The cash you take into your practice is your Achilles heel. It is the cash receipts collected in your practice that are most vulnerable to fraud. With the advent of Point of Sale machines, most receipts are not easily manipulated by less than honest employees. However, your cash receipts are. Most dental practices realize less than 4% of their receipts in cash (the average is 2 to 4 % for practices with POS systems). That doesn’t sound like much, does it? Think about it for a minute; if your practice produces $500,000 per year, and your cash receipts are 2%, that is $10,000 that could be vulnerable to dishonest employees. My experience in the management of dental practices is that dishonest employees are few and far between, but it only takes one. Here are a few business coach tips to ensuring that the small portion of your receipts that are vulnerable are safeguarded:
- Balance your receipts EVERY day to the reports that your dental software produces detailing the day’s receipts. These reports generally detail how much cash, POS and cheques make up the day’s take. Ensure there is a reconciliation between the reports and the banking information.
- Ensure that whoever is balancing the cash is NOT the same person who is doing your books. Dividing the job of reconciling and recording your receipts creates a system of checks and balances.
- Make sure that your bookkeeper is reconciling your daily production, collections and banking information together. For every one of my clients, I create a monthly spreadsheet whereby the day’s production and collections are followed by a detail of where those collections went; bank deposit, Visa, MasterCard, Debit, Amex. I then use this information when reconciling the bank statements. There is no room for error and I know immediately if the day’s collections showed up in the bank!
Remember, with airtight systems in place, you are protected, and your employees are too – they can rest assured that their honesty and integrity is not ever in doubt. As a practice comptroller, I have always told my clients that I want to ensure that they trust me, but not on blind faith – rather, because systems are in place whereby they can KNOW that their hard earned money is accounted for.