New Business Direction LLCBackup, Backup, Backup!
I cannot stress enough the importance of a good solid backup for your QuickBooks files. If your computer stops working, your hard disk crashes or you find a corruption in your data file, you will be glad that you have a backup of your data. It will save you many long hours and an enormous amount of frustration.
Media Options
You can use any number of media to store your Backups – you can use a CD-R or a DVD-R or an external hard drive. If you use one of these methods you will need to make arrangements to move these media off-site and make it part of routine that you will stick with. Do not leave your backup media in the same location as your live data file.
Do not use a flash/thumb drive or an RW type of CD or DVD – these allow you to overwrite previous backups and that means you may not have the one you need in the event that you have to restore your data. Data corruption can happen at any time and may not be evident until a much later date. You may need to restore back to before the corruption happened and you need to find that backup file. If you have overwritten previous backups you may not have a clean backup file.
Frequency
You should backup every time you use your QuickBooks file. If it’s daily, backup daily, if it’s once a week, backup once a week, if it’s monthly…you get the idea.
Restoring Backup Files
The proc
ess of turning a backup file (QBB) into a company file (QBW) is called restoring. When data is lost or damaged, restoring a recent backup file created before the data loss recovers most of the information in the company files.
What’s Included in a QuickBooks Backup
A QuickBooks Backup includes the QuickBooks data file (QBW) and most of the supporting files. It includes the Business Planner (BPW), Cash Flow Projector (CFP), Loan Manager (LMR), QuickBooks Letters and Templates, Logos and Images, Printer Settings and the Spell Checker. These additional supporting files are restored into a separate folder and need to be copied to the directory where the QBW file is stored in order to use them.
What’s Not Included in a QuickBooks® Backup
Not all supporting files are backed up using the QuickBooks® backup feature.The QuickBooks® Statement Writer (QSM), Fixed Asset manager (FAM), Financial Statement Designer (FSR), certain payroll forms and the attached documents folder are not included in a QuickBooks® backup. These files need to be backed up separately.
Portable Company Files
A Portable Company file (QBM) is not the same thing as a QuickBooks backup (QBB). It is a highly compressed version of the data file that contains only the raw data from the QBW file without the database indexing and without any supporting files. It allows for faster transfers of data over the internet, but it does not contain the Transaction Log File (TLG).
Transaction Log File
The Transaction Log File (TLG) keeps track of any transactions that were entered after the most recent backup was made and helps with recreating the transactions and changes to the files since the backup. The TLG is re-set each time a backup is performed using the QuickBooks® backup process. It is not re-set when backed up to on off-site location or copying and pasting files outside of QuickBooks.
Test Your Backups
There is nothing worse than finding out that your backup method was not working when your computer crashes and you go to restore a lost data file and it’s not there. You can test a backup by restoring the data file to your computer or to another computer that has the QuickBooks® software. DO NOT OVERWRITE an existing company file. There is no way to recover a file that has been overwritten.
Off Site Options
You can use the Internet to backup your data off site automatically to a secure, remote location. You select the files to be backed up, you select the frequency and set a schedule for these backups to happen automatically.
There are several good and inexpensive options for offsite backups. QuickBooks® offers an Online Backup Service as do Acronis®, AVG®, Backup Solutions®, Carbonite®, Comodo®, Crash Plan® and IBackup®. What’s important is that it works and that your data is secure.
If you need help choosing a backup method that works for you or if you would like us to test your backup to make sure that it’s working, please contact us. We would be happy to help.
This article of QuickBooks Tips and Tricks was based on the 2012 version of QuickBooks.
Ah, the Opening Balance Equity account – as accounting professionals it’s one of the first things we look for when someone hands us a QuickBooks® file at year end. It tells us a great deal about the clients’ skill level with QuickBooks® and is an early indicator of how much time we will have to spend cleaning up the QuickBooks® file before we can rely on the numbers to prepare a tax return or financial statements.
Opening Balance Equity is a very useful account, when used properly. Although you may be tempted to delete this account, it’s much better if you use it as it was intended. It will really help if you ever need to go back and look at the original setup.
Proper Use of Opening Balance Equity
The Opening Balance Equity account is a special clearing account, which allows you to start using QuickBooks® before you have finished setting up the entire Balance Sheet.
The proper use of the Opening Balance Equity account is for the original setup of an existing company. When you start a new QuickBooks® company file with a start date later than the actual start date of the company, you will need to enter opening balances for the various general ledger accounts.
