How to Generate Quickbooks Profit & Loss Statements - What to Look out For
In recent years, QuickBooks accounting software has made a significant impact on the way that modern businesses facilitate their financial functions—most notably their bookkeeping and accounting.
QuickBooks has enabled business owners to drop a significant accounting and bookkeeping load off their backs while making their reports as accurate as possible in a shorter amount of time. Packed with various unique features, the QuickBooks software functions as an all-in-one tool that businesses can use to create financial reports, manage their bookkeeping, and generate invoices.
QuickBooks, however, has been shown to excel in its profit and loss report generation function especially. With a few clicks and a surprisingly simple process, a QuickBooks software automatically generates an accurate profit and loss statement based on the past information that you’ve fed it. It essentially means that you won’t have to burn the midnight oil doing manual computation and tabulation anymore.
Even so, most business owners haven’t been able to maximize QuickBooks as much as they should. That is because most business owners are unaware of what they should check before using the software-generated profit and loss report.
To ensure that you’ll be able to maximize your obtained document without errors, here are a few key items to review before generating a QuickBooks profit and loss report:
1. The currentness of your stored data
At the end of the day, your profit and loss reports are only as good as the quality of data that you have. It means that not routinely reconciling bank accounts can spell quite a bit of trouble in terms of accuracy.
Before you generate a QuickBooks profit and loss report, head over to the banking tab and update your listed accounts in the software to reel in key data. Afterwards, ensure that all of your transactions are properly categorized and in sync with any financial tracking apps that you use to make your data pool even more well-rounded. As an added bonus, feel free to manually enter any outstanding sales or expenses that haven’t been automatically imported yet to complete your financial data.
2. The data range option that you choose
Depending on your set of goals and overall orientation towards interpreting data, the data range option that you settle for will definitely affect the way you track your progress. If you’re looking to customize the tally of data in your reports depending on the frequency of information compilation, then you can select between monthly, quarterly, bi-annual, and annual reporting. When choosing your data range option, however, it is ideal to ensure that your QuickBooks year matches your fiscal year for the accuracy and freshness of your profit and loss reports.
3. The type of accounting method that your report will use
Another useful add-on that comes with the QuickBooks accounting software is the ability to choose between cash-basis or accrual accounts reporting template when reflecting your data. Generally, the software’s default template reports settings are geared towards the accrual side, but you can switch over to cash templates easily.
Making a few tweaks before you generate a profit and loss report with the help of your QuickBooks accounting software is an effective way to save yourself the time and trouble of dealing with inaccurate reports.
Should you find yourself in need of an accounting software expert’s services in setting up Quickbooks for your business’s needs and functions on the Gold Coast, get in touch with our business accountant today!