A Practical Guide To Dentist Accounting

At our Michigan CPA firm , Strategic CPA Accounting & Tax Solutions LLC, we provide reliable and comprehensive dental accounting strategies designed to save time and resources. Enlisting us as your financial partner allows you to get back to what you enjoy most, spending time with your patients. It also affords you more time to develop your business and attract new clients. Another step that is often missed by inexperienced dental bookkeepers would be to reconcile payroll. I can’t even tell you the countless payroll mistakes we find practice owners making after we reconcile payroll each month.

Dental schools are great at teaching prospective dentists how to care for their patients’ oral health. However, they don’t share the knowledge dentists need to be effective small business owners. Now that you’re accounts are reconciled and your dental bookkeeping bookkeeping is up-to-date,  you can easily generate Financial reports that determine exactly how well your business is doing. A good place to start When it comes to bookkeeping for your dental office is to learn the basic accounting lingo.

A Guide On Dental Bookkeeping

Without dwelling too much on the textbook definitions, the distinction between the two is simple. Financial accounting (which you probably have now) is compliance-based and intended for us by
external parties
like lenders and regulatory agencies. Managerial accounting (which is what you want) is intended for
internal
use like you, the owner.

• Here are some suggestions for how dental practices can become better organized, more efficient, and more accurate in their bookkeeping.
• So we provide solutions that go beyond what a traditional CPA offers.
• First, most dentists do not want to be accountants, but they do need to be business owners.
• Your bookkeeper can catch bank errors, mistakes on invoices and service subscription fees you meant to cancel.
• There is no standard definition, but “corporate dentistry” typically refers to the larger or most well-known dental support organizations.
• This podcast includes a detailed discussion with Dr. Shawn Terrel on the proprietary monthly reporting prepared by HDA Accounting Group and how that report is prepared.
• That means we’re constantly working to increase our knowledge and the level of service you receive.

To keep you informed, we deliver timely and accurate reporting on a regular basis. These reports are designed to give you clear insight into the financial condition of your practice, whenever you need it. We’ll also reduce tax obligations through proactive planning that ensure you’re taking advantage of applicable deductions and tax breaks. In conclusion, dental accounting involves setting up a chart of accounts, tracking revenue and expenses, managing cash flow, and complying with tax laws and regulations.

Charlottesville, VA General Practice Seeking Associate Dentist

Inaccuracies can create a snowball effect with one missed transaction snowballing into a cash flow issue. Every misguided transaction will significantly affect your statement and improper bookkeeping could lead to making misinformed decisions that could put your practice at great financial risk. Once your accounts are reconciled and your practice’s bookkeeping is up to date, you are able to generate financial reports and clarify precisely how well your dental practice is doing. Bookkeeping is one of the most important functions for a dental practice. Dental business owners rely on bookkeeping to ensure they are spending their money appropriately.

The cash method is way simpler because there are no accounts receivables and accounts payable but it doesn’t provide as much detail. The other and more common way is the accrual method,  with this revenue is recorded when the invoice is sent regardless of when you receive the payment. And vice versa expenses are recorded at the time you receive the bill regardless of when you pay.

Goals Based Break-Even Calculator

Not only do busy dentists enjoy reducing their time doing accounting, but focusing on your craft is in your business’s best interest. Maximizing the hours you spend on your core competency is highly beneficial to your profitability. Every business whether big or small requires a certain amount of cash on hand to be able to run smoothly. The Cash flow statement lets the business owner know exactly where his Cash is going and exactly how much cash he’s generating day to day in his business. It’s a good practice to reconcile your accounts as often as you can, but at the bare minimum, you have to do it at least monthly.

Keeping a tab on necessary accounting principles and the primary do’s and don’ts help you assess your business model better and make necessary alterations for increased profits and decreased errors. Having the right accounting team who understands the needs of your industry is the first step in that direction of accounting efficiency and an enhanced financial health. Features are similar between the two, but with very distinct differences. QuickBooks reporting is geared specifically toward organized businesses.

Let’s discuss the important differences to clear up the confusion. When you keep your books up to date, you should be able to pinpoint mistakes and establish new protocol right away before getting your practice into a situation that could take a long time to resolve. Receive financial tips and strategies right in your inbox from our CPA firm. Sign up for our dental newsletter and have it delivered to your inbox, so you don’t miss a thing. Setting up your DSO or Multi-Site group correctly is imperative to ensure you are in compliance with the state and federal regulatory boards. CLA will work along side of you and your attorney to ensure your financials are telling the right story.