With anything new, there’s a learning curve. QuickBooks Online is no exception. From the initial setup to changing operations, your QBO file is the backbone of your company. You want to be sure it’s operating at its peak potential. Fully leveraging the power of QuickBooks Online relies on understanding these four common challenges business owners face and how to overcome them.

Challenge #1: Poorly Configured Chart of Accounts

When you sign up for QBO, you will receive a standardized chart of accounts based on your business structure. QBO doesn’t alter the chart of accounts to fit your industry or operations; that part is up to you. A poorly configured chart of accounts can lead to incorrect financial statements and tax returns. Not to mention,you will develop minimal insights from your accounting data.

To properly configure your chart of accounts, go through your current income and expense items. Do you have different classes of expenses grouped together? For example, can you breakout office wages from direct labor? How about separating office supplies from direct materials?Take the time to revisit your chart of accounts to add accounts and adjust the naming.

Challenge #2:Delayed Account Reconciliations

Reconciliations arethe method ofdouble-checkingthat your accounting records match whatactually cleared the bank. Ignoring reconciliations for months at a time can lead to bank overdrafts and poor cash flow management. In addition, how will you know which customers actually paid you if you never reconcile accounts? A customer’s payment could have gotten lostin the mail orcleared for an incorrect amount.

Make it a priority to complete your bank and credit card reconciliations shortly after month-end.If you don’t have the time, outsource your bookkeeping to an expert, like Chandler Gilbert Bookkeeping.

Challenge #3:Losing the Administrative Password

This is one of the most common challenges business owners will face when using QBO. With the abundance of digital accounts we use on a daily basis, it can be almost impossible to remember every login. If you lose your administrative password, go to your company settingsand reset your password. QBO will send you an email with a token to reset your password safelyand securely.

Challenge #4:Depositing Funds Wrong

When you receive a payment from a customer, you need to precisely follow deposit instructionsto clear out the receivable and populate the amount in your bank’s feed. Otherwise, you could have payments sitting in the undeposited funds account. This can lead to mistakes in youraccounts receivable aging schedule and anincorrect sales amount on your income statement.

When a payment is made from a client, record the money in the deposit module. Also, batchchecks together that you’re taking to the bank,entering them as a single deposit in the software.This will save you time when completing bank reconciliations and keep your deposit function operating accurately.

Summary

Do you have another challenge you are facing? Trying to navigate QBO on your own can feel overwhelming, which is why we are here to help. At Chandler-Gilbert Bookkeeping, we are experts on all things QBO. Reach out today to schedule your free consultation