Cloud-Based Accounting with QuickBooks Online: Is It Right for You?

Cloud-Based Accounting with QuickBooks Online: Is It Right for You?

 

LUTZ BUSINESS INSIGHTS

 

Cloud-Based Accounting

Cloud-Based Accounting with QuickBooks Online: Is It Right for You?

Mike Perry, Client Accounting Services Director

 

You’ve probably been hearing for years that everyone is moving to the cloud for their small business accounting. That’s actually not true. You may be one of the millions of companies that still use established manual methods, with perhaps a little work in Excel. Or maybe you’re still using the desktop version of QuickBooks because you like the idea of your financial data residing on your physical drives.

But it is true that the cloud is where most of the real innovation and growth resides. QuickBooks Online launched over a decade ago. It started small but has nearly caught up with QuickBooks desktop’s capabilities, surpassing it in some areas.

QuickBooks Desktop vs. QuickBooks Online is more than a feature war, though. Working in the cloud has advantages that go beyond what’s on a product’s spec sheet. Here are five things that might be stopping you from trying it.

1. It’s not safe.

Making the leap from desktop software to an online solution makes many people nervous at first, thanks to all of the stories in the news about hackers and data breaches. But QuickBooks Online’s security measures are at least as strong and effective as what your banks use.

2. I might lose my data.

Yes, that’s a nightmare scenario. But Intuit, the maker of the QuickBooks product lines, stores and backs up your business information on servers that are constantly monitored for intrusions. Your data is actually protected 24/7 by full-time security staff. You can read more about QuickBooks Online security here.

3. My company isn’t big enough to need a cloud-based solution.

You don’t have to be a Fortune 500 company to benefit from cloud-based accounting. QuickBooks Online actually has five service levels that begin with an application called QuickBooks Self-Employed, which could be used by an independent contractor or freelancer with very simple needs.

4. My company is too big for an online accounting application to handle.

That may not be true. QuickBooks Online Advanced supports up to 25 users. Beyond its top-notch core accounting tools, this solution offers sophisticated features like workflow automation, powerful analytics and insights, project profitability, and enhanced reports.

5. I take notes at meetings and enter them into my accounting system when I return. Why would I need the cloud?

All the more reason to consider QuickBooks Online. It has a mobile app that doesn’t replicate absolutely everything found on the browser-based version, but it supports enough tools and data that you can create and edit records and transactions while you’re sitting in someone’s office, and that information will be immediately synchronized with the version of QuickBooks Online that resides on your PC. You can even snap photos with your smartphone and create expense records.

You’re probably already working in the cloud for applications like email and word processing. Accounting can be a logical next step for you. Sign up for a free trial of QuickBooks Online, and we can show you how it works. Please contact us if you have any questions.

ABOUT THE AUTHOR

Mike Perry + Lutz Client Accounting Services in Nebraska

402.827.2087

mperry@lutz.us

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MIKE PERRY + CLIENT ACCOUNTING SERVICES DIRECTOR

Mike Perry is a Client Accounting Services Director at Lutz with over 15 years of accounting experience. He focuses on providing business consulting, software implementation and training, accounting procedure assistance and outsourced accounting replacement consulting for closely held companies.

AREAS OF FOCUS
AFFILIATIONS AND CREDENTIALS
  • American Institute of Certified Public Accountants, Member
  • Nebraska Society of Certified Public Accountants, Member
  • Intuit Certified ProAdvisor, QuickBooks Advanced
  • Certified Public Accountant
EDUCATIONAL BACKGROUND
  • BSBA in Accounting, University of Nebraska, Kearney, NE
COMMUNITY SERVICE
  • Community Bike Project Omaha, Past Treasurer
QUICKBOOKS PROADVISOR CERTIFICATIONS

Certified ProAdvisor - Online  Certified ProAdvisor - Advanced Desktop  Certified ProAdvisor - Enterprise

BILL.COM CERTIFICATIONS

Bill.com Guru Certification   

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Getting Ready to Reconcile in QuickBooks

Getting Ready to Reconcile in QuickBooks

 

LUTZ BUSINESS INSIGHTS

 

Reconcile in QuickBooks

getting ready to reconcile in quickbooks

jimmy burgess, senior accountant

 

If you’ve ever reconciled a bank or credit card account manually, you know how challenging it is. The good news is that QuickBooks has built-in reconciliation tools. The bad news is it can still be difficult to get your statement and QuickBooks to agree.

If you want to try to tackle it yourself, there are a few steps you should take before you reconcile for the first time.

