Functions of Medical Accountants

Basic functions of a Medical Accountant are providing comprehensive financial services not limited to

•     Accounts prepared on a timely basis
•     Meetings at your premises with a Chartered Accountant partner
•     An all inclusive fixed fee for accounts, taxation and general advice.
•     Appraisal of the practice finance with our ratios and statistical analysis
•     Drawings projections prepared and discussed with the partners
•     Income tax projections prepared in advance of liabilities falling due
•     Superannuation shortfall projections
•     Advice and explanations of capital/current accounts
•     Phone calls and emails returned the same day, letters within 10 days
•     Proactive advice delivered through courses, meetings and emails
•     Advice given on all aspects of G.P. finance including premises reimbursements, personal medical services, extra income generation, etc. With no additional fee - just the agreed annual fee.

What are practice accounts?

Practice accounts are an historic record of the financial performance of the practice. The accounts themselves typically comprise of two pages, the profit and loss account and the balance sheet. The accounts will be prepared to the accounting year end from the books and records. The accounts will usually be for a year, if for a shorter period this should be clearly indicated on the accounts. The profit and loss account provides the practice with a record of all their income and expenses for a given period. The difference between the incomes and expenses is the profit for the practice. The balance sheet is a snapshot at the year end and provides the practice with a value of their assets and liabilities. It also shows each GP partners share of those assets as detailed in the partners current account balances.The accounts will also include supporting notes with further explanations of the figures on the profit and loss account and balance sheet. The profit and loss account shows the income that the practice has earned less the expenses (overheads) incurred in running the practice for a given period of time. The expenses are deducted from the income to give the profit of the practice. 

Profit means how much money has been earned from the day to day activities of running the practice. The partners/owners of the practice are entitled to the profits. The profit and loss account shows the profits made for the period. GPs are conducting a business, and the main object of a business is to maximise profits. New partners thinking about joining a practice will be interested in the profitability of the practice. This will give an indication of earning potential of the practice.
      

The Role of Medical Accountants

The job of Medical Accountants involves many complex tasks including. It would not be a surprise to anyone that the accounting in medical practice at the bottom of priorities. The paperwork, the management of cash, your debtor and creditor list creates a compliance program that does distract you from what you are trained to do, practicing medicine. 

Even though every doctor’s situation is unique, there are some sound financial strategies which apply to the majority of medical practitioners and their practices.

Medical Accountants will help practice to
•     Choose the correct legal structure for your practice. This will usually be a trust based structure for most specialist-level doctors with the maximum amount of income distributed to lower tax rate beneficiaries including an investment company.
•     Minimize or even eliminate non-deductible debt connected to home purchases and renovations, through the careful management of practice and investment cash flow.
•     Defer tax as far as possible and use the improved cash flow for investment strategies and non-deductible debt-elimination  

•     Claim every single deduction that is legitimately claimable including cars, home office expenses, phones, IT, medical indemnity and income protection insurance as appropriate.

•     Investment in home as a tax-free investment
•     Structure all practice debt so it is connected to deductible at the highest possible marginal rate   
•     Pay the maximum amount of Superannuation annually (up to the Government allowed limit- the RBL) and use gearing through non-recourse loans as needed.
•     Use gearing in investments and SMSF to maximize the returns on practice investments and to match tax deductions to reduce taxable income.
•     Preparation of Annual Financial Statements and Income Tax Returns for doctors, Medical Practices and their entities.
•     Preparation of monthly/quarterly BAS
•     Advice re bookkeeping, MYOB problems etc.
•     Tax planning
•     Business Restructuring, incl. establishment of Incorporated Medical Practices, Service Trusts etc.
•     Business Advice, such as entry/exit of partners, purchase or sale of practices, benchmarking, business set-up.
•     Strategic and Long term Planning
•     Corporate Secretarial Services and Registered Office
•     Self Managed Superannuation Funds 

Doctors should not be spending their time on reading financial reports. They should understand immediately the financial position of the practice and understand the profit they are expecting to make. This above all else is the first step to long term wealth creation, ‘where are we right now?’

The ability to accurately map every single cent spent in medical business will give practice a greater understanding on what the cost drivers and revenue generators are. The biggest threat to your profitability is not know exactly what drives practice costs. Medical Accountants are specialist accountants and consultants to the medical profession. They have proven expertise in medical practice tax planning and business development.

Functions and Specialization Of Accountants

Medical Accountants are helping healthcare industry by providing lot of complex services to the Practice so that practice can concentrate more on patients rather than on financial matters. 

Medical Accountants will provide services on the following accounts
•     Financial accounts
•     Management accounts
•     Statutory accounts
•     Abbreviated accounts
•     Unaudited accounts
•     Audited accounts

They will give advice on the following matters
•     Meeting legal/statutory requirements
•     Calculation of your tax liability
•     Identify areas where we can assist in minimizing your tax liability;
•     Providing information to banks/third parties
•     Formulating financial plans
•     Book keeping
•     Evaluating profit and efficiency
•     Helping  you run your business

However Medical Accountant will exercise the power of exact, timely accounting reporting can take on and engage your practice surgery by locating efficiencies and eradicating wastes. Medical Accountants will be having ability to accurately map each and every single penny spent in medical business will give a greater understanding on what the cost drivers and revenue generators are. The biggest threat to medical business profitability is not know precisely what effects the costs. 

