LESSON 5: THE FINANCIAL SYSTEM OF THE HEALTH SECTOR

=FINANCIAL MANAGEMENT=

INTRODUCTION
As health workers you need to understand how the financial system operates so that you will be able to access resources for use at the subdistrict level

LESSON CONTENT
BUDGET It is a financial statement of planned activity i.e. how much it will cost in terms of money to carry out activities to achieve organization goal, objectives and targets.

=CHARACTERISTICS OF HEALTH SECTOR BUDGET= It is resource based and takes account of all expected sources of funding. There are 3 main sources of funding.
 * Government of Ghana (GOG) is the contribution of government to the ministry of health and Ghana health services from the consolidated fund. This component constitutes 60% of the total budget estimate.
 * Donor pooled fund (DPF) These are contributions from international donor agency like European Union, Danida, USAID, UNFPA UNICEF WHO, World bank, IMF, ADB – African Development Bank, DFID. This contributes 30% of the total budget estimate.
 * Internally Generated fund (IGF) They are user charges at facilities. It contitutes 10%

It is need based. It is based on the major health priorities e.g. malaria, TB, HIV/AIDS. It consist of four items. It consist of four items namely 1234 Item 1,2,3 are referred to as recurrent budget and 4 is called capital budget. It is bottom up approach. You plan from the lowest level of care to the highest level i.e. from the community to the national level . Imprest Account. The funds allocated to us in the budget do not come to us in a form of physical cash. They are accessible to us through the issuance of cheque. Most of our activities are paid for in the form of cheque. However there are very little activities that the use of cheque becomes very cumbersome and time wasting. In such situations petty cash is advanced to the health worker to be used on that activity. The amount of cash to the health worker or manager depends upon the level of operation or function. An imprest therefore is an advance of cash given for a particular purpose and replenished as necessary. An imprest is also restored to its original level e.g. supposing that a health worker is given and amount of 100,000 cedis he finds his office supplies are low so he buys some sationary worth 60,000 cedis the unspent balance is 40,000cedis. He then takes his receipts and petty cash book to the accounts officer who will give him 60,000 in cash to make the imprest up to 100,000 again. This process is referred to us RETIRING OF IMPREST ACCOUNT.
 * Item 1 stands for personal Emoluuments
 * Item 2 stands for administration
 * Item 3 stands for service ie for the purpose for which the institution exists
 * Item 4 stands for investments such as construction, infrastructure, vehicle, equipment

Charenninful 08:58, 2 March 2007 (CET)