🙅🏽♀️ The 7 mistakes to avoid to get the most out of QuickBooks Online ®️ ✨
QuickBooks Online ®️ is an essential tool to simplify the financial management of your business. However, without careful use, it is easy to make mistakes that can distort your data and complicate your reports.
Here are the common mistakes to avoid to take full advantage of QuickBooks and ensure flawless accounting .
#1 Wrong categorization of expenses 📂
Many entrepreneurs assign expenses to the wrong categories, which distorts financial reporting and makes it difficult to track costs.
For example, an advertising expense classified as “office expenses” could give a misleading view of your marketing budget .
💡 Take the time to understand the categories available in QuickBooks and adapt them to the needs of your business.
A good categorization will give you precise reports, thus facilitating decision-making. You can also consult a 6DT advisor to optimize your charter of accounts.
#2 Missing VAT (TPS/TVQ) entry 💸
Forgetting to apply the GST/QST can cause tax discrepancies and make tax filing a hassle. Taxes are an essential component of ensuring your business is compliant.
💡 Set up applicable taxes up front in QuickBooks and make sure to add them to every transaction. QuickBooks even offers options to automate tax entry on recurring transactions, simplifying your tax management.
#3 Incomplete customer and supplier accounts 🧾
Failure to record all customer or supplier invoices can lead to cash flow tracking errors. Incomplete transaction management can make it difficult to track your receipts and payments, thus altering your view of cash flow.
💡 Develop a routine for systematically recording each invoice. QuickBooks allows you to set reminders for rigorous follow-up.
#4 Misuse of bank accounts 🏦
Entrepreneurs sometimes tend to use the same bank accounts for their personal and business finances, which complicates reconciliation and hinders the accuracy of financial reporting.
💡 Open a bank account exclusively for your business operations and connect it to QuickBooks. Separating accounts makes financial management much clearer and simplifies bank reconciliation.
#5 Ignoring bank reconciliations 🙈
Not doing monthly bank reconciliations can hide discrepancies or missing or duplicate transactions, making accounting less reliable. A monthly reconciliation helps catch anomalies before they become big problems.
💡 Perform monthly bank reconciliations to ensure all transactions are correctly recorded in QuickBooks. This regular check ensures up-to-date accounting and prevents costly errors.
#6 Forgetting to track recurring revenue 💰
Recurring revenue is sometimes overlooked, especially when it comes from repeat customers. Omitting these entries changes the perception of your revenue and can affect your cash flow.
💡 Use QuickBooks' recurring income feature to automate these transactions. With this feature, each recurring payment is integrated without any extra effort, allowing you to have a more complete picture of your income.
#7 Neglecting to regularly check financial reports 📊
QuickBooks financial reports are valuable resources for evaluating your business's performance. Many entrepreneurs neglect to review them, missing out on the opportunity to spot trends and adjust their strategy.
💡 Make it a habit to review your reports at least once a month. QuickBooks generates reports like the balance sheet, income statement, and cash flow.
These supports give you an overview of the health of your business and make it easier to adjust your strategies in real time.
QuickBooks Online ®️ is a powerful tool, but knowing how it works is essential to get the most out of it. By adopting these best practices, you ensure reliable financial data and maintain total control over the evolution of your business.
↪️ To avoid these mistakes, contact our 6DT Conseil business advisors!