Opening balances can be entered into the company file in the form of a General Journal Entry for most Balance Sheet accounts using Opening Balance Equity as the offset account. Once all of the beginning balances are entered, the remaining balance in Opening Balance Equity can be apportioned between the proper equity accounts using another journal entry.
Once your QuickBooks data file is completely set up, Opening Balance Equity should be zero. This is because the account is only used to “park” the offsets for anything you are setting up opening balances for. If it is not zero, go back to the original Trial Balance and locate the discrepancies before moving on.
Automatic Posting to Opening Balance Equity
In some instances, QuickBooks® automatically posts to the Opening Balance Equity account.
QuickBooks® uses the Opening Balance Equity account automatically as the offset when entering a new Customer, a new Vendor or a new Account balance. This often occurs when clients set up their own QuickBooks® files. Entering beginning balances in the screen for setting up a new Customer, Vendor or Account is not the proper method of setting up beginning balances.
Do not enter beginning balances in the opening balance field.
Leave this field blank when entering Customers, Vendors and Accounts.
How to Correct Postings to Opening Balance Equity
Unlike the Retained Earnings account, the Opening Balance Equity account does have an account register. If you find that your client has inadvertently or unknowingly made postings directly to the Opening Balance Equity account during the year, you can open the register by going to Lists – Chart of Accounts and double clicking the account. Then double click each posting and make the corrections here.
For more information on how to properly set up beginning balances for Customers, Vendors and/or Accounts or for help in troubleshooting your clients’ Opening Balance Equity account, please call us.
This article of QuickBooks Tips and Tricks was based on the 2012 version of QuickBooks.
If you frequently enter the same transaction, you can memorize and schedule the entry of the transaction so that you will not have to re-enter it each time. For example, you can memorize your monthly rent or a journal entry for monthly depreciation expense or even a recurring invoice to a customer.
If the amounts on the transaction do not change (for example, if you always pay the same monthly rent), you can fill in all of the details for the transaction and can even have QuickBooks® automatically enter the transaction for you.
If the amounts or other details sometimes change, you can enter the memorized transaction and leave some of the fields blank. When you want to use your memorized transaction, just choose it from your Memorized Transaction List and edit it as needed.
Memorizing a Transaction
First, create the transaction that you want to memorize.
For a bill – Enter Bills.
For credit card charges – Enter Credit Card Charges.
For an Invoice – create an Invoice.
For a journal entry – Make General Journal Entries.
Once you have created the transaction to be repeated, click Memorize from the Edit menu.
Enter the Name of this Memorized Transaction using a name that you will recognize so that you can easily find this transaction in the Memorized Transaction List.
Set the fields as shown in the screen shot above to indicate when and how often you want the transaction entered and then click OK.
Click Save & Close to record the transaction.
Every time you open QuickBooks®, it checks your Memorized Transaction List for transactions that need to be entered automatically. If the system date is on or after the date in the Next Date Field (less the number in the Days in Advance to Enter field), QuickBooks® will ask you if you want to enter the memorized transaction.
To see your Memorized Transaction List, choose Memorized Transaction List from the Lists menu or hit Ctrl T. This report shows detailed information about each transaction you’ve memorized, including the transaction type, the account, the amount, the frequency and the next date.
Rescheduling a Memorized Transaction
When you specify a schedule for a memorized transaction, you can choose whether QuickBooks® should remind you of the transaction or automatically record it for you.
- Go to the Lists menu and click Memorized Transaction List or Ctrl T.
- Select the memorized transaction whose schedule you want to change.
- Click Memorized Transaction at the bottom of the list and click Edit Memorized Transaction.
- Select a different scheduling option for the transaction.
- Click OK
Deleting a Memorized Transaction
To delete a memorized transaction:
- Go to the Lists menu and click Memorized Transaction List or Ctrl T.
- Select the memorized transaction you want to delete.
- Click Memorized Transaction at the bottom of the list and click Edit Memorized Transaction.
- Select Delete Memorized Transaction or Ctrl D.
As always, if you have any questions or would like more information, please call us.
This article of QuickBooks Tips and Tricks was based on the 2012 version of QuickBooks.
Did you know that there are at least 40 different file extensions in QuickBooks®? Those are just the ones that I found when researching this article – I am sure there are many more!
There are extensions for everything from Loan Manager and Financial Statement Designs to Online Banking and Images. There is even one called LGB which stands for Little Green Box. This file contains encrypted information on user names and passwords.
