QuickBooks: Bank Feeds – Matching and Unmatching

Utilizing the bank feeds in QuickBooks makes for a more seamless bank reconciliation process and allows you to keep up on your banking transactions more timely. Once you have your bank feed set up (which is a fairly straight-forward process that uses your online banking login information), you can begin matching transactions posted with those that download from your bank feed.

These steps and figures will all be using QuickBooks online. If you need help with using the desktop version of QuickBooks, please feel free to CONTACT ME.

Figure 1: First, from the left-hand menu, click on “Transactions” and then on “Banking.” You will see any linked accounts at the top. Clicking on each account will display a list below of unmatched transactions. It’s always good update the bank feed often by clicking on “Update” in the top right.

Figure 1 – CLICK TO EXPAND

Figure 2: Once your bank feed is updated you can start matching transactions. When QuickBooks finds assumed matched transactions – ones with the same amount, payee, and date range – it will indicate “Match” in the Category/Match column. If you confirm they are a true match, click “Match” under the Action column to the far right. Doing so will remove that transaction from the list.

Figure 2 – CLICK TO EXPAND

Figure 3: If you match a transaction by mistake, which can be an easy thing to do if you have multiple transactions to the same payee for the same amount, you can simply unmatch it. Notice how directly under the accounts there is: For Review, In QuickBooks, and Excluded. Click on “In QuickBooks.” This will display all the transactions you have matched. Simply find the transaction in question and click “Undo” under the Action column to the far right. This will unmatch the transactions and place it back under the “For Review” section, where you can match with the correct transaction.

Figure 3 – CLICK TO EXPAND

Figure 4: As I mentioned, using bank feeds will streamline the reconciliation process. To see this in action, click on “Go to Register” on the far-right side. This brings you to the register of all posted transactions to this account. Notice the two green squares in the column second from the right. This is indicating that the transaction has been matched to a bank feed item. Once reconciled, that “C” above the squares will change to an “R.” Essentially, when you start a bank reconciliation, it will already take into account the matched items so you do not need to mark those manually.

Figure 4 – CLICK TO EXPAND

Those are the basics for using bank feeds. There are some other functions that relate to bank feeds but the items above should be enough to get started. I invite you to give it a shot, it’s a great time saver! It’s also a great stress-reducer if waiting to do bank recs with a monthly statement is a hairy task due to a high volume of transactions.

Becoming a Solopreneur: My Story

As a new business owner, I love hearing stories from other successful entrepreneurs. It fills me with inspiration and energy. Although I’m only 6 months in, I hope that my story will inspire at least one person to take that leap of faith to work for themselves. My story started first with an attempt – and a failure – which you can read about in My Gritty Start-Up.

I grew up in the small foothill town of Placerville, CA. I couldn’t wait to move away after graduating high school, so I ventured off and lived in the greater Sacramento area for over a decade. I graduated from CSU Sacramento in 2009 with my Bachelor’s in Accountancy and passed the CPA exam in 2015. It was in 2014 that I started and failed at entrepreneurship. By the time 2015 came around, I found myself stuck in a rut and spiraling into a depression. I figured I should be a married, self-employed mom by then, but nothing seemed to be going as I had planned. I was a 29-year-old, single, employed individual.

It was then that I decided I needed a change, I needed to stir things up and get a change of scenery. So, I made the bold move to Reno, uprooting my entire life to make the 2-hour trek. I packed up my things, my big goofy mastiff-mix, and my two cats, sold my condo, and never looked back. I bought a house here just last August, so I’m definitely here to stay!

Hiking with my dog Rocky in Reno.

For the first 4 months in Reno, I completed my then-current accounting job remotely. The arrangement was ideal as it allowed me time to search for a new job and allowed my employer time to find and train a replacement. We both happened to find what we were looking for within a couple weeks of each other, so I had no gap in employment.

My first Nevada job sounded like a dream – a Supervisor for an accounting department at a large gaming company. I was ecstatic to land my first supervisory role since I felt I had been working towards that next level for quite some time. Only problem was, my team was made up of 8 direct reports (which is a lot!) and I was overseeing a department that was new to me so there was a huge learning curve. I quickly realized the job was more hands-off with regards to the accounting and entailed mostly checking others’ work and approving time off requests. This was not what I had hoped for and I soon felt overwhelmed with feeling like I had made a mistake taking this job. I resigned.

