QuickBooks Online is an important piece of software because it helps ensure the accuracy of your financial records with a little help from your bank statement. Your bank statement reflects the actual transactions conducted by your business. By reconciling your QBO records with your bank statement, you can identify discrepancies, errors, or missing transactions. This process ensures that your financial data in QBO is an accurate reflection of your real-world financial activity.
Bank reconciliation can help you identify errors or even potentially fraudulent activity within your accounts. Discrepancies between your QBO records and your bank statement can be an early warning sign of accounting errors or unauthorized transactions. Timely detection of such issues can prevent financial losses and protect your business' financial health.
QuickBooks Online also provides the advantage of real-time accessibility from anywhere with an internet connection. Small business owners can monitor their financial data, generate reports, and manage transactions on the go.
Using account types and detail types ensures the correct data is shown on key financial reports. Choosing the right account type ensures you have accurate reports, like the Balance Sheet and Income statements, so you can analyze the financial health of your business.
Finally, when you connect your bank or credit card account to QuickBooks Online, you can streamline your bookkeeping process and save valuable time that would otherwise be spent on entering transactions manually. When you connect your online bank in QuickBooks, the transactions automatically download and categorize. This saves time in updating your bank feeds. All you have to do is to review and approve them. These feeds allow for specific transaction customization that will automatically recur each time, including splitting expenses between accounts and business segments, making your job a lot easier.
This article was written by Cherrie Beaty. Cherrie is an Accounting Specialist II with Baldwin CPAs. For more information on the support Baldwin CPAs can provide you, contact cherrie.beaty@baldwincpas.com.