Here is just a sampling of the file types and extensions in QuickBooks.
It is important for accounting professionals to understand the different file types and file extensions involved with QuickBooks®.
There are five (5) main file extensions used for holding transactions and data for a QuickBooks® company file. The table below describes these file extensions.
| Extension |
File Type |
Description |
| .QBW
|
QuickBooks® for Windows company file |
This is the main file type for a QuickBooks® company file. All of your data is entered into this file. |
| .QBB | QuickBooks® backup file
|
A backup file is a compressed file containing everything you need to recreate your company file and QuickBooks® environment. Use a backup file to safeguard your QuickBooks® files against accidental data loss. When you create a backup, QuickBooks® starts a log of transactions (.TLG) that you have entered since the last time you backed up. To open a .QBB file, go to the File menu and click Restore. Double-clicking the file and choosing Open from the File menu will NOT restore or open a backup file. |
| .QBM
|
QuickBooks® Portable company file | This is a compressed file that contains all of the data of a QuickBooks® company file, but not the database indexing, so it is much smaller than the .QBW or .QBB files. It is useful for transferring data through the Internet because the data file size is much smaller than any of the other file types and it can be restored to the full .QBW on the receiving end. |
| .QBX
|
Accountant’s Copy (Export File) |
This is also a compressed file format and it is used specifically for transferring a file from an end user (client) to an accountant for review. This includes a Dividing Date which prevents the client from creating transactions on or before this date. |
| .QBA
|
Accountant’s Copy (Working Copy) |
When the accountant opens a .QBX file they must restore and convert it to a .QBA file in order to enter transactions and run reports. |
It is important to assess the client’s needs and determine which file type is appropriate for the situation. It will depend on the type of work to be performed, the condition of the client’s current data file, the nature of their operations and a number of other factors. If you have a solid
understanding of the different file types and options available, then you can make a more informed decision on how to best serve the needs of your client.
QuickBooks® also uses many other file extensions to access or store other types of data associated with QuickBooks®. The table below describes a few of these file extensions. It is not an all-inclusive list.
|
Extension |
File Type |
Description |
|
.QBW.TLG
|
Transaction Log File for QuickBooks® company file
|
When you backup a company file, QuickBooks® starts a log of transaction that you have entered since the last backup. In case of accidental loss of data, Intuit Technical Support can use your most recent backup in conjunction with the transaction log file to recover your data. This log file is also used if you sync your QuickBooks® data with certain online services using Intuit Sync Manager. This allows ongoing syncs to happen much more quickly than the initial full upload of QuickBooks® data into your online service. Note: A manual backup (not an automatic backup) is required to ‘reset’ the .TLG file. If the .TLG file is too large, create a manual backup. |
| .QBA.TLG
|
Transaction Log File for Accountant’s Copy
|
When you backup an Accountant’s review copy, QuickBooks® starts a log of transaction that you have entered since the last backup. In case of accidental loss of data, Intuit Technical Support can use your most recent backup in conjunction with the transaction log file to recover your data. Note: This file is created during backup provided that you have set a verification level. |
| .QBY
|
Accountant’s Copy (Import File)
|
When you (the Accountant/Consultant) are finished making changes in an Accountant’s Copy, you provide the client with a .QBY file to be imported into their company file. Note: This file only includes the changes made by the Accountant and not all of the transactions of the company. |
| .IIF
|
Intuit Interchange Format file
|
You can import and export lists and/or transactions using text files with an .IIF extension. |
| .ND
|
QuickBooks® Network Data file
|
A configuration file that allows access to the QuickBooks® company file. Note: DO NOT DELETE this configuration file. |
| .DES |
Form Design Template file |
This file type is created when you export a form design from the templates list. |
For a printable list of file types and extensions, click here.
This article of QuickBooks Tips and Tricks was based on the 2012 version of QuickBooks.
I was telling a friend of mine about the topic of this months’ newsletter and he said “you’re the expert in QuickBooks® and you make a living from setting it up and cleaning it up and teaching people how to use it – why in the world would you tell people NOT to use it?”
The answer is simple – QuickBooks® is a really great program, it’s relatively low cost and it works well for most small businesses. However, one size does not fit all. It’s like that suit in the back of your closet. If QuickBooks® doesn’t fit, it won’t work and it won’t get used.
Fortunately, QuickBooks® has many solutions in their product line-up and with our expertise and knowledge we can customize and tailor a program specifically for you and your small business.