1. Understand the process. 

It’s similar to the old manual method. As you find entries in QuickBooks and your statement that match, you’ll be putting a checkmark in the column in QuickBooks to indicate that the transaction is reconciled. When you’re done, the difference between the two should be $0.00. If it’s not, QuickBooks will offer suggestions. These may or may not solve your problem.

2. Make sure you have created a bank account in QuickBooks to mirror your real-life account.

We don’t normally recommend that you go into QuickBooks’ Chart of Accounts and change anything, but if you haven’t yet created a checking account in the software, you’ll need to do so before you try to reconcile. You may also want to set up accounts for credit cards, loans, etc. We can show you how.

3. Know what the Beginning Balance for the reconciliation is.

This is different from the opening balance for your bank account. It’s the beginning balance printed at the start of your statement. Once you’ve done a reconciliation successfully, QuickBooks will use the ending balance from the previous reconciliation for the next one.

4. Be aware of the service charges and interest-earned amounts that have been applied by the bank.

You’ll be entering these in the Begin Reconciliation window in QuickBooks. Your account will not reconcile if you don’t apply these.

5. Enter any missing transactions for the period you’re reconciling.

If you’ve connected QuickBooks to your online bank, this will not be so difficult. If you haven’t, we recommend you consider it. It’ll be far easier than going to your bank website and looking for each transaction individually.

6. Back up your company file before you reconcile.

Open the File menu and hover over Back Up Company, then click Create Local Backup. Click the Options button and complete the fields for a local backup (like a USB drive). Click OK, then Next. Choose Save it now in the window that opens, then Finish. There are other backup options that we can go over with you.

QuickBooks does a good job of walking you through the reconciliation process, and it tries to help when you can’t get the numbers to match. But making that happen can be difficult. It’s much easier if you can work with a pro who knows where to look for problems. We can help you master the mechanics of reconciliation in QuickBooks or simply complete the task for you every month. Contact us to set up a consultation.

ABOUT THE AUTHOR

402.514.0016

jburgess@lutz.us

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JIMMY BURGESS + SENIOR ACCOUNTANT

Jimmy Burgess is a Senior Accountant at Lutz with over four years of relevant experience. His primary focus is to provide outsourced accounting to clients with a focus on QuickBooks, tax and payroll compliance, small business consulting, as well as software implementation training.

AREAS OF FOCUS
  • Outsourced Accounting Services
  • QuickBooks
  • Tax & Payroll Compliance
  • Small Business Consulting
  • Software Implementation & Training
  • Construction Industry
AFFILIATIONS AND CREDENTIALS
  • Nebraska Society of Certified Public Accountants, Member
  • Certified Public Accountant
EDUCATIONAL BACKGROUND
  • BS in Business Administration and Accounting, University of Wyoming, Laramie, WY
COMMUNITY SERVICE
  • Youth Sports Coach, Volunteer
QUICKBOOKS PROADVISOR CERTIFICATIONS

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Connecting Your Bank Accounts and Credit Cards in QuickBooks Desktop

Connecting Your Bank Accounts and Credit Cards in QuickBooks Desktop

 

LUTZ BUSINESS INSIGHTS

 

Connect bank accounts and credit cards

connecting your bank accounts and credit cards in quickbooks desktop

amanda harpster, client accounting services manager

 

One of the five best things about QuickBooks Desktop is its ability to download transactions from your financial institutions. The software has been capable of this for a long time, so this function has matured nicely and is protected by bank-grade (or better) security protocols.

If you are still entering transactions manually, consider the benefits of connecting your bank accounts and credit cards to QuickBooks Desktop:

  • You can see which transactions have cleared.
  • You’ll know your current bank balance.
  • Your reconciliation chores will be much easier.
  • You will find errors or other problems without waiting for a bank statement.

QuickBooks Desktop supports thousands of financial institutions — major banks and credit card issuers as well as many smaller ones, so it’s likely that you will have access to your accounts.

 

Just a Few Steps

The process of getting QuickBooks Desktop set up to download transactions is simple. You open the Banking menu and click on Bank Feeds, then select Set Up Bank Feed for an Account. In the window that opens, either find your financial institution in the list supplied and click on it or enter its name in the search box. Matching results will appear in a box below. Be sure to double-check the URL you select. It must match the URL that you use when logging in online.

There are three ways that QuickBooks Desktop brings transactions into the software. Your bank may only support one or two of them. They are:

1. Express Web Connect

You enter the username and password that you use to access your transactions directly from the bank’s website. QuickBooks Desktop makes a connection and automatically downloads your data when you set up the link and every time you log into the software. You never have to supply your login details again unless a problem crops up, or the bank changes the security settings.

