Planning and Budget Strategies

Use the prompts provided on the second tab of the sample budget document to make adjustments to the Income Statement.

You may create your own Word document to communicate the findings and analysis from the 6 prompts in the student file, which should answer the following questions:

1. Please articulate how each scenario changes the company's profitability.

2. Which budget categories were impacted by the changes?

3. What would have happened if the changes were implemented at the beginning of the year?

4. How would this company be impacted if all 6 scenarios took place in the same year?

Trending Income Statement FY20 VOLUME Medical Claims Prescriptions FY21 21,971 72,853 37,267 90,433 Total Medical Revenue 3,894,734 41,129,375 45,024,108 4,129,825 42,558,225 46,688,050 Total Grant Revenue 1,847,424 31,491 1,166,068 3,044,983 2,793,283 74,629 981,215 3,849,127 Total Revenue and Other Support 148,710 91,661 21,008 48,330,471 148,710 4,348,351 300 55,034,538 14,950,555 1,059,251 2,697,390 52,130 482,195 136,979 221,934 1,096,205 24,589,583 474,105 490,684 63,305 71,499 1,079,291 13,026,627 950,634 2,241,893 55,697 432,277 125,978 181,261 966,350 25,409,707 411,830 639,584 20,360 71,985 1,121,987 REVENUE PER VOLUME Medical Claims Payor Contract Improvement Prescriptions REVENUE Medical Services, Net Pharmacy Services, Net GRANT REVENUE Federal Grants Other Grants State Grants In-Kind Rent Miscellaneous Event Income Salaries & Wages Employer Paid Taxes Employer Paid Benefits Personnel Expense-Other Occupancy-Rents, Leases & Taxes Occupancy-Utilities/Telephone & Security Occupancy-Other Program Expenses Pharmacy-Cost of Drugs & Supplies Clinic Medical Supplies Office Expenses Travel & Mileage Dues, Subscriptions & Education Network & Application Licenses & Support Bad Debt Depreciation & Amortization Insurance Legal Advertising & Promotion Board Expenses Contract Services Miscellaneous Operating Expenses Interest Expense In-Kind Expenses Interest & Dividend Income Gain/Loss on Investments Investment Income, Realized & Unrealized Total Operating Expenses 46,445 788,568 236,650 41,632 260,091 2,726 1,595,973 40,324 12,864 148,710 50,639,087 46,580 661,453 276,687 26,678 94,452 82,518 1,485,602 16,094 11,749 148,710 48,506,695 Net Income from Operations Total Margin (2,308,616) 6,527,843 -4.8% 11.9% Jan-22 Feb-22 Mar-22 Apr-22 May-22 Jun-22 Jul-22 Aug-22 2,213 7,823 2,471 8,086 2,589 8,056 2,644 7,992 2,919 8,260 2,818 8,529 2,935 8,210 2,893 8,179 $ 145.03 $ $ 444.53 $ 145.03 $ 0.0% 444.53 $ 0.0% 145.03 $ 0.0% 444.53 $ 0.0% 145.03 $ 0.0% 444.53 $ 0.0% 145.03 $ 0.0% 444.53 $ 0.0% 145.03 $ 0.0% 444.53 $ 0.0% 145.03 $ 0.0% 444.53 $ 0.0% 145.03 0.0% 444.53 0.0% 320,947 3,477,577 3,798,525 358,364 3,594,489 3,952,854 375,478 3,581,154 3,956,631 383,454 3,552,703 3,936,158 423,337 3,671,838 4,095,175 408,689 3,791,417 4,200,107 425,657 3,649,612 4,075,269 419,566 3,635,831 4,055,397 252,489 59,771 312,260 317,902 3,500 62,733 384,135 267,259 3,500 111,207 381,966 164,380 3,301 153,508 321,189 228,369 3,450 172,933 404,752 227,080 4,784 179,998 411,861 217,393 3,450 189,800 410,643 212,434 3,450 170,857 386,741 12,393 9,270 5,000 4,137,448 12,393 19,988 2,600 4,371,969 12,393 10,731 2,900 4,364,620 12,393 1,575 5,375 4,276,690 12,393 12,886 (2,275) 4,522,930 12,393 5,904 (13,850) 4,616,414 12,393 8,607 4,506,911 12,393 7,243 4,461,773 975,421 62,740 195,084 5,118 15,216 9,836 20,740 82,416 2,354,038 24,257 42,107 337 4,589 81,258 1,015,051 65,289 203,010 12,553 1,812 14,037 13,345 92,024 2,433,178 21,904 50,302 512 3,329 75,681 1,016,021 65,351 203,204 8,035 2,312 11,292 12,791 96,419 2,424,150 50,608 73,682 3,357 7,049 105,622 1,010,764 65,013 202,153 3,827 14,914 13,112 19,351 98,467 2,404,892 41,513 42,925 1,007 9,212 70,237 1,051,598 67,639 210,320 5,443 1,812 9,594 16,127 108,709 2,485,537 40,682 105,197 518 12,552 80,555 1,078,543 69,372 215,709 20,958 1,812 8,910 16,075 104,947 2,566,482 43,539 51,439 1,712 18,106 81,762 1,046,486 67,311 209,297 4,610 1,812 12,237 12,380 109,304 2,470,491 47,236 57,414 690 5,730 77,626 1,041,383 66,982 