Purchase Solution

Generally accepted accounting principles (GAAP) and health care

Not what you're looking for?

Ask Custom Question

Some generally accepted accounting principles (GAAP) apply only to health care, and there are many health care organizations that use other comprehensive bases of accounting when GAAP does not apply -- for instance, an HMO that must report to a government regulatory agency using that agency's guidelines instead of GAAP. What is so unique about health care that it would cause accounting principles to change? This is so confusing to me. Can anyone help me understand this?

Purchase this Solution

Solution Preview

There are a few different reasons as to why health care reports under different accounting principles. The first main reason is because in the health care industry, some organizations are government owned (like the VA hospital) and others aren't. This automatically would require the non-government organizations to use accounting principles based more on GAAP than the government owned institution. The government owned facilities would have to adhere to principles as set forth by GASB (Governmental Accounting Standards Board).

The accounting required for government vs. non-government facilities is drastically different, in various circumstances. The main reason is because for the government-owned facility, the financial statements are prepared with the user in mind - those with interest in the government owed facility. When preparing the financial statements for the non-government owned facility, ...

Purchase this Solution

Free BrainMass Quizzes
Business Ethics Awareness Strategy

This quiz is designed to assess your current ability for determining the characteristics of ethical behavior. It is essential that leaders, managers, and employees are able to distinguish between positive and negative ethical behavior. The quicker you assess a person's ethical tendency, the awareness empowers you to develop a strategy on how to interact with them.

Change and Resistance within Organizations

This quiz intended to help students understand change and resistance in organizations

Introduction to Finance

This quiz test introductory finance topics.

Balance Sheet

The Fundamental Classified Balance Sheet. What to know to make it easy.

Academic Reading and Writing: Critical Thinking

Importance of Critical Thinking