#5 of 8 - Review Checking Account Registers for un-cleared transactions

#5 on the list of "8 Things Every Business Owner Should Know How to Do in QuickBooks"

Review Checking Account Registers for un-cleared transactions:

• HOW?  Banking – Use Register – Choose Account you want to review
  • In the bottom left, from the dropdown list of sorting options, choose ‘Cleared Status’
• WHAT TO LOOK FOR:
  • Scroll up to where the check marks, stars or lightning bolt marks stop.  
    • If the cash accounts are being managed properly, the cleared balance (that’s what those marks mean) should match the bank or statement balance as of a certain date.
    • If you see check marks, the account has been reconciled through the last bank statement. (the balance at the last check mark should equal the bank statement)
    • If you see lightning bolts, the bank activity is being downloaded.  To verify the register matches the downloaded balance:    
      • Bank Feeds (or Online Banking) – Choose Account – Look in the bottom half for the last downloaded balance
    • If you see asterisks, that means the activity has been cleared, but not reconciled.  
      • The balance is only accurate to a certain point. Without knowing that point, it’s hard to determine the accuracy.  Best plan of action is to reconcile to the most current statement, then review again.  If there are still asterisks, pull the bank activity and go through the reconciliation process through the latest balance.  DON’T hit reconcile though.  That makes a mess!!!
  • To see when a bank statement was last reconciled:
    • Reports – Banking – Previous Reconciliation.

#6 of 8 - Review Undeposited Funds in QuickBooks

#6 on the list of "8 Things Every Business Owner Should Know How to Do in QuickBooks"

Review Undeposited Funds

• HOW?  Banking – Make Deposits – Review items in Pop Up Window
  • Any transactions here should only be deposits that have not been deposited in the bank.  
• WHY?  If there are items in this window, several things could be going on:
  • Customer payments on invoices or sales receipts have been entered, but the money hasn’t been deposited to your bank register
  • If these are here for too long and your bank accounts are reconciled, your income will be overstated
  • A customer payment or sales receipt may have been entered twice. Again, this will overstate your income

#7 of 8 - Review “Misc”, “Need Info” or “Ask My Accountant” in QuickBooks

#7 on the list of "8 Things Every Business Owner Should Know How to Do In QuickBooks"

Review “Misc”, “Need Info” or “Ask My Accountant” 

• HOW?  This depends on where you  or your bookkeeper post transactions to be reviewed.  Look at the chart of accounts to find the 'catch-all' account. .
  • Lists – Chart of Accounts – Click on Account – Quick Report (at the bottom of the Account List window)

#8 of 8 - Review Payroll Liabilities in QuickBooks

#8 on the list of "8 Things Every Business Owner Should Know How to Do in QuickBooks"

Review Payroll Liabilities

• HOW?  Employees – Employee Center - Liabilities
  • Look at the “Pay Liabilities” section.  All liabilities should be current (no red!)
  • If you have tight cash flow, I highly recommend that you NEVER consider this an optional payment.  The IRS and state tax agencies frown upon this….and the penalties and interest add up very quickly..  
• WHY?: Nobody likes to get nasty grams from the IRS, their State Department of Revenue or the Department of Labor.  When liabilities are incorrect in QuickBooks or not paid on time, you will hear from one of the aforementioned agencies and there's a very good chance there will be penalties and interest due.

For more advanced information on how to review and adjust payroll liabilities, look for more posts on the topic here in our blog in the Payroll section.