What Are the Differences between Bookkeeping and Accounting?
Dental accounting is the process of financial planning and record-keeping for a dental practice. This includes creating and following a budget and tracking income and expenses. On the other hand, bookkeeping is the process of recording financial transactions. This can be done manually or electronically, but the important thing is that all transactions are recorded in a consistent and accurate manner.
While both dental accounting and bookkeeping are essential for running a successful dental practice, they are two distinct processes. Dental accounting is focused on financial planning and decision-making, while bookkeeping is focused on recording transactions. It is important to understand the difference between the two to get the most out of both services.
Read this article to learn more about each.
What Is Bookkeeping For?
Bookkeeping is vital for business owners because it helps them keep track of their spending and ensure that their money is used appropriately. A good bookkeeper can be worth a lot of money because they can help prevent errors and inaccuracies in transactions. Their typical tasks include:
- Credit and debit posting
- Handling payroll
- Ledger balancing
- Transactional recording
The bookkeeper’s job is to make sure that the accounting software and the practice management software match up. They also look for ways to improve the practice based on the data they see.
What Is Dental Accounting For?
Dental accounting goes beyond bookkeeping by providing strategic financial advice to help improve the future of the practice. This may include advice on things like investing, taxes, and other financial planning matters. While bookkeeping is essential for keeping track of transactions and ensuring accuracy, dental accounting can provide valuable insights that help the practice reach its financial goals.
Dental accounting entails the following:
- Analyzing operational costs
- Evaluating periodic accruals and amortization
- Preparing financial statements
- Preparing tax returns
- Reviewing internal controls
A dental accountant is responsible for the financial planning and management of a dental practice. This includes forecasting financial needs, advising on financial best practices, and overseeing the budget and expenditure of the practice.
Determining Which One Your Dental Practice Needs
If you’re not sure whether your business needs a bookkeeper or an accountant, start by evaluating your needs. The best way to ensure that your dental practice is on solid financial footing is to hire both a bookkeeper and a dental accountant.
Having both professionals on your team will help you manage your finances more effectively and save money in the long run. Trying to get by with just one person to handle all of your financial needs is not always advisable. You need the expertise of a bookkeeper and an accountant to keep your dental practice running smoothly and avoid any future financial pitfalls.
Bookkeeping and accounting are critical aspects of dental practice management. Without accurate and up-to-date financial records, it would be difficult to make sound business decisions or track the progress of your practice.
Working with a qualified accountant or bookkeeper can also be extremely helpful, especially if you are not comfortable managing these tasks yourself. They can offer valuable insights and guidance to help ensure your dental practice runs smoothly and efficiently.
Are you looking for an accountant for dentists? Choose Ash Dental CPA, offering top-notch accounting services for dental and healthcare professionals. Book an appointment now.