Common Medical Bookkeeping Mistakes to Avoid

Bookkeeping can easily fall to the bottom of the list when you’re running a busy medical practice with lots of important and urgent things always coming up - and there are some common bookkeeping mistakes that you can make as a medical professional that we want to help you avoid.

Bookkeeping is essential because without real data, you could be overspending and falling into unnecessary errors. If you don’t know what you’re spending each month, whether or not your medical practice is profitable, or if you have enough cash in the bank to cover all your expenses - this isn’t a sustainable way to run a practice. That’s why we’re here to help!

CASH FLOW

Stay on top of accounts receivable to maintain a healthy cash flow in your practice. This will ensure you have enough cash to pay employees, cover all of your expenses, and take home profits.

SKIPPING BANK ACCOUNT RECONCILIATIONS

You must be matching transactions recorded in your records to your bank or credit card statement. If you see a charge for something that you don’t recognize, or a payment for a procedure you didn’t expect, you can look into it to make sure it’s not an error. Regular reconciliations will allow you to handle anything unusual immediately before it leads to bounced checks or negative cash flow.

NOT SEPARATING BUSINESS AND PERSONAL ACCOUNTS AND EXPENSES

Many times doctors use their practice to directly finance things in their personal life through their personal account, rather than keeping personal and business accounts and expenses separate. Not only can this cause problems relationally with business partners, but it can also put you in danger of an IRS audit.

Bottom line: Make sure you have a separate business bank account and business credit card for the practice, and keep all business and personal expenses separate.

Avoid these bookkeeping mistakes and you will be on the right track in your practice. Whether you handle bookkeeping and medical billing on your own or outsource it to a professional, keep it a priority and don’t let it fall by the wayside - it will cost you. When you stay on top of your books, you’ll have real insight into your practice’s finances to make data-driven business decisions. If you need to outsource bookkeeping, payroll or sales tax we would love to support you - get a free estimate at www.harquinbookkeeping.com/estimate!