Monthly Archives: March 2012
What records should your veterinary practice keep, and how long should you keep them? There are several categories of records that are important to a practice, some for internal purposes and some for tax returns and other government requirements. Let’s take a look at these by category.
- Tax records. First, consider the records you need to substantiate your annual income tax return. The IRS says that you must maintain adequate records, to support the items of income and expenses that you claim. That means you must be able to produce receipts, invoices, cancelled checks, or banking records supporting expense items. Similarly, you should keep sales slips, invoices, or bank records to support income items.
- Accounting records. Most practices have adequate accounting systems to capture routine transactions, but not for nonroutine transactions such as the purchase of depreciable assets. When you buy a car, computer, or piece of office equipment, be sure to file all purchase documents, assign an inventory number, and immediately set up a depreciation schedule.
- Travel and entertainment expenses. Good recordkeeping for travel and entertainment expenses is essential. Although the rules can be complex, in general you should capture where, when, who, how much, and the business purpose for each expense. A well-designed standard expense report form can help insure that your records contain all the required information.
- IRS audits. Generally, the IRS can audit a tax return for three years after the date it was due or the date the tax was paid, whichever is later. However, if there is a major understatement of income, they can audit for six years after the due date (or seven years after the tax year). For that reason, you should keep most income tax records for seven years.
- The IRS requires records relating to employment taxes to be kept for at least four years after the date of the return or the date the tax was paid, although here again a seven-year rule is safer.
- Corporate records. Every incorporated practice (or Limited Liability Company) needs good corporate records, including documents associated with forming the company, bylaws, business licenses, and minutes of all board meetings. Shareholder records should include stock registers and records of all share issuances and redemptions. Also keep copies of all contracts and leases. Finally, don’t forget current and terminated employee files, and records of employee pension or profit sharing plans. Most corporate and employee pension plan records should be kept indefinitely.
- Computer recordkeeping. The IRS has established a series of rules and recommendations concerning how electronic records must be maintained. Generally, such records should contain the same information as paper records and should be kept for the same length of time.
Now is a good time to start planning for the rest of 2012.
Practice owners are often concerned about how to best protect their patient base when an associate leaves the practice. There are two methods of preventing this type of devastation to a practice, which are: (1) non-compete agreements and (2) trade secret agreements. Both of these types of agreements should be incorporated into an associate’s employment agreement.
A non-compete agreement allows the owner of a practice to limit a former associate from starting his or her own practice as well as prohibit an associate from working for a competitor. The owner of a practice should always consult with their attorney before entering into any type of non-compete agreement.
A trade secrets provision in an associate’s employment contract will also help protect confidential information of a practice. A trade secrets provision should provide that all patients and their confidential information are trade secrets of the practice, and sanctions will be enforced against any associate or employee who attempts to use this confidential information for their own personal gain.
The owners of a practice must be familiar with non-compete and trade secrets agreements. All associates should be required to sign a non-compete and a trade secrets agreement at the beginning of their employment.
Without a proper non-compete and trade secrets agreement, either prepared separately or incorporated into an associate’s contract, the owner of a practice has substantial financial risk.
Due to the increasing public concern regarding oral cancer, it is important for dentists to be aware of proper patient assessment and documentation procedures so that they may provide timely and proper treatment to their patients.
The U.S. Department of Health and Human Services states that oral pharyngeal cancers affect around 30,000 people per year in the United States, with around 8,000 of those cases resulting in death. A good deal of malpractice claims against dentists in the United States involve oral cancer cases.
For every dental practice, correct patient assessment is the first step in minimizing any risk to future legal entanglements. When assessing a patient and planning a treatment strategy, dentists should first carefully review the patient’s medical history to note any predisposing oral cancer factors. Next, a comprehensive oral evaluation should be completed.
This full examination should be followed with a review of oral radiographic images in order to note any potential abnormalities in the bones and dentition of the patient.
Properly documenting the patient assessment is just as important as accurately assessing the patient. In order to satisfy the basic standard of care, all dentists are required to perform these evaluations and note all the results from the examination in the patient’s permanent record.
In cancer cases, it is crucial that a treating dentist contact the patient’s oncologist to determine if any special precautions should be taken for the patient before and after undergoing medical treatment, such as chemotherapy. It is also essential that the medical history dictated in the patient’s record include information regarding whether or not the patient has undergone such medical treatment.
Dentists must carefully follow all procedures in the practice in order to help them avoid legal pitfalls. Properly assessing and examining the patient and documenting the patient’s record will not only keep the dentist out of legal trouble, but it will also provide the patient with positive dental care service.