Now that your data has moved into QuickBooks Online, it’s time to review your QuickBooks Online account. We have created a review checklist to get you started using QuickBooks Online for your business. Here we go over what you need to do before you start making changes to the data or entering new transactions.
Note: Because not every business is registered for GST, the steps to clean up your GST might not apply to you. Skip these steps if your business isn't registered.
Step 1: Verify your data
This is an important step to verify the data conversion to make it consistent with your old accounting system. These are the three areas to check.
The first thing you need to verify is your accounting method. Follow these steps to make sure your accounting method has been set up correctly:
- Go to Settings ⚙ and select Account and settings.
- Go to the Advanced tab.
- In the Accounting section, select the Edit ✎ icon.
- Select the Accounting method.
- Select Save, then Done.
Compare the balances between your prior accounting system and your new QuickBooks Online subscription by comparing the below reports across the two systems. Ensure your reports are being viewed on an accruals basis.
- Trial Balance
- General Ledger
- Balance Sheet
- Profit and Loss report (income statement)
- Accounts Payable ageing summary
- Accounts Receivable ageing summary
Outstanding supplier and customer balances
The outstanding balances of suppliers and customers in your old software should line up with the new balances in your QuickBooks Online account. You can check this at random for around 5-10 customers and suppliers to make sure there are no discrepancies. Also, check the historical account payable (A/P) and account receivable (A/R) on some random dates.
Note: There might be some discrepancies due to adjustment notes. In some accounting systems, you can specify a due date for a adjustment note, which isn't available in QuickBooks Online. This might cause amounts to appear in the wrong column.
Step 2: Configure your QuickBooks Online account
Next, let's set your QuickBooks Online account properly so you can start reaping the rewards straight away.
- Go to Settings ⚙️ and select Account and settings.
- Select each tab from the left menu and update information.
- Select Done when you've finished.
Note: It’s important to select the correct first month of financial year under Advanced settings. For details visit How do I set my advanced account settings.
It’s important that QuickBooks Online is set up with the correct ABN and lodging frequency before you and your client start using it. You can skip this step if your business isn’t registered for GST. Please follow the steps below to make sure GST has been set up correctly.
- Go to GST.
- Select Settings dropdown.
- Select Tax settings.
- Check the Accounting method is correct and change the Lodging frequency if required.
- Select Save.
Step 3: Match the unmatched entries
- We strongly recommend you complete the below process in order to ensure your invoices/bills and their associated payments are clearly linked (matched) in your new QuickBooks Online subscription.
- This step is more effective if performed in your source system, before moving your data. All payments should be linked to the relevant invoice or bill in the source system. MMC Convert will move over these payments. However, in some cases, they might not recognise the link between the payment and the source invoice or bill. The below steps are how to tidy this up in QuickBooks Online.
For every customer or supplier, follow these steps:
- Select the customer or supplier.
- If the open amount doesn't equal the overdue amount, go to step 3; otherwise, go to the next customer or supplier.
- In case of customers:
- Select Payment from the New transaction dropdown.
- Select an appropriate Payment method and other details.
- Select the applicable transactions from the list of Outstanding Transactions.
- In case of suppliers:
- Select Cheque from the New transaction dropdown.
- Select Add to link a transaction or Add all as applicable.
- QuickBooks will automatically make a payment linking the journal entries and the invoices or bills (amount overdue should be 0.00).
- Select Save and close.
Step 4: Reconcile your bank accounts
After the data conversion, all bank accounts are unreconciled. You'll need to reconcile them before you start using QuickBooks Online. For each bank account follow these steps:
Before you start:
- Last statement ending date: Make sure your bank statement starts the day after your last reconciliation.
- Beginning balance: Make sure the beginning balance in QuickBooks matches the one on your bank statement. This is the account balance at the beginning of the time period you're reconciling. Here’s what to do if they don't match.
- Go to Transactions and select Reconcile (Take me there).
- From the Account ▼ dropdown menu, select the account you want to reconcile.
- Enter the Ending balance and Ending date as it shown in your exported reports or previous accounting system.
- When you're ready, select Start reconciling.
- Select All transactions for reconciliation.
- Select Finish now, follow the steps (if any), then select Done.
If you need further help with reconciliation or have a unique situation, please visit reconcile an account in QuickBooks Online.
Note: We bring over the main types for chart of accounts, but not the specific types (subtypes) if those exist in your previous accounting system. You're free to change the nominal code types after the conversion to something that suits you better.
Step 5: BAS and IAS lodgement (Optional)
It's important to check if your tax lodgement is matching with the previous accounting system. You will need to include all converted data into a single period and mark the BAS as lodged in QuickBooks Online.
Note: You may find that the amount of GST outstanding looks incorrect, even though the GST Account shows the correct figure. Since this will be the first time you are lodging a BAS using Quickbooks Online, it assumes that all GST figures ever recorded are now due.
- Go to GST.
- Select Get started.
- Select the Begin date as far back as you can to make sure it includes all historical data.
- Select the End date to match what was lodged in the previous accounting system.
- Select Continue.
- Review your GST obligations - QuickBooks will display the total sales (including GST), total purchases, GST collected on sales, and GST paid on purchases. Then select Next.
- After reviewing the complete activity statement, select Mark as lodged, then select Done to close the tax period in QuickBooks.
Step 6: Remove conversion partner user from user list
Before your data was moved over to QuickBooks, you would have had to invite a user from MMC Convert, our conversion partner. To free up a user slot in your user list, remove the MMC Convert user from your company.
- Go to Settings ⚙️, then select Manage users.
- Find the MMC Convert user that you invited to your company prior to the conversion.
- In the Actions column, select the dropdown arrow, then select Delete.
- Select Delete to confirm user deletion.