How to Use QuickBooks and Accounting Assistant to
Posted By admin on December 21, 2011
Listed below are some blunders that I see little enterprise make with their accounting and QuickBooks. Could this be you?
1. QuickBooks isn’t arrange properly for their small business
Several tiny home business proprietors never have QuickBooks arrange thoroughly for his or her organization. In some instances they might even be working with the incorrect version of QuickBooks. This triggers tiny organization proprietors to possess to devote a great deal of time getting information and facts out of QuickBooks or possessing to track facts manually outside the house of QuickBooks. The real key here is to first understand the various variations of QuickBooks accessible after which to comprehend how information is gathered in QuickBooks principally from the use of tasks, objects, plus the chart of accounts. Soon after you may have that understanding then you can certainly put in place QuickBooks especially for your organization along with your desires. When it’s put in place appropriately, you can utilize QuickBooks reports, like profitability studies, that demonstrate you simply how much cash you created by customer, by project or profession, and by inventory or service products.
2. Use QuickBooks only as being a bookkeeping tool and don’t overview QuickBooks reviews to handle their business finances
A lot of smaller company owners use QuickBooks only as being a bookkeeping tool – to capture their each day transactions. Sadly, they don’t evaluate economical reports for instance the Gain & Loss, the Balance sheet, and crucial reviews which include the accounts payable aging, accounts receivable aging, and several types of profitability reports. QuickBooks also allows you to create budgets and to track budget versus actual on a regular basis. In order to handle your company effectively you need to own timely and relevant fiscal info out there to you and you need to evaluation it on a timely basis. If you haven’t done so already, go to the Report Center in QuickBooks and look at the studies available. You should at the very minimum be looking at the reviews in -Company & Financial.-
3. You should not maintain the bookkeeping up to date
I know that keeping your bookkeeping up to date can be a thorn on your side but it is actually a necessary function of running your enterprise. Listed below are a few tips:
a. Set aside time on a weekly basis to update your books.
b. Use a checklist to ensure that you record all your transactions.
c. Be sure to acquire receipts for all of your transactions.
d. Set up a filing system that is appropriate for the size of your home business and file away all your receipts and documents.
4. Don’t reconcile accounts
Many tiny home business proprietors have messy balance sheets because they don’t reconcile their accounts. This includes reconciling bank accounts, credit card accounts, sales tax accounts, and other accounts on a monthly basis. A telltale sign of a messy balance sheet is usually when balances in credit card and sales tax accounts show a negative balance on the balance sheet. A monthly reconciliation process is important to ensuring that your economic data is accurate. QuickBooks makes it easy to reconcile bank accounts, credit card accounts, sales tax accounts, and more. If your economical data will not be accurate then how can you rely on it to make decisions on your home business?
5. Use and older version of QuickBooks
Numerous smaller business proprietors use an outdated model of QuickBooks. Why is this important? Because QuickBooks does not support any variations older than three years. Also, newer versions of QuickBooks allow for automatic downloading of bank and credit card transactions from the bank and credit card companies. Newer versions also have higher capabilities, for example QuickBooks 2011 version allows for batch invoicing – a great time saver for companies that bill multiple customers for recurring fixed amounts (such as monthly support charges). Upgrading to a new version of QuickBooks is very simple and generally only takes minutes.
6. Improperly plan for future growth
Whether you do your own accounting and QuickBooks or have hired someone to do it for you (an employee or bookkeeper) – do you might have a solid plan for how your accounting function will grow as your organization grows? Lots of little company owners fail to appropriately plan for this. Very first, consider whether you will need to hire someone else to do your accounting and QuickBooks — what should be their qualifications be? What should you expect from them? How will you monitor them? What areas will they be responsible for? What areas will you be responsible for? Second, consider computer and software requires. Will you have enough computers to your employees, do you need to purchase additional software licenses? What security restrictions will you place on your QuickBooks so that your employees don’t have access to sensitive fiscal or payroll areas? Finally, how will you remove yourself from the day-to-day management of your company’s accounting and QuickBooks and when will the right timing be for this? Make time to device a plan and budget for future growth.
7. Hire the wrong person to do their accounting and QuickBooks
This is a very typical mistake that tiny business owners make – they hire someone who just isn’t qualified to take care of the accounting and QuickBooks. There are two vital areas right here – compensation and qualifications. A lot of smaller organization owners never want to pay for a qualified individual. For a result, they hire someone who is under qualified or inexperienced. As a result, the person they hired a) is unable to do the work correctly, b) can’t keep up with the work load, c) they are unhappy with their low paying task, and d) may well find a reason to retaliate. Retaliation can take place in lots of forms – a bad attitude, absenteeism, tardiness, rudeness toward customers and employees, not gaining any work done, quitting without giving notice, and sometimes even theft and embezzlement. I have also seen employees quit without giving notice right before payroll is due leaving you scrambling at the last minute.
The other issue to consider is whether the person you hire is qualified. You need to make sure that you clearly comprehend their past accounting and bookkeeping experience. Ask detailed questions and make sure that you get clear answers. Never ask -do you know QuickBooks?- and be satisfied with -yes- as being the answer. I have interviewed people in the past who put on their resume that they used QuickBooks but upon further questioning I found out that they were only doing data entry. Ask specific open ended questions like – how would you invoice a consumer in QuickBooks? How would you pay for a vendor bill in QuickBooks? How would you reconcile the bank account in QuickBooks?
8. Do not know how to monitor their accounting staff
Lots of little organization owners worry because they don’t know how to monitor their accounting staff. They worry about whether the staff person is doing a good profession, whether it really takes that long to get something done, whether the staff is invoicing customers for everything that requirements to get billed, and they worry about whether vendor bills are gaining paid on time. The keys to monitoring accounting staff are a) setting clear expectations on your staff, b) documenting procedures to be followed, and c) go over expectations and procedures with your staff. Expectations and procedures should cover things for example – what tasks are to be completed, when they are to be completed, and how they are to be completed. For example, expectations and procedures should include specific dates when certain monetary reviews will be obtainable for you to review in QuickBooks. If you want to overview your accounts receivable aging on Fridays you then need to let your accounting staff know that all sales invoices and payments need to be entered by end of day on Thursdays. Another key is usually to establish good communication with your staff – they should be able to come to you with problems and inform you of when they are not able to meet their deadlines. Many times accounting staff get interrupted throughout the day or need to put out fires and they don’t get the time they need to take care of their daily duties. Keep the lines of communication open.
9. Really don’t have a plan for when their accounting staff or bookkeeper leaves
What would happen if your bookkeeper or accounting staff suddenly left? Would you know what to do? How would you train their replacement? The important thing here’s to setup an accounting process that is independent of the people carrying out the process. You need to setup a turnkey process. Most large corporations already have this in place. Take McDonald’s for example, they have a process that they use to train employees in a low paying high turnover industry. They don’t rely on the people they hire – they rely on the process. In order to create a process for ones accounting you need to document your accounting procedures and keep them up-to-date. At the time you document your procedures then you can certainly use them to train new staff and you or others can use them when your accounting staff is out sick or in the event that you or someone has to step in while you hire new or additional accounting staff.
10. Don’t back up their QuickBooks file remotely
What would you do if your QuickBooks file became corrupted or if there was a theft, fire, or a natural disaster and you lost your QuickBooks data and your back ups? Many little home business proprietors back up their QuickBooks file to their hard drive or to a zip drive but they don’t use an online backup services. Mozi or Carbonite are are relatively inexpensive online backup. They cost around $60 per year. Isn’t your peace of mind worth $60 per year?
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