In the course, we understood that there are certain key financial reports for the healthcare services organization. The Balance Sheet, Operating Statement $($Income Statement; Revenue$/$Expense Statement$),$ and the Cash Flow Schedule each represent a certain perspective of the organization$$s financial position within its

fiscal period. At the end of each year these three financial reports make up the year$-$end financial statements, and following the audit by certified public accountants $($CPA$$s$)$ of the organization$$s financial transactions and recordings, they are issued with any required adjustments, qualifiers, and notes in the certified financial report

of the auditing CPA firm.

At the beginning of each year $($fiscal period$),$ the organization applies an operating budget that includes projections within the Balance Sheet, Operating Statement $($Income Statement; Revenue$/$Expense Statement$),$

and the Cash Flow Schedule. The budget provides a guide for volume and financial expectations in the day$-$to$-$day operations of the organization, and commonly, the budgeted Balance Sheet, Operating Statement $($Income Statement; Revenue$/$Expense Statement$),$ and the Cash Flow Schedule are compared on a monthly$-$basis with the Balance Sheet, Operating Statement $($Income Statement; Revenue$/$Expense Statement$),$ and the Cash Flow Schedule that reflect the actual experience of the organization $$ to compare the projected and actual results,

and determine variations, understand the reasons for the variations and take any management action to make operational improvements.

These three financial reports are inter$-$related, in that a change in one can affect the others. Increased receipts shown on the Cash Flow Schedule, for example, can lessen accounts receivable $($patient revenue$)$ on the Operating Statement and add to the Cash Asset in the Balance Sheet.

Question

Explain the relationship between the three reports $-$ the Balance Sheet, Statement of Operations $($Income Statement; Revenue$/$Expense Statement$),$ and the Cash Flow Schedule. Provide at least three $(3)$ examples of how a change in one of the reports effects the other two reports, and indicate the financial categories of

assets, liabilities, revenue, expenses, receipts, and$/$or disbursements that are affected by the changes, as well as how the results of the three reports are impacted $-$ e$.$g$.,$ Net Worth $($Owners$$ Equity and Retained Earnings; or Fund Balance$),$ Revenue over Expenses $-$ Net Gain$/$Loss $($Net Income$),$ and Closing Balance.

Indicate the specific references used to prepare the answer.