208,277 6,673 1,885 10,905 12,125 107,740 2,461,163 60,883 53,518 1,169 2,706 78,706 4,435 55,474 12,670 63 6,529 87,033 9,666 847 12,393 4,062,268 4,616 57,083 22,320 (5,590) 2,998 113,874 1,272 834 12,393 4,211,826 4,620 58,693 19,037 4,886 11,063 121,783 4,235 820 12,393 4,317,421 4,596 58,692 7,242 4,126 17,063 106,220 2,622 806 12,393 4,211,147 4,782 58,693 15,694 2,444 8,199 100 140,666 2,423 793 12,393 4,442,465 4,904 59,969 14,492 2,515 10,825 118,693 16,991 779 12,393 4,520,926 4,759 63,565 16,728 (2,444) 23,291 106,099 1,398 765 12,393 4,349,177 4,735 61,414 17,628 284 16,142 102,715 751 12,393 4,330,178 75,179 160,144 47,199 65,543 80,465 95,488 157,735 131,595 1.8% 3.7% 1.1% 1.5% 1.8% 2.1% 3.5% 2.9% Sep-22 $ $ Oct-22 Nov-22 Dec-22 3,093 9,562 3,073 9,151 3,086 9,328 2,950 9,623 145.03 $ 0.0% 444.53 $ 0.0% 145.03 $ 0.0% 444.53 $ 0.0% 145.03 $ 0.0% 444.53 $ 0.0% 145.03 0.0% 444.53 0.0% FY22 33,684 102,799 448,572 4,250,619 4,699,191 445,671 4,067,917 4,513,588 447,557 4,146,599 4,594,156 427,833 4,277,736 4,705,569 4,885,127 45,697,492 50,582,619 393,107 4,151 201,499 598,756 212,004 3,450 143,605 359,059 226,139 10,200 54,650 290,989 (39) (6,900) 87 (6,852) 2,718,515 36,335 1,500,649 4,255,499 12,393 9,063 5,319,402 12,393 3,192 4,888,231 12,393 13,431 4,910,968 12,393 28,076 4,739,185 148,710 129,965 (250) 55,116,543 1,206,703 77,616 241,341 4,354 1,887 12,656 14,648 115,189 2,877,325 93,777 57,257 1,011 6,724 73,461 1,159,042 74,550 231,808 4,951 1,812 11,497 18,310 114,444 2,753,650 82,116 58,138 545 2,408 72,306 1,179,731 75,881 235,946 7,554 12,822 10,843 18,310 114,928 2,806,911 33,332 55,857 1,030 10,734 74,076 1,208,341 77,721 241,668 12,280 1,812 9,104 13,386 109,863 2,895,680 39,418 47,883 1,333 5,430 61,735 12,989,086 25.7% of Revenue 835,464 6.4% of Salaries and Wages 2,597,817 20.0% of Salaries and Wages 96,356 0.7% of Salaries and Wages 59,908 134,023 187,588 1,254,449 2.5% of Revenue 30,933,496 $ 300.91 Per Pharmacy Scipts 579,263 695,719 13,220 88,568 933,024 5,487 61,415 17,213 189 10,916 115,440 229 738 12,393 5,007,965 5,270 57,675 18,113 118 11,268 99,324 3,095 724 12,393 4,793,554 5,364 57,675 16,724 1,191 5,763 147,053 48,175 760 12,393 4,933,052 5,495 13,688 13,739 12,537 76,570 (3,310) 12,393 4,856,765 59,063 664,036 191,600 7,782 136,590 100 1,335,471 86,796 8,617 148,710 49,670,618 311,437 94,677 (22,084) (117,580) 4,810,969 5.9% 1.9% -0.4% -2.5% 8.7% 0.1% of Revenue Prompt #1 #2 #3 #4 #5 #6 Scenario The state Medicaid program provides notice that your Medical rates are being cut by 7% in September The union that controls the workforce is demanding a 9.5% increase to salaries and wages to bring all e Your Pharmaceutical supplier terminates their agreement with your organization, forcing the organiza The Federal government passes legislation that raises the ceiling on FICA taxes, which increases your co Your CEO decides to slash the employee benefit plan to save cost, reducing employer contributions in F Your organization's application for the American Rescue Plan Act (ARPA) was approved and $2M in fun Questions: Please articulate how each scenario changes the company's profitability. Which budget categories wer impacted by the changes? What would have happened if the changes were implemented at the beginn of the year? How would this company be impacted if all 6 scenarios took place in the same year? Pleas provide both quantitative as well as qualitative responses. g cut by 7% in September. However, they plan on increasing your Pharmaceutical reimbursement by 3% in January. es and wages to bring all employees back in alignment with market rates. The increase will go into effect in May. ation, forcing the organization to move their business to a competitor at a 2.7% cost increase starting in July. es, which increases your cost for Taxes by a full 1% point for the full year mployer contributions in Feburary by 4% points. approved and $2M in funding will be dispersed to you in September. ich budget categories were mplemented at the beginning ce in the same year? Please ent by 3% in January. nto effect in May. arting in July.