Data File Sizes and Transaction Limits
What impacts whether you should use QuickBooks® Pro or Premier or the more powerful version, Enterprise Solutions, is the size of your data file today and how that data is expected to grow over the time period for which you want to keep all transaction data in one (1) company data file.
The rate of growth of QuickBooks® company data files varies significantly from company to company. There is no “average” or “typical” data file size, since businesses track different information. How quickly a file grows depends on the number of transactions, the amount of information entered in each transaction and the number of “links” per transaction.
If your business generates more transactions than QuickBooks® can handle, performance may be affected. Technically, QuickBooks® Pro and Premier can handle two billion transactions in a single company file. In practice, however, tasks like running reports and finding transactions can take longer if the file grows too large.
We recommend that QuickBooks Pro and Premier data files should not exceed 200MB and that Enterprise Solutions files should not exceed 300 MB. These are general guidelines, based on several factors. There are no specific maximum file sizes and your system will not come to a crashing halt if you exceed these recommended sizes, however, as the data file grows, the overall performance of the software declines and the risk of data corruption increases.
To see how large your data file is currently, open your QuickBooks® file and press the F2 key. A Product Information box will appear and your data file size will be listed on the left hand side of the screen under File Information.
Item or List Limitations
QuickBooks® also has item limitations – counts that cannot be exceeded. Companies with list requirements that exceed those in the following table are not a good fit for QuickBooks®. This list highlights some of the more important physical limits and it is not an all-inclusive list. These counts are “combined” counts. For example, in Premier, you can have 14,500 customers, vendors AND items combined, not 14,500 per list.
| List Name | Pro and Premier | Enterprise Solutions |
| Chart of Accounts | 10,000 | 10,000 |
| Names (customers, vendors, employees and other names) | 14,500 | >100,000 |
| Items (including inventory) | 14,500 | >100,000 |
| Classes | 10,000 | 10,000 |
| Price Levels | 100 | 750 |
*For an all inclusive list click here
For companies that require a more robust inventory, we recommend using Enterprise Solutions, QuickBooks® Point of Sale or an add-on software such as Fishbowl.
To find out how many items your data file is currently using, open your QuickBooks® file and press the F2 key. A Product Information box will appear and your List Information will be shown on the right hand side of the screen – be sure to scroll down to see all of the lists.
User Access Limitations
QuickBooks® limits the number of users who can access the company data file simultaneously. Companies that require more users simultaneously accessing the company data file than QuickBooks® supports are not suited for QuickBooks®.
Inventory Method Limitations
Companies that require an inventory method other than average cost (such as FIFO or LIFO) may want to use QuickBooks® with an add-on software for the inventory feature. Note that an exception is QuickBooks® Online Plus – as of mid-2010 it offers Inventory using the FIFO cost method. Another exception is QuickBooks® Enterprise Solutions for 2012 with Advanced Inventory which has a FIFO option as well.
| QuickBooks® Product | # simultaneous users |
| Pro | 3 |
| Premier | 5 |
| Online Plus | 5 |
| Enterprise Solutions | 30 |
| Online | 25 |
Summary
Although QuickBooks® works quite well for companies of various sizes and across many industries, there are a few situations in which QuickBooks® may not be the best solution.
If you are interested in finding out more about any of the QuickBooks® line of products or if you would like to discuss what solution is best for your small business, please call us.
This article of QuickBooks Tips and Tricks was based on the 2012 version of QuickBooks.
If your company has a policy that allows you to give your employees advances on upcoming payroll, you can use QuickBooks® and QuickBooks® Payroll to record the advance, which can then be reimbursed to the company through payroll deductions. We recommend that you document any loans to employees with terms for repayment clearly spelled out and signed by both parties.
Note: This QuickBooks® tip assumes that you have an active QuickBooks® payroll subscription.
First, create an Asset Account to Track the Employee Loan and Repayment
This is a one-time setup task
- Go to the Lists menu and click Chart of Accounts
- Click Account at the bottom of the list and then click New
- Under Other Account Types choose Other Current Asset and then click Continue
- If you are using account numbers, enter the number in the Numbers field
- In the Account Name field, enter Employee Advances
- Click Save & Close
Next, you can either write a regular check (non-payroll) to the Employee for the Advance and post it to the Other Current Asset account Employee Advances or you can pay the Advance through Payroll in which case you will need to create a Payroll Item of the type “addition”.
This is a one-time setup task.
