Scenario
In an ongoing effort to explore the feasibility of expanding services into rural areas of the state, leadership at Memorial Hospital has determined that conducting a review of its financial condition will be essential to ensuring the organization’s ability to successfully achieve its expansion goals.
Instructions
The CFO has provided you with a copy of the organization’s financial statements. **See attached**
This information will be critical in evaluating the organization’s financial capacity to support the proposed expansion of services into the rural areas of the state.
You are asked to review these financial statements (which include the Income Statement, Statement of Cash Flows, and the Balance Sheet) and prepare an executive summary outlining the financial strength of the organization and evidence to support the expansion. Your executive summary should include the following:
- An overview of the issue.
- A review of critical financial ratios (Liquidity, Solvency, Profitability, and Efficiency) based on financial statements.
- Inferences of forecasts, estimates, interpretations, and conclusions based on the key ratios.
- Provide a recommendation based on ration analysis.