2. Direct Connect

Using this method, you also download transactions directly into QuickBooks Desktop, but you also have the option to initiate payments and transfers. You will have to supply special information from your bank, and fees may apply.

3. Web Connect

This is the most labor-intensive and least convenient way to move transactions into QuickBooks Desktop. It requires that you log into your bank’s website and download a QuickBooks-compatible file, then upload it into QuickBooks Desktop. This option does allow you to select only the date range you want to import.

Financial institutions have been tightening up their security to help prevent fraud. So even if you are using one of the first two connection types listed above, you may be asked to supply additional identifying information, like your birthdate or anything else the financial institution’s site itself requires when you log in.

Once you have successfully established a connection and downloaded your transactions into an existing account (or created a new one), you will have access to QuickBooks’ Bank Feeds Center, where you can view, edit, and accept the transactions that appear in a register-like display.

These connections usually work well – except when they don’t. We are available to help you troubleshoot the transaction-downloading process. Once you clear that hurdle, we think you will find that real-time access to your account data will accelerate your daily accounting work and give you a clearer picture of where you stand financially. If you have any questions, contact us, or visit our website to learn more about our Client Accounting Services.

ABOUT THE AUTHOR

402.827.2307

aharpster@lutz.us

AMANDA HARPSTER + CLIENT ACCOUNTING SERVICES MANAGER

Amanda Harpster is a Client Accounting Services Manager at Lutz with over 14 years of relevant experience. She focuses on QuickBooks support, tax and payroll compliance, and small business consulting.

AFFILIATIONS AND CREDENTIALS
  • Intuit Certified ProAdvisor, QuickBooks
EDUCATIONAL BACKGROUND
  • BSBA in Accounting, University of Nebraska, Omaha, NE
COMMUNITY SERVICE
  • St. Patrick’s Parish, Volunteer
  • Cub Scout Pack #409, Treasurer
  • Ponca Hills Fire Department Women’s Auxiliary, Member
QUICKBOOKS PROADVISOR CERTIFICATIONS

Certified ProAdvisor - Online  

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QuickBooks Online Series

QuickBooks Online Series

 

LUTZ BUSINESS INSIGHTS

 

QuickBooks Online

QuickBooks Online Series

Join us for a QuickBooks Online Series throughout August, September & November!

Accounts Receivable Set-Up Tutorial

8.31.21 | RECORDING

Key Takeaways:

  • General Overview Demo
  • Customer & Job Set-Up
  • Item Set-Up
  • Using Invoice Templates

Accounts Receivable Module Tutorial

9.15.21 | RECORDING

Key Takeaways:

  • Creating Invoices
  • Receiving Payments & Undeposited Funds
  • Record Deposits for Payments Received
  • Credit Memo Options
  • Memorize Recurring Invoices

Banking Module Tutorial

11.17.21 | RECORDING

Key Takeaways:

  • General Overview Demo
  • Connect Accounts (Bank & Credit Card)
  • Rules Option
  • Receipt Capture

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Independent Contractor or Employee? How to Classify Your Workers

Independent Contractor or Employee? How to Classify Your Workers

 

LUTZ BUSINESS INSIGHTS

 

INDEPENDENT CONTRACTOR OR EMPLOYEE

independent contractor or employee? how to classify your workers

brandi mckay, client accounting services manager

 

When your small business hires a new worker, how do you decide whether that individual is an independent contractor or an employee? Independent contractors are, by definition, self-employed. They’re responsible for their own income taxes and benefits like health insurance. They can work part-time or full-time, and they usually take care of setting up their own office space.

But to the IRS, the distinction is not that simple. All of the above could apply to a worker, yet he or she might actually be an employee. The agency has been known to painstakingly scrutinize the relationships between management and labor at large companies in an effort to ensure that everyone has been classified correctly.

Unfortunately, there’s no magic formula you can apply to determine a worker’s status. Rather, the IRS defines the difference by asking you to explore three elements of employment that should help you make this distinction correctly. They are:

  • Behavioral. Who controls what the workers do and how they do their jobs?
  • Financial. What about the business aspects of the job? Who determines, for example, how workers are paid and whether expenses are reimbursed? Are workers responsible for their own office expenses, like tools and supplies?
  • Type of relationship. Is management providing resources like written contracts and standard employee benefits? Is the individual providing work that is a “key aspect of the business?” Will the relationship be ongoing?

As you consider these questions, you may find that your answer to one would indicate that the worker is an independent contractor, while another points to an employer/employee relationship. There’s no one factor that determines what the worker’s status is. To muddy the waters further, some of the work that the individual does may lean in one direction, while other work would indicate a different answer.

