PPS System Overview Revenue cycle

PPS System Overview Revenue cycle

PPSSystem Overview: Revenuecycle


PPSSystem Overview Revenuecycle

PPSSystem Overview: Revenuecycle

Therevenue cycle in the system will constitute the various set ofactivities in the institution that result from exchange services toour customers for cash. The fact being that most of the transactionsare carried out on credit basis has triggered to this mostsignificant accounting information system known as revenue cycle. Theprocess of revenue cycle will have two major phases: the physicalphase in which the psychiatric disorder services are offered to theclients and then the financial phase in which payments are receivedfrom the customer (James, 2014). Physical phase will be handled bythe subsystem known as sales order processing while the financialphase will be handled by cash receipts subsystem.

Featuresof the revenue cycle

Therevenue cycle discussed below has been designed to ensure thatfundamental tasks are recognized and are undertaken regardless of thelevel of innovation and technology. PPS system will ensure that allthe functional department have been identified and involved in theactivities of the revenue cycle. This will help in tracing the flowof sales transactions within the institution (James, 2014). PPSsystem revenue cycle will also specify various transaction journalsand books of account providing audit trails and endorse thepreservation of historical records. The system will facilitateidentification of risks associated with the operation of the newsystem and providing appropriate control measures to reduce the risk.The revenue cycle of the PPS system will play a great role insupporting the internal decision making and also nourishing thefinancial reporting.

Flowchart of the revenue cycle

Theflow chart revenue cycle represents the activities that must occur inthe sales order processing and the payment activities. Both thefinancial phase and the physical phase will depend on the type of theservice offered. Some of the services that are offered under the IPFsinclude diagnostic evaluation, referral services, treatment planning,psychotherapy, medication management, and crisis interventionservices. The price that is the main component of revenue will varyfrom one service to the other. The revenue cycle will facilitatepreparation of monthly financial statements that are vital in makingshort-term decisions for the organization (James, 2014). The systemwill also strengthen the internal accounting control system of thebusiness.

Inconclusion, transaction authorization at all functional level isessential at any point in the revenue cycle. Due to this reason, aparticular order must be put in place whenever the customer wants toaccess Psychiatric disorders services in PPS system. Segregation ofduties is also recommended however, the authority should not be muchdecentralized so as to avoid ambiguity while carrying out atransaction from the beginning to the end.


JamesA.(2014).Accounting Information System 4thedition. Retrieved September 3,2015, from https://www.google.com/url?sa=t&amprct=j&ampq=&ampesrc=s&ampsource=web&ampcd=10&ampcad=rj uact=8&ampved=0CEcQFjAJahUKEwjit__Zid_HAhXwjtsKHQ2jD8U&ampurl=http%3A% F%2Fwww.swlearning.com%2Faccounting%2Fhall%2Fais_4e%2Fstudy_notes%2F h04.pdf&ampusg=AFQjCNEsk8_MJ82gGbXGGrSyd11Jvza2og&ampsig2=v BtJ8tPZK8Xea3JsRrMsw