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Securely Upload Data Using an Accountant’s Copy File

Chief Mechanic · September 24, 2008 ·

Starting with the 2008 version, QuickBooks Pro, Premier, and Enterprise Solutions users can upload files to Intuit’s Accountant’s Copy File Transfer secure server. Accountant’s Copy1 files are encrypted, so even en route to the secure server they’re protected. From a user’s perspective, the entire process takes place from within QuickBooks. Best of all, it’s free! 2 There are just a few simple steps that are launched from the File->Accountant’s Copy menu. Here’s the sequence in Enterprise Solutions 8.0:

Confirm sending Accountant’s Copy
Set the dividing date
Enter your accountant’s email (twice), your name, and your email
Enter a strong password (twice) and a message to your accountant
Accept the warning to close all data files
Acknowledge that the Accountant’s Copy has been successfully uploaded
You’ll receive an email confirming your successful upload
Your accountant will receive an email notifying him there’s work to be done

It’s not recommended to include the password in the comment area. Instead, communicate the password to your accountant via a more secure method, such as by telephone call.

Like most things, there are a few restrictions to using Intuit’s secure server. Your company file must be under 200 Mb in size. Next, you have to conduct the transfer using a high-speed internet connection.

There are also a few simple things to keep in mind when uploading an Accountant’s Copy to Intuit’s server. You must use a strong password, which means one that contains at a minimum:

1 uppercase character
1 number
More than 7 total characters

Note that once you’ve completed uploading your Accountant’s Copy export file, your QuickBooks program title bar will remind you that you have an Accountant’s Copy file outstanding. If your upload session ends before the file transfer is complete, an Accountant’s Copy import file (with a .qby extension) may remain on your computer. It can be safely deleted.

One important consideration is whether the Accountant’s Copy file is the right file choice to work with your accounting support, because there are some restrictions3 on this file type.

An Accountant’s Copy file is the right choice when you want to continue working in your QuickBooks file and your accountant plans to independently perform tasks such as closing a fiscal period. When you create an Accountant’s Copy, you specify a dividing date. Your accountant can make entries on or before that date, and you can make entries after but not on that date. That allows both you and your accountant to work independently. You can continue to view data before the dividing date and attempt to make changes to that data, but when you try to save your changes, QuickBooks will warn you and ignore your changes. Once your accountant has completed his work, you’ll import your accountant’s work into your primary QuickBooks data file. There are restrictions on what your accountant can do in an Accountant’s Copy file, such as working with lists or performing reconciliations. Generally speaking, Intuit has expanded the capabilities of the Accountant’s Copy file over the years when both the client and accountant are working in the most recent version. For example, for 2009 the Accountant’s Copy allows the accountant to perform reconciliations after the dividing date or to modify classes, two things not allowed in previous versions.

Even if your accountant doesn’t plan to change data, an Accountant’s Copy file is still a good choice. For example, if we are producing custom reports for you, we recommend you make and transfer an Accountant’s Copy file using the steps described above and then immediately cancel it by removing restrictions. Canceling the Accountant’s Copy file removes the dividing date restrictions on the file, but it does not delete the file or make it unavailable to your accountant. This allows you to take advantage of free, secure transfer to your accountant without any restrictions on your continued QuickBooks work. Although Accountant’s Copy files are not intended as full backups, the transfer method we’ve described offers a fast and easy way to create a partial off-site backup, which could prove invaluable in disaster recovery.

QuickBooks offers other file types which can also be used to transfer accounting data, such as a portable file (.qbm file extension) and a backup file (.qbb file extension). Like the Accountant’s Copy file, these other file types come with different capabilities and restrictions. It’s important to pick the right file type for the task at hand. Because of the free, easy-to-use, and secure transfer process for an Accountant’s Copy file, it’s a great choice for a wide range of tasks.

We’ve extended this discussion with 3 articles in our QuickBooks KnowledgeBase.

This series of articles covers the full cycle of sending data to us or another accountant and incorporating recommended changes into your QuickBooks company file.

(+1 rating, 1 votes)

Specifically, a QuickBooks Accountant’s Copy export file with a .qbx extension. [↩]
Generally speaking, Intuit’s resources of this type are only available to users of versions that aren’t obsolete. If that policy remains unchanged, when the 2011 version is released in late 2010, users of the 2008 version won’t have free transfers any longer. [↩]
Some restrictions depend on other QuickBooks applications you use. For example, Velocity Inventory users running Enterprise Solutions can’t create Accountant’s Copy files. Velocity Inventory is a separate inventory management program that offers serial number tracking, multiple warehouses, and bar code support. [↩]

Have a Question? Get a Free Answer

Chief Mechanic · September 22, 2008 ·

All of our support services include free QuickBooks support via email for a specified duration. We think you’re going to like getting one of support emails because they typically contain both detailed step-by-step instructions and annotated screen images taken from QuickBooks so you’ll learn just what you need to know. Here’s a typical support email on the subject of tracking classes in QuickBooks.

