Accrual Basis Accounting 

There are 2 methods of accounting - cash and accrual. Most dental offices use cash basis accounting rather than accrual basis accounting. 

Here we will discuss how to use EZ 2000 Plus with accrual basis accounting:

Current Guidelines
1. On the Security window (bottom), use the lock date feature to 'close out' each month.
2. After you lock, you should run monthly reports.  Do not ever unlock to make historical changes.
3. PPO writeoffs: See Report Setup, where it discusses the option for "Default to using Proc Date for PPO writeoffs". 
    Use method 2 (insurance payment date) to avoid changing history.

Unearned Income
Unearned Income Type is a PaySplit field.  This allows flagging some Payments as pre-payments.  The reason for this flagging is due to offices that use accrual accounting and must not yet report that as income.  So the prepayment total can be subtracted from income for accounting purposes.  In Definitions, you can set up different types of prepayments for accounting purposes.  Once a paysplit is flagged as unearned income, it will show in red at the top of the Account module. The patient account balance will be affected by unearned income split in the normal manner so that the patient can see that they have prepaid.  To remove the unearned income from an account, a second entry should be made at a later date.  The second entry is a zero entry with two balancing paysplits, one to reduce or remove the unearned income, and the other to increase income.  Two Reports show unearned income liabilities (total amounts) and unearned income activity (date range).

Frequently, offices will use a dummy Provider to track unallocated income.  If cash basis accounting is used, there's no point in going to the extra work of also tracking unearned income as described above.  Tracking unallocated income is much simpler.  The amounts are temporarily assigned to the dummy provider while the work is in progress.  Once the work is complete, the amounts are reallocated to the proper providers.  This is usually done as a second zero sum entry using two balancing paysplits.