CHECK YOUR BANK BALANCE

Doing bank reconciliation is probably one of the most important aspects of your business. There is no point in fussing about claiming, transaction checks and follow up if this aspect of your debtor/admin control is neglected.

Rule of thumb:    
BANK DEPOSITS = RECEIPT BOOKS (OR TILL SLIPS) = COMPUTER PRINT OUT

There are various methods of balancing and the choice is yours however, the method you chose should remain consistent. 

TIP 1: At the end of the month when you close off and there are still outstanding remittance advices however the money has already been paid into your bank account, you could enter the receipt into a control account. (You could call this account “Remittance Control Account” With this method your banking and computer system will always balance. However when the remittance arrives, this money should be entered onto the correct patient account.  This involves one journal to clear the control account which is followed by posting the money as usual to the correct member account. 

This won’t alter your overall figures because it is a straight debit and credit. The correct system journal must be used to ensure that the VAT is adjusted accordingly.
Please note that this should only be done at month end and the receipt should be cleared with in a few days. This account must not grow.

TIP 2: Accept the fact that there is money in the bank for which you have no remittance. Accept that your receipts captured and banking will not balance. The important aspect is that you record the pending payments manually.  Specifically at month end you should cross check you balancing by adding the receipt total on your computer print out plus the missing/pending remittances and this should balance to your bank statement. If you outsource to an accountant it is particularly important to share this information.

For both options the remittance advice could be delayed longer than expected, due to the normal gremlins that creep in. My advice to you is track it down so that your patients don’t get accounts from you when the medical aid has notified you them that the account has been settled. This could be rather embarrassing and also causes unnecessary expense of postage on what are actually paid up accounts.

TIP  3: A suspense account may also be used for those unknown payments. To be able to balance your books to your bank account these also need to be recorded. As it so happens you will sometimes be paid in error. When posting to the suspense account you should enter a comment or as much information as possible.  Once you have traced the person you need to either do a refund or credit the now known patient account.