You’ll also get your answer quickly. We strive to get you the answer you need as quickly as possible, typically in a few business hours. Want to get an email? What’s your question?

QuickBooks Clean Up Improves Performance

Chief Mechanic · September 20, 2008 ·

Just like a car, your QuickBooks company file needs regular maintenance to perform optimally. At a minimum, that maintenance should be performed annually. We refer to our specialized program to maintain a QuickBooks company file as our QB Tune Up, something QuickBooks users often generically refer to as a “clean up.” This is the among the most requested QuickBooks consulting services.

From within QuickBooks, you can press F2 to produce the Product Information screen, a sample of which appears nearby. This display shows some basic facts about your QuickBooks installation, including overall file size, database file fragments, the number of list entries, and the date that QuickBooks internal clean-up was last run. This information is important because QuickBooks has limits on the amount of list entries. Overall file size and the number of file fragments impact performance.

Unfortunately, while this basic information is useful, it doesn’t provide much insight into what needs to be cleaned up. Most QuickBooks users define the need for clean up more broadly: improve the accuracy of their accounting data and the performance of QuickBooks.

There are some identifiable operational indicators that it’s time for you to get our QB Tune Up:

reports and financial statements produce unexpected results
balances shown on detail reports don’t match balance sheet accounts
GL chart of accounts has become unwieldy
lists contain many outdated entries, increasing transaction entry time and the risk of operator error
sluggish system performance

It takes a specialist to develop a specific action plan to solve these data reliability and performance problems. We’ll provide a free, comprehensive analysis of your QuickBooks data file and an estimate of what needs to be done during our QB Tune Up. All of our QuickBooks service programs include free email support for a specified time period.

You don’t want to keep running your accounting system without a regular QB Tune Up.

Certified Enterprise Solutions ProAdvisor

Letting Inventory Levels Go Negative Results In Unreliable Numbers

Chief Mechanic · September 19, 2008 ·

A common problem for many inventory-based businesses is recording receipt of inventory before that inventory is billed to a customer. In retail settings, pressure to promptly take care of customers can lead to pressure to produce an invoice that hasn’t yet been received. Since producing an invoice is often a necessary first step to getting paid, many firms prioritize invoicing over properly receiving inventory. When invoicing results in inventory levels going negative, the results are inaccurate financial reports.

To see how, let’s start with the sample data included with QuickBooks for a products-based business, Castle Rock Construction. First, let’s review the firm’s Balance Sheet and Profit & Loss before we make any transactions. We start with a total inventory value of $30,121.33. Our starting cost of goods sold is $3,610.50. Castle Rock has incurred costs of $10,211.23 for customer Kathy Abercrombie, the customer we plan to invoice. Next, let’s add a new inventory item called “COGS Test” with an opening balance of 5 units costing $5 each. QuickBooks debits inventory for $25 and automatically posts an offsetting credit of $25 to Opening Balance Equity; both entries are marked as reconciled. Our opening balances before creating the new inventory item are shown below.

For a simple example of the impact of letting an inventory level go negative, let’s sell all 10 units of our “COGS Test” item to Kathy Abercrombie. Since we only have 5 units of that item on hand, that will reduce our quantity on hand for this inventory item to -5. When we attempt to save the invoice, QuickBooks will warn us that we’re attempting to sell inventory that we don’t have, but we’ll ignore this warning. That’s where our trouble will begin.

At the time of the sale, QuickBooks had information on the average cost to that point in time. That cost was $5.00. But what if our cost for the item had changed and was now something other than $5.00? We can imagine that if we had to scramble to get this item for the Abercrombie order, we faced higher costs. Let’s enter a bill for 20 units dated after the date of the Abercrombie invoice. The date is very important, as we’ll soon see. The 20 units we received cost $7.50 each, or 50% more than our normal cost. Here’s our Balance Sheet and Profit & Loss after entering the vendor receipt.

Negative Inventory Impact BS If Negative Inventory

Negative Inventory Impact P & L If Negative Inventory

By letting inventory reach negative levels, QuickBooks accounted for the transaction as if we sold 5 units that cost $5 each and 5 units that cost $7.50. In effect, even though QuickBooks uses the average cost method, this transaction was treated on a First In First Out (FIFO) basis.1 A look at the Transaction Journal for the bill confirms this. Once we entered the new inventory at higher cost, QuickBooks automatically applied the extra cost of $2.50 per unit to the 5 units that we did not have in stock. Our cost of goods sold is now $3,673.00, an increase of $62.50. Our total costs for customer Abercrombie are $10,261.23, and our inventory value is $30,233.83.

We obtain totally different results if we record the bill for receiving inventory before invoicing the customer. Our cost of goods sold in this case is $3,680.50, or $7.50 higher than reported by allowing inventory to reach negative levels. Our inventory value is $30,226.33, or $62.50 higher than reported when we recorded the invoice before the bill. Our costs for customer Abercrombie are now $70 higher than when we started.