I was unemployed for a month, right around the holidays, which – to say the least – was pretty crummy. I was facing rejecting from job interviews like I had never faced before (since it had never happened to me previously, I always got any job I went after). Not only was the job market smaller in Reno (especially for the senior positions), but my short stint at the last job and multiple jobs held not more than a year was being seen as unstable to potential employers. At one point I was getting close to desperate, so I decided to get creative in my job hunting. I started scouring websites of local companies in search for emails of CFO’s. I would reach out to them directly to see if they were in need of someone with my particular skill set. It just so happened that one CFO was looking for what I had, so we met for lunch and thereafter I was hired on as the senior accountant.

I was grateful for the job and I certainly gained experience in a multitude of new industries –entertainment, sports, restaurant, and retail. I used my knack for process improvement to enhance the accounting procedures. They became so efficient, in fact, that my work-load diminished to less than a 30-hour week for me. I was starting to feel stuck in a rut again. I couldn’t help but feel that I wasn’t meant to be trapped in a regimented accounting job working for The Man. I had a gift for implementing great change. Once that great change is working consistently, I need to move on to another change project.

When the CFO approached me about the opportunity to pursue entrepreneurship again and keep them on as my first client, I jumped at it! I knew that a stable client was part of what I was missing the first time around. They were a reputable establishment in the community which would add to my credibility, plus it was enough work to support me financially so that I could avoid taking on any debt this time. Money was tight for a while, but I pushed through and am now in a comfortable place. I started my MBA this semester (I only have one final left, woohoo!) and am proud to say that paid my tuition in cash and plan to do so until I graduate in May 2018.

Working for myself certainly has its ups and downs. I am working towards financial freedom and flexibility in my schedule. Right now I am working long hours and often don’t break on the weekends, but I will tell you it’s damn rewarding since I’m doing it for myself. I also get to spread my love of accounting and process improvement to other business owners, which I feel so fortunate to do. I’m always meeting new people, learning about their businesses, hearing about their journeys, and if I’m lucky enough, I get to join in on their journey and make a positive impact. That is what entrepreneurship is all about my friends!

Reno has been pretty darn fantastic to me, both for my personal and professional lives. If you’re thinking about making that huge leap into being a solopreneur, are thinking about moving to the Biggest Little City, or both, I invite you to jump fast and steady and know that you will land with both feet planted so that you can walk – then run – towards your dreams.

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Tax Time is Over…Now What?

We’re now a full week into the month of May. The rain has been falling, the sun is shining, and flowers are in bloom. It’s an especially great season since tax time is now just a distant memory, right? WRONG! If you’re like most small business owners, you probably wait until January, February, or maybe even as late as April to start checking your list of items needed for your tax preparer. Does waiting last minute give you anxiety? Does waiting last minute put you into a time crunch and keep you up at night?

Instead of dealing with the stress and time constraints of this situation every year, wouldn’t you rather just keep swimming along after year-end in the same manner as the rest of the months? Today, I’m going to give you some tid-bits of advice on how to accomplish this consistent swimming and avoid the tax-time drowning.

Keep Your Receipts

This is probably one of the biggest organizational problem I’ve encountered in the past, both with clients and employers. Keeping your receipts, ALL of them, is your best line of defense. Keeping them organized, just by month, or type, is even better! As a new business, your bookkeeper or accountant will thank you for having documentation for every purchase or deposit made. Plus, if you are ever audited by the IRS, you already have your backup ready to go. No stressful calls are needed to try and track down a receipt from 10 months ago to show that the large purchase you made at Best Buy was indeed for business purposes.

Retain Copies of Your Statements

Whether you do this digitally or print them out each month, retain copies of your monthly statements. This includes checking, savings, credit cards, and other sources like PayPal. Again, your accountant will thank you later. Plus, creating this routine will likely force you to at least look at the statement and quickly glance over for any issues (What?! I had 3 overdrawn checks this month? I need to see if that’s a bank error or if I have a cash flow problem!)

