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Stamp out Employee Fraud and Embezzlement

No company should allow the same person that is printing the cheques to reconcile their bank accounts. Having another person perform the bank reconciliation is a built-in safeguard against employee fraud and embezzlement.



How to Handle Barter Transactions In QuickBooks

Create a bank account called "Barter". In between barter transaction postings, it's a good idea to make this account inactive. Also, in between posting groups of barter transactions, the balance in this notional account will be $0. (The account register colour for the Barter bank account should be a colour that is different from existing real bank accounts on the chart of accounts.)

You have a customer who is also a vendor. Let's call that company SmithCo. On the vendor list, SmithCo will have the vendor name "SmithCo (v)" while the company name will be just "SmithCo". On the customer list, SmithCo will have the customer name "SmithCo (c)" while the company name will be just "SmithCo". That way, any correspondence received by SmithCo from you out of QuickBooks will just show the name Smithco without the (v) or the (c) indicating which type of contact is being used.

Case #1: let's assume that you owe SmithCo (v) $1000 and SmithCo (c) owes you $900. Therefore the payable is greater than the receivable.

  • Make sure the Barter bank account is active.
  • Customers > Receive Payments....Receive the $900 (the lower of the 2 amounts) and use the payment method of "Barter" (create a new payment method or use the payment method of "cheque" and use the cheque number "Barter"). Make sure the $900 goes into the Barter bank account. The Barter bank account balance is now $900.
  • Vendors > Pay Bills...Pay $900 of the $1000 owing from the Barter bank account with a cheque number "Barter" ...the balance in the Barter bank account is now $0.
  • You can now reconcile the Barter bank account, if you wish, so that the reconciled balance is $0 and you can checkmark all transactions in the reconciliation window, as long as the difference in the bottom right corner is $0.
  • Make the Barter bank account INactive.
  • Now the amount owing to SmithCo (v) is the $100 left.
  • You can then pay the $100 outstanding to SmithCo (v) from the REAL bank account.
  • You can also show the Vendor Balance Detail for SmithCo (v) & Customer Balance Detail for SmithCo (c) if there is any question from SmithCo about the account.
Case #2: let's assume that you owe SmithCo (v) $500 and SmithCo (c) owes you $600. Therefore the receivable is greater than the payable.
  • Make sure the Barter bank account is active.
  • Customers > Receive Payments....Receive the $500 of the $600 receivable (the lower of the 2 amounts) and use the payment method of "Barter" (create a new payment method or use the payment method of "cheque" and use the cheque number "Barter"). Make sure the $500 goes into the Barter bank account. The Barter bank account balance is now $500.
  • Vendors > Pay Bills...Pay the $500 owing from the Barter bank account with a cheque number "Barter" ...the balance in the Barter bank account is now $0.
  • You can now reconcile the Barter bank account, if you wish, so that the reconciled balance is $0 and you can checkmark all transactions in the reconciliation window, as long as the difference in the bottom right corner is $0.
  • Make the Barter bank account INactive.
  • Now the amount owing from SmithCo (c) is the $100 left.
  • You can then receive the $100 outstanding from SmithCo (c) into the REAL bank account.
  • You can also show the Vendor Balance Detail for SmithCo (v) & Customer Balance Detail for SmithCo (c) if there is any question from SmithCo about the account.

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Looking for release updates to your old QuickBooks software ?

Many QuickBooks users encounter a problem when they have to re-install their old QuickBooks software on a new computer and then it will not read the data they last read using the same version of QuickBooks on the old computer.


Assuming that there is nothing wrong with the data, and that they are attempting a File|Open if it's a *.QBW file that is on your hard drive or a File|Restore if it's a *.QBB file, what could be the problem ?


If you are getting a message you cannot read the data in your version of QuickBooks (but you are using the very same installation disk), then you have updated your QuickBooks program to a new release at some point or other.


So what do you do if your installation CD gives you QuickBooks version 200X release 1 but your data demands version 200x release 9 or it won't open ? How do you get your hands on those release update programs ?


Firstly, while hindsight is 20/20, foresight makes it unnecessary to look back. I recommend manually downloading any release updates from the Intuit Product Updates site and saving them first on your hard drive, and then onto a rewritable CD which is stored with your install disk. You can find release updates going back as far as version 6.0C here .


