August 26, 2021 Accounting, Taxes

The Mess of QuickBooks

QuickBooks is an intuit product meaning it is “intuitive” to use.  I will give them credit, they have taken double-entry accounting and made it “easy” to use, however, intuitive… not so much.

The beauty of QuickBooks is that you can enter things just like a check register, which most people are used to using (though most people don’t do), and ultimately it creates your financial reporting – a profit and loss and a balance sheet.

Here is the kicker – there are also all these “add on” features like Bill Pay and Invoicing and Payroll which then integrate with the Check Register to create your reporting. When these are not set up or used correctly, QuickBooks creates its own entries to keep itself in balance – because after all, it is a double-entry accounting system.

What do you end up with? A mess!

And if you are using QuickBooks online it is a mess on steroids.

Just this week I worked in a set of books and found this company had paid tax on a profit that didn’t exist in their company the year before. They were on track to do it again this year based on how their books were set up and yet they were strapped for cash flow.

I have seen it over and over where people are doing their own bookkeeping and thinking they are saving money. Then, they take their reports to a CPA to file their taxes. The CPA can see from the Balance Sheet that the accounting is not good so they pick through the P&L, ask for your loan and bank statements at year-end, and file your taxes.

What you are left with is a set of books that really don’t mean much and you certainly can’t make decisions from, and you may have paid too much or too little in tax but neither you nor your CPA knows the answer to that.

You think because you have done all the right things – kept your books and used a CPA – you must have good numbers.

Yet you just can’t reach the next level of growth in your company and your cash flow just keeps getting tighter and tighter.

As an accountant I love numbers. I geek out on the functionality of a piece of software like QuickBooks and how it can support an entrepreneur when used correctly.  If you are part of the 90% of the population who doesn’t resonate with this, then give yourself a break and hire someone who is so they can help you in this area.

Money and numbers are emotional enough without banging your head on the wall trying to figure out how to use a piece of software like QuickBooks. I will guarantee you that you are either leaving money on the table or you are paying way too much in tax if you are doing your own accounting.  Not to mention lost revenue if this is not your zone of genius. We are here to serve you.

Let’s connect and see if we are a good fit.

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