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Cash-basis and Accrual Accounting
The practice of reporting financial information as a function in
today’s operation of a medical practice is particularly important
due to intense demands for fiscal acuity. Therefore, it's
important to understand the difference between cash and accrual
accounting.
What is the difference between cash-basis accounting and
accrual accounting? How does each method affect the financial
statements?
Financial Statements and their Use
A healthcare organization’s financial statements provide various
financial information that key stakeholders (investors, vendors,
financial institutions, employees, etc.) use to evaluate an
entity’s financial performance. Financial statements are also
important to an organization’s managers because by publishing
financial statements, management can communicate with
interested outside parties about its accomplishment running the
organization.
Different financial statements focus on different areas of
financial performances.
What are the four basic financial statements and what does each
report tell the healthcare manager?

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Cash-basis and Accrual AccountingThe practice of reporting fin.docx

  • 1. Cash-basis and Accrual Accounting The practice of reporting financial information as a function in today’s operation of a medical practice is particularly important due to intense demands for fiscal acuity. Therefore, it's important to understand the difference between cash and accrual accounting. What is the difference between cash-basis accounting and accrual accounting? How does each method affect the financial statements? Financial Statements and their Use A healthcare organization’s financial statements provide various financial information that key stakeholders (investors, vendors, financial institutions, employees, etc.) use to evaluate an entity’s financial performance. Financial statements are also important to an organization’s managers because by publishing financial statements, management can communicate with interested outside parties about its accomplishment running the organization. Different financial statements focus on different areas of financial performances. What are the four basic financial statements and what does each report tell the healthcare manager?