Cost monitoring It focuses on how much will
  be spent where ,when, why .
• MANAGEMENT COAST- it focuses on what can be done
  by whom to contain costs.

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Cont

• COST INCENTIVES- it motivates
• cost containment(control) and reward
• desired behavior . (money saving
• ideas , insurances)

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Cont.

• COST AVOIDANCE-Action taken to reduce future cost
  , replacing parts before they fail and cause
  damage to other parts.(computer)
• COST REDUCTION- means spending less for goods
  and services , it depends on the size of the
  agency ,previous efficiency, skill of manager and
  cooperation of employees.

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Cont

• COST CONTROL
• It is effective use of
  available resources through careful forecasting,
  planning , budget preparation .reporting and
  monitoring

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STEPS IN BUDGETARY PROCESS

• Budget estimate preparation
• Budget approval
• Budget allocation and appropriation
• Budget monitoring

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Budget Estimate Preparation

• It include the records of income and
  expenditures.
• Provide blueprint for any organization.(design)
• maintaining coordination through proper
  communication.

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Budget Approval

• 1) Extra mural approval system - approving
  authority is GOVT. . i.e. Health Secretary and
  Health Minister.
• -it is then presented in Parliament and final
  approval is signed by Prime Minister.

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• 2) Intra Mural Approvable System-
• approval system goes into 2 steps -
• Head of hospital Chief Medical Officer
• Head of institute-Chair person.

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Budget allocation and appropriation-

• After final approval budget is voted to account
  of maintenance, for allocation (distribute the
  resources ) to organization.

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Budget monitoring

• it made by budget reports by budget(expenses)
  monitory committee

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ADVANTAGES OF BUGTING PROCESS

1. It helps plan for detailed programmed activities.
2. It encourage manger to make a careful analyses
   of operation.
3. Financial matters can be handle in a orderly
   fashion .
4. Frequent opening and closer of nursing unit.
5. Mishandling and wastage costly equipment by staff
   under training.

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Limitation of budgetary process

• Time consuming.
• Gaming the system only experienced person is
  able to made the perfect budget.
• Blame for outcomes if department does not
  achieve its budget result the manager blame any
  other department.

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• Spend it and lose it if the budget goals will
  not achieve the all over spended money will lost.
• Strategic rigidity budget are often too rigid
  and restrictive supervisor are given little free
  hand in managing their resources.
• To evaluate the performances and result, but
  causes and successes are not thoroughly
  investigated.

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ILLUSTRATION OF MAKING BUDGET

• CREATING A WORKING BUDGET
• Calculate how much money you earn in a month
  after taxes- home pay, supplementary income, side
  jobs, investment.

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• Calculate your expenses calculate weekly,
  monthly expenditure on groceries or gas other
  things.
• Determined your variable expenses after listed
  of your fixed expenses you want to determine
  variable expenses(electricity bills).

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• Divide your budget in to basic categories
  housing, food, auto, entertainment, savings,
  clothing's, medical.
• List all your spending for each category
• 100Rs/m-insurances
• 250Rs/m-gas
• 50Rs/m- maintanance
• 10Rs/m-registration

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• Add up your spending by categories- This should
  show your total monthly spending spending compare
  it to how much you make each month after taxes.
• Decide on a method to keep a track of your
  budget.
• Decide how long your budget must last it depend
  upon us either once or twice a month.
• eg Auto
• Total Rs 710
• gas Rs 50
• payment Rs
  300
• Gas Rs60
• Total 300

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NURSING BUGDGET

• It is a plan for allocation the resources based
  on preconceived needs for a proposed series of
  programmes to deliver patient care during one
  fiscal year
• 1. Determine the productivity goals by director
  of nursing services and nurse manager.
• 2. forecast the work load, number of coming of
  the patient expected on each nursing unit for
  coming fiscal year is calculated.

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• 3. Budget patient care hours and the staffing
  schedule is maintained.
• 4. Non productive hours and productive hours
  budget is prepared for the coming year.
• 5. The cost of supplies and services to be
  purchased for the year are budgeted.
• 6. The expected capital investment for the coming
  year is included in the budget.

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ROLE OF NURSEADMINISTRATOR

• 1.He/she identify unit needs thus inspiring the
  pro-active rather then re-active fiscal planning.
• 2. He/she should have the knowledge about
  political, social and economic factors that shape
  fiscal planning.

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• 3. He/she demonstrate flexibility in fiscal goals
  setting in a rapidly changing system.
• 4. Recognize and create problem showing budgeting
  and have control over routine budget.
• 5. Influence and inspire group members to
  participate in the short and long range fiscal
  planning.

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• 6. Recognize that fiscal planning should meet the
  organizational and unit goal.
• 7. When the budget is allocated the administrator
  should support the budget that is the
  responsibility of the administrator is to see
  that expenditure should not exceed the
  appropriation made.
• 8. Submit budget request with justification with
  proposal expenditure.

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Have a nice day