Account reconciliation compares two sets of records to ensure the figures are correct and in alignment. It is useful for explaining the difference between two financial records or account balances.
Accrual Based Accounting
With accrual-basis accounting, revenues and expenses are recorded when services are rendered or products are sold. When the cash is received or paid is irrelevant to when it is recorded. Customer invoices, inventories, and bills to pay are elements of accrual accounting.
The balance sheet is a representation of a practice’s financial health at a point in time. It includes three major categories: assets, liabilities, and equity accounts.
Chart of accounts
A chart of accounts is a hierarchical structure of buckets. Each account captures transactions of a similar nature. It details the activity within a designated set of accounts and organizes financial transactions into easily identifiable categories of information.
Finacial controllers typically have a financial accounting background. They are responsible for data integrity and all of the day-to-day financial operations of the business.
Cost of professional services
Also known as the cost of goods sold, or COGS, these expenses are directly associated with providing the services your practice offers, including laboratory, imaging and radiology, dentistry, ancillary products, and grooming and boarding.
Certified Public Accountant (CPA)
Certified Public Accountants, or CPAs, offer tax, financial reporting, and advisory services. CPAs must be licensed and participate in lifelong learning to remain active.
From the capital you need to open a brand new practice or expand your current practice, to refinancing existing debt and reducing monthly bills, debt financing can enable you to move your practice forward.
A company’s earnings before interest, tax, depreciation, and amortization is a useful metric for understanding a business's ability to generate cash flow for its owners and for judging a company's operating performance.
Financial statements highlight your current financial condition, concerns, and opportunities for improvements. It includes a balance sheet, income statement, and the statement of cash flows.
Key performance indicators (KPIs)
Practice Management Software
Profit and loss statement
Also referred to as an income statement, it summarizes the operating activities over a period of time. It includes revenues and expense accounts and nets the two together to present the net income or net loss for the period.
Return on assets (ROA)
SaaS (Software as a Service)
Software provided by a third-party over the Internet.
Software integration refers to the bringing together of two or more software systems into one system to act as a coordinated whole.
Statement of cash flows
The statement of cash flows reports the amount of cash coming in and the amount going out. It is separated into three different categories: operations, financing, and investing.