QuickBooks mistakes every business owner makes
As a small or medium-size business, you’ve got a lot on your plate. On-site accounting applications like may seem like the go-to solution for maintaining accurate books and keeping your finances in order. But this software is increasingly easy to misuse and errors can lead to significant consequences.
While this software is designed to be as easy to use as possible — you don’t need to be an accountant — in order to be successful, you’ll need to know how to do more than write a check, create and send invoices, and file your bills.
Most commonly, QuickBooks mistakes result from businesses skipping routine accounting tasks in an effort to save time. Shortcuts like these, however, will inevitably waste your precious time and lead to avoidable accounting errors.
10 QuickBooks mistakes to avoid
Forgetting to reconcile bank accounts on a regular basis: Ensure your financial data is accurate by reconciling credit card accounts, bank accounts, sales tax accounts, and other data on file each month.
Failing to apply payments to open receivables: Enter activity as you go, and reconcile bank accounts as soon as the bank statement is available. Failing to reconcile bank accounts can result in lost deductions and/or incorrect numbers.
Recording payments without linking them to accounts payable: Track and plan for future expenses by entering all payments into the accounts payable system. When you receive a bill, enter it into QuickBooks first, then use the “Pay Bills” feature to pay it.
Not setting bill dates: Avoid late fees and associated costs by setting dates for each of the bills added into your QuickBooks account.
Not using online bill pay: Rather than physically writing a check to each client or employee, use the built-in online bill pay to save time.
Not using shortcut keys: Instead of manually typing and clicking your way through the software, save time and energy with shortcut keys.
Failing to back up data: Backup QuickBooks each time after using the company file. To really protect your data, backup information via a DropBox in case of a computer crash.
Using outdated versions of QuickBooks: QuickBooks won’t support versions older than three years. Newer versions offer automatic transaction downloads and higher capabilities.
Failing to review financial reports regularly to drive success: QuickBooks is more than a bookkeeping tool. You should also review profits and losses, the balance sheet, receivables aging, accounts payable, and profitability via customizable reports.
Hiring an unqualified person to handle your bookkeeping: Ensure your bookkeeper has a firm understanding of accounting and experience with QuickBooks — beyond just entering data. If the bookkeeping is being neglected or the growth doesn’t support on-site accounting applications, hire an accounting firm to ensure profitability and long-term success.
Are you struggling to get your QuickBooks data in order? In addition to our financial consulting services, the trusted CPAs at Pittman & Brooks offer QuickBooks training and support. Contact us at firstname.lastname@example.org or call 503.684.9233 to schedule an appointment.