Dental Practice Bookkeeping: A Month-End Checklist

Quick answer: Dental bookkeeping at month end is a short, repeatable list: reconcile bank and card accounts, tie deposits to collections, review insurance and patient A/R, review adjustments and write-offs, tie payroll, record supplies, lab and loans, then read the financial statements. Done in the same order every month, it keeps the books current and the numbers believable.

Production is not collections, and collections is not the bank deposit. A good close explains each difference between the three.

Most dentists do not need a longer process. They need a repeatable one. This checklist is the order we follow when we close the books for dental practices. It is written for the owner or office manager, so you can use it to run your own close or to check what your dental bookkeeper is doing. If your books are already months behind, start with our post on catch-up bookkeeping for dental practices first, then use this list to stay current.

Key takeaways

• Close in a fixed order. Cash first, then deposits and collections, then A/R, adjustments, payroll, supplier and lab costs, and loans.
• Three numbers must be explained, not forced to match. Production, collections and the bank deposit differ for real reasons, and each difference should have a cause.
• Insurance and patient payments are tracked separately. Their A/R ages differently and needs different follow-up.
• Adjustments and write-offs deserve a monthly look. They are where revenue quietly shrinks.
• Payroll and loans are tied to outside documents. Payroll reports and lender statements are the proof.
• A close ends with a review, not just a reconciliation. Read the statements and write down the open questions.

Want someone else to run the close? Our team does it monthly. Book a free 20-minute call.

Before you start: what to have in hand

A close goes faster when everything is in one place. Gather these for the month:

• Bank and credit card statements for every account
• Practice management reports: production, collections, adjustments, deposit detail and A/R aging
• Merchant processing and patient financing statements
• Payroll reports for each pay date and any tax deposit confirmations
• Loan and equipment financing statements
• Supplier and lab invoices

The IRS notes that deposit slips support gross receipts, and that a bank statement can prove a payment only if it shows details such as the check number, amount, payee and date posted. Proof of payment alone does not establish a deduction, so keep the invoices too (irs.gov, Publication 583). That is why this list pairs each account with its supporting document.

Step 1: Reconcile every bank and card account

Compare the ledger to the statement, account by account. Every deposit, withdrawal, transfer and fee should be matched or explained. Check for:

• Duplicate or missing entries
• Transfers between accounts recorded on only one side
• Personal spending run through the practice
• Deposits no one can explain yet

Do this first. Nothing else in the close can be trusted until cash is right. Our dental bookkeeping services start every month here.

Step 2: Reconcile production, collections and deposits

This is the dental-specific heart of the close. Three figures describe the same month in different ways:

Collections should tie to deposits, adjusted for timing and fees. Match the daily or weekly deposit detail to the collections report and list what is left. The usual reasons for differences:

• A payment posted on one day and deposited on another
• Card processing fees taken out before the deposit lands
• Patient financing payouts that arrive net of fees
• Insurance payments posted to the wrong day, patient or provider
• Refunds netted against deposits

Production against collections is a different comparison. It is not meant to tie. The gap is made up of insurance write-offs, discounts, uncollected balances and timing. Track the gap, and review what is in it, which leads to the next steps.

Step 3: Separate insurance payments from patient payments

Insurance and patient payments behave differently, so the books should show them separately.

Insurance. Match insurance deposits to the explanation of benefits (EOB) or electronic remittance advice (ERA) where you can. Look for short pays, denied claims that no one has followed up on, and payments applied to the wrong patient. One insurance deposit often covers many claims, so deposit detail matters here.

Patients. Patient payments include cash, checks, cards, financing and payment plans. Confirm that card and financing receipts, net of fees, equal what the bank received. Check that payment plan balances in the software agree with what you expect to collect.

When insurance and patient payments are mixed into one line, you cannot tell which kind of balance is aging.

Step 4: Review A/R aging and patient credit balances

Run the accounts receivable aging report. It groups unpaid balances by how long they have been outstanding, typically current, 31 to 60 days, 61 to 90 days, and over 90 days, and should separate insurance from patient balances.

Ask:

• Which insurance claims are over 60 days with no activity?
• Which patient balances are growing without a payment plan or a statement going out?
• Do the A/R totals in the software agree with what the books show?

Also look at credit balances. A credit balance can mean an overpayment, an insurance payment applied to the wrong account, or a posting error. Some credits are owed back to a patient or payer. List them for the owner to decide rather than writing them off. Rules about refunds and unclaimed property vary by state, so ask your attorney.

Step 5: Review adjustments and write-offs

Adjustments are the quiet part of dental revenue. They include insurance contractual write-offs, courtesy and professional discounts, and bad debt write-offs.

Each month, look at the adjustment report for:

• Large or unusual adjustments, and who posted them
• Write-offs that appear without a note
• Changes from the usual mix of adjustment types

You do not need a benchmark to find a problem. A change from your own prior months, with no reason you can name, is the signal. Give the owner or manager a short list of anything unusual.

