Why MedSpa Bookkeeping is Different
Medical aesthetics is a unique hybrid industry where high-compliance healthcare meets high-volume retail, creating a financial environment that standard bookkeeping methods simply cannot handle. If your current strategy treats a vial of Botox the same as office supplies, or records a sold package as immediate profit, you are operating with a distorted view of your business's health. True financial clarity requires a partner who understands the specific operational levers of a MedSpa, from the legal necessity of MSO/PC separation to the complexities of deferred revenue. Here is how specialized oversight differs from the generalist approach:
General Bookkeeping
They often book packages and gift cards as "income" immediately, which can artificially inflate your revenue and thus your tax bill and distorting cash flow.
The CBO Approach
Deferred Revenue Logic: We can track unearned revenue liabilities (packages, gift cards, and prepayments), recognizing income only when treatments are delivered, keeping books accurate.
Revenue Recognition
General Bookkeeping
No review structure to help prevent commingle funds or expenses between the clinical entity (PC) and the management entity (MSO), risking CPOM violations.
The CBO Approach
Entity Separation: We maintain strict separation of books for MSO and PC entities, correctly recording management fees and inter-company transfers to protect your legal structure.
MSO & PC Compliance
General Bookkeeping
They treat $50,000 of injectables and other one time use items the same as office supplies, expensing them immediately upon purchase.
The CBO Approach
Cost of Goods Sold (COGS): We track high-value inventory (Botox, fillers) usage to match costs with revenue, giving you accurate gross profit margins per treatment.
Inventory Management
General Bookkeeping
They may not know how to help you calculate bonuses or commissions based on "net of consumables" revenue with a more detailed Profit and Loss.
The CBO Approach
Granular Revenue Reporting: We generate clear reports separating service revenue from retail revenue, ensuring your providers are paid accurately and transparently.
Provider Commissions
Our MedSpa Specalized Bookkeeping vs. General Bookkeeping
Revenue
Recognition
The CBO Approach:
Deferred Revenue Logic: We can track unearned revenue liabilities (packages, gift cards, and prepayments), recognizing income only when treatments are delivered, keeping books accurate.
General Bookkeeping:
They often book packages and gift cards as "income" immediately, which can artificially inflate your revenue and thus your tax bill and distorting cash flow.
MSO & PC
Compliance
The CBO Approach:
Entity Separation: We maintain strict separation of books for MSO and PC entities, correctly recording management fees and inter-company transfers to protect your legal structure.
General Bookkeeping:
No review structure to help prevent commingle funds or expenses between the clinical entity (PC) and the management entity (MSO), risking CPOM violations.
Inventory Management
The CBO Approach:
Cost of Goods Sold (COGS): We track high-value inventory (Botox, fillers) usage to match costs with revenue, giving you accurate gross profit margins per treatment.
General Bookkeeping:
They treat thousands of dollars worth of injectables and other one time use items the same as office supplies, expensing them immediately upon purchase.
Provider
Commission
The CBO Approach:
Granular Revenue Reporting: We generate clear reports separating service revenue from retail revenue, ensuring your providers are paid accurately and transparently.
General Bookkeeping:
They may not know how to help you calculate bonuses or commissions based on "net of consumables" revenue with a more detailed Profit and Loss.
Our Core MedSpa Bookkeeping Plan includes:
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Management Service Organization (MSO) and Professisional Corporation (PC) bookkeeping.
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Categorization: Every financial event is meticulously reviewed and coded to ensure that treatment package sales and gift cards are tracked as unearned revenue liabilities until the service is delivered. This essential precision avoids the common error of overstating your income and provides an accurate view of your actual month-to-month profitability and cash position.
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Monthly Reconciliation: We reconcile all bank accounts, credit card processors, and payroll transactions to ensure that all transactional data is captured.
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Financial Reporting: We deliver a Profit and Loss report and a Balance Sheet for each entity per month.
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Industry Specific Knowledge: Our expertise is focused on the MSO/PC business structure, ensuring accurate accounting for management fees, due to/from accounts and inventory.
To deliver the financial precision and foundational structure the MedSpa industry demands, our specialized plans are fixed-fee and based on the complexity of your business model, not on billable time.
*Includes both the PC and MSO books. For MedSpas with high transaction volume (over 200 per month) or more than two entities, pricing will be customized following a consultation.
