You know the report ends up on your desk every morning?  The one that lists all your patients from the previous day, and you push it aside, maybe even place it on top of other similar reports, and then once in a while you tell someone to shred them?  That’s your Day Sheet.

It’s important to get into the habit of daily reconciliations to prevent embezzlement, both by catching suspicious acts early on and by letting your staff know you check all the deposits.  If you’re not already printing your Day Sheet, you can find it under:

  • Dentrix: Office Manager –> Reports –> Day Sheet (Charges and Receipts)….
    • You may also want to print the Deposit Slip to get the check totals
  • Eaglesoft: Reports –> Financial –> Day Sheet
  • Open Dental: Standard Reports –> Daily –> Daily Adjustments Report, Daily Payments Report, Daily Procedures Report, Daily Write-off Report

Here are the 5 things to check on every day sheet:

1. Check the payments entered against the cash, checks, and credit card receipts

Go line by line down the column of payments and match them with the cash, checks, and credit card receipts that you received.  Check each one off as you go.  Count the cash, down to the penny.  If you don’t make your own deposits, I would suggest pocketing any cash and writing a check from your personal bank account to the business in the same amount.  This prevents any “sticky fingers” between your daily reconciliation and the time it is deposited into your account.

2. Enter the payments into your accounting software as ‘Sales’

Once you have confirmed that all the payments have been received, enter them into your accounting software.  I personally use QuickBooks Online, mainly because that is what my accountant uses and I can give them direct access; but there are a number of different accounting software available so take your pick.

Enter the deposits as “Sales”, and not just a regular deposit in your bank account.  To make your life easier during monthly reconciliations, you should look at your bank statement to see how the deposits are made into your account.  For example, are credit card transactions combined into 1 deposit per day?  Or, are deposits recorded separately for each credit card terminal (if you have more than 1)?  Monthly reconciliations are frustrating enough that you don’t want to be adding up transactions to figure out which deposits to match them to, especially since the deposit dates on your statement are always 1-2 days after the actual date of business.

3. Scan the report for any unauthorized adjustments

One way for your staff to hide their embezzlement is through account adjustments (courtesies/discounts, write-offs, and refunds).

  • Mrs. Smith pays for her $100 filling in cash.  Your office manager takes $20 for herself, and records the payment as $80 cash and $20 courtesy
  • Mr. Booth pays $200 towards his crown.  Your office manager keeps the $200 for herself, and writes-off the balance so that it doesn’t show up on the Accounts Receivable/Aging report
  • Mrs. Thompson requests a refund for her last filling ($100), but the check is really made out to your office manager

This is how embezzlement happens for YEARS in dental offices before anyone figures it out.  Small amounts are stolen on a regular basis, and it is allowed to continue to happen because no one is paying attention to the small details.  At the end of the month, your monthly reconciliation still balances out and you are none the wiser!

4. Scan the report to make sure the proper procedures were charged out

Every patient on the schedule should appear on the Day Sheet, even if they came in for an Office Visit at $0 charge.  Here, you are looking to make sure the proper procedures were charged out – be on the look out for missing procedures, and additional, unperformed, procedures.

If procedures are missing, then your office manager is either forgetting to charge out the procedure or, they could be pocketing the  money and not recording both the charge & payment.  If unperformed procedures are charged out, then they could be committing insurance fraud.  For instance, the office manager overcharges the patient’s insurance with extra procedure codes, and when the patient receives the insurance check, the office manager instructs the patient to endorse the check to them or has them pay the equivalent in cash and pockets the money.

Whatever is happening, first give your staff the benefit of the doubt.  They could be just forgetting or missing steps, or maybe they need more training.  Bring this issue up and give them a chance to improve – either they truly messed up and are going to do better, or, if they are in fact embezzling from you, they now know you are on the look out for suspicious activity.  Accusations of theft are not something you can come back from, and you better have evidence to back that up, so that is a discussion for a different time.  Right now, we’re talking about prevention and nipping the problem in bud.

5. Scan the report to make sure charge amounts look normal

Similar to the way cash can be skimmed with adjustment codes, procedure codes can be edited to a lower fee so it looks like 100% payment was received.  This would be especially easy for fee-for-service (non-insurance) practices.

At this point, I can hear you saying “how do I have time for this??”

Well, let me put it to you this way – it doesn’t take me very long to complete each daily reconciliation.  I have it down to a system, and it doesn’t take me more than maybe 5-10 minutes per day (depending on the number of transactions).   Estimates of embezzlement occurring in dental practices range from 35% (Levin Group) to as high as 60% (Dentistry IQ), and the average loss is around $100,000!!!  By not performing daily reconciliations, you are putting yourself into the high risk category for embezzlement so you need to block off the time to do it.