Friday, February 14, 2014

10 Common Mistakes Accountants Make with Quickbooks Accounting

Zenobia Lewis for My Real Data writes:The use of QuickBooks accounting software has outgrown drastically over the recent past and QB client base now includes a good number of CPAs, small business firms and individual accounting practitioners. However, it is a surprising fact that only few accountants are able to use the program correctly. It is mainly due to lack of accounting knowledge and analytical skills make these accountants are prone to making some or the other error. Here are ten commonly made errors by accountants:

1. They utilize QuickBooks only as a tool for bookkeeping
Many accountants make use of the QuickBooks accounting software only as a tool for bookkeeping. This means that they use it to capture their daily transactions. They have never even reviewed the QB reports to manage their business finances.
2. QuickBooks is not set up properly for their business
Many individual practitioners have not even set up QuickBooks properly for their business. It might also be possible that many of them are using the wrong edition of QuickBooks and are blaming the software for its limitations in functionality.
3. Use older version of QuickBooks
Usage of older version of QuickBooks makes accounting functionality obsolete. Why is this even important? It is so because QuickBooks has no table to support any versions which is older than three years.
4. Their bookkeeping is not up-to-date
There are many accounting users who don’t even upgrade their version of QuickBooks. It is indeed an uphill task to update your bookkeeping which undoubtedly is a necessary operation for maintaining a consistent state of your financial reports.
5. Hire the wrong person to do their accounting and QuickBooks
There are professionals who have unknowingly or knowingly hired someone who is not qualified or experienced enough to take care of the assigned QuickBooks accounting activities.
6. Improper plan for future growth
You may be doing accounting yourself or you may hired some else to do it. In either of the cases, you need to have a concrete plan as to in what direction your accounting function will grow with the growth of your business.
7. They are without a plan for when their accountant leaves
If at any point of time your accounting staff suddenly leaves, then what would you do? You can solve this problem by having in place an accounting process which will be independent of the people who are carrying out the process.
8. Don’t know how to monitor their accounting staff
Lots of business owners worry because they don’t know how to monitor their accounting staff. The reason for this is justifiable as they are unable to judge whether the staff is doing a good job and whether it really takes that long to get something done.
9. Don’t back up their QuickBooks files
Usually the starter business accountants are unaware of how and where to back up their data. In some cases, they don’t even realize the need to do so. In this scenario, they usually don’t have a contingency plan in place to restore their lost data.
10. Not Using Credit Card Accounts
Many new accountants forego to put in their credit card in hosted QuickBooks.