Step 6: Tie payroll to the bank and the reports

Payroll is where small errors become penalties. Each month:

• Match gross wages, withholdings and employer taxes on the payroll reports to the ledger
• Match payroll debits in the bank to the reports
• Confirm tax deposits were made on time. The IRS says there are two deposit schedules, monthly and semiweekly, and employers who withhold income tax, Social Security and Medicare file Form 941 each quarter (irs.gov, Depositing and reporting employment taxes)
• Check that benefit and retirement plan contributions were recorded and sent

If an associate dentist or other worker is paid as a contractor, confirm the classification was reviewed. Our dental accounting services include payroll tie-out as part of the monthly close.

Step 7: Record supplies, lab and software costs

Supplier and lab invoices drive a large part of a practice's costs. At close:

• Enter or confirm every invoice for the month, coded to supplies, lab, software or other lines
• Compare each category with prior months and look at changes you cannot explain
• Check for invoices paid but not recorded, or recorded but unpaid
• Check recurring charges on cards, such as subscriptions you no longer use

Lab cost should track with the work you did that month. If it does not, ask why before you close the month. A late lab invoice that lands in the next month makes this month look better than it was.

Step 8: Update loans and equipment financing

Every loan payment has two parts, interest and principal. Interest is an expense. Principal reduces the loan balance. Booking the whole payment as an expense overstates cost and hides the debt.

Each month, compare the loan balance on the books with the lender's statement. New equipment belongs on the balance sheet as an asset when you buy it. How to treat it on your tax return is a separate decision, made with your CPA, not at the keyboard during the close.

Step 9: Review the statements and carry open items

When the numbers are posted, read them as a set:

• Does the profit and loss look reasonable against collections?
• Is the balance sheet clean: no unexplained cash differences, no old unreconciled items?
• Are any accounts, such as "ask my accountant," holding amounts that should have a real home?

Write down what is still open and who owns it. Carry that list into next month's close. A short open-items list is normal. A growing one means the process needs attention.

Printable month-end checklist

Copy this list and check it off each month.

Cash

• All bank accounts reconciled
• All credit cards reconciled
• Transfers matched on both sides
• Unexplained deposits listed

Revenue

• Production, collections and adjustments reports pulled
• Deposits tied to collections, differences explained
• Insurance deposits matched to EOB or ERA
• Patient payments, card and financing receipts tied to net deposits
• Refunds recorded

A/R and adjustments

• A/R aging reviewed, insurance and patient separate
• Credit balances listed and decided
• Adjustments and write-offs reviewed for unusual items

Payroll

• Payroll reports tied to the ledger and the bank
• Tax deposits and quarterly returns confirmed
• Benefit and retirement contributions recorded

Costs and debt

• Supplier and lab invoices entered and coded
• Recurring charges reviewed
• Loan balances match lender statements, interest split from principal
• New equipment recorded as assets

Review

• Profit and loss and balance sheet read
• KPIs reviewed
• Open items listed with owners

KPIs to review after the close

Once the books are right, a few measures turn them into decisions. These are definitions only. What counts as good depends on your practice, and we do not give outside benchmarks here.

Track each one against your own prior months. A trend in your own numbers tells you more than a number from someone else's practice.

When to hand off the close

You can run this yourself, or hire a dental bookkeeper, if someone has the time and a consistent routine. The risk is that the close slips when the schedule is full, and slipping is how practices end up months behind. If that happens, the answer is a catch-up and then a fixed routine.

We are a CPA firm founded in 1985 in Lisle, Illinois, with 20+ years in healthcare, serving dental practices nationwide, fully remote. We do not quote bookkeeping from a price list. We scope it after a free call. Our dental bookkeeping services run this close every month.

Ready to stop doing the close at midnight? Book a free 20-minute call and tell us which software and accounts you use.

Frequently asked questions

What should a dental practice do at month end?

Reconcile every bank and card account, tie deposits to the practice management collections report, review A/R aging and patient credit balances, review adjustments and write-offs, tie payroll to the bank and the payroll reports, record supplier, lab and loan activity, then review the financial statements and carry open questions into next month.

Why do my deposits not match collections in my dental software?

Common causes are timing (a payment posted on one day and deposited on another), card processing fees taken out before the deposit, patient financing payouts that arrive net of fees, insurance payments posted to the wrong day or patient, and refunds netted against deposits. A reconciliation lists each difference and its cause.

What is the difference between production and collections?

Production is the value of the services provided, usually at your fee schedule, before adjustments. Collections is the money actually received from patients and insurance. The two differ because of insurance write-offs, discounts, timing and uncollected balances, so a practice can have strong production and weak collections.

How often should a dental practice review accounts receivable?

Monthly at minimum. An A/R aging report groups unpaid balances by how long they have been outstanding and separates insurance from patient balances. Reviewing it every month shows which balances are aging while follow-up is still easy.

Can my dental office do its own month-end close?

Yes, if someone has the time and a consistent routine. The risk is that the close slips when the schedule is full. If your books are already behind, start with a catch-up and then keep a fixed monthly routine, whether in-house or outsourced.

Sources

• IRS, Publication 583, Starting a Business and Keeping Records
• IRS, Depositing and reporting employment taxes

Last updated: October 2026.

This article is general information, not legal or tax advice.

Soriaga & Associates, LLC is a CPA firm founded in 1985 in Lisle, Illinois, serving home health, hospice, home care, wound care and dental providers nationwide. (630) 491-1268.