Overview
To achieve your business objectives you need to research, forecast and monitor your financial performance. Good financial management deals with the day-to-day cash-flow of a business and financial planning to meet future business needs. The success of your practice will depend on the right pricing structure, accurate management of operating costs and monitoring financial performance against forecasts.
Business and financial objectives go hand in hand; it will be your business activities that result in your business income and expenditure. Most businesses aim to maximise value while controlling their financial risks.
All businesses, whether new or established need to devote time to financial management. This advice provides a background to the different tasks you need to consider in managing the financial aspects of your dental practice.
Key learning points
This advice will help you to understand:
- The importance of financial planning and forecasting – identifying income sources and typical expenses to help you develop your cash-flow forecast
- How to monitor the performance of your practice using your financial records to develop financial controls and key performance indicators
- The financial state of your business based on information revealed by your profit and loss statement and end-of-year balance sheet
- How to manage financial difficulties – the preventative measures that you can implement quickly and when to seek professional advice
- The implications of bankruptcy, including your professional obligations and responsibilities towards your employees and your patients.