27: How to Tell if Your Chart of Accounts is Set Up Correctly

When we start working with clients, about 25% of the time, we see errors with how they’ve set up and managed the chart of accounts in QuickBooks. The chart of accounts is the listing of accounts that you use to categorize transactions, which then turn into your financial statements. When you don’t have this set up correctly, it could look like you have more income or cash on hand than you really do, cause you to over- or under-paying taxes, and have the wrong data to base decisions on. 01:17 — What is the Chart of Accounts? 02:15 — Why choosing the wrong account types is so common in QuickBooks 07:59 — How the wrong accounts gives you the wrong data and can cause you to over- or under-pay in taxes09:54  — Understanding how to correct this error and how the severity of it can add up by over-paying taxes and having someone fix it for you11:19 — What to expect during a QuickBooks Clean-Up15:43 — Utilizing AI for Chart of Accounts for your industry If, after listening to this episode, you realize you haven’t set up your accounts in QuickBooks properly, now is the time for a cleanup so you can keep your books and numbers accurate for 2024. This cleanup is very personalized depending on your business needs and will be discussed during our discovery call. You may be new to Quickbooks OR you're looking to re-categorize existing transactions, reconcile accounts, examine journal entries, etc. First, we’ll understand your goals for a QuickBooks clean-up, such as re-categorizing existing transactions, reconciling accounts, examining journal entries, etc. Then, you’ll give us access to your QuickBooks so we can see what your current setup looks like, how long you’ve been in there, and see if any mistakes need to be amended. We’ll provide you with a custom quote based on what your project needs along with an estimated timeline, and walk you through our recommendations. Clean-ups can range in price but start as low as $400 for a simple cleanup and $1,200 a month for more complex fixes. If you’re not in QuickBooks yet, but realize you’re at the point where you need to be (but want to ensure it’s set up correctly), we also offer a QuickBooks Set Up service starting at just $250. That way, even if you’re not quite ready to outsource your monthly bookkeeping, you can feel much more confident that it’s set up properly. Book your call with us here!