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Accounting Principles and Ethics
A health care organization is believed to be a place where there is care, organization,
consistency, and support; a place where patients need to feel and see the unity and
harmony within the organization. Health care organizations necessitate this consistency,
unity, and organization within because of its dependency on its patients and to provide the
proper care for such a diverse group of individuals. A health care organization also needs
consistency and organization in financial management. Proper financial management
shows strength in the organization and gives patients more faith. In order to have proper
financial management, organization, and consistency, many health care organizations use
the Generally Accepted Accounting Principles, corporate compliance, and the value of
ethics.
Generally Accepted Accounting Principles
The General Accepted Accounting Principles (GAAP) refers to a set of accounting
standards that are acknowledged by numerous companies. These principles are set by the
Financial Accounting Standards Board. They are used to normalize financial accounting of
public companies. These principles are vital for several reasons. They are important to
companies and for those whose stock trades on the stock exchanges (Raithel, 2005). These
standards let investors know of the financial state of the company. They also allow the
company to maintain track of its cash flow.
Another reason that GAAP is important is for the reason that these standards offer
consistency across the companies. When a company follows GAAP, the company becomes
comparable financially with other companies that apply GAAP.
Corporate Compliance and Ethics