- Go to the Lists menu and click Payroll Item List
- Click Payroll Item at the bottom of the list and then click New
- Select the Custom Setup method and click Next
- Choose Addition and click Next
- Enter the name for this addition as Employee Loan
- Click Next
- On the Expense Account screen, choose the Other Current Asset account, Employee Advances, that you created in Step 1 for tracking this expense and click Next
- Select None as the tax tracking type
- Leave the taxes unchecked and click Next
- Select Neither in the calculate based on quantity screen and click Next
- Select Net Pay and click Next
- Leave the default rate and limit blank and click Finish
Use this addition on the Employee’s paycheck under Other Payroll Items. Enter this amount as a positive number.
Then, create another Payroll Item of the type “deduction”Again, this is a one-time setup task.
- Go to the Lists menu and click Payroll Item List
- Click Payroll Item at the bottom of the list and then click New
- Select the Custom Setup method and click Next
- Choose Deduction and click Next
- Enter the name for this deduction as Loan Repayment and click Next
- Leave the first two fields blank, then under the Liability account field, choose the Other Current Asset account, Employee Advances, that you created in Step 1 for tracking this expense and click Next
- Select None as the tax tracking type and click Next
- Leave the taxes unchecked and click Next
- Select Neither in the calculate based on quantity screen and click Next
- Select Net Pay and click Next
- Enter a default rate and limit if desired and then click Finish
Note: You should only enter a default rate and limit if the rate and limit will apply to everyone using the Payroll Item. The limit may be marked as an annual limit and if so, you will need to manually adjust or remove the amount at the beginning of the calendar year or it will start recalculating.
Use this deduction on the Employee’s paycheck under Other Payroll Items. Enter this amount as a negative number.
Create a Custom Summary Payroll Report to Track Employee Loan Balances
- Go to Reports
- Select Employees & Payroll
- Select Payroll Summary
- Click on Customize Report in the upper left corner
- On the Display tab, choose All Dates
- Select Payee in the Display Columns by drop-down menu
- Check % of Row and uncheck Hours and Rate
- Click on the Filters tab, select Accounts and choose the Other Current Asset account used for the Employee Advances on the drop-down menu
- Click OK
Manage Employee Loans that will be Repaid over Time on Multiple Paychecks
- Edit the Employee
- Change tabs to Payroll and Compensation Info
- Under Additions, Deductions and Company Contributions select the Loan Repayment Payroll Item
- Enter the amount to be paid by paycheck in the Amount column as a negative amount.
- Enter the balance remaining to be paid at this point into the Limit column as a negative amount.
- Click OK
Note: QuickBooks® will automatically deduct this repayment on each paycheck and will stop the deduction once the limit has been reached.
This article of QuickBooks Tips and Tricks was based on the 2012 version of QuickBooks.
When you run financial statements on a Cash Basis in QuickBooks®, the results may not be what you expect. For example, you may find balances for Accounts Receivable and/or Accounts Payable on Balance Sheets run on a Cash Basis. This often means that the client has assigned a Payable or a Receivable to a Balance Sheet account, rather than to an Expense or Income account. There are other reasons this happens too.
Reasons for Accounts Receivable on a Cash Basis Balance Sheet
- There may be open balances on Invoices that use Items linked to Balance Sheet accounts. An example would be a Customer Deposit linked to a Liability account.
- There may be a prorata cost of Inventory Items listed on open Invoices. For example, if an Invoice that includes Inventory Part Items is half paid, half the cost of the Inventory Part Items will remain in Accounts Receivable.
- There may be unapplied credits from Credit Memos or Payments. You can find these entries easily because they appear as negative numbers on the Open Invoices report.
- There may be Sales Tax due listed on an accrual basis. You can change the Sales Tax Preference to Cash Basis to eliminate this problem. CAUTION: Check with your State taxing agencies for rules regarding payment of Sales Tax – some States require the basis for Sales Tax accruals to match the basis for Income Tax filing.
Reasons for Accounts Payable on a Cash Basis Balance Sheet
- There may be Bills using Items linked to Balance Sheet accounts.
- There may be Bills entered for a Note Payable or to buy a Fixed Asset.
- You may find the cost of Inventory Part Items on open Bills.
- There may be unapplied Vendor Credits or Prepayments.
To review balances in Accounts Receivable and/or Accounts Payable:
Filter a transaction report with a paid status of Open transactions and date range of All to get a report showing the transactions that QuickBooks® did not reverse as part of the internal Cash Basis conversion.
