Common QuickBooks Mistakes Clients Make and How to Fix Them Presented by: Dante Layton Advanced Certified QuickBooks ProAdvisor Dante Layton, Inc. Objectives Determine if your client has made these mistakes Obtain a basic understanding of the alternatives available to fix these errors Learn methods of working efficiently with QuickBooks data files Explore the symptoms and causes of these common mistakes Discover the solutions to eliminate the errors in the future. Notes About Approach Based on time considerations, we have chosen one error for each category to discuss in the course. The Menu Bar is used for navigation in these instructions The fixes presented here assume: You are using QuickBooks: Premier Accountant Edition 2009 You have the live data file or you are accessing the data file via Remote Access Before Making Any Changes… Back up the data file prior to implementing any changes and periodically during the process Prior to making any changes, print reports. For major changes, have the client sit with you! They see results of the situation they created They understand changes that will be made in the data file They know how long it took to correct the mistakes They LEARN Working with Different Data File Types QBW (Working copy) Log in remotely or at client’s office to work QBB or QBM (Back up or Portable file) Client should not work in file while you have it Changes do not merge back into their file QBX or QBA (Accountant’s copy) Many changes will import back into their file Some limited backward compatibility (1 year) Must have QB Premier Accountant Edition In general You need the same year of QB as the client (unless you use remote access) New for 2009 – External Accountant User Provides you with Admin rights except: Cannot access sensitive credit card information Cannot create or modify users Allows you to track your changes separately Allows access to Client Data Review in QuickBooks Pro 2009 New for 2009 – Client Data Review (CDR) List Errors—Chart of Accounts Mistakes Common Mistakes: Duplicate accounts Accounts duplicate the function of customers, vendors, or items Primary Indication: Extremely long chart of accounts list Supplemental Symptom: The presentation on the Balance Sheet and Profit & Loss reports looks wrong Review List Changes Growing Balance in Undeposited Funds Common Errors: In addition to Receive Payments—used Make Deposits Deposits directly into check register Symptoms: Accts Receivable is high with old A/R Growing balance in Undeposited Funds Income is unusually high Bank account balance may be OK Accounts Receivable—Open Credits or Small Balances Common Errors: Payments not applied to an invoice Credit issued and not applied to an invoice Small balances need to be written off Symptoms: Open Invoice report is lengthy with unapplied credits, payments and/or small account balances Accounts Payable Errors Common Errors: Client enters bills then writes checks Unapplied vendor credits Symptoms: A/P balance high with many old A/P Expenses too high Bank account balance is OK Numerous unapplied vendor credits Credit Card Errors Common Errors: Only amount paid is entered into QB as a guesstimate of how to allocate payment Balance to a single expense account A/P used to enter bills Credit card balances not reconciled Symptoms: Credit card register balance only increases Bank account balance looks OK Sales Tax Errors Common Errors: Clients write checks to pay taxes Sales taxes not set up properly Symptoms: Sales tax payable appears too high Sales tax expense Pay Sales Tax dialog does not show previous payments Sales taxes not calculating properly Payroll Tax Errors Common Errors: Clients write checks to pay payroll taxes Symptoms: Payroll liabilities higher than expected Payroll tax expense higher than expected Bank account is OK Payroll tax returns show no balance due Inventory Errors Common Errors: Incorrect and/or inconsistent inventory procedures Symptoms: Inventory valuation summary report does not appear correct Inventory quantities are negative or too high Average cost appears too high, too low or is zero Asset value does not agree with GL Prior Period Balance Discrepancies Common Errors: Users record, modify, delete and void transactions Users never enter year end journal entries provided to them Symptoms: Ending balances used by the tax accountant have changed from year to year Reports to help with Prior Period Discrepancies Several Reports to help troubleshoot Go to Reports> Accountant & Taxes to find: Audit Trail Closing Date Exception report Voided/Deleted Transactions Set a Closing Date Password Set Closing Date Password Necessary for the Closing Date Exception Report Go to Edit>Preferences> Accounting>Company In QB 2009, you can set the closing data password in the Accountant’s Copy to send back to the client Most Important Fix of All! 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