Basically, it all comes down to the degree of control that management has over workers.

If you’ve answered these questions and are still unclear whether to classify people as employees or independent contractors, you or your workers can complete an IRS Form SS-8: Determination of Worker Status for Purposes of Federal Employment Taxes and Income Tax Withholding.

Individual states also have their own worker status “tests” based on workers’ compensation and unemployment insurance laws. This classification is actually more difficult in most states because you have to consider how economically dependent individuals are on the business, in addition to the degree of control tests. You can find contact information for your own state’s labor offices here.

As you may know, income taxes are handled very differently for independent contractors and employees. And it’s very important that you’re doing this right – for both you and your staff. If you have questions about this issue or about the classification of the individuals you employ, or if you’re looking for general business and accounting advisory services, please contact us.

ABOUT THE AUTHOR

402.778.7945

bmckay@lutz.us

BRANDI MCKAY + CLIENT ACCOUNTING SERVICES MANAGER

Brandi McKay is a Client Accounting Services Manager at Lutz with over seven years of experience in accounting. She is responsible for providing outsourced accounting services to clients with a focus in payroll compliance.

AREAS OF FOCUS
  • Outsourced Accounting
  • Tax & Payroll Compliance
  • Healthcare Industry
  • QuickBooks
AFFILIATIONS AND CREDENTIALS
  • Medical Group Management Association, Past Member
  • Nebraska Medical Group Management Association, Past Member
EDUCATIONAL BACKGROUND
  • MPA, University of Nebraska, Lincoln, NE
  • BSBA in Accounting, University of Nebraska, Lincoln, NE

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Lutz adds Staff Accountants to Omaha, Lincoln and Grand Island Offices

Lutz adds Staff Accountants to Omaha, Lincoln and Grand Island Offices

 

LUTZ BUSINESS INSIGHTS

 

Lutz adds Staff Accountants to Omaha, Lincoln and Grand Island Offices

Lutz, a Nebraska-based business solutions firm, recently added seven staff accountants to its Omaha, Lincoln and Grand Island offices.

Bailey Armbruster

Bailey Armbruster joins the accounting department in Lutz’s Grand Island office. She is responsible for the preparation of individual and business income tax returns and providing credibility to clients through financial reporting. Armbruster previously interned with Lutz during summer 2020. Bailey graduated from Peru State College with a Bachelor’s degree in accounting and computer management, and information systems.

Tracy Chvala

Tracy Chvala joins the firm’s tax department in Lutz’s Lincoln office. She is responsible for preparing individual and business income tax returns, and providing general accounting assistance to clients in a variety of industries. Tracy graduated from the University of Nebraska-Lincoln with a Master’s degree in accounting.

Victor Salerno

Victor Salerno joins the audit department in Lutz’s Omaha office. He is responsible for providing credibility to clients through financial reporting. In addition, he works to maintain a high level of objectivity and confidentiality in all areas for clients in a variety of industries. Salerno previously interned with Lutz during tax season 2020. Victor graduated from the University of Nebraska-Lincoln with a Bachelor’s degree in accounting.

Claira Thede

Claira Thede joins the accounting department in Lutz’s Grand Island office. She is responsible for providing credibility to clients through financial reporting and preparing individual and business income tax returns. Thede previously interned with Lutz during tax season 2019 and 2020 and summer 2020. Claira graduated from Hastings College with a Bachelor’s degree in accounting and business administration.

Mali Thramer

Mali Thramer joins the state and local tax department in Lutz’s Omaha office. She is responsible for assisting clients with tax-related issues, from pursuing tax incentives to managing state tax audits. In addition, she will prepare individual and business income tax returns. Mali graduated from the University of Nebraska-Omaha with a Bachelor’s degree in accounting.

Ashley Tyler

Ashley Tyler joins the firm’s client accounting services department. She will work in both the Omaha and Lincoln offices. She is responsible for providing outsourced accounting services and accounting assistance, including QuickBooks and payroll compliance. Tyler previously interned with Lutz during summer 2019 and tax season 2020 and 2021. Ashley graduated from the University of Nebraska-Lincoln with a Bachelor’s degree in accounting and finance.

Ansel Uerling

Ansel Uerling joins the tax department in Lutz’s Lincoln office. He provides tax consulting and compliance services for clients with a focus on individual and business income tax. Uerling previously interned with Lutz during summer 2019 and tax season 2019, 2020 and 2021. Ansel graduated from the University of Nebraska-Lincoln with a Bachelor’s degree in accounting.

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