Best Practice #3: REVIEW YOUR FINANCIALS AT LEAST WEEKLY
If you’re only sitting down once a month to review your financials, you’re missing out on a real opportunity to improve the financial health of your practice. Here’s the problem. If you don’t review your January P&L until the second week of February, the information is already dated.
Great practices keep an ongoing eye on the financials. This allows them to detect and address any irregularities or problem areas right away. Such proactive attention can save a practice thousands of dollars each year. This means, at a minimum, conducting a weekly review of your P&L and your A/R.
What to look for in your weekly reviews?
By staying connected with your financials on a regular basis, it shouldn’t be a laborious task. Here are a few things to look for to ensure the ongoing health of your practice:
- Unexpected Expenses. Keep a close eye on any expenses incurred since your last review. Are all your expenses expected and within your established budget? If not, that doesn’t necessary indicate a problem. Not all expenses can be anticipated. However, if you see significant or reoccurring unbudgeted expenses, this should be addressed.
- Signs of Fraud. No matter the size of practice, there is always some risk of fraud. Consistent review of your financials is the BEST way to detect fraud in the early stages before it causes significant damage to your business.
- Opportunity for Streamlining or Automation. This is an important one for dental practices. Often your financials can point to costly pain points in your business. As you review these costs (especially related to payroll), ask yourself if there are any that can be reduced or eliminated all together by streamlining a process or using technology to automate.
- Opportunity to Outsource. Similar to the previous point, take a hard look at the tasks you are conducting (and paying for!) internally. It often makes more sense to outsource these things – saving your practice both time and money. For dental practices, tasks such as bookkeeping, payroll, accounting, and financial reporting are great candidates for outsourcing.
PRO TIP: To dramatically decrease the effort and increase the speed of expense reporting, consider using an automated system Dext for collecting, processing and publishing receipts.
As you can see, a regular review of your financials can greatly benefit your practice. Make it a part of your weekly routine and you’ll be on your way to becoming (or remaining 😊) a thriving practice!
Until next time!
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7 Key Financial Practices That Separate Thriving, Growing Practices From The Rest.
There’s no denying it. Creating a thriving practice is about much more than practicing medicine!
Topping the list of “other” priorities is your practice’s financial management. In this short guide, the experts at STAC Bizness Solutions outline 7 financial best practices that differentiate struggling practices from those which are highly profitable and experiencing healthy levels of growth.