Balance Sheets With Classes in QuickBooks
Balance Sheets With Classes in QuickBooks
My client - let’s call him Bob - is a mild-mannered guy, so when I heard him muttering swear words under his breath the other day, I had to ask what was wrong. “QuickBooks!” he exclaimed. “I wish it would export to Excel without wiping out everything I had set up in my financials last month!”
A few days later, K2 Enterprises sent their April e-newsletter and a highlighted article about QuickBooks caught my eye. (K2 is a technology education firm based in Louisiana that puts on high-quality training for CPAs and others. I’ve taken two or three of their classes over the years and found them excellent.) Intuit has put out a report writer for QuickBooks. It’s called ISW, or Intuit Statement Writer, and it functions by pulling data out of QuickBooks into Excel. Before you get too excited, you should know that ISW is for QuickBooks Premier only, and it doesn’t work with versions prior to 2009. Still, if you spend hours every month formatting and proofing financial statements, upgrading QuickBooks and purchasing ISW at $149.95 may be worth it to you.
According to K2, ISW makes producing a balance sheet with classes in columns– similar to income statements by class – very easy. If you’d like to see a demonstration of how it works, you can go to http://www.youtube.com/watch?v=WOzPORNs-NA and view K2’s video. Why would you want a balance sheet by class? The most common instance in the nonprofit world is probably to separate restricted assets from unrestricted ones. A columnar balance sheet by class could also be useful for organizations with fixed assets in different locations, where locations were set up as classes, or for reporting operations and capital projects separately. You can probably think of an application for your organization.
When you report balance sheets this way, remember that in each class, assets should still be equal to liabilities plus net assets. Achieving that in QuickBooks will almost assuredly take you some extra time each month. As you do your daily work, you’ll need to remember to post accounts payable, accounts receivable, and all journal entries affecting balance sheet accounts to classes – something QuickBooks doesn’t normally prompt you to do. Then, as part of your month-end closing, run a balance sheet by class and verify that each class is in balance. Don’t expect that it will be, and allow enough time before any deadlines to correct errors.
Once you’ve gotten each class to balance, you’ll need to run an unclassified balance sheet and compare it to the total column on your classified one to see that they agree. This will ensure that the classes you’ve set up truly capture all of the balances in the GL.
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