Even though the computer age appears to be so much a part of our modern lives, there are still individuals and businesses clinging to their manual ledgers for dear life. But, for each of them there comes a day when they realize that they are going to have to migrate to the computer for their business accounting. But, these late-comers usually don't have a lot of computer know-how and don't have the slightest idea where to even start with the process of converting their manual accounting to some computerized accounting software. The following is a hypothetical example of what could happen in this situation without the proper amount of planning.
A business owner runs off to Office Depot and grabs the latest version of QuickBooks at the instruction of the sales clerk. Then he turns around and runs home to stare at the box with no idea where to even start. The types of people described above traditionally have a good working knowledge of how the accounting processes work (they have been running the manual systems which are usually much more cumbersome). But, sometimes they don't even have enough computer savy to install the software - let alone convert the financial records and input beginning balances. So the business owner calls the CPA who makes a visit and installs the software and gives a quick explanation on how to operate the software and enter transactions. Then a bill is received for this visit and the client begins to feel that the cheap software recommendation at Office Depot has turned into a major cash outflow and source of much confusion and loss of sleep.
Then, after much headache and heartbreak, the client has started using the software and delivers a backup to the CPA at the end of the year for the preparation of the tax return for the business. The CPA takes the back up and determines that the client has been entering many transactions incorrectly and the ending balances are really wacky. So, the CPA begins correcting the ending totals and finally gets the trial balance in working order. Next, the CPA calls the client and tries to explain all the issues with the ending QuickBooks totals and how the transactions should have been entered in the first place. Inevitably, the CPA has to make another visit to the client and enter the corrections while offering the client another lesson in the proper software operations for the various transaction types.
The CPA (feeling pretty proud at the fact they have imparted so much wisdom to the client) sends a bill to the client for the tax return and the subsequent QuickBooks training session. When the client receives this bill they are completely blown away at the cost. They can't even begin to understand why the return is two or three times the cost of the prior year return done on the manual system. So, they call the CPA to vent. The CPA is immediately thrown on the defensive and goes into a lengthy explanation of how screwed up the accounting records were and how long it took to sort through the mess.
Indignant at having been scolded by the CPA for trashy accounting work (remember the CPA was the one who trained the client to operate the software to begin with), the client ponders dropping either the stupid QuickBooks system (which has become VERY expensive at this point) or the CPA. The CPA begins looking for someone to blame the entire mess on and settles on QuickBooks. So the CPA calls the client back and explains that QuickBooks is a piece of trash and they never saw a real reason for using it in the first place. And, the CPA really thinks that the client would be better served with the accounting software that the CPA uses at their firm. So, the CPA suggests the client abandon QuickBooks and install the software sold by their firm.
And, here we go again!! -----
Stories like this have helped QuickBooks get a bad name with a lot of people. Many CPA's are suspicious of the software, and many clients are flat out scared of it. But, avoiding the Accounting Software Carousel could be done easily if the CPA and client took a little more time on planning how and when to make any sort of transfer to QuickBooks. Here are a few tips and hints in dealing with QuickBooks that might help clients and CPA's both save tons of time, money, and goodwill:
- Remember, QuickBooks has a specific way to enter each transaction. Creativity is frowned upon. Never try to get around doing something. QuickBooks will usually let you do what you want. But, in the end you could seriously screw up your system. You simply cannot outsmart the system.
- Always try to start using the system at the beginning of your fiscal year. It is always easier to start payroll from scratch at the beginning of the year. Trying to enter beginning balances in payroll and other areas is always much harder. If it is impossible to start at the beginning of the year, then pick a quarter end date (usually the next upcoming quarter end).
- Go ahead and purchase the QuickBooks payroll system. It is worth the money to avoid trying to enter paychecks from manually calculated spreadsheets. Also, you can save tons on payroll tax preparation when your CPA can run all the returns straight out of QuickBooks.
- Never wait till the end of the year to contact your CPA. Asking questions as you go along will help you and your CPA to deal with any possibly time consuming issues before they have gotten out of control. Fixing one or two transactions is a lot easier than trying to sort through six months of mistakes.
- Be patient!!! Rome wasn't built in a day - accounting software conversions aren't either.
- Finally, The QuickBooks for Dummies series is an awesome tool. It is written in language that is understood by welders and CPA's alike.
