Business and financial How strong are your systems? I
n our last article ‘Making your time work for you’ (June/July 20ı3), director of Turner Accountancy Ltd, Damian Turner,
set out the importance of prioritising your time and setting measureable targets in order to help make your practice more profitable. In order to set and measure
your targets, you must have the financial systems in place which provide the informa- tion you need. This will help you benchmark your perfor- mance against your previous performance, and against the targets you have set. There is a direct correlation between the best performing practices and the strength of their financial systems. If you have an interest in
tracking your performance to enhance profitability and practice management, here are some points to consider: • Identify, measure and track your ‘key performance indicators’. These KPIs can be used as a ready reckoner for how well you are doing in working towards the targets set in your action plan. Some examples of KPIs would include revenue gener- ated per patient, number of new patients, number of complaints, and prof- itability by Associate. If you can’t measure it, you can’t manage it.
• Ensure you are getting your practice accounts prepared as soon as possible after your period end. This means the information
you are reviewing has a degree of currency and not out of date before you get the chance to consider them. Ask your accountant if they offer a guaranteed turnaround time.
• Consider whether your prac- tice book-keeping is capable of producing reliable interim management accounts. You may wish to ask for help from your accountant to prepare these on a regular basis i.e. quarterly or half-yearly. Management accounts will give you the information to take correc- tive action if expenses start to balloon/profit starts to drop, and do so sooner rather than later. Many of our clients choose to include the preparation of
interim management accounts and an interpretation of KPIs as part of their fixed-price menu of services with us. Meeting on a regular basis
such as this can help focus your mind on what is adding to your bottom line, and help put in place an action plan.
ABOUT THE AUTHOR
Andrew Morrison FCCA is client service manager at Turner Accountancy Ltd, a chartered accountancy firm offering specialist value- added accountancy, taxation and financial services to the medical sector.
70 Scottish Dental magazine
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