The Dental Practice Financial Calculator

(Note: Click on the Bold Link to view a software segment.)

Accounting Input is for actual data input and reveals monthly actual results in a trial-balance income statement. There are only 28 data fields that must be recorded each month. They can easily be entered by the accountant over a secure Internet connection. When the user adds data from the monthly trial-balance reports (prepared by most practice accountants or business software), it should only take a few minutes each month to enter the data.

Productivity Input collects information about practice productivity in only three fields for each dentist or hygienist. That data can be entered each month by the bookkeeper or office manager. The productivity graphics generated from this data help users understand the owner's individual productivity and compare the performance of other working professionals in the practice. This tab helps reconcile monthly in-balance between revenue reported in the practice financial statements and monthly productivity records.

The Control Panel enables the user to compare historical financial data against a projected financial model, which helps with practice planning. This detailed data provides the statistics that help users make crucial practice decisions and get a clearer view of the future. The Control Panel also lets users generate "What If" probability analyses that project the effects of various planning strategies by simply changing any variable (e.g. patients per day, billing rates, days worked, open hours, number of employees, etc.).

The Activity Based P & L separates the conventional income statement into four major Activity Based categories. This report enables the user to quickly understand the financial drivers that affect the profitability of the practice and spot unusual items that may require further investigation.

Dashboard (Stoplight) Graphics - On one screen you can view six key graphics that alert you of any variances that must be addressed. There is a graph for all four Activity Based categories, and a similar graph for Profit and Cash in the Bank. All graphs highlight the same information for each respective category.

Productivity Graphics - Dentist and hygienist productivity appears clearly in graphical form and assist hygienist, associate dentist, and the practice owner set and measure reasonable productivity objectives. These reports can also be used for performance reviews or other communications with professionals. The graphics were also designed to give a new practice owner, who may have little prior management experience, a tool to discuss productivity with employees.

Percentage Graphics - Activity Based categories are expressed as a percentage of Dental Service $s Provided. This allows the user to quickly see expense trends and monthly variances.

The Cumulative Income Statement Graphic shows a graphical view of the cumulative dollars and the percentage of Dental Service $s consumed for each activity based category.

The Fair Market Value Appraisal (FMV Tab1) is divided into three tabs for easy viewing and printing. This valuable document estimates a dollar value for the business and can also be used as a financial document for a potential buyer to secure financing to purchase a practice. When viewed or printed, the information in these three tabs helps simplify various business transactions or legal issues, such as assigning a value for a practice for pending partnerships or other practice buy-in agreements. This document could be used in wills, estate plans, divorce settlements, or other disputes. Our team devoted many hours reviewing the financial documentation that judges use when deciding how to value small businesses.

» Fair Market Value Appraisal (FMV-Tab-2)

» Fair Market Value Appraisal (FMV-Tab-3)

The Get Started process teaches practice owners how to use the software in one hour, while they calculate the Fair Market Value of the practice.

The Partnership Calculator This tool presents users with a choice of three easy-to-understand, logical formulas for compensation and profit distribution. In other words, this is where partners go to understand and agree upon the compensation and profit distribution. These methods simultaneously encourage individual productivity.

The Current Financial Rates The financial rates used to calculate the Fair Market Value appraisal are updated on the first day of every month and posted on our Web site. Both the financial rate and financial criteria that we use for the FMV calculation can be updated or replaced with different rates or criteria that you or your financial advisor feel are more appropriate for your practice.