As a chiropractor, the success of your business depends on providing the best care to your patients. While your patients depend on you for their health, your business health is also dependent on how well you manage your finances. Having a habit of keeping your business books in order and having good accounting practices will allow your business to grow and bloom the way that you intend.
Follow these five accounting and bookkeeping tips for your chiropractic practice and ensure that you always have access to accurate and timely financial data to base all important business decisions.
Must have Separate Personal and Business Accounts
If you have a small chiropractic practice, it seems tempting to combine your personal and business finances. This is a big mistake that many business owners make, and this can also complicate your bookkeeping process considerably.
Not only do your combined accounts make it harder to track the success of your business but also make tax season a nightmare. Also, when your personal finances are mixed with your business, it will be very unprofessional to lenders and future investors.
Keep Your Books Updated
As a business owner, bookkeeping is an important task to keep you informed on the financial health of your business and to give a clear picture of the finances of the business to make crucial decisions in the future.
Bookkeeping tasks include:
- Making cash deposits
- Recording income and expenditure
- Sending invoices for patients and insurance providers
- Reconciling insurance billing to accounts receivable
- Reconciling your bank and credit card state
- Paying vendors, suppliers, and contractors
- Generating financial reports like profit and loss, cash flow statements, and balance sheets.
It is important to ensure that all the above tasks are done on a regular basis so that you always have access to accurate and timely financial information on your business.
Outsourcing your Bookkeeping
Bookkeeping is one of the most time-consuming processes which will take away focus from your business. Even if you have an in-house bookkeeper, you will still have to put effort into your finances and take time away from your business needs. So, it is better to shift to outsourcing your bookkeeping needs.
Outsourcing Bookkeeping to a bookkeeping firm can help you keep your books updated and make your tax season hassle-free. To get the Best Bookkeeping services for chiropractic practices, make sure that you have a team of professional and experienced individuals to handle your critical financial data.
Outsourcing your bookkeeping needs will save you a significant amount of time and the costs associated with training someone else to look after your books for you. When you outsource your books, you will always have access to the data which will allow you to get a complete idea about the financial structure of your business to make future decisions.
Monitoring your cash flow
Cash flow is the lifeblood of your business. It will let you know about the business’ inflow and outflow and ensure your clinic meets its financial obligations.
A budget is one of the best ways to manage your cash flow. The budget will allow you to ensure there is always enough cash on hand to pay employees’ salaries, pay rent, cover the cost of the equipment, and cover all other expenses of your business.
Make sure to consider that certain times will be busier than others and that your cash flow situation will fluctuate over time.
Reviewing the Business Financial Statements Regularly
As a business owner, you must review your financial statement regularly, providing constant insight into your business’ health. There are three important things to remember when reviewing your financial statement:
- Profit and loss
Reviewing your financial statement will allow you to see which service makes the most income and whether you have an under or over-budget for your expenses. Your profit & loss will show you the revenue, expenses, and profit or loss of your business at the end of every month.
- Cash Flow Statement
The cash flow statement will identify the total amount of money that is flowing in and out of your business in a certain period. Cash flow problems arise due to a mismatch between money entering and leaving your business.
- A/R Aging Report
The Aging Report will show you all your unpaid invoice balances and the length of time outstanding. It is important to review this information at regular intervals and follow up on outstanding invoices because these can have a negative effect on your cash flow.
Bookkeeping can be a time-consuming and costly task, but it doesn’t have to be when outsourcing it. By staying up to date on your financial information and enrolling the help of trained experts, you can ensure that your books will be accurate and current.
Contact us today to how we can help your chiropractic clinic to keep your financial books up- to- date.