Negative Inventory Impact BS If No Negative Inventory

Negative Inventory Impact P & L If No Negative Inventory

All of these differences are due to the fact that by entering an invoice before a bill, we prevented QuickBooks from correctly calculating the average cost for our new inventory item. After all, we can’t expect QuickBooks to calculate average cost before we’ve entered that cost. By first entering the bill for inventory receipt and then recording the invoice, we stick to our inventory cost assumption. We started with 5 units costing $5 each, and we added 20 units costing $7.50. That produced an average cost of $7 for each of our 20 units. The results reported by entering transactions in the proper sequence are consistent with that average cost.

Account	Invoice Before Bill ($)	Invoice After Bill ($)	Difference ($)
Cost of goods sold	3,673.00	3,680.50	7.50
Customer costs	10,261.23	10,281.23	20.00
Inventory valuation	30,233.83	30,226.33	7.50
Item average cost	7.50	7.00	0.50

The bottom line: when customer invoices are entered before vendor bills, your financial reports will be inaccurate. In our example, overall cost of goods sold, customer costs, and inventory were under-reported. That resulted in overstating income. Our average cost for the new item was reported as $7.50, rather than the $7.00 obtained by applying the average cost method consistently. We built our example around a discussion of this problem in the QuickBooks knowledge base.

If you’ve already made the mistake of entering invoices before bills that have resulted in negative inventory levels, we can help get your financial reporting back on an accurate track.

(+3 rating, 3 votes)

In August 2008, the SEC announced that some companies can report under International Financial Reporting Standards (IFRS) by 2010 and that all companies will be required to do so by 2014. IFRS, unlike US GAAP, requires FIFO costing where individual items are not identifiable. [↩]

QuickBooks 2009 Is Here!

Chief Mechanic · September 19, 2008 ·

Intuit made QuickBooks 2009 available for electronic download on Monday, September 29th. The new version brings with it a host of important changes, new products, and in at least 1 case, the migration of a included feature into a extra-cost add-on.

We’ve prepared a short list of what we think are the most noteworthy new or improved features. Keep in mind it’s not an all-encompassing list. Here’s our top 10 improvements:

Feature	Pro & Premier 2009	Enterprise Solutions 9.0	POS Basic 8.0	POS Pro 8.0
Multi-currency support	Yes	Yes	-	-
Multi-user enhancements	Yes	Yes	Yes	Yes
New company snapshot	Yes	Yes	-	-
Improved sorting in bank reconciliations	Yes	Yes	-	-
Support for larger numbers	Yes	Yes	-	-
PIN pad with signature capture	-	-	Yes	Yes
Improved sales tax reporting	-	-	Yes	Yes
New POS Webstores service	-	-	-	Yes
Improved inventory turn reporting	-	-	-	Yes
Improved re-order support	-	-	-	Yes

With the economy becoming increasingly global, multi-currency support for all global currencies is a timely addition. Pro, Premier, and Enterprise Solutions automatically convert currencies into a designated “home” currency. A new report, “Realized and Unrealized Gains & Losses,” shows the impact of currency fluctuations. In addition, wire transfers can now be performed directly within QuickBooks.

For Enterprise Solutions, the maximum number of users in multi-user mode increased from 20 to 30; for POS, it doubled from 10 to 20. Pro, Premier, and Enterprise Solutions now allow a back-up to be performed and reports to be printed while in multi-user mode. An instant messenger feature is now included to allow users to communicate using the familiar QuickBooks interface.

Less dramatic improvements for Pro, Premier, and Enterprise Solutions products include a new company snapshot, column sorting in bank reconciliations, and support for larger numbers (11 vs 8 digits).

One negative: the Financial Statement Designer that was formerly included at no extra charge with the Accountant edition has been replaced with the Intuit Statement Writer at a retail cost of $149. The program is included with the multi-user versions of Enterprise Solutions, but most accountants will find themselves having to buy something that was previously included at no charge.

POS Basic got new support for PIN pads with signature capture (pictured at left), and QuickBooks now saves an electronic copy of the signature in case of disputed transactions, along with a doubling in the number of active workstations in each store from 10 to 20.

POS Pro received all of the POS Basic improvements plus a new Webstores service to allow companies to create a web store ringing up sales from a product catalog. Intuit also introduced a new product, Cash Register Plus, for those businesses that aren’t ready for POS. The program rings up sales and tracks customers, processes credit cards, and performs basic bookkeeping to track sales performance.

This is just a partial list of the improvements for 2009. Two features – multi-currency support or the multi-user enhancements – could tip the scales to justify upgrading right away. We’ve done an in-depth analysis of the new multi-currency features in QuickBooks in a post on our blog.

With the release of the 2009 version, QuickBooks 2006 is slated to become obsolete in April 2010. Time to upgrade! When you decide to upgrade, you can save by using the banner at the top of this page or you can review discounts on both QuickBooks and Quicken at our Buy QuickBooks page.

Hopefully, Intuit addressed more than a few items on your personal wish list.

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