- From the Reports menu, choose Company & Financial
- Choose Balance Sheet Standard from the submenu
- Click Customize Report
- Select Cash as the Report Basis
- Click OK
- Double-click the balance in the Accounts Receivable and/or Accounts Payable account
- Click Customize Report, and then click the Filters tab
- In the Filters list, select Paid Status and then select Open
- Click OK
Complete the Cash Basis Conversion
To complete the Cash Basis conversion, use a Journal Entry to adjust away the Accounts Receivable and/or Accounts Payable balances. For the Journal Entry, create a Customer called ***A/R CPA Use Only*** and an Accounts Payable Vendor called ***A/P CPA Use Only***. Use these names to transfer the balances to whatever accounts you choose for the adjustments.
These Journal Entries are Reversing Entries as of the first day in the next fiscal period and you must apply the Journal Entry and the Reversing Entry against each other to offset them or you will have Unapplied Credits going forward.
Do not use Accounts Receivable and/or Accounts Payable as the first line of a journal entry in QuickBooks®. To find out why, see our next Accounting Professionals Only newsletter.
Please contact me if you have any questions or need further details regarding this information. This article was based on the 2012 version of QuickBooks®.
Rhonda Rosand, CPA
Certified QuickBooks® ProAdvisor
New Business Directions
Please note that you should rarely need to void a payroll check. Remember that voiding a payroll check is not like voiding other kinds of checks; paychecks have associated tax and other liability calculations and payments that need to be taken into consideration. You are required to amend and file corrected payroll tax returns if you void a paycheck from a previous tax period.
To correctly replace a lost or destroyed paycheck and ensure that your payroll data remains accurate, you need to print a replacement check with a new check number and make a record of the lost or destroyed check.
Find the Paycheck in QuickBooks®
First, open the check register and find the paycheck that was lost or destroyed. In the Banking section on the Home page, click the Check Register icon. If you have more than one bank account, select the appropriate account and click the OK button. This brings up the Check Register where you can search for the lost or destroyed paycheck. You could also search for this check in the Employee Center.
Once you find the original paycheck, make a note of the check number and the net pay amount. You will need these later.
Double-click the entry in the register to open the Paycheck window. Select the To be printed checkbox and click the Print button at the top of the window to reprint the check using the next check number in your numbering sequence. Click Save & Close in the Paycheck window and close the check register.
This is the replacement paycheck that you will give the employee.
The next steps create a record of the lost or destroyed paycheck.
In the Banking section on the Home page, click the Write Checks icon.
-
- Use the same check number as the original lost or destroyed check.
- Make the date the same as the day the check was originally written.
- Make the check payable to the employee (ignore the message about using the built-in payroll features.)
- Make the check amount the net payment amount from the original check.
- Note in the memo line that this check was replaced by the check you reprinted.
- On the Expenses tab, choose Payroll Expenses in the Account column.
Click Save & Close.
Open the check register again. Find the check you just created, right-click it, and click Void Check.
You should now see the word “VOID” in the Memo field and a check amount of “0.00.” You now have a record in your check register of the lost or destroyed check.
*Please note that clients using the Assisted Payroll service and/or QuickBooks® Payroll with Direct Deposit may need to perform additional steps when reissuing paychecks to Employees.
This article of QuickBooks Tips and Tricks was based on the 2012 version of QuickBooks.
New in 2012 – QuickBooks® Accountant and Enterprise Accountant versions only
Starting with the 2012 version of QuickBooks® Accountant and QuickBooks® Enterprise Accountant, accounting professionals can now set a date range to extract transactions for a specified period of time and condense transactions outside the date range.
This preserves transactions in the condensed file only for a particular period with entries prior to that period summarized and entries after that period removed.
This is useful for clients with file size and list limit issues as well as for third-party requests of information – not only for audit requests, but also in the event of a business sale, a divorce or legal dispute when you do not need to provide the entire QuickBooks® file.
First thing – BACKUP your data file.
You are creating a new file to be issued to a third-party and you do not want to overwrite your working file.
Then under the FILE menu, UTILITIES, CONDENSE DATA – Accept the prompt that it is ok to lose Budget data.
When it prompts you for what transactions you want to remove, select “Transactions outside of a date range” to prepare a period copy of the company file. Set your before and after dates to include the period you want to keep.
Then when it prompts you how transactions should be summarized, choose “Create one summary journal entry”.
Remove the recommended transactions.
Remove the unused list entries.
Begin Condense.
This article of QuickBooks Tips and Tricks was based on the 2012 version of QuickBooks.