Start Early

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This is the most straight-forward advice I can give! The earlier you start, the easier the on-going record process is. Think about being offered a whole pecan pie, but you also must eat it in one sitting. Sounds painful, and maybe impossible, right? But what if you were able to eat it just a bite at a time until it was gone? That’s what monthly bookkeeping is all about. Breaking it down into more manageable bites.

You’re also better able to proactively fix errors, follow-up on monies owed to you, and more efficiently track bills coming due when you have a consistent record-keeping process in place. And if you hate the idea of doing this task so regularly, hire someone who enjoys doing it so that you both benefit from the timely work.

If you’d like to start working on your manageable bites together, CONTACT ME to schedule a free consultation.

Do I Really Want to Deal with Your Box of Receipts?

Let me walk your through a typical initial client meeting. The client greets me at the door of their home or office and leads me to a table piled with papers. The papers might be in organized stacks, disorganized stacks, or it may look like a tornado just passed through. At this point, the client is excited about getting their books in order and very eager to pass the torch over to me.

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And at this point, I am very eager to grab onto that torch because this is the moment when I really get to start learning a lot about this business owner and their company. But what about that mess of papers? I almost never leave without my client first asking, “Are you SURE you want to go through all this? It’s such a mess.” I can’t help but laugh as I respond “YES! I love doing this kind of work. You see a mess, but I see a puzzle.”

The client gives a sigh of relief. Not only will their books get caught up, but now they can rest assured that the process will be fast and painless since I’ve taken that worry off their shoulders. Not only that, but they seem relieved that I will enjoy the task and they will not be a thorn in my side. Don’t believe my enthusiasm? Check out my new “About Me” Video!

As I mentioned, sorting through a client’s receipts and piecing them together with their invoices and bank statements really helps me to better understand the operations of their business. Is it service-based or product-based? How are those services and products broken out? What vendors do they work with? What customers do they have? Who works for them? Who do they bank with? How do they run their business? And, most importantly, what improvements can I suggest to get all the moving pieces to be cohesive so that they may work smarter, not harder?

Another reason that a pile of papers in no way intimidates me is the simple fact that my client’s volume of work is a relatively minute amount compared to the work I’ve done in corporate accounting jobs. I’ve had to re-reconcile 18 months of bank reconciliations for a large hospital affiliation. Each one would require 4-5 business days to complete. Finding documentation needed to reconcile was more difficult due to the amount of time that had passed. Talk about doing a puzzle! But I ABSOLUTELY LOVED every minute of it. I’ve also done a lot of clean-up work for the Reno Aces, as highlighted in the CFO’s testimonial.

Although your stacks of papers may be hindering YOU with decision paralysis on where to even start or how to begin, that one box will be a walk in the park for me. If you’re on the fence about partnering with someone to help with your financials, do yourself a favor and call me already! I promise you that I will love every minute of the work I do for you, just as I have loved every minute of the work I’ve done for others.

Excel: Text to Columns

In my last blog, I discussed taking text from separate cells and stringing them together. Today, we’ll discuss the opposite: separating text from a single cell. This function is referred to as “Text to Columns” and is found under “Data” on the ribbon bar menu.

Figure 1

Often times, we download a CSV formatted file in which all the data is listed in a single cell, instead of being formatted in separate columns. The “Text to Columns” function will make separation of the text a simple process. In Figure 2, we have an example of a bank transaction download. Notice how selecting cell A8 shows the string of text.

Figure 2 – CLICK TO EXPAND

To separate out the text, highlight the cells or row containing the text. Click on the “Text to Columns” as shown in Figure 1. You will then see a pop-up box, where you will click next to “Delimited,” not “Fixed Width” and then click “Next” (Figure 3).

Figure 3 – CLICK TO EXPAND

On the next pop-up screen, choose whichever delimiters you have. This is the item type that separates the data you want in different columns. This is why you may be familiar with the term “Comma Delimited” file format. This would mean there are commas between the text that should be split into different columns. With our example, we will be choosing “Space” for the delimiter (Figure 4). Note how when you make a choice it gives you a preview of how the text will separate into different columns. This is helpful before committing to the split.

Figure 4 – CLICK TO EXPAND

If you are happy with the data preview, click “Finish” and watch as your text magically separates into different columns! (Figure 5).

