Updating quickbooks for a client


H

harshni

I have to update books of the company I work for and I have few
questions :

1. We want to do bank reconciliation but when I do that I see lots of
transactions /deposits from previous years like 2003 , 2001 in the bank
reconciliation window. How do I handle this situation.The aim is that
we shld be able to do bank rec for yr 2005.

2. We want to do inventory adjustment books to actual on hand and we
want to do it for each item so that we know how much is left to
reorder.

Our books were update by a cpa and he did some year end ajustment to
bring our books to same as the numbers he filed to IRS.

I am a new hire and it seems the company hasn't closed any previous
years....Any help will be appreciated.

HR
 
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T

Tee

I have to update books of the company I work for and I have few
questions :

1. We want to do bank reconciliation but when I do that I see lots of
transactions /deposits from previous years like 2003 , 2001 in the bank
reconciliation window. How do I handle this situation.The aim is that
we shld be able to do bank rec for yr 2005.
Transactions from previous years are showing up in the reconciliation window
because....

a) they were never reconciled or
b) they were reconciled then inappropriately altered or
c) they are duplicates

You'll have to take the time to find out which of the above happened.
2. We want to do inventory adjustment books to actual on hand and we
want to do it for each item so that we know how much is left to
reorder.
Read the help section on how to do inventory adjustments. Its really pretty
easy but you'll need to know how they were initially entered and how your
CPA chose to deal with them in order to adjust them to the correct accounts.
Our books were update by a cpa and he did some year end ajustment to
bring our books to same as the numbers he filed to IRS.
If your CPA has already adjusted your books then be very careful about
making adjustments. Don't make adjustments to anything prior to the date he
included in his/her adjustments.
I am a new hire and it seems the company hasn't closed any previous
years....Any help will be appreciated.
Closing years in QB isn't necessary nor is it required like in some other
accounting programs. You may want to close the period for 2004 to preserve
the CPA's adjustments from accidental tampering though.
 
H

harshni

Hi Tara,

Thank you for informative message.

Regarding the bank rec..It seems those transaction were never
reconciled..how do I deal with that?

Thanks
HR
 
T

Tee

Hi Tara,

Thank you for informative message.

Regarding the bank rec..It seems those transaction were never
reconciled..how do I deal with that?
It depends on what happened. Were those transactions never completed (as in
checks not cashed) or did the previous bookkeeper not check those
transactions off and instead dumped the discrepancy amount in an income or
expense account? How has the CPA dealt with these items?

If the items were never actually cleared and the CPA hasn't done anything
with them then you could void them. If they cleared the bank but weren't
checked off during reconciliation then you'd find out where the discrepancy
amount went during that reconciliation and then make a journal entry. Talk
to the CPA first though.
 
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L

Laura

Tee said:
It depends on what happened. Were those transactions never completed (as
in checks not cashed) or did the previous bookkeeper not check those
transactions off and instead dumped the discrepancy amount in an income or
expense account? How has the CPA dealt with these items?

If the items were never actually cleared and the CPA hasn't done anything
with them then you could void them. If they cleared the bank but weren't
checked off during reconciliation then you'd find out where the
discrepancy amount went during that reconciliation and then make a journal
entry. Talk to the CPA first though.
Becareful about voiding prior years checks. QB will void them using the
original date of the check.

If the bank recs have never been completed then I would start with the
January 2005 bank statement. Go through the 2005 bank statements and list
all of the checks from 2004 that cleared in 2005. They should mostly be the
ones from November & December 2004. Then clear all of the prior year(s)
checks except for those that cleared in 2005. Do the normal January 2005
reconciliation. If necessary do an adjustment on 1/31/05 so that your bank
balance is correct and then proceed to do the remaining months of 2005 until
you are caught up to date. Remember, you don't want to change the bank
balance for 12/31/04 or you won't match the CPAs records but you can change
this years balance.
 

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