Quickbooks Clinic Series

Quickbooks is a great tool to get you started.

It helps you see where your money is going.

It's designed for the
non-accountant, to be simple and easy to use.

However, lack of accounting knowledge coupled with simplicity often leads to problems.

Poor implementation and inconsistent practices takes many down the wrong path.

Mapping a Better Chart

The Chart of Accounts, is a critical element of your accounting.

It is the foundation on which all else is built.

It organizes data so you can generate reports more effectively.

Quickbooks comes with a standard chart of accounts.

But it rarely reflects the uniqueness of your business.

You need to customize your chart of accounts for your business.

Otherwise, the information that an outsider needs to understand your business is either missing or misplaced in your reports.

Different accounts relate to others and should be grouped for reporting.

Most non-accountants are unaware of those relationships and how to group effectively.

Mapping them to the wrong places will create statements that don't make sense.

Create your chart of accounts with reporting in mind to share with key constituents.

Making Sense of Costs

Costs need to be segregated in a way that leads to better decisions.

Pricing decisions rely on accurate designation
of costs like COGS and SG&A.

If you include SG&A costs with COGS, you can overprice a product.

Take the time to develop a chart of accounts that flows costs correctly into financial statements.

If you're not an accountant, hire a consultant to help.

It's worth the time and expense to do it right at the beginning.

Otherwise, you'll end up fixing it later.

Author: Chris Reynolds

To learn more on the topic

• Read the full blog article
• Visit our website at www.cfos2go.com
• Contact us at 925-283-8080 and ask to speak with a Consulting CFO

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