Business cooperatives, or “co-ops,” are different than other business models. Much like a credit union, co-ops are designed for and run by the community to which they serve. Decision-making in a co-op tends to be democratic and socially oriented, and members are often both owners and customers.
Co-ops are not run like traditional businesses, and their accounting software should reflect this difference. QuickBooks can help you set up and track your co-op finances, manage all of your member accounts, and prepare your taxes efficiently; after all, the government of Canada recognizes cooperatives as a legally distinct business classification.
Why QuickBooks Makes Sense for Co-ops
All businesses need to maintain good bookkeeping, but cooperatives often have so many different member accounts and nontraditional considerations that even knowing where to start can be a challenge.
If you run a co-op, you should ensure that your accounting and tax preparation solutions meet a threshold for functionality. For instance, you should look for solutions that:
- Are flexible
- Have top-level support and troubleshooting
- Present an intuitive, easy-to-use interface
- Save you time and reduce uncertainty
Intuit QuickBooks is the world’s most used accounting software. Business owners and managers can quickly select or change their type of business, customize their chart of accounts, and create a hub through which outside accounts can connect.
Using the QuickBooks EasyStep Interview for a New Account
If you are just adding your new co-op to QuickBooks, start by running the QuickBooks EasyStep Interview. Therein, you’ll walk through a step-by-step questionnaire about your business and its important information. Among other things, you’ll fill out:
- Your industry
- Your tax identification information
- How you want to customize your chart of accounts
- The way you bill, invoice, and manage payments
- Accounts you want to sync with QuickBooks
For a co-op, you’ll select the General Business format after starting your new file. From there, you’ll have complete control over how you add, delete, set up, and refine your bookkeeping needs. It is very important that you have proper tax returns or tax information, since those serve as the reference for your chart of accounts.
Update Your Co-op Company Settings
If you feel like you’ve entered the wrong information after setting up your QuickBooks account, you can always change it through the Gear Menu. Go to the QuickBooks home screen, and look for the gear-shaped icon located in the top right corner.
You should see four columns in a drop-down menu. In most cases, your solution can be found in the far left column, Settings. Here, you can change basic business information and update your chart of accounts.
Getting the software set up correctly is crucial. As a co-op, you need to be cognizant of two extra bookkeeping processes that other businesses may not need to worry about. The first is the storage and maintenance of members and their history with the co-op. The second is a consolidated entity financial statement. If you are uncertain about how to do this through QuickBooks, ask support or the community for help.