We talk to many dental practice owners who want to know more about how to grow their practice. They provide quality dental services to clients, but they aren’t familiar with how to support the business side of the practice to achieve greater revenue and profitability.
Consider refining your dental accounting and bookkeeping. Working with the right CPA firm can help you create the right processes that support accounting. Caudell & Associates, PC can help.
We will work to understand the service you need and the reason you are looking for a CPA. We’ll put together an approach that meets your goals. First, let’s take a look at what your dental bookkeeping priorities should be.
What Are the Top Dental Bookkeeping Priorities?
Here are the most common dental bookkeeping priorities that you need to be aware of so that you can keep your dental practice on the path to profitability.
1. Accounting and Payroll Software Set-up
How is your accounting software set up? What about your payroll software? Did you use a canned set-up rather than creating one that highlights the nuances of your practice?
We can help optimize your accounting and payroll set-up so that you can take full advantage of the automation offered by your online accounting system and a modern payroll system.
A fully-configured payroll system helps ensure that employees are paid correctly and on-time. You should be able to see that you have enough cash to cover your payroll and tax deposit before the transfer is initiated.
2. Separate Personal vs. Professional Transactions
Keeping personal and professional transactions separate is especially important for tax purposes. Paying personal expenses from your business account complicates deductions and business write-offs. Merging finances also means that if the IRS selects you for audit, your personal records are likely to be audited as well as business records.
When you commingle business and personal financial activity and use business assets to pay personal bills, you nullify any benefit derived from creating your limited liability entity. This can become bigger than a tax or bookkeeping mistake, which is why we recommend working with our CPA firm to make sure this priority is taken care of responsibly.
3. Evaluate Business and Personal Financial Position
When you commingle business and personal activity, you also make it more difficult to confirm your business and personal financial success. You are creating extra work for you or your tax preparer to separate the two.
While most business expenses are deductible, most personal expenses are not. We recommend keeping your personal finances separate. This will keep your accounting and tax preparation bills low. We can help set this up correctly so that you can gain greater insight into the financial position of your practice, as well as your own personal finances.
4. Streamline Accounts Payable
Accounts payable is a sore spot for many dental practice owners. You don’t want to be in the middle of it, but you also need visibility to see the cash outflows from your practice.
If you, the practice owner, pays the bills, we recommend using your bank’s online bill pay service. The challenge then becomes ensuring that those payments are correctly recorded in your accounting system. This can feel like a duplication of effort. We help clients set up electronic syncs between the bank account and the accounting system. In many cases, we take care of recording this activity in your accounting system.
If your practice has gotten so busy that you have delegated vendor payments to a member of your team, we recommend a different approach. It’s a bad idea to allow any staff member the ability to initiate and complete a payment on your behalf. We recommend that you not give any staff member signing authority on your bank account. We will help you implement a process that ensures that you, as the owner, see and sign off on all outgoing funds. We help you delegate the work without delegating the authority to pay the bills.
There are certainly electronic solutions. They frequently require more set-up, care, and feeding. If you and your team are comfortable with technology, then we can help you set up an even more automated process that still allows you to retain control over outgoing funds.
You need a solution that works for you and your team. We can help identify and implement a solution that makes the most sense.
5. Produce Accurate Financial Reports
Canned financials built on a canned chart of accounts may not offer the info your need to effectively manage your practice. We recommend using a custom chart of accounts created for your business.
We can help you create management reports that provide information that makes sense to you. We’ll create standard financial statements to satisfy requests from your banker and other third-parties. Well-organized financial information makes dealing with creditors and banks less stressful and is a key factor toward successful practice management.
Caudell & Associates Provides Dental Bookkeeping and More
Want to see growth in your dental practice? Let’s make sure your dental bookkeeping is properly set-up and managed. Our CPA firm can help by providing dental accounting and practice advisory services to help your practice maximize performance and increase profitability.
We offer dedicated CPA support to Houston dentistries to get the most benefit out of these dental bookkeeping priorities. We’ll start where you are helping to optimize your processes, then work toward helping your practice achieve profitability.
Call us today. We’re here to help your practice grow.