Right Sizing QuickBooks as an Information System

I enjoy opportunities to help students and clients optimize QuickBooks to meet their needs. I get to hear about individual business models and different perspectives about what information is important to track. The most difficult part of this task is maximizing the benefits to be derived based on the resources available to maintain up to date accounting records.

I recently worked with a student who was taking on the accounting for her husband who, as a successful outside sales rep, had recently incorporated his business. She had already set up QuickBooks but realized she needed some advice on how to best use it.

When she told me he had about 4,000 existing customers he was tracking in another application, my first thought was that we could import customer records into QuickBooks and easily track customer puchasing patterns to identify sales opportunities. However, I found that her husband was placing his orders though the manufacturer and receiving regular statements. Rather than account for individual sales, he was interested in tracking income and expenses based on four categories of customers he was selling to.

At this point I realized that the benefit they wanted from QuickBooks could be accomplished by entering a single journal voucher off of each manufacturer’s statement and using the “Write Checks” and “Enter Credit Card Charges” entry forms to other handle travel and sales expenses. 

I made some modifications to the chart of accounts to better classify and group income and expenses and set up class tracking for the customer types.  Since she was going to be making journal entries, it was especially important that I give her some instruction on how accounting works with debits and credits to assets, liabilities, equity, income, and expenses.  I have created a brief written primer with examples, which I give students for future reference.

In addition, we made a journal entry from her first statement and walked through the class tracking dropdown menu on the data entry forms. I suggested that she apply what she had learned, call me if she had questions, and let me check her work in the not too distant future to make sure she was on track.

This right sized QuickBooks for the client.  No pzazz, just nuts and bolts stuff properly set up and minimal time required to keep up to date records. I really like getting people off to a good start.

Robert Guild is certified QuickBooks ProAdvisor in Austin, TX who conducts CPE courses for CPAs and individual training and group classes to QuickBooks users. His company, Accounting Insight, maintains a sixteen-station QuickBooks lab, providing hands-on training. You can contact him directly at rguild@accountinginsight.biz or follow him on twitter at QBPro