Figure 5 – CLICK TO EXPAND

There are many different options how data is split or delimited. If you’d like more information on what else the “Text to Columns” can do, CONTACT ME for further help or comment below with a specific question.

Excel: Using Concatenate to String Text Together

Are you ever in need of combining the text in multiple Excel cells? Are you ever in need of creating a pattern of text but one component is a variable? If so, you need to be using the CONCAT formula in Excel (this shortened formula now replaces the previously used CONCATENATE formula). Today I’ll go over two basic uses for this formula.

String Together Multiple Text Cells

Let say you have a list of first names, last names, and cities of residence. You’d like to combine all three items for a new list. Use the CONCAT formula to as follows:

  1. In the cell where you want the combined text, type =concat
  2. Add a parenthesis and then start selecting the cells in the order you want them combined, placing a comma between each chosen cell.
  3. Hit “enter” and the combined text will show in the cell.
  4. Note how the there are no spaces between the words. You will need to add in a space surrounded by quotes between each set of cells where you want a space.

String Together Text From Cells Plus Additional Text

Let’s say you have created a list of locations and distances ran recently. You’d like to create a formatted sentence using this list. Use the CONCAT formula to as follows:

  1. As in the steps above, type =concat( in the cell where you want the sentence.
  2. Anywhere you want to add text, put the text in quotes. You can do a combination of this and choosing cells, putting a comma between each section. (Note how spaces are added in the additional text sections. This can be done instead of individual “ “ between items).
  3. Drag the formula down, or copy/paste for the rest of the list to apply the same sentence to all lines of the list.

 

 

 

 

 

If you would like help with more complex concatenate formulas please CONTACT ME to work on it together. Or comment below with other formulas you’d like featured in a future blog.

Budgets, They’re Not Just for the Birds!

I was reading a fellow blogger’s post this morning about how business owners learn the hard way that budgets are the secret to survival. At the bottom of Belisle’s post, he states “Lesson learned: Budgeting is a waste of time only if you don’t plan on making money!” And I couldn’t agree more!

I then wandered over to Forbes to look for some blogging inspiration and the quote of the day was “A goal without a plan is just a wish.” This pretty much ties into Belisle’s post, so now I feel I must address my own opinion on the matter.

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Once again, I may surprise you when I say that I love budgeting! To me, the budget process unveils a lot about a company’s story: where they’ve been, where they are, and where they see themselves going. I’m sure a budget to most just looks like a bunch of numbers in a spreadsheet, but I assure you there really is a story lurking beneath the numbers. It’s packed with insight!

For companies that have never created a budget, the task can seem daunting. It can be difficult figuring out how to start one, so I advise you to start by looking at historical data, if you have any. From there, look at one revenue or expense account at time and really think about what influences the outcome of those numbers.

For instance, are you just throwing a sales number out there because it sounds like a number investors would like? Or are you considering what sales would actually be attainable but still be a challenging goal to inspire your sales team? Also, depending on what sales you budget, are you considering how the sales volume might directly influence expenses? Aside from overhead expenses that do not vary, some expenses will increase will increased sales. Departments are doomed to go over budgeted expenses if volume changes are not taken into account (this is where a rolling forecast can come in handy for volumes that are susceptible to constant change).

It is always surprising to me when I’ve been tasked with budgeting in a corporate position and there is very little backup for how the budget was formed. The more detail you can incorporate into a budget, the better. That is the only way you will truly be able to understand variants later on when looking at why actuals deviated from the budget.

A budget is a critical elemental in making a plan to reach your business goals. Without one, you are pretty much blindly navigating a massive ship in an expansive open ocean. Where will you end up? Anywhere. Is it the place you want to be? Maybe, but likely not.

If you’d like help implementing a budgetary plan to reach your goals, let’s set up a consultation to see what can be accomplished! Email me at jamie@renoaccountingsolutions.com

QuickBooks: The Audit Log

 

I know we’ve all been there: you’re working in QuickBooks and you know you posted a transaction yesterday, but today you just can’t find it! Are you losing your mind? Maybe. Or maybe not. There is a way to figure out if something was accidentally changed or deleted. And that way is through the use of the Audit Log.

