Differences in cash basis reporting from Quickbooks desktop to online

I can help provide insights about the difference between accrual and cash methods reports in QuickBooks, FCTFks.

In the Cash basis accounting, income and expenses are only recorded when cash is actually received or paid. On the other hand, an accrual-basis report shows income whether your customers have paid your invoices and expenses regardless you have paid all the bills.

Check this article to learn more about their difference: Differentiate Cash and Accrual Basis.

You can also check out this article as an additional reference: Cash vs. accrual accounting: What’s best for your small business?

Let me know if you need further clarification on your questions. I'm always around to provide answers.

Yes, I know what cash vs accrual accounting is. My question is how cash basis reporting in Quickbooks Online differs from cash basis Quickbooks Desktop. We just moved from the Desktop version to the Online version and cash basis reporting is different. How are cash basis transactions treated differently in Online vs Desktop versions of Quickbooks?

Hi, @FCTFks!

There is no difference in cash reporting between QuickBooks Desktop and QuickBooks Online. The cash basis transactions are treated the same way because when moving from QB Desktop to QB Online, the balances will not match on the cash basis method after converting. I recommend that you use cash accrual and then select all dates so that you can review all of your balances.

You can check these articles for more details:
 

• What to do after you move from QuickBooks Desktop for Windows or Mac to QuickBooks Online.
• Learn how features and data move from QuickBooks Desktop to QuickBooks Online.

If you would need to manage your expenses in QuickBooks Online, please visit this article: Enter and manage expenses in QuickBooks Online.

If you need further assistance with your financial reports, feel free to reach us again.

Maybe it's terminology but I'm not understanding your response and it seems to contradict itself. I've read all of those articles already before posting my question. Your response says there is no difference in cash reporting between Desktop and Online and then that the balances won't match on cash basis after converting which would imply that there is a difference. This comes from one of the articles you sent (https://quickbooks.intuit.com/learn-support/en-us/help-article/convert-files/converting-quickbooks-d...):

Report discrepancies you can expect:

• Cash basis — QuickBooks Desktop and QuickBooks Online don't track transactions as paid the same way. Reports may not match using cash basis.

So, the question is, how does the Desktop version track transactions as paid differently than the Online version? What causes the reports not to match on a cash basis between Desktop and Online?

I have this exact same question, my cash accounts receivable is dramatically different from QB desktop to QB Online. I understand the difference between cash and accrual accounting, but I would like to know HOW QB desktop records the transactions differently than QB online, and why is there such a huge difference between the two (QB Desktop cash basis A/R and QB Online cash basis A/R).

Just a thought, because it was an issue when we moved from QBD to QBO, QBO likes to make random accounts.  I ended up with multiple sales tax payable accounts, accounts receivable accounts, income, and cogs.  You might check and see if the entries are placed in a random or duplicate account.

Was there ever a resolution as to how to resolve the Cash vs. Accrual report?  I too just converted from QBDT to QBO.  On accrual, we match numbers for "All Dates" perfectly however, in Cash we are way off.  I can't have this difference especially as we report only on a Cash basis and now the Year-to-Date does not match from the QBDT to QBO.  This is not a small number so I need to get a specific work around to make sure I can explain this to the owners and management.  Can you provide a specific work around without sending me to basic articles with QB Community?

Thank you for posting your concerns here in the Community, @MRBooks. Welcome to the forum. You're joining us here is greatly appreciated. I'd be happy to conform with others and share some thoughts about the Cash vs. Accrual report.

You'll want to review the date set up in those cash transactions. Ensure that they are aligned. You may make an edition of it if necessary.

Moreover, this article may come in handy in the future: Resolve accounts receivable or accounts payable balances on a cash basis balance sheet in QuickBooks.... It contains information about fixing an Accounts Receivable (AR) or Accounts Payable (AP) balance on a cash basis balance sheet.

Feel free to drop by the Community for further questions. We are available 24/7 to lend a hand with each of your queries. Have a great day!

Hi! I just migrated from Desktop to QBO and came across the same problem with Acct Rec on the Cash Balance Statement. Did anyone ever resolve the questions of why the two platforms calculate this differently?

Hello there, @afnjlawbk.

Allow me to join this thread and share some information about how your data move from QuickBooks Desktop to QuickBooks Online.

You may notice differences upon switching between the two software. QBO reports differ from the QBDT. Thus, the Accrual basis reports match in the two software while Cash basis reports may not match due to platform difference and conversion process.

To help you understand more about how your books were moved, feel free to read through this reference: Learn how features and data move from QuickBooks Desktop to QuickBooks Online.

Furthermore, I’ve got these great resources that contain information about managing various reports that can help you manage your business. You can modify them based on the data you need and save their current customization settings for future use:

• Customize reports in QuickBooks Online
• Memorize reports in QuickBooks Online

I’m always ready to assist you if you have any other questions or concerns about the accounting methods. Tag me in your reply, and I’ll sprint back into action. Have a good one, and keep safe.

@Carneil_C 

Your customer isn't asking about the difference between cash and accrual.  Your customer is specifically asking why, after converting from Desktop to Online, there is a difference in the way A/R is being calculated.  QB's help section specifically states that after migrating from Desktop to Online:

"Accrual basis reports in QuickBooks Online will match your reports in QuickBooks Desktop. Cash basis reports may not match."

Many of your customers want to know why.  Are you able to help them?

