5 Tips For Dental Bookkeeping – Best Practices For Simpler Finances

If you’re a dentist and you own your own practice, proper bookkeeping is essential for your financial health, for staying out of tax trouble, and for fine-tuning your expenses and finances. Here are a few quick tips from Tooth & Coin that can help you keep your books clean and accurate.

1. Keep Your Business Funds And Private Funds Separate

Your personal bank account and your business bank account should never meet. Commingling business funds with personal funds can make your finances much more complicated. Not only will you have a harder time understanding the financial health of your business, but mixing funds could get you into tax trouble or make it harder to secure loans from lenders in the future.

2. Use A Chart Of Accounts (COA) To Organize Your Finances

A Chart of Accounts (COA) is basically a roadmap that allows you to keep all of your financial information in one place. It includes all of your assets such as cash on hand, petty cash, accounts receivable (money unpaid by customers and dental insurance customers), inventory, and equipment.

It also will include all of your liabilities (debts), like credit card debt, accounts payable, payroll, and other debts. An accurate, industry-specific COA makes it much easier to keep your books organized.

3. Invest In Cloud-Based Accounting Software

Cloud-based accounting software is a must-have. Cloud-based programs have backups so that you never lose any financial data. Today’s accounting systems also make it easy to integrate transactions, receipts, bills, and other information quickly and easily, cutting down on physical paperwork.

There are lots of different cloud-based accounting software suites out there. We’d recommend taking a look at a few, comparing their features and pricing, and picking the one that fits your needs the best.

4. Reconcile Bills, Invoices, And Other Financial Data Regularly 

Reconciliation is the process of comparing two sets of financial records to make sure that they're correct. For example, if you go on a business trip and input your receipts for your flight, hotel booking, meals, and other expenses, you’ll want to double-check that the receipts match the information you put into your bookkeeping software.

Regularly reconciling your records is the best way to find accidental errors and other issues. These may be minor, but can build up over time if you’re not tracking and reconciling your expenses, accounts payable, and other financial data regularly.

5. Review Your Financial Statements Every Month

Some dentists “close the books” on their financial statements monthly. Others may do this quarterly or even annually. But no matter what schedule you choose, it’s still important to review your financial statements every month.

Regularly reviewing your statements helps you identify potential errors, areas with high overhead or expenses, bad debt, and other useful information that can help you run a more financially-healthy practice. Review your statements every month, and your practice is less likely to be blindsided by financial issues in the future.

Turn To The Pros – Tooth And Coin Offers Expert Dental Bookkeeping Services

If you’re a dentist, keeping your books yourself can be time-consuming and difficult. So why not turn to the pros? At Tooth & Coin, we specialize in dental bookkeeping and accounting, along with a variety of other financial services for dentists.

With our industry expertise, we can keep your books shipshape, find areas where you can cut costs, and put your practice on the path to future growth. So don’t wait. Give us a call at (877) 265-2121 or schedule a consultation with Jonathan VanHorn today, and see how you can benefit from our outsourced dental bookkeeping services.