Depending on size of practice Medical Accountants are having choice of plenty of accounting systems to use. Outdated accounting packages can be obtained and can be influenced to a practice’s need. There are many systems which are more complicated and call a requirement of team of programmers to put up the software from scrape which is considered as a costly work out but no doubt practice exactly know what they are being paid as a end result. Cost of such packages is very high and only big practices can afford it. The new age is on the internet where Medical Accountants will interact with practice online and outsource data entry and delivering accurate accounts. There are products that are totally online and even talk directly to practice bank account to give live reporting.

Medical profession is arguably the most complex in terms of accounting and taxation. Medical Insurance companies will stipulate different rules and bye-laws to process med claims. They follow certain set of formats and billing codes for each claim. These codes will help them in analyzing data and avoiding misuse and manipulations. Medical Accountants at the practice are conversant with these codes and formats, so that they will deal with billing issues without burdening practice. Medical Accountants will keep themselves update with changing government policies and regulations which will help them in providing financial services to the practice.

Medical Accounts

Like any other business practices have to ensure that there is a planned and workable cash flow. As partnerships, medical practices also have the issue of partners leaving or retiring and how the process is managed to ensure that both sides are content financially. Medical Accountants play great role in financial planning and cash flow in an efficient way  and run like any other business. They help with budgets planning and management accounts so practice can predict incomes and expenditures accurately, allowing practice to take the right amount of salary at the right time. 

Medical Accountants provide services in the following areas...

•     Partnership profit sharing
•     NHS pensions
•     Annual superannuation certificates
•     Partnership structure advice
•     Assistance in dealing with partnership disputes
•     Succession planning
•     Tax planning
•     Financial reporting
•     Accounting
•     Tax compliance
•     Bench marking
•     Accounting for income from varying sources
•     Profit improvement
•     Book-keeping

Medical Accountants developed their in depth knowledge of the financial concerns affecting the medical sector through years of operating in this field, and constantly keep up to date with topical issues affecting all areas of the medical profession. Medical Accounts’ in depth knowledge and expertise will enable practice to maximize income and help practice run more efficiently. Medical Accountants will understand the tax burden from medical income and try to work with practice to reduce it.

In some developing countries, Entrepreneurs establishing companies with a pool of Medical Accountants and using their resources for outsourcing work. By this way practice is getting high-end expertise services at an affordable cost and companies are saving money on optimum utilization of their resources.
Medical Accountants  offer a full financial planning service, where they will look at the overall lifestyle and financial planning objectives as fully as possible to ensure that the financial resources are used in the most tax efficient manner. This is a comprehensive plan, the objective of which is to help practices to achieve their financial objectives in each area of financial planning. They help practices to achieve financial independence by their desired age, by tailoring a financial plan to each individual's own circumstances and requirements. This plan is then regularly monitored and adapted to take into account changes in circumstances.

In summary, Medical Accountant service offers a structured plan that is regularly monitored to ensure Practices are adequately protected against unforeseen circumstances and that resources are used in the most tax efficient way to achieve financial independence at the earliest age.

 

Medical Accountants-The Basic Requirement

Medical Accountants help practices to Spend less time on finances matters, and more time with patients. Basically they will monitor all financial issues of a practice like billing, claims submission, insurance verification, taxation, payroll, creditors and debtors, tax implications, pending bills, online bank transactions, fulfilling statutory obligations, book keeping, reporting and final balance sheet. In addition they give Partnership structure advice and deal with partnership disputes, budgeting, forecasting and cash flow. Medical Accountants will update financial status to the Practice thus visualizing balance-sheet of income and expenses to the practice. 

Part of offering quality health care to the patients involves a well orchestrated office administration. Medical accountants can put the financial concerns of private medical practice to rest and let practice focus on more important aspects such as the healthcare to the patients.

Of all the professions, the medical profession is arguably the most complex in terms of accounting and taxation. Medical Insurance companies will stipulate different rules and bye-laws to process med claims. They follow certain set of formats and billing codes (like CPT and ICD codes in USA) for each claim. These codes will help them in analyzing data and avoiding misuse and manipulations. Medical Accountants at the practice are conversant with these codes and formats, so that they will deal with billing issues without burdening practice. 

Medical Accountants are also providing their services through outsourcing companies. By outsourcing practice can reduce cost by 30% to 50%. Improved Return on Capital Employed, Improved Customer Satisfaction levels. But these outsourcing companies have to comply with some security standards of the origin country. Practices in most of the advanced countries are opting outsourcing of the accounting system without compromising with security and privacy of patient data.

Medical accountants are attuned to the constant changes faced by the medical profession and are a reliable source of information and advice on the impact of government legislation and policy decisions made locally by primary care and acute trusts. For doctors seeking to grasp the opportunities arising from the new era of healthcare commissioning, Medical accountants provide expert advice on funding, financial modeling, contract documentation and negotiations with the PCT. They have unrivalled financial intelligence on what makes the most profitable, well-managed medical practice.

In an increasingly globalised and complex economy Medical Accountants aim to develop innovative accounting, tax and consulting services that will rise to these exciting challenges and deliver practices high economic, sustainable value.