Small Dental Practice Accounting & Taxation 101: A Guide

  • Post author:
  • Post category:Bookkeeping

To better determine how each site performs, take advantage of your class or location tracking functionality in your accounting software. It is crucial to understand the performance of each individual location so that you can perform financial comparisons across all of your practices and find ways to improve each clinic. Depending on what works for your business you could also choose to close books annually. This is to ensure that data from other accounting periods doesn’t bleed into the current period . The main purpose of bookkeeping is to keep a complete and accurate record of all financial transactions in a systematic, orderly and logical manner. This ensures that the financial effects of such operations are reflected in the accounting records.

When year-end comes around, your accountant can review the books prepared by your bookkeeper and identify any potential errors. The digital age has made it so that services such as bookkeeping can be done remotely. Going virtual gives employers the added benefit of a tremendously widened talent pool. QuickBooks is faithful to produce a new version annually, but you only need to upgrade your version every couple of years.

A Guide to Dental Bookkeeping Basics for Growing Practices

They are typically prepared on a monthly or quarterly basis and include a balance sheet, income statement, and cash flow statement. These statements provide an overview of the practice’s financial performance, including income, expenses, assets, liabilities, and equity. On the other hand, most dentists take comfort in knowing they have hired someone who does dental bookkeeping every day to handle their information. QuickBooks, Xero, Waveapps, etc. all make you feel like you are a bookkeeper but didn’t you go to a zillion years of school to be a dental bookkeeper… you put all that hard work in to be a dentist.

Dental Bookkeeping Basics for Growing Practices

I am a  firm believer that anyone can learn the bookkeeping process;  with enough studying and enough practice you’ll be on your way to becoming a bookkeeping, Guru. However, the area in which I see most business owners struggle is allocating Dental Bookkeeping Basics for Growing Practices enough time in doing their bookkeeping. Luckily having a good Accounting software makes the reconciliation process A whole lot easier. After you are done with categorizing all of the transactions for that certain month’s bank statement.

Create a file for external citation management software

There are several reasons why dentists and oral surgeons decide to outsource their bookkeeping to a dental accountant instead of keeping it in-house. You might be running a larger dental practice, or the job is just too much to hand off to an office manager. Depending on your particular financial needs and resources, it might be wise to hire more than one professional. Dividing your practice’s financial management between two or more professionals will help prevent fraud, embezzlement, and costly errors.

Dental Bookkeeping Basics for Growing Practices

This includes recording payments from patients, insurance companies, and other sources of revenue. It is important to accurately record income in order to properly calculate the profitability of the practice. Some of this information is recorded in both the patient management system, and again in the QuickBooks Online accounting software. The final collected revenue in these two separate systems should reconcile (match) at the end of the year. I have taught and used both and, ultimately, have found QuickBooks to be the best solution for dental practices.