Clean Books, Stronger Offers: Your September Financial Tune-Up

If you’re thinking about transitioning your dental practice in the next one to three years, here’s a question worth sitting with: if a buyer’s lender opened your books tomorrow, what would they find?

Not what you’d find. You know where everything is. What would a stranger find — a stranger deciding whether to hand someone $900,000 to buy your life’s work?

September is the perfect month for this tune-up. You still have a full quarter to clean things up before year-end financials get locked in — and those year-end numbers are exactly what buyers and banks will study hardest.

Buyers Pay for Proof, Not Potential

Every seller believes their practice has upside. “A younger doctor could add implants.” “We’ve never marketed.” All probably true — and none of it changes your practice’s value the way clean, verifiable numbers do. When we value a dental practice, the buyers and lenders on the other side are looking at three things above everything else:

• Collections — trending and consistent. Three steady years beats one spectacular year. If 2026 is on pace to dip, now is the time to understand why and document it.
• True profitability. Your EBITDA after normalizing your own compensation and the personal expenses running through the practice. Every dollar of “gray area” spending muddies the water.
• Clean accounts receivable. A bloated 90-day-plus AR column tells a buyer your front desk isn’t collecting — and they’ll price that problem into their offer.

The Personal Expense Problem

Let’s be direct about the most common issue we see. The cell phones, the vehicle, the family member on payroll who’s rarely in the building — every practice has some of this. Buyers understand it. But here’s the mechanic most sellers miss: every personal expense has to be identified, documented, and “added back” to show true profit. Add-backs a lender can verify get counted. Add-backs that live only in your memory get discounted — or thrown out entirely.

A practice showing $60,000 in undocumented add-backs can lose multiples of that in the final sale price. The fix costs you nothing but a conversation with your CPA this fall.

Your Q4 Tune-Up Checklist

Here’s what to tackle between now and December 31:

• Reconcile your production and collections reports with what your P&L actually shows. Discrepancies spook lenders.
• Move personal expenses out of the practice — or at minimum, tag every one of them so your CPA can build a defensible add-back schedule.
• Chase your AR now. Collections you bring in this quarter show up in the year-end numbers a buyer will see.
• Document your fee schedule and PPO participation. Buyers want to know exactly what they’re stepping into.

Why This Month, Not January

Because January is too late for 2026’s story. Once the year closes, the numbers are the numbers. A September tune-up means your strongest year-end financials ever land right as you’re ready to go to market — and in this Arizona market, with buyers and DSOs still competing hard for quality practices, strong books create bidding pressure.

At Frye Practice Sales & Healthcare Real Estate, we review financials with sellers long before a practice ever goes to market — quietly and confidentially.

You’ve spent years building the practice. Spend one quarter making the books prove it. You’ll thank yourself at the closing table.