Yes!!  Exactly. Thank you.

I cant believe this thread....how can the intuit employees / experts not clearly understand what specifcally causes this issue if it happens everytime and is a known problem?   Further, I feel like it should be communicated ahead of time.  

****The cash basis financials dont reconcile after converting to QBO!!!   It is primarily A/R and A/P, but I notice small variances in other accounts, on both the balances sheet and the P&L.   

WTF?

I appreciate you reaching out here, Asch04. Allow me to chime into this thread and help you to get this into detail. 

QuickBooks Online (QBO) doesn't have the same reports as QuickBooks Desktop (QBDT). When you switch from QBDT to QBO, you may notice differences in how it appear.

Discrepancies happen due to the differences between QBDT and QBO. Thus, the Accrual basis reports match in the two software while Cash basis reports may not match due to platform difference and conversion process.

Your past reconciliation reports don't move to QBO:

• All reconciled transactions in the register will have an R in the cleared column in QBO.
• Cleared transactions will have a C in the cleared column in QBO.

Additionally, here's an article that you can browse through to know more about how to run a Profit and Loss report or a Balance Sheet report in QBO and QBDT and compare the two: Learn what to do after you move from QuickBooks Desktop to QuickBooks Online.

Lastly, I've also added this article for you to enjoy a more flexible, secure, and up-to-date platform for your books: Move your QuickBooks Desktop file to QuickBooks Online.

Feel free to let us know if you have any other queries with your P&L reports. We're always here 24/7. Stay safe. 

I appreciate you taking the time to reply, but nothing in that response helped me.

What specifically causes a difference in cash balances?  What is driving the differences in my cash basis P&L and Balance Sheet?  

@Sherrie_F 

"Discrepancies happen due to the differences between QBDT and QBO. Thus, the Accrual basis reports match in the two software while Cash basis reports may not match due to platform difference and conversion process."

We know that.  The question is: What specifically is QBO doing during/after the conversion process that changes the way it calculates cash basis reports?  Isn't there someone at Intuit you can ask that knows the answer?  There must be some way for you to contact them.      

I am finding the same issues. My AR, AP, cost of goods sold and inventory accounts detail do not match the cash basis balance sheet. Having an issue with my my inventory asset. I am trying to match year end 2022 cash basis reports from QB Desktop to QBO as I prepare for year 2023 reports.  The QBO cash basis balance sheet shows $112. The accrual basis balance sheet shows the $67,789. The detail report for the inventory account clearly shows $67,789. Why would the cash balance sheet report show $112 while the accrual report show $67,789. I think the cash basis reports are flawed.

Hello there, @elepadilla. I understand the differences you've experienced when migrating from QuickBooks Desktop (QBDT) to QuickBooks Online (QBO). Let me share some details on why this is happening.

Since QBDT and QBO are different platforms, they use different ways of calculating things. 

• Methodology: different methods for cash basis reporting. QBDT typically uses a more traditional approach to cash-based accounting, while QBO has variations in its computation.
• Accounting Settings: The settings and preferences for cash basis reporting differ between QuickBooks Desktop and QBO, leading to variations in on certain transactions are recorded and reported.
• Transaction Processing: The handling of transactions, especially those related to AR, AP, cost of goods sold, and inventory, differs in QBDT and QBO, affecting the cash basis balance sheet.

I recommend seeking an accountant's advice to help you track and record the transactions to match the reports.

Additionally, you can refer to this article for things you need to do after migrating: Learn what to do after moving from QuickBooks Desktop to QuickBooks Online.

Return to this thread if you need further assistance with your reports. We're here to lend a hand. 

I am a CPA. If I can't figure it out no other accountant/CPA can figure it out. My details do not match the reports. The underlying details should match for an asset account.

I appreciate you for posting here, Elepadilla. Allow me to add insights regarding the differences in your cash basis report.

It is worth acknowledging that QuickBooks Desktop(QBDT) and QuickBooks Online(QBO) are distinct products. The differences in settings and preferences lead to variations in reported transactions. 

Although accrual reports in QBO match those in QBDT, cash basis reports differ because of migration limitations. 

There are differences in how the data is presented and reported in the online platform due to the movement from QBDT to QBO. Thus, your inventory account details do not match the cash basis report.

Furthermore, these articles provide more details and information about how features and data move and the steps you should take after migration:

• How features and data move from QBDT to QBO
• What to do after you move from QBDT to QBO

Finally, consider checking out this article about fixing migration errors: Fix errors when migrating from QBDT to QBO.

If you have further questions about managing your data in QBO, please do not hesitate to comment back on this thread. We are always here to help you. Have a good one!

@elepadilla 

After researching this a bit more, I believe that QB Desktop uses modified cash basis so it includes inventory on both accrual and cash basis balance sheets.  QBO uses true cash basis reporting so inventory items are removed from a cash basis BS.  I'm guessing the $112 balance on your QBO cash basis BS was posted directly to the inventory asset account with either a JE, expense, check or bill transaction, thereby bypassing QBO's product filter.  Does that match what you're seeing? 

The $112 is showing as an opening inventory balance after the QBO conversion. (I drilled into the details on the cash basis report). 

Thank you for the answer regarding the modified cash basis reporting!

I can use this to explain to my tax accountant why the QB Desktop Reports do not match the QB Online Reports. I went and found all the differences and can show why my 2022 year-end reports do not match (QB Desktop vs QB Online).