Focus Management Group

Healthcare Industry Experience

Assisted Living Facility Operator

Industry:

Healthcare

Company:

Assisted Living Facility Operator

Situation:

The healthcare company had slipped on its rental payments to our client, a Real Estate Investment Trust (“REIT”).

Focus Scope:

The client engaged Focus to perform an on-site analysis of the company and prepare a Summary of Finding Report.

Tasks Performed:

  • 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.

Results:

  • 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.

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