Managing accounts receivable

Q How do the levels of accounts receivable compare in a companion animal practice to an equine practice? What's a reasonable level of accounts receivable for both?

"Ideally, accounts receivable will represent no more than 1.6 percent of annual revenue in a well-managed companion animal practice," says Denise Tumblin, CPA, president of Wutchiett Tumblin and Associates in Columbus, Ohio. "In a well-managed equine practice, accounts receivable typically represent 10 percent to 11 percent of annual revenue." To calculate your percentage, she says, divide your total accounts receivable by your annual revenue.

Denise Tumblin