A non-profit organization is described as an entity that exists not for the front of making money , but for another defined and ordinarily charitable or developmental purpose (Rosenbaum et al , 2003 ,. 4 . The organization is a line of merchandise entity and , apart from having a untaxed status , operates within the parameters designated for business . The Sisters of gentleness Health placement of St Louis is such an organization , and in to fulfill the dower of its rudimentary mission that requires that it serve all endurings even if they cannot pay (2003 , the hospital must have a financially secure standing(a) in a cut-throat business world . The hospital maintains mo meshingary equity by implementing an array of strategies to both care for its community of interests and maintain fiscal viability . The interest analysis will turn in how the Sisters of Mercy Health System is able to survive in a competitive and risky marketStrategic management is very strategical to the wellness of any steadfast (David 2005 , and a clear strategic direction and a rigorous focus on business have contributed to Sisters of Mercy s strong financial position everyplace the course of instructions . Mercy continues to maintain the outstanding acknowledgement gild of Aa1 , the highest assigned by Moody s for any health care carcass . This rating describes how risky the system s fixed income is deemed to be , and measures the likeliness that an obligation might be dishonored (Moody s Investor profit , 2006 . The following ratios , as of and for the year ended June 30 , 2005 , as derived from the FY 2005 audited financial statements , illustrate the System s sound financial conditionLong-term Debt to uppercaseization 20 .5Maximum Annual Debt Service Coverage 4 .86 timesCash to Debt 2 .05 timesUnrestr icted years of Cash on Hand 160 .1 daysRetu! rn on Assets 3 .3 It can be noted that the amount of capital financed with debt (20 .5 represents only a small ratio of the hard .
This component part demonstrates that the system operates at low risk (Morgenson Harvey , 2002 . The debt benefit income is shown to be almost five times the debt , and the amount of exchange visible(prenominal) in relation to the debt is over twice as often . With 160 days cash on hand , the gather along stands well above the recommended number 60 ) that indicates financial health and viability (Burke , 2002 , and the per centumage return on assets indicates the general profitability of the firm (Morgenson Harvey , 2002 despite these strong ratios , Mercy faced several challenges in 2005 on with other healthcare organizations , revenue realization proceed to be a focal point as a progeny of continuing outgrowths in self-pay revenue as a percent of all other revenueand a decrease in self-pay reimbursement . Despite this challenge , days in accounts receivable were lessen by 9 to 55 days below that of the anterior year , bringing this number into the range of healthy organizations (Holzberg Holton , 2003 . boilers suit , Mercy showed a 7 .5 increase in net patient service revenue from FY 2004 to FY 2005 , with a 1 .6 increase in acute...If you want to get a full essay, order it on our website: OrderEssay.net
If you want to get a full information about our service, visit our page: write my essay