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(i) Identify and explain FOUR (4) strengths in the LifeCare Physio Bhd’s operating environment. (ii) For each strength identified in (i) above, describe how LifeCare Physio Bhd make further improvements to provide the best value for money.

(i) Identify and explain FOUR (4) strengths in the LifeCare Physio Bhd’s operating environment. (ii) For each strength identified in (i) above, describe how LifeCare Physio Bhd make further improvements to provide the best value for money.

Understanding Business
Understanding Business
12th Edition
ISBN:9781259929434
Author:William Nickels
Publisher:William Nickels
Chapter1: Taking Risks And Making Profits Within The Dynamic Business Environment
Section: Chapter Questions
Problem 1CE
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(i) Identify and explain FOUR (4) strengths in the LifeCare Physio Bhd’s
operating environment.


(ii) For each strength identified in (i) above, describe how LifeCare
Physio Bhd make further improvements to provide the best value for
money.

LifeCare Physio Bhd (LifeCare) is a well-known physiotherapy centre located in Klang Valley. Two years ago, management reviewed all aspects of the centre's activities and implemented a number of measures to improve value for money for the local community. The management has requested you, as the audit manager of the centre's internal audit department to conduct a review of the measures implemented. LifeCare has a central purchasing service and all requests for rehabilitation supplies should be submitted here. Upon reception, the purchasing team will seek the lowest price from the vendors and a purchase order will be generated. It is then passed on to the purchasing manager, who authorises all orders. The small procurement team receives over 300 forms daily. The Department of Human Resources has had difficulty recruiting appropriately trained personnel. Overtime rates have been increased to encourage permanent staff to fill in the staffing gaps, which has been popular, and the use of costly temporary staff has been reduced. Monitoring of staff hours of work has been difficult, but the centre has implemented time card entry and exit procedures and these hours are also used for overtime payments. LifeCare has invested massively in new high tech treadmill equipment that, although very expensive, has made it possible to perform more rehabilitation health care services and speed up the recovery of patients. However, there is currently a shortage of qualified physical therapy staff. A capital expenditure committee has been established, made up of senior management who plan and authorise any major capital expenditure items.
Transcribed Image Text:LifeCare Physio Bhd (LifeCare) is a well-known physiotherapy centre located in Klang Valley. Two years ago, management reviewed all aspects of the centre's activities and implemented a number of measures to improve value for money for the local community. The management has requested you, as the audit manager of the centre's internal audit department to conduct a review of the measures implemented. LifeCare has a central purchasing service and all requests for rehabilitation supplies should be submitted here. Upon reception, the purchasing team will seek the lowest price from the vendors and a purchase order will be generated. It is then passed on to the purchasing manager, who authorises all orders. The small procurement team receives over 300 forms daily. The Department of Human Resources has had difficulty recruiting appropriately trained personnel. Overtime rates have been increased to encourage permanent staff to fill in the staffing gaps, which has been popular, and the use of costly temporary staff has been reduced. Monitoring of staff hours of work has been difficult, but the centre has implemented time card entry and exit procedures and these hours are also used for overtime payments. LifeCare has invested massively in new high tech treadmill equipment that, although very expensive, has made it possible to perform more rehabilitation health care services and speed up the recovery of patients. However, there is currently a shortage of qualified physical therapy staff. A capital expenditure committee has been established, made up of senior management who plan and authorise any major capital expenditure items.
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