Continuous Accounting Advantages in Orthodontic Practice Management Software

Continuous Accounting is a relatively new approach to accounting made possible by modern computing technology which delivers tangible and significant improvements in the cost effectiveness, reliability, and immediacy of accounting and financial reporting of large corporations today. Which means spending a lot less time and money on bookkeeping (a non-value adding activity) while getting a lot more reliable, meaningful, and more immediate financial reports.

So how can an orthodontic practice just like yours save significant time and effort spent on bookkeeping while getting a more accurate and a more immediate picture of its financial condition?

Let’s start by listing all such activities that have to be performed by your office manager when using a traditional practice management system:

1. Beginning of day routine. This sets up the ledgers in the database in preparation for the daily activity. If you forget to launch this routine from your practice management software before you do anything else that day, your financial reports will be inaccurate.
2. Daily activity. Capturing charges and credits in your practice management software as they occur within the clinical and administrative processes within the practice (adding and modifying contracts, insurance claims, chargeable procedures, payments received, etc.)
3. End of day routine. This posts all transactions captured during the daily activity to the appropriate ledgers. If you forget to launch this routine from your practice management software after you finished all of your daily activity, your financial reports will be inaccurate.
4. End of month routine. This ages all receivables and “freezes” all ledger entries captured during the month. If you forget to launch this routine from your practice management software after the end of the month, your financial reports will be inaccurate.
5. Generate financial reports. This is typically done on an as-needed basis, and the most important ones relate to Patient Statements, Aged Receivables and Cash Flow (charges and collections); unfortunately, due to the “batch” processing nature of traditional bookkeeping, the information in these reports is of necessity stale, potentially up to a month out of date depending upon when the reports are being generated within the month.
6. Export to QuickBooks (or other financial software). This is typically done once a month or once a quarter, depending on your accountant’s preferences.
7. Beginning of month routine. Required by some practice management software, this initializes the ledgers and prepares them to receive entries for the new month. If you forget to launch this routine from your practice management before the beginning of the month, your financial reports will be inaccurate.

While using practice management software for these tasks is still preferred to manual bookkeeping, the amount of work the office manager has to dedicate to these activities can easily add up to 1 - ½ days / week or more. And come to think of it, everything outside the “daily activity” tasks are just mechanical “paper pushing” transactions which add zero value to the practice -- very similar to traditional bookkeepers taking a pile of transaction receipts and posting them manually to the appropriate ledgers at the appropriate times.

With the help of a continuous accounting engine, the list above will shrink down to just the 3 essential, value added activities:

1. Daily activity. Capturing charges and credits in your practice management software as they occur within the clinical and administrative processes within the practice (adding and modifying contracts, insurance claims, chargeable procedures, payments received, etc.)
2. Generate financial reports. This is typically done on an as-needed basis, and the most important ones relate to Patient Statements, Aged Receivables and Cash Flow (charges and collections); due to the “instantaneous” processing nature of continuous accounting, the information in these reports is always current, no matter when the reports are being generated within the month.
3. Export to QuickBooks (or other financial software). This can be done as often as desired: monthly, quarterly, or even daily – depending on your accountant’s preferences.

Bottom line: continuous accounting will save your office manager at least a day of effort on average each week, while providing peace of mind (no need to worry about forgetting “end of day”, etc.) and the additional benefit of instantaneous financial reports. For example, with continuous accounting you can generate a Patient Statement at any time, including at the time of patient check out, and it will always be up to date.

So why don’t all orthodontic practice management software products offer a continuous accounting engine today? The answer is because most established vendors rely on platforms that were developed decades ago, typically a “client-server” or a “peer-to-peer” arrangement where the “server” is used to merely store data in a central location -- and with which the implementation of a continuous accounting engine would be extremely challenging – if even possible.

Being implemented on a relatively new “n-tier” native cloud platform, Visual Practice seems to be the only Orthodontic Practice Management system on the market today that has a built-in continuous accounting engine running at the server level. This unique feature can save you and your staff a significant amount of effort and frustration while giving you extremely accurate financial reports which are always up to date.

Contact us at (888) 845-7621 or on the web at www.visualorthodontics.com for more information on how Visual Practice can help you save more time, increase your patients’ satisfaction, and give you more peace of mind than any other practice management system on the market today.