Assisted Living Facility Operator
Service:Business Viability Assessment
Company:Assisted Living Facility Operator
The healthcare company had slipped on its rental payments to our client, a Real Estate Investment Trust (“REIT”).
The client engaged Focus to perform an on-site analysis of the company and prepare a Summary of Finding Report.
- Reviewed cash disbursements of each nursing home, summarized by vendor/payee and verify the validity of a sample of said transactions with supporting documentation, tracing the transactions through the bank records of to the entities.
- Reviewed the Accounts Receivable and Accounts Receivable Aging of each Home and analyzed changes in their DSO and trace deposits to the bank statements.
- Reviewed the Accounts Payable Aging of each Home and analyzed changes in their DSO.
- Reviewed all payments made to officers, shareholders and tax agencies and related supporting documentation and tracked to tax returns.
- Reviewed Medicaid cost reports.
- Focus determined that cash was tightening due to low occupancy levels and a large falloff in Medicaid reimbursements.
A review of the Company’s checking accounts also indicated that there was a siphoning of funds to the management company. We presented our finding to the REIT as requested.