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CMA Final · Cost and Management Audit · Audit of Different Service Organisations

In the audit of a hospital as a service organisation, which of the following is the most appropriate cost-oriented performance measure for evaluating the efficiency of bed utilisation?

The bed occupancy rate, patient-days used divided by patient-days available, is the right measure. It shows how fully a hospital's core capacity, its beds, is being used. The other ratios do not relate service output to available capacity, so they cannot evaluate bed utilisation efficiency.

  1. ABed occupancy rate, being patient-days actually used divided by patient-days availableCorrect
  2. BTotal revenue divided by number of doctors
  3. CProportion of administrative staff to nursing staff
  4. DRatio of fixed assets to current liabilities

Explanation

Bed occupancy rate compares patient-days used with patient-days available, directly measuring how well the main capacity of a hospital is utilised. The other options are either not capacity-utilisation measures or mix unrelated items, so they do not show bed efficiency.

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