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FINANCIAL ASSESSMENT
These GP partners have far too much personal capital invested in their practice. By Laurence Slavin
The partners at this Midlands practice have an unusual problem: they are leaving profits languishing in the business rather than drawing them out.
In other words they have too much of their own cash invested in the practice - a situation that many GP practices facing a squeeze on funding would not have allowed to develop.
The practice, which is GMS, has a weighted list of 8,300 while registered patients number around 10,000. There are five whole-time equivalent (WTE) partners plus 2.5 WTE salaried GPs.
Further investigation
The annual accounts are an opportunity to look at how the practice is run and they highlightcertain issues, somerequiring immediate attention and others needing further investigation. For the year ended 31 March 2009, they show profits increased by 19.4 per cent while working capital (the financial resources left in the practice) increased by a massive 421 per centfrom£33,493 to£174,582.
This is not, of course, bad news, but why is much money so beingleft in the practice?
There is also a glaring error in the accounts. Since 2004, the employer'sshare of the partners' ownNHSpensioncontributions has been deemed by HM Revenue & Customs (HMRC) part of the global sum. Contractor GPs make increased superannuation contributions consisting of the...