Financial Management Performance Measures

Which performance measure is primarily concerned with evaluating the economy of the charity's operations?

What is the BEST measure of effectiveness in the context of ARP's service operations?

In assessing the value for money of ARP, which metric does NOT relate to efficiency?

Which of the following measures would MOST likely indicate a successful transport service in terms of community engagement?

Which measure is LEAST likely to provide insight into ARP’s operational efficiencies?

Performance Measures in Charitable Organizations

ARP, a charity, offers transport services for individuals visiting hospitals.
Efficiency in a value for money review focuses on the cost-effectiveness of services provided.

Key Performance Measures

Cost per journey to hospital:
- Identified as the best fit for measuring efficiency.
- Reflects the financial resources utilized for each transport service.
Percentage of members who re-use the service:
- Measures effectiveness rather than efficiency.
- Indicates user satisfaction and suitability of the service.
Comparison of actual operating expenses against the budget:
- Relates to economy; assesses financial management and adherence to budget.
- Does not directly measure service efficiency.
Number of communities served:
- Another indicator of effectiveness.
- Focuses on outreach rather than cost-efficiency.

Conclusion

Distinguishing between efficiency, effectiveness, and economy is vital in performance measurement for charities.
Cost per journey is the key metric to evaluate operational efficiency, while other measures provide insights into effectiveness and overall financial management.

This quiz examines key performance measures critical to evaluating efficiency in financial management, particularly in a charity context. Participants will focus on understanding value for money reviews and how to assess organizational effectiveness using specific metrics.