Effective Analysis of Your Practice Financials – Think Big, Then Small
A typical profit and loss statement may contain thirty or more different expenses categories, making it easy to get lost in the minutia when searching for the things that matter most to your financial success. In a previous post, I mentioned revenue as being the more important number on your P & L. While this is true, you must also pay careful attention to how you spend that revenue in order to maximize profits.
Getting out of the Weeds
Instead of culling thirty expense accounts for the items that matter, consider stratifying your expense accounts into broader categories and comparing your performance in those categories to industry standards or internal benchmarks. Here is how that looks: