Given the current turbulent political and economic state of both the United States and many other key world powers, a variety of financial experts are predicting something ranging from a significant economic slowdown to another full-blown recession. While times may be good now, physicians should examine the lessons many doctors learned the hard way and act now, while they still have the time and resources to prepare. Worst case scenario, those predicting rough seas are wrong, and you’ve merely made your continued success more predictable and better defended.

“Work as hard as you can” is not a business plan. You must understand key issues at your practice like your fixed expenses, cash flow, projected earnings, and the options available to manage them. Many practices and their owners lack the liquidity to sustain their current high levels of fixed business and lifestyle overhead with existing cash. Think about what an earning or cashflow change would do to your business. Is the core personal and business planning you have in place complete? Would it adequately protect your business and family in a crisis? What are your essential overhead items and what would you cut or change first, both personally and in your practice, to reduce overhead so it could be reallocated? Be sure you know your “survival number” and plan to be able to sustain it.

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Polk & Associates

Large enough to serve a diverse clientele, yet small enough to maintain a hands-on approach, we are committed to maintaining the highest accounting and ethical standards with continuous education, extensive research resources, and excellent quality control.

Polk and Associates is a member of the Michigan Association of Certified Public Accountants, and the American Institute of Certified Public Accountants. The firm participates in the AICPA Peer Review Program, and has always received the highest level of award for its audit practice and quality control.