Gather the Troops, continued

Reason #2... If you bring in a CPA too late, it can become a bookkeeping nightmare! Here's why...

Let's say you've just purchased a healthy dental practice. You found the practice through a broker, and went for it, without the help of a CPA or dental consultant. This is because you felt comfortable with your industry knowledge, and felt the price the practice broker put on the practice was fair.

You open a checking account for your new practice, start incurring some expenses, etc. You've even got some collections. So, now you've got a checking account with some activity. After operating this way for a while, you decide you need a CPA. Your new CPA suggests that it would be advisable to operate your practice as a corporation. After he/she explains why this is a good idea, you agree and you incorporate. This involves an attorney, articles of incorporation, stock certificates, etc. Meanwhile, you're still trying to run your practice.

Now, because you didn't talk to a CPA before, you need to open a different checking account for your new corporation, send new W-9's to all of your insurance companies, etc. You also need to start a new company file in Quicken. Then your CPA needs to straighten out two sets of books, decide where to draw the line on collections, expenses, etc. This is a huge hassle and involves a lot of $$ billable hours $$ for your new CPA.

So, again, if you're buying a dental or medical practice, or starting one from scratch, please get an attorney and a CPA involved early! They like billable hours, sure... but they would rather spend that time helping strengthen your practice, rather than cleaning up bookkeeping messes.