QuickBooks provides access to a variety of financial accounts, but your Chart of Accounts is particularly important. This account is a list of all of the accounts that you plan to use in various transactions that can also help you with creating accurate reports.
In QuickBooks, your Chart of Accounts is established by you answering questions about your business when you first start using the program. You can also answer these questions or change your previous answers by heading to the “Company Settings” option in QuickBooks. Once you complete this step, you will have several different accounts listed, such as assets, liabilities, income and expenses. Generally, you will not need to organize transactions manually because QuickBooks realizes that certain transactions are tied to certain accounts. For example, a bill is sent to your Accounts Payable and an Invoice is sent to your Accounts Receivable. However, you do have to choose a specific account when you enter an expense or write a check. Your accounts are also seamlessly added to main reports, such as your profit and loss statement and balance sheet. You should run these reports periodically in order to keep a better eye on the finances of your business.
QuickBooks Chart of Accounts is particularly flexible, allowing you to edit your Chart of Accounts whenever the need arises. To view your Chart of Accounts, simply click on the upper right portion of your screen on the small gear icon. Click on “Chart of Accounts.” You can also highlight and click on the “Register” button to become more familiar with specific kinds of transactions.
In terms of other accounts, QuickBooks also tracks these accounts in the Chart of Accounts. You can also establish financial accounts in QuickBooks so that you can download financial data directly to QuickBooks. Select “Transactions” and then “Banking.” Next, select “Add Account.” Select one of the financial institutions or enter the specific URL in the top field. Input your data that you commonly use to log into your financial account. From here, you can start downloading transactions once they occur. Keeping your accounts connected in this manner can help you minimize transactions as you will no longer have to duplicate them. Additionally, your accounting data will be more accurate and you will have an up-to-date balance at all times.
If you need assistance with any portion of your Chart of Accounts, a QuickBooks ProAdvisor can be of assistance.