Transparent, Fixed-Fee
MSO & PC Bookkeeping
$599.00 per Month*
Clarity for Your Growing MedSpa Practice
You entered the medical aesthetics industry to deliver exceptional patient results, not to lose sleep over MSO structures or inventory reconciliation. Yet, as your practice scales, the financial fog often thickens. We exist to clear that fog. By implementing a bookkeeping strategy built specifically for MedSpas, we transform your financial data from a source of anxiety into your most valuable tool for decision-making.
Here is what that clarity looks like in practice:
Cost of Service Framework
Do you know if your packages, treatments and service are actually profitable after factoring in technician time, machine consumables and inventory? We help you see the numbers behind the services.
Due Diligence Readiness
Whether you are maximizing valuation for a future Private Equity acquisition or aiming to protect your practice from tax risks, our books are built to withstand due diligence and ensure you sleep better at night.
Profit vs. Cash Visibility
Our bookkeeping helps you understand the difference between 'cash in bank' and 'operating profit,' so you don't accidentally spend tax money or prepaid package funds. A bank account balance is never a profit and loss.
MedSpa Bookkeeping FAQs
Accounting for the hybrid MedSpa model introduces unique structural and compliance challenges. In many states, that means a physician medical director owns the professional corporation while a nurse practitioner or physician assistant owns and operates the management services organization. We have compiled the most common questions we hear to help you achieve financial confidence and ensure your operations are fully compliant from MSO and PC separation to deferred revenue tracking.
MedSpas are unique because they blend a high-compliance healthcare structure (PC/MSO) with a high-volume retail model. This requires specialized accounting for legal entity separation, correct handling of deferred revenue (packages/memberships sold upfront), and accurate inventory tracking for expensive items like Botox and fillers. A generalist often misrepresents your true income and assets.
Yes. Our CBOs have years of experience in managing the necessary accounting separation for the Management Services Organization (MSO) and the Professional Corporation (PC). We ensure all intercompany transactions, management fees, and expense allocations are correctly documented and reconciled, maintaining the structural integrity of your business.
We are careful in recording revenue strictly from a cash-basis perspective. We look out for the clues of deferred income or reference any provided reporting from your point of sale system: when a package or gift card is sold, the funds are initially recorded as a Liability (Unearned Revenue) on the Balance Sheet. Revenue is only moved to the Profit & Loss statement after the services are actually delivered or the gift card is redeemed, providing you with a true picture of your earned income.
Yes. Unlike general bookkeepers who may treat product purchases as an immediate expense, we correctly classify high-cost items (e.g., Botox, dermal fillers, and laser cartridges) as inventory assets. We then calculate and track Cost of Goods Sold (COGS) as these items are used, which is critical for generating accurate Gross Profit margins per treatment and managing inventory shrinkage.
We deliver financial statements (P&L, Balance Sheet, etc.) structured to provide maximum strategic value. Because your books correctly track deferred revenue and MSO/PC separation, you receive reliable, accurate data that you can use with confidence to guide staffing decisions, manage package sales, and plan for future growth.
MedSpa Client Stories
In a rapidly growing medspa, success hinges not just on clinical expertise, but on the flawless, segregated financials of your Management Services Organization (MSO) and Professional Corporation (PC). Discover how we transformed fragmented ledgers and confusing intercompany transactions into clear, strategic financial reports and audit-ready books.
Some of the most successful medspa operators are not doctors. They are nurses who understand patient care, office flow, and what a well-run practice looks like. The client in this story was exactly that. After years in dermatology, she had the experience, the drive, and the vision to build her own medspa.
Like many new operators, she went to every seminar in town. If you have ever attended one, you know the format. They explain the MSO and PC structure, the Management Services Agreement drafted by a contract attorney, and the importance of a good EMR system to keep the clinical side compliant...click here to read more.
Sometimes a new client does not come to us because they never had bookkeeping. They come to us because someone else stepped aside. And you can always sense it. There is a different kind of handoff when a bookkeeping firm transitions a client. It is rarely neat or polished. Sometimes it happens fast, and sometimes you can hear the relief in the outgoing bookkeeper’s voice. Naturally, questions come up. Why now? Why us? What happened before?
But those questions do not matter very much. Transitions happen constantly in this industry, and not always because something went wrong... click here to read more.
Mastering the Business of Aesthetics
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