Three Tips for Medical Office Bookkeeping

As a physician or other medical worker, you have a lot of important responsibilities and bookkeeping isn’t always going to be top of mind. However, bookkeeping isn’t something you want to overlook. You’ll need accurate financials for record and to guide you in your practice. When it comes to your bookkeeping, you want to ensure that everything is accurate and up-to-date.

Three Tips for Medical Office Bookkeeping

CHOOSE YOUR ACCOUNTING METHOD

For medical practices, there are two types of accounting to choose from:

• Accrual accounting

• Cash basis accounting

Accrual accounting is a common form of bookkeeping in the medical industry. In this method, you account for all of your expenses the moment you receive a bill for them. You’ll also account for any receivables from your patients the moment you bill them rather than when they make a payment.

The cash basis accounting method is similar to the accrual accounting method, only receivables and billables are logged upon payment, not receival. The majority of physician-owned medical practices prefer this method, as it provides the most current report on your business. For this method, it’s very important to prepare for large quarterly expenses. Hidden costs can sneak up on you with cash basis accounting if you’re not careful in planning ahead.

PROFIT & LOSS

Get into the habit of looking at profit and loss statements. This will give you a real understanding of what is gain and what is loss, and help you run your practice more efficiently from a financial perspective.

HIRE PROFESSIONAL HELP

Having the cleanest, up-to-date books possible, making sure your day-to-day transactions are being managed, is essential. You may benefit from hiring a bookkeeper to ensure this. To take things to the next level you may choose to take that information from your financial reports and gain even more insights and value from them in CPA consulting. We offer both. Explore your options here!