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Quality of earnings is an important concept both for individual perspective as well as organizational perspective. The earning quality of an organization or an individual affects its financial health or physical health. Though one can main good financial health of an organization through manipulation but it will not sustain in the end (Example of such matter is Enron). In any quality of earnings analysis it’s critical to assess the quality of health. Ensuring a healthcare properly recognizes earning on an accrual basis is fundamental in assessing historical trends in operations. This is particularly important in healthcare as many target earning report financial statements on a cash basis and may be subject to seasonality, which can further distort a earning’ underlying operations. If earnings follow the paths of knowledge, scrutiny, interactions, and competition, expenditures will also follow these paths. On the other hand, if earnings follow the paths of linkage and ideology, expenditures also follow these paths. Better medicine, better treatment and early diagnosis may reduce the mortality but the earning process without adequate knowledge, sufficient interactions and transparency and performance may increase morbidity and limit active life. Better health service may increase life expectancy but knowledge and quality of earnings may increase both life expectancy and disease and disability free life expectancy and the study find that.
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