Key Takeaways

• Filing your tax return on time does not mean your accounting relationship is strategic or proactive.
• Dental practices require industry-specific financial insight, including overhead benchmarking and cash flow analysis.
• If your CPA only engages at tax time, you may be missing planning opportunities that affect profitability and long-term value.
• Clean, timely bookkeeping is essential for accurate tax reporting and confident decision-making.
• You should understand your numbers clearly without jargon or confusion.
• Choosing an accounting firm that works exclusively with dental practices can provide deeper, more relevant guidance.

Most dentists don’t wake up thinking about their accounting firm.

If your tax return gets filed on time and your CPA answers emails eventually, it’s easy to assume everything is working. After all, your focus is patient care, team leadership, and keeping the schedule full. Accounting may feel like something that simply needs to “get done.”

But the right accounting relationship should do more than produce a tax return or monthly books. It should give you clarity, confidence, and control over the financial engine of your practice. If it doesn’t, you may be operating with blind spots you don’t even realize are there.

Indicators Your Current Accounting Firm May Not Be the Right Fit

You’re not clear on what they actually do for you

Every accounting relationship should begin with a clearly defined scope of services. The AICPA emphasizes the importance of engagement letters that outline responsibilities, limitations, and expectations so there are no misunderstandings later.

If you can’t confidently explain what’s included and not included in your monthly services, who is responsible for bookkeeping accuracy, and what happens if something goes wrong, then the relationship may be too vague to protect you. A well-defined scope isn’t about paperwork. It’s about accountability.

Your relationship is tax-focused, but your business decisions aren’t

Filing a tax return is compliance. Running a dental practice requires financial strategy.

If your accounting firm only engages with you during tax season, you may not be getting the guidance you need for decisions such as:

• Hiring another hygienist
• Investing in new technology
• Adjusting fees
• Adding an associate
• Reducing insurance participation
• Planning for an eventual transition

Tax preparation looks backward. Business strategy looks forward. If no one is helping you connect those two, you’re likely missing opportunities or exposing yourself to risk.

Your books don’t tell a clear story

The IRS is clear that business owners must maintain records that support income and deductions and clearly reflect business activity.

If your financial records regularly require last-minute cleanup, reclassification, or reconstruction at tax time, that’s a signal that your accounting system isn’t functioning properly.

In a dental practice, that can be especially problematic. Production, collections, payroll, lab costs, and supply expenses move quickly. Without clean monthly reporting, you may not notice overhead creep or margin compression until it becomes significant. You shouldn’t feel unsure about whether your books are accurate. You should trust them.

You don’t understand your overhead or how it compares to other dental practices

Dental practices operate on relatively tight margins. Industry sources commonly cite average overhead in the low 60% range for general practices, with variation depending on specialty and location. That benchmark doesn’t dictate how your practice should run. But without context, numbers lack meaning. 

If your accounting firm never references industry norms, never discusses trends in your expense categories, and never helps you interpret your results, you’re operating without a frame of reference. You don’t need generic advice. You need informed interpretation.

Cash feels unpredictable even when production is strong

Profit and cash flow are not the same thing. Loan payments, equipment purchases, quarterly tax estimates, and timing differences in insurance collections can create tension even in a profitable practice.

If your accounting firm can’t clearly explain where your cash is going, or why certain months feel tight, that’s not just frustrating; it’s limiting your ability to plan confidently. A strong accounting partner should be able to translate your financial statements into plain language and connect them to operational reality.

Data security is treated casually

Dental practices are already highly regulated when it comes to patient information. Your financial and tax data deserve the same level of care. The Federal Trade Commission’s Safeguards Rule highlights the importance of maintaining a written information security program to protect sensitive data.

If your accounting firm cannot clearly articulate how they protect client data beyond saying “we’re careful,” that’s worth examining. Security isn’t optional; it’s part of the service.

You leave conversations more confused than when you started

This may be the simplest indicator of all. When you ask a question about taxes, compensation, debt, or practice value, do you receive clarity or jargon?

Dentists are highly educated professionals. You shouldn’t feel intimidated in financial conversations. If you consistently walk away unsure of what was decided or why, the communication gap may be limiting your growth.

Questions to Ask When Evaluating an Accounting Firm

If you’re reconsidering your current relationship or evaluating options, here are a few practical questions to guide the discussion:

• What percentage of your clients are dental practices?
• How do you help owners interpret monthly results, not just prepare tax returns?
• What does your month-end close process look like?
• How do you ensure our books support our tax reporting cleanly?
• How do you protect client data?
• Who will actually be doing the work on my account?

The AICPA recommends interviewing CPAs and asking direct questions about specialization, experience, and client expectations before engaging a firm. You are hiring a strategic partner, not just a preparer.

Your Practice Deserves More Than Basic Compliance

Many dentists stay with an accounting firm out of habit, in part because changing feels disruptive. But the cost of staying in the wrong relationship can be much higher than the inconvenience of transitioning.

The right accounting partner should help you:

• Understand your numbers
• See risks before they become problems
• Make informed hiring and investment decisions
• Build a practice that supports your long-term goals

If your current firm isn’t providing that level of clarity and confidence, it may be time to reevaluate the fit. At Edwards & Associates, we work exclusively with dental practices, helping owners move beyond basic compliance to truly understand their numbers and make informed, strategic decisions. Reach out if you’d like to learn more.