Year End Bookkeeping Health Check
February 15, 2018
The 31 March is a popular year end for many GP Practices and with this date fast approaching, ensuring that your books and records are correct and accurate will not only help assist your accountants but will also ensure that everything for that financial year has been considered.
However, with a practice / finance / business manager’s time being stretched more than ever, it can be difficult to know which areas to concentrate on and what you should be looking for. Using our knowledge from dealing with a vast array of practices we have created a list of common problem areas and how we suggest you deal with them:
Does your bank balance in your specific system match the balance shown on your bank statements? If not, do you have a list of differences or uncleared items at your year end? This is the most important area for you to check as if the bank is correct / balances then you know that all the transactions for income and expenses that pass through the bank have been included.
- Income streams
Have you fully analysed all your income streams, so you do not have large amounts labelled as CCG / NHS in your system, which could be broken down into enhanced services? This has become a problem more recently with local CCGs not sending remittances or making it clear what an amount or deduction is for.
Ensuring that your Open Exeter reports match what has been banked is vital. If it doesn’t, ensure that you have the remittance which shows what the extra income or deductions are for and enter this onto your system.
- Debtors (income that is owed to the practice)
At your year end you should have a list of services and individuals who owed you money for either enhanced services or for items such as insurance reports. It is also useful to know, especially for CCG income, which quarters have been paid as some services are paid a quarter in arrears.
Can your accounts package/system provide an “aged debtors” report? Are all the entries on there going to be paid and if not, should they be written off? Carrying forward old debts can complicate a system and can lead to chasing debts which will not be paid.
- Creditors (expenses that have not yet been paid for)
As with debtors you should have a list of people and businesses you owed money to at the year end. The largest ones would normally be for items such as drugs and medical expenses, with some being two or three months before payment is due.
If your system can produce an “aged creditors” report ensure that the list is accurate and does not hold any old balances or small differences which need to be removed.
As close to your year-end date as possible, take stock of all items, including reimbursable drugs, consumable items and stationery. Stationery has become a significant figure in recent years due to the cost of printer and toner cartridges.
- Professional expenses paid personally statements (PEPPS)
While not strictly a part of the practice’s records these should be made available alongside the accounts to ensure that nothing is missed and items which have been paid for by the practice are not duplicated. The GP partners may have been asked to fill in a questionnaire to provide the information required, please check that they have dealt with it.
A final note would be to ensure that the software you are using is up to the task and its functions match your specific requirements. With “Making Tax Digital” just around the corner, it is even more important that the software you are using is compliant with HM Revenue & Customs requirements .
These are just a few useful guidelines. Each practice is different and the systems you use will be unique to you, some of these tips will be more relevant than others. However, if you follow these steps it will give you a head start on your year-end to assist in ensuring the records are in the best position to be processed into the annual accounts.
If you would like to discuss your bookkeeping and year end processes, or you would like to speak with a member of our team, please contact Ben Brauer or call 01772 821021 to be put in touch with a member of our Healthcare team.