Depreciation JE showing up on Cash Basis financial statements,

Hello, @Oana Palade.

The journal entry is a transaction that hits directly to your account. Therefore, it will always appear on the reports, regardless of the accounting method used (in cash or cash) and the date on which it was entered.

Although, you'll have to date the journal entry to when it should be depreciated.

For more details on cash and accrual accounting, please refer to this article: Choose between cash and accrual accounting methods in reports.

You can rely on me if you need anything else. Please let me know by leaving a comment down here. Take care of yourself!

Do you mean I can't record a depreciation for a 50k asset? 

Thank you for recommending contacting my accountant, but is happening for me to have accounting experience for 10 years, and it baffles me that QBO can't make distinction between non-cash transactions and cash transactions. I'm asking because other accounting systems don't have this issue and I don't have accrual accounts on cash basis financial statements. I can count here the competior, XERO, NetSuite, SAP, etc.

Also, who do you record depreciation in  QB than JE? Was this issue fixed since 2018?

Also, Now is notice that you think I don't the choice for accounting method for Trial balance, and other reports. 

Please if you don't have a solution for me, just say so,

Welcome back, @Oana Palade.

Allow me to fill you in on everything about how depreciation is posted in QuickBooks.

In QuickBooks, the journal entry is the best way to record depreciation, and you can enter for a 50k asset. As mentioned by my peer above, transactions created via journal entry hits directly to your account. That said, QuickBooks will always show JE transactions on any reports regardless of the accounting method.

You might want to read this article to learn how your incomes and expenses are reported depending on the accounting method you select: Choose between cash and accrual accounting methods in reports.

Please know you can continue to reach me here with any additional questions. Thanks for coming to the Community, wishing you continued success.

Hey Mark, 

Thank you for reply.

Do you see this part in the article? 

Cash

When you use the cash method in reports:

• Your report counts income or expenses as though they happened when you got the payment or paid the bill
• If you sent an invoice or got a bill, but the money hasn’t changed hands yet, your report doesn’t include it in your income or expenses

My issue is that I choose Cash Basis and is showing a non cash transactions. Why does it show it? Is not like I'll ever have payments against depreciation expense account or acumulated depreciation. This account should be exluced. 

I have a sugestion. Add a checkbox on JE to be able tyo choose if i want to not to show on cash basis.

I am coming from XERO where I could calculate depreciation for tax purposes and keep cash basis. And we move over to QB because we thought QB is better, and now I see that I need to edit Cash Basis reports in Excel to show up correctly.

Thanks for following up with the Community, Oana Palade.
 

I'm happy to hear you were able to find a solution to your problem by editing reports in Excel. I can certainly understand how an ability for determining whether a journal entry should show up on cash basis reports could be useful and have submitted a suggestion about it as of today.
 

You can also submit your own feature requests while signed in.
 

Here's how:

1. Use the Gear (⚙️) icon.
2. Click Feedback.
   
3. Enter your suggestions and/or comments.
4. Hit Next.
   
5. Choose Skip and send message.
6. The available drop-down menu can be used to pick an appropriate category.
7. Select Send message.
   

Your feedback's definitely valuable to Intuit. It will be reviewed by our Product Development team and considered in future updates. Feature requests can be tracked through Intuit's Customer Feedback website.
 

If there's anything else I can help with, I'm just a post away. Enjoy the rest of your day!

Hi Zack, 

I want to follow up on the issue above, it's been more than a year, and we are facing the same problem. I submitted the request to add this feature to the JE (to filter out non-cash transactions) multiple times and this is still open, no one contacted me to follow up on this issue. The advice is still to keep these records out of QuickBooks in Excel, like 20 years ago? Thanks.

Thanks for getting back to us, Oana Palade.

We haven't received an update about the request you've submitted to our Product Team. New improvements and upcoming features are posted through the Firm of the future page.

You can visit this link to see what's new in QuickBooks: Product Updates. It has screenshots and video tutorials to help manage your business needs.

Also, since your request is still open, our Product Team may not have started this feature. You can send a callback request from our Live Support Team if you need more details about the feature that you want.

Here's how:

1. Sign in to your QuickBooks Online company.
2. Select Help (?).
3. Select Contact Us and choose Get a callback from the next available expert. 
4. Please know that they're open from M-F 6 AM to 6 PM PT and Saturday 6 AM to 3 PM PT.

I'm adding this link to find some steps on how you can record their depreciation: Depreciate assets in QuickBooks Online. 

Don't hesitate to post again if you have other QuickBooks concerns. I'm always right here in the Community Forum to provide articles and steps.

I was researching this same issue and came across this thread.  It is comically sad to read the responses from the QB staff/moderators.  When you asked if the only solution to the issue was to export your reports to Excel and manually fix them there, ZackE quickly replied with "I'm happy to hear you were able to find a solution to your problem by editing reports in Excel."

Clearly that is not a solution at all, but an inconvenient workaround on your part for an issue that should be very simple.  It seems like the folks at QB have no comprehension regarding the difference in accrual-basis and cash-basis accounting.  I guess I will have to use the same 'solution' in order to present financial statements on a cash basis since this simple accounting issue has still not been fixed.  Now I know why our CPA prefers for us to not post depreciation throughout the year and instead book it at year-end.  Doing so during the year would result in the financial statements being incorrect every single month without taking the additional step of fixing them in Excel.  I hope that Intuit is paying a commission to Microsoft for ensuring that QB users' financial statements are accurate.

It seems to be across the board that QBO does not eliminate j/e transactions from cash-basis reports. The only way that I could find that would work is to use QBO's built-in functions like Bill or Expense (and I'm not sure how you'd use those to report depreciation).

I tested this a bit for a client who wanted separate payables accounts for accruing interest on a variety of loans/notes/investments in the company. We really wanted to report them individually, but they kept showing up on cash-basis reports (I provide him with both cash and accrual reports). The only way I could see to prevent this from happening was to create a Bill each month, which puts all the expenses into Accounts Payable -- the QBO knows not to list it. But that would mean dozens of unpaid bills each year (since we were accruing for several years but not paying, and he wanted to accrue monthly).

Out of curiosity, I made a j/e with a Dr to XYZ Expense and Cr to A/P, which QBO should have been happy with (since it wants all payables in A/P). If I remember correctly, that transaction was not eliminated from the cash reports either! 

What I finally concluded is that the only way to reliably suppress these transactions is to use (for payables) Bill or Expense. That can mean complicated work-arounds for something that is otherwise a simple accounting j/e. I do understand that QB and other accounting software is meant to eliminate the need for j/e, but sometimes j/e make the most sense.

Just adding to the collective knowledge base.