I actually had a situation like this happen to me just yesterday. A big journal entry I post every month was missing. I knew I had posted it the week prior, so I pulled up the Audit log. It turns out that instead of copying a prior journal entry, which I do often to save time, I accidentally saved over it. After making this discovery, I hastily posted the new journal entry to get everything squared away. The Audit Log allowed for a quick deciphering of why my mistake occurred, not merely that it did occur.

There are a number of reasons to run an Audit Log report, such as:

  • Verifying who posted/edited/deleted a transaction
  • Verifying changes made to a transaction
  • Identifying when a transaction was posted (this is helpful when trying to locate changes made after a specific date)
  • Verifying who has logged into QuickBooks and when
  • Seeing changes made to the chart of accounts and other lists

To view the Audit log, follow these easy steps:

  • Click the gear icon and then on “Audit Log”
  • THAT’S IT!
  • Or, go the traditional route and choose “Reports” from the left-hand menu
  • Go to All Repots
  • Choose Business Over
  • Click on Audit Log
Audit Log from Sample Company of QuickBooks online – CLICK TO EXPAND.

You can customize the Audit Log to filter by such things as employee, date, and transaction type. This is useful if you’re looking for a particular item to review. Once you’ve found a transaction, click on “view” to the right-hand side and it will display the changes in detail.

Detail for changes of one transaction listed in the Audit Log – CLICK TO EXPAND.

The steps above are specifically for QuickBooks online, so if you’re working with QuickBooks desktop and need help with running an Audit Log, please CONTACT ME.

What Business Owners Need to Know About Accounting

I came across a Forbes article today based on a podcast: “Do Business Owners Need to Know Accounting”? I think this is a great question to discuss and today I will go over the aspects of accounting that I feel all business owners should know. It is critical to at least have a basic understanding of certain aspects in accounting in order to make timely and positively impactful business decisions.

Financial Statements

Business owners are probably familiar with the most commonly used financial statement: the Profit and Loss Statement. This statement not only tells you whether you are in the black or not, but it also tells a story of why your bottom line number is what it is.

It’s important to understand what each account’s purpose is and what can make that specific revenue or expense account change. You cannot estimate future amounts without this foundation. This is also a great first step in educating yourself for when it’s time to create a budget or forecast.

The second most commonly used financial statement is the Balance Sheet, although it’s not as commonly used by business owners in particular. The Balance Sheet  summarizes a company’s assets, liabilities and shareholders’ equity at a specific point in time. This financial statement tells a different story than the Profit and Loss Statement.

The key point for business owners to understand about the Balance Sheet is that it does not affect your bottom line (unless you’re looking at depreciable assets, but that’s a tax related topic). In working with clients, it is typical for business owners to expect a cash exchange to show up in their Profit and Loss, as this seems to be the only report that most ever look at. This is not always the case. Writing a check to yourself in place of a salary? That will likely go on the balance sheet as an Owner Distribution, not an expense.

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Cash versus Accrual Method

Simply put, the cash method of accounting is recognizing transactions as the actual cash exchange occurs. Writing a check in January 2017 that is for December 2016 rent? You recognize the rent expense in January, when the exchange occurred. Typically, every transaction is recognized in one single month.

The accrual method can be a little more complex for those unfamiliar with accounting. This method entails recording transactions to match actual usage, which can be spread to more than just one month. In the rent check example above, you would record a bill in December 2016 and this is when you would see the expense. The bill creates a balance in your accounts payable (on the balance sheet), and when the bill is paid, you offset the accounts payable and there is no affect to your Profit and Loss in January 2017. There is an advantage to using this method though: it more accurately reflects the story of how your business is doing, plus it can be easier to track upcoming bills to be paid and invoices waiting for payment from customers.

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You Have an Accountant

If for no other reason, it’s important to have a basic understanding of accounting so that you know what your accountant is doing! This is your business, and you are ultimately responsible for it financially. If there ever is a transaction or account balance that looks off to you or you aren’t sure what the implication is behind it, ASK YOUR ACCOUNTANT! There should never be any hesitation on his or her part to do so, and a good accountant will willingly continue to explain something until you both feel confident that you understand what is being questioned.

If you have a specific accounting question you’d like answered, comment below to have it featured in a future blog.