ABSTRACT
If the book-keeping system in use in the practice is fairly comprehensive, there is no reason why detailed accounts cannot be prepared in a format that will make them a very useful tool for the management of the practice. There is no statutory obligation on a dental surgeon to produce annual accounts. Before looking at typical accounts and the sort of information that can be gleaned from them, it would perhaps be appropriate to consider how a dental practice is funded and how it operates in general terms. If the permanent capital is very much less than the total of borrowed capital the business is said to be 'high geared' and risky because, in the event of an economic downturn, interest will continue to accrue on borrowed money, irrespective of what happens to profit margins. Current liabilities are 'immediately payable' because they do not enjoy the longer contractual delay of the long-term debts.
