Standardized chart of accounts can boost practices’ financial health

Available free to all veterinarians

chart-of-accounts-vets-at-computers-350x233Traditionally, the accounting methods of individual veterinary practices have been as diverse as the owners themselves. Times are changing, though … and for the better. Individual veterinarians now have access to a free, powerful finance tool that will help you better assess and ultimately improve your practice’s financial health.

Through a partnership led by the AVMA, American Animal Hospital Association (AAHA), Veterinary Management Groups (VMG), VetPartners and the Veterinary Hospital Manager’s Association (VHMA), AAHA’s previously “members-only” Chart of Accounts has been revised, expanded and made available to all veterinarians free of charge. We encourage all practice owners and managers to download the revised AAHA/VMG Chart of Accounts and begin using it in your practice.

What exactly is the AAHA/VMG Chart of Accounts? Simply put, it’s the standard for classifying revenue, expense and balance sheet accounts in small animal veterinary practice.

The human dental and medical professions have long recognized that a lack of standardization in their practitioners’ charts of accounts, diagnostic codes and procedures is an impediment to success.

“Standardization of the veterinary chart of accounts is crucial in gathering data essential to strengthening practice profitability, individual financial well-being and enhancing the veterinary workforce as a whole,” said Dr. Link Welborn, former chairman of the AVMA’s Veterinary Economic Strategy Committee, past president of AAHA and president of VMG .

By using the AAHA/VMG Chart of Accounts, practitioners can better organize their finances in line with generally accepted accounting principles. This allows an apples-to-apples comparison of productivity, costs and profitability, which helps veterinarians assess the financial health of their hospitals.

It also helps create a better picture of the veterinary profession’s overall economic health. This, in turn, should allow the AVMA and other industry leaders to better develop and assess initiatives to improve the economic health of veterinarians and the veterinary profession.

How did the AVMA get involved?

The AVMA’s Veterinary Economics Strategy Committee is charged with bringing the profession together to facilitate collaboration necessary to improve business knowledge, acumen and financial success. The committee initiated the profession-wide Economic Advisory Research Council, which took on the task of making a standardized chart of accounts available for free to all veterinarians.

As a high-value financial-management resource, the AAHA/VMG Chart of Accounts is the cornerstone of a much broader economic initiative. It is the first of many new resources to come from this collaboration.

“As a trusted partner, the AVMA is committed to working in partnership with colleagues to develop programs that will help every veterinarian meet their professional and personal goals, whether they are just graduating from veterinary school or looking toward retirement,” said AVMA President Dr. Tom Meyer.

The AVMA, VetPartners and the Veterinary Hospital Manager’s Association have all endorsed the AAHA/VMG Chart of Accounts as the industry standard. AAHA also recommends that all accounting firms working with veterinary practices adopt the standardized codes.

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