ABSTRACT
General practitioners (GPs) wishing to take up a personal medical services option, which will look increasingly attractive, will need to reconsider their financial future carefully, especially older GPs who need to protect their pensions and those partnerships who have bought their own premises. The majority of practices employ external accountants who carry the responsibility for reporting on the financial situation. Companies are obliged by law to prepare a set of financial statements each year. It is in management accounting that financial information is analysed and disseminated in a user friendly form as a basis for decision making. Practices need to develop robust financial control systems as a matter of urgency. A cash flow forecast is a first step towards understanding the practice finances. GPs no longer rely entirely on capitation and item of service payments, and gradually over the years different reward schemes have emerged to encourage a quality service.
