P&L Report Profit Isn't Correct

You can double-click on most amounts on the P&L and see the details that make up each amount. If those details are correct, then the P&L is correct.

Thanks for joining the Community, swoodling.

The data populated on a Profit & Loss report is generated from records that you've entered into your books. It's possible the report might've been customized to show data that shouldn't be shown on it.

You can try checking the report's customizations to see if this may explain the profit discrepancy.

Here's how:
 

1. Run your Profit & Loss report.
2. From the Report window, click Customize Report.
3. On your Modify Report screen, go to the tabs you need to check. I'd recommend checking each one if you're unsure.

There's Display, Filters, Header/Footer, and Fonts & Numbers tabs. You can refer to our Customize reports article for detailed steps on customizing reports.

I'd also recommend checking your date range, accounting method, and other customizations available on the report screen. You can refer to our How to run & customize reports article for detailed information.

If you've already checked everything, and are unable to identify why your profit's off, I'd recommend working with an accounting professional. If you're in need of one, there's an awesome tool on our website called Find a ProAdvisor. All ProAdvisors listed there are QuickBooks-certified and able to provide helpful insights for driving your business's success.

I'll be here to help if there's any additional questions. Have a wonderful Monday!

I just did a Profit and Loss by Month report. At the bottom, if I add up all the net income for each month it doesn't match the total net income. I'm unsure why they don't match but that may be why my boss says it looks wrong.

@swoodling 

How are you running a P&L report by month?  Are you just running a standard P&L and then customizing it on the Display tab by choosing 'Month' next to 'Display columns by'?  If so, it's confusing that you mentioned "if I add up all the net income" because QB totals it for you (as shown below).  Are you saying that the Total does not equal the sum of the months on the report?  Please post a screenshot is that's the case.   

Thank you for returning with this follow-up question, swoodling. Your thoroughness in investigating the issue your boss raised is commendable. The discrepancy you noticed in your Profi and Los report is significant. Let's explore the reasons for this difference and find a solution so you and your boss have an accurate view of the financials you need.

To begin with, I agree with Rainflurry's suggestion the reporting period of your Profit and Loss report may differ from your reference point, which could explain the discrepancy you're seeing. This is a crucial factor we should investigate further.

In addition to this, there are several other possible reasons why the Profit and Loss report may be mismatched:

1. It could be a transaction categorized under Asset, Liability, Capital, or Equity accounts in your bank statement. This could explain the discrepancies between the report and the statement.
2. If transactions are not categorized or incorrectly classified in the accounts, this could result in an inflated profit on the Profit and Loss report.

Also, the discrepancy could be due to the basis of the report, whether cash or accrual. This significantly affects how transactions are recorded. For example, accrual basis reports recognize income and expenses when they are incurred, regardless of when cash is received or paid. To check your report basis, here's how:

1. Go to the Reports tab and choose Company and Financial.
   
   
2. Run Profit and Loss report.
3. On the Report basis, select either Accrual or Cash to see the difference.
   
   

Additionally, I recommend utilizing the memorize report feature in QuickBooks if you want to save the settings of your customized report for future use.

I hope this explanation helps clarify the potential reasons for the discrepancy in your Profit and Loss report, swoodling. Please don't hesitate to reach out if you have any questions or need further assistance navigating this issue. We're here to help you align your QuickBooks data correctly so you can make informed decisions for your business.

Yes that is what I was saying. Adding up all the totals is like $20,000 off the collective total. I tried putting it in cash and accrual but I get the same totals. 

@swoodling  You may want to also provide the collective total you are mentioning.

Just going by the image you provided, the 10 monthly columns do add up to what I assume to be the total column on the far right.

@swoodling 

"Adding up all the totals is like $20,000 off the collective total."

The total is correct on the screenshot.

Ok. I just checked it again and it does total correctly. When I added it up the other day I'm not sure what I did but it wasn't adding up. Thank you everyone for your help. I think I may still have to speak to a financial specialist to figure out why our profit is so high. The only other thing I can think of is that maybe something in the Chart of Accounts is off. Could that affect it?