March 31, 2020

7 of the Best Practices for QuickBooks Online

QuickBooks Online
By: Ronald B. Allen

7 of the Best Proven Practices for QuickBooks Online

Do you consider yourself a QuickBooks Pro?

Whether you're a new user or have been with QB from the start, it's good to step back periodically and evaluate your actions.

The term “Best practices” doesn’t mean enforceable rules. They’re simply guidelines commonly followed once proven useful. In retail, for example, one proven practice is to ask customers upon checkout if they found everything they were looking for. This serves two purposes: It conveys a feeling of concern for the customer’s shopping experience, and it may also lead to increased sales.

QuickBooks Online has many proven practices, some serving multiple purposes, including these:

  • They keep your company data safe and clean.
  • They provide insight on your financial status.
  • They save time.
  • They can lead you to better relationships with customers and vendors.

Are any or all the following common practices for your business?

Account Reconciliation

One of QuickBooks Online most useful features are its ability to connect to your financial institution’s websites and download cleared transactions. QuickBooks Online also offers tools to help you keep your accounts reconciled online instead of dealing with the paper statement.  Reconciling accounts helps you uncover errors, gives a true picture of your cash flow, and improves the accuracy and timeliness of some reports.

It’s not a particularly pleasant process, but you should be reconciling your accounts regularly in QuickBooks Online. We can help.

Clean up your lists.

Lists of customers and vendors, products and services, can grow unwieldy over the years. This means it takes more time than it should to scroll through lists when you’re using those entities in transactions. It also puts unnecessary stress on your company file. If you can’t delete any, at least make them inactive. If you have any questions, we would be more than happy to discuss this.

Never leave QuickBooks Online open when you leave your work area.

This goes for everyone, even people who work alone and don’t access their company files away from their work areas. The obvious reason is to keep someone else from getting in and authorizing payments, for example, or otherwise compromising your financial information. It also protects the integrity of your data file in case your internet connection suffers an outage.

Keep track of 1099 vendors.

Whether your company uses 10 vendors or a hundred, you may have to supply at least some of them with an IRS Form 1099 at the same time you’re preparing W-2s for employees. Your 1099-related tasks will be much easier if those individuals and/or companies are earmarked. If you think vendors might need 1099s when you create their records in QuickBooks Online, click in the box to the left of Track payments for 1099 in the lower right corner. Not sure? Ask us!

Classify everything with care.

Every time you create a record or transaction where categories are involved (i.e., Classes, Customers and Vendors, Territories), check and double-check that you’ve assigned them the correct classification. Errors here can result in problems with daily workflow and inaccurate reports. A related practice:

Create a meaningful group of Classes, and use them faithfully.

They’ll help you make better business decisions.

To create your list of Classes, click the gear icon in the upper right and select All Lists | Classes | New.

View reports on a regular basis.

There are some advanced financial reports in QuickBooks Online that we should be creating for you on a regular basis, either monthly or quarterly. These include Profit and Loss, Balance Sheet, and Statement of Cash Flows. The mechanics of creating them aren’t difficult, but analyzing them is. You should be running reports on your own at frequencies that you think would be helpful, like A/R Aging Detail, Unpaid Bills, and Sales by Class Detail.

Exigo Business Solutions Accounting & Bookkeeping

If you’ve been using QuickBooks Online for a while, you could probably come up with your own list of best practices. If you’re new to the site, consider scheduling some time with us to go over more of them. Develop good habits from the start, and there won’t be nearly as much need for troubleshooting down the road. Our team of Advanced QuickBook ProAdvisors are available and ready to set up a meeting! Get back to focusing on the aspects of your business you love and let us do what we love - Accounting and Bookkeeping! Schedule a FREE QuickBooks assessment with one of our ProAdvisors today! Want to learn more abour our services? Check us out!

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