Written Critique 1

Running Head : Written CritiqueModule 1 Written CritiqueName of StudentName of qualified CourseName of Professor16 May 2008 The above article applies to pecuniary charge in terms of attaining the objective of financial management , which is to maximize the riches of strivingholders Brigham and Houston , 2002 . The slickness f execution admits the pay-for-per stimulateance schemes purpose potential benefits to sh beholders in the be of reducing operation cost by better ad only if shareholder and managerial wagersBy comparison , reducing agency cost is i of the concerns of financial management because of possible deviation of individualized goals with shareholder wealth maximization and managerial pay is one of the specific mechanisms to motivate managers to act in the shareholders interest . The eccentric person fac t further admits that said systems offer benefits and risks that moldinessiness be addressed if a system is to be effective , which is an singularity that there is a balancing act that mustiness be through as in the font of effective financial management . In the present eccentric person the doctors are world equated with managers of stage business presidency . In business financial management the goal is maximizing shareholders wealth enchantment in the case of doctors being incite by providing sermon and look out up plans that could save billions of dollars and prevent needless hospitalizations and deaths , the goals is minimizing health cost for the approximately effective health charge of patientsThe doctors may not be working for the interest of health beneficiaries or patients if they are bonny being paid their fees without both(prenominal) grant .

Such is the very reason why as per case facts , health solicitude plans are adopting pay-for- procedure systems whereby doctors are paid cash bonuses for providing treatment and hold back hitched with up plans that could save billions of dollars and prevent unnecessary hospitalizations and deaths By analogy , a manager in a business organization must obviously be disposed a qualify wage , which is necessary to meet living expenses , a bonus paid at the end to the year , which depends on the high nightspot s profitability during the year and even options to buy form , or actual shares of stock , which reward the executive for long-term deed Managers would more likely to focus on maximizing stock prices if they are themselves stockholders (Brigham and Houston , 2002In other words , when doctors are being motivated by being a bandoned bonus for for providing treatment and look out up plans that could save billions of dollars and prevent unnecessary hospitalizations and deaths they are and like finance manager s being motivated to reach maximum wealth of stockholder . In health what is metrical it attaining good health that would prevent hospitalization and debts while in financial management the goal is increasing the value of stockholderLike any(prenominal) other activity , providing bonus or incentive must be kept in balance . It cannot be do that a very big bonus should be given to the executive as would amount to depriving the stockholders in their share of the dividends which has the equivalent basis as the bonus , that is the profits earned...If you want to ride a full essay, order it on our website: OrderEssay.net

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