Most health care accounting systems are,usually for historical reasons, locked into an annual cycle. Most countries present an annual budget to parliament and money is allocated from this to the Health Budget annually.

Thus the cycle is

Plan - Predict spending pattern - Prepare budgets - Agree budgets - Allocate budgets - Control spending in line with budgets - Account for spending patterns - Take corrective action where necessary - Review yearly performance

Management accounting tries to look deeper, tries to consider different aspects of budgets and to relate them to outcome. It allows for and encourages comparisons between units, patients and doctors and asks questions.