A Conversation With TaxMama: It's Finally Time to Upgrade Your QuickBooks Software

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If you know me at all, you've probably come to realize that as far as I am concerned, if something ain't broke, don't fix it. So, I tend to discourage software updates, just for the sake of the update – or QuickBooks Premier 2007 simply to enrich the company selling it.

If I had my way, I would still be using the original version of QuickBooks, which was a neat, compact, tidy program that let you treat your entries as if you were making them in your checkbook – with the ability to also post the entry to the account that identified the income or expense. Simple. Neat. Easy to use. But, it's in DOS.

I've always discouraged my clients from upgrading – if the software was working for them. (But there was always someone who did!) So, today, my computers contain about six versions of QuickBooks, so we can synchronize with a variety of clients and their versions of QuickBooks. PAIN! PAIN! PAIN!

For you, using the one version in your office, it's not an issue. For your accountant or tax professional, this tendency of QuickBooks to always upgrade the files to the new version when the accountant uploads your records ... well, it means, if you want to be able to get your files back so they still work on your computer – your tax pros must have your version on their computer. What a pain!

For 2006, QuickBooks came out with QuickBooks Premier for tax professionals that let them retain the version of their clients' files. Your accountant or tax pro could export the adjusted accountants copy – and you could install it and have all the journal entries appear. And that was a big improvement because clients didn't have to upgrade, and everyone could be on the same page.

The big problem with the accountant's copy, as I saw it, was that you are apt to make a variety of mistakes that really should be corrected at the source, at the original entry, rather than as a journal entry. For instance, if you entered the check with the wrong amount – don't you think it would make more sense to just change the data on the original check than to have to make a journal entry for it?

Or if you entered the check you deposited into your business account to cover upcoming bills, and you entered it as income. Don't you think the original entry should be changed to a loan in the first place? Rather than having a journal entry out there for IRS to scrutinize and wonder if it wasn't, in fact, income in the first place?

Journal entries should be used for actual accounting adjustments, like depreciation, accruals, reconciling beginning and ending inventory, writing off bad debts ... things like that. Not to correct your posting and entries.

That was one of the things I've always liked about QuickBooks from the very beginning. You weren't forced to close the accounting period a month or two after the month or quarter ended. You could correct source entries anytime you found them – usually when you were getting ready to do your tax return about ten months after the previous year ended.

Remember, my philosophy has always been – don't upgrade if it works.

Today I am going to encourage you to upgrade to QuickBooks 2007.

Why? Because this version has enough changes to make it really worth your while!

I'll just give you the TOP 10 reasons to upgrade.

1) They've introduced a new ‘divide the date' feature that lets you give your tax pro a copy of your files. Instead of it being simply an accounting copy which only lets us make journal entries, it will let us make any changes at all. And when you re-install the updates, you'll be able to review each change and accept it or reject it. Cool, eh?

2) Incidentally, once you've approved those changes, you'll still be able to find them as changes. There's an ‘always on' audit trail tool to keep track of all changes.

3) You're going to be able to eliminate more of your stationery costs. QuickBooks is making it easier to customize your invoices and other forms, and to add graphics. You'll be able to see a preview before you finalize it.

4) Searching for information has just gotten really easy. QuickBooks just integrated the Google desktop search functions and you won't have to piddle time away while you're looking for something you vaguely remember was in a particular account, or from someone with a name like .....

5) Payroll (if you subscribe to it) is more flexible for those of us who want to keep complex records on how employee time is split across different departments. And you'll also be able to create pre-schedule payrolls, even if your hourly and salaried employees get paid on different schedules. You'll be able to create groups of employees, each with their own schedules – and on the due date, all you'll have to do is enter the hours for just that group ... and awaaaay you go!

6) Business Plans – (Did you read Chapter 2 of Small Business Taxes Made Easy?) So essential to new and growing businesses – and to business audits to prove a profit motive. QuickBooks Premier 7 lets you create a business plan with 3-year projected financial statements that you can export to your Excel software. Where you can add more columns for more years, if you need to. If you don't want to buy the Premier edition, just give your tax pros your data and they can create the business plan for you, via their Premier edition.

7) Inventory Controls have become really neat. You know how you order things in large quantities, and pay your costs based on case prices, reams, bales, bolts, tons, etc.? And then you sell them by the piece, the pound, the yard, and so forth, right? QuickBooks has just built in a unit converter. So you can enter your purchases into inventory the way you buy them. Then enter the conversion information for the various ways you sell them. And the customer's invoice will have quantities described in terms that are meaningful to them.

8) Do you want your clients to find you? Are you sick and tired of giving them directions? Well, as a result of QuickBooks' new partnership with Google, you'll be able to post your business and it's address on Google Maps so people can find you. Better yet, you'll be able to add COUPONS! And the advertising is FREE!

9) Do sell things? Products or services that you've set up as items in QuickBooks? You'll be able to enter specific product details, even pictures, that you can export to the Web via GoogleBase and have them integrated into Google, Froogle and other search tools, to attract clients.

10) You can e-mail invoices to clients directly from within QuickBooks – they get the bills faster and can pay you more quickly. And there's another blow to the office supply stores – no more envelopes!

Incidentally, the Simple Start version has several of these Google tools integrated. And they've added a Simple Start Online Edition, too. You can choose which way you want to go, when you install it. The cost includes one-year of online fees.

So, if you're serious about growing your business - THIS year's edition is worth upgrading – across the board.

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