If you have a Canadian version that pre-dates 6.0C and cannot find your release update on the Intuit site, newer install disks of QuickBooks (if you can get hold of one) have all previous release updates on them. You just have to find a subfolder on the disk (do not choose to install QuickBooks; just explore the disk or choose the Search utility) called "Update." Within that folder you will find subfolders by version number. You will find the update utility you need within the appropriate folder; copy it to your hard drive and execute it (not while QuickBooks is running), and also copy it to that rewritable CD to be stored with the installation disk.


Then when you start QuickBooks, you can hit CNTL+1 to get product info and it will say at the top of that window which release and version you are running.


You should then be able to open (if it's a *.QBW file) or restore (if it's a *.QBB file) your data.




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Backing up your data on CD

Back in the olden days of floppy diskettes, backing up your QuickBooks data was pretty straight-forward. You would click on the Backup icon or click on File|Backup and you would back up to your "A" drive. A compressed form of your QuickBooks Working file (e.g. yourcompany.qbw; the extension stands for QuickBooks Working file) would be either created or overwritten on your floppy diskette (e.g. yourcompany.qbb; the extension stands for QuickBooks Backup file). You would be instructed when to switch diskettes and your backup set would contain several floppies, depending on the size of the QBW file.


But that was then; this is now. We have many alternatives to the 1.44 MB floppy; many computers don't even have a floppy drive anymore. Floppies deteriorate over time and are subject to data corruption from magnetic and heat sources. File sizes, especially with later versions of QuickBooks with all their bells and whistles, have grown dramatically in size, making the floppy option appear truly antiquated.


When you engage in a backup from QuickBooks, you can choose your backup drive. Some users choose their CD burner drive, figuring that the resulting QBB file on one formatted CD is more secure than a floppy set which consists of many disks of questionable durability. Sure enough, a QBB file appears on your CD-R or CD-RW and they think their data is secure. WRONG ! If they ever try to restore that data file, it will prove to be useless. That is because the backup utility in QuickBooks does not jibe well with the technology required to write data to a CD.


What can you do ?


You can copy the entire QBW data file to a rewritable CD or similar medium (after all, CD's have 700 MB of capacity so a compressed backup file is not necessary). Or, if you still want to use the backup utility to create a QBB file, use QuickBooks Backup to create a QBB file on your desktop or other easily accessible place on your hard drive. Then drag a copy of that QBB file to your rewritable CD. That backup will be fine, assuming there is nothing wrong with the CD itself.


And don't forget to have a different backup CD for each day of the week, just the same way you would have had Monday through Friday diskette backups. Click on Goodies for your free downloadable backup log.




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Reasons why Certain QuickBooks Detail Report Totals Might Not Match the QuickBooks Financial Statements

There will be the odd time when a client runs a subledger report (such as Accounts Receivable) but its total does not match the company total on the balance sheet. Do not panic !


For a list of reports that should match, click here.


Find a guide to obscure reasons why subledger report totals do not match the account amounts on the balance sheet and income statement by clicking here.


You will need Adobe Reader to open "PDF" documents, and you can get it free by clicking here.


Third-Party Software Packages that "Talk" to QuickBooks and Increase Efficiency

For a listing of third-party software developers and their offerings that integrate with Canadian versions of QuickBooks, click on The QuickBooks Marketplace.



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How to Handle NSF Cheques in QuickBooks

For an NSF cheque received from a customer, here's a slick way to handle it.

Let's assume that you already received a payment and deposited it into the bank in QuickBooks, to match what you did in real life. Then the bank took the amount of the cheque (and perhaps a service charge) out the bank to reflect the fact that it was NSF. Here's what to do from that point forward:

Click on Cheque as if you're writing a cheque to the customer (or job of a customer) which bounced the cheque on you. For the cheque number, put NSF and then the cheque number that was bounced. (e.g. If they bounced cheque #123, call it NSF123). Put the amount that came out of the bank as the amount of the cheque. If the bank charged you a service charge and you are going to charge the customer for that amount, make the amount of the cheque include the bounced amount and service charge. Put the date that it bounced as the date of the cheque (e.g. Oct. 26).

Specify what happened on the memo line of the cheque. Then for the account, put it to "Accounts Receivable". (If QuickBooks prompts you for a name in the "split" line, re-enter the name of the Customer or Job that bounced the cheque in the Customer:Job field.) That takes the money out of the bank on the date that it bounced, and puts the money that bounced back into Accounts Receivable. Then you can "receive payment" again on the second cheque that the customer gives you..


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More Tips n Tricks On the Way....

Keep watching here for a growing list of tips and tricks !




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