 QuickBooks Online 2024 budget reports. Get ready because we're moving on up with QuickBooks Online 2024. Here we are online in our browser searching for QuickBooks Online Test Drive looking for the result that has Intuit.com and the URL Intuit being the owner of QuickBooks selecting the United States version of the software and we want to verify that we're not a robot just in case there's any confusion about the matter. How many times do I have to tell you? Anyways, let's go to the reports. Open up the major financial statement reports like we do every time. Reports on the left hand side in the favorites. We're going to be right-clicking on that balance sheet so that we can open Lincoln a new tab. First a word from our sponsor. Yeah actually we're sponsoring ourselves on this one because apparently the merchandisers they don't want to be seen with us but but that's okay whatever because our merchandise is is better than their stupid stuff anyways. Like our trust me I'm an accountant product line. Yeah it's paramount that you let people know that you're an accountant because apparently we're among the only ones equipped with the number crunching skills to answer society's current deep complex and nuanced questions. If you would like a commercial free experience consider subscribing to our website at accountinginstruction.com or accountinginstruction.thinkific.com. Right click on the profit and loss so we can once again open the link in a new tab. Let's go into that middle tab, that balance sheet, close up the hamburger and change that range bringing it back to two thousand twenty three oh one oh one two three tab twelve three one two three tab running it to refresh it and then we'll tab to the right close up the hamburger and we're going to make a new range oh one oh one two three tab twelve thirty one two three tab and then we run it and it refreshes it just like drink it a glass of lemonade after a run the screen refreshes you. Okay that's the setup process that we do every time remembering that these are our major two financial statement reports that being the balance sheet the income statement otherwise known as the profit and loss all other reports for the most part given us more information about these major two reports however this time we're going to get into kind of an exception and we've seen some exceptions before to the general rule of all other reports basically supporting or providing more detail about one or multiple line idens on these major financial statements one being the bank reconciliation because the bank reconciliation is an internal control type of report and the other being the statement of cash flows which is really another major financial statement which is kind of reworking in essence primarily our profit and loss but not on an accrual basis but a cashed basis this time we want to take a look at budgetary reports budgetary reports are often confusing because they're they blur the line between the accountant's obligation the bookkeeper's obligation and the obligation of management so in other words if we look at the budgets they have the format of financial statements and therefore you would expect then the accountant to be involved in the creation of the budgets however when you think about accounting in general what we're trying to do in the accounting department is take past data or transactions that are currently happening in real time and record them document them in our financial statements compile them in such a way that we can have useful information that we can use to make decisions with those decisions of course being projections now that we're going to think about what we're going to do at this point in time to try to change the future to increase our productivity to increase sales revenue generation so note that the general concept of budgets then is not something that's directly in the purview of the bookkeeper typically it's what the bookkeeper might be in on with other people that are involved in the business so that we can try to make projections into the future from the accountant or bookkeeping side then our major goal is the formatting that's where we kind of play a role but we're going to need more information than just past data so that's just something to keep in mind so in other words if you're working in the accounting department of a business then you're going to possibly be involved in the budgeting but you're not going to be the only one involved because you're going to need other decision makers that are that are going to try to make changes to what they're currently doing to hopefully improve revenue generation in the future if you are a bookkeeper you have a similar situation the owner of the business might expect a budget or something like that from you you can make a budget based on just prior year numbers however to make a really good budget that's going to going to have a good benchmark going forward you would need the input of the owner of the business if you are the owner of the business and you're doing your own bookkeeping then of course you're doing everything right so now you you're putting your bookkeeping hat on to think about what kind of bookkeeping you would need to do to create the budget what's the technical format of the budget financial statement looking format and you're thinking in terms of the management to think about what changes you might make so quick quick note on some of the changes you might make right what are we going to start the budget with most likely prior year numbers is going to be our starting point but then we're going to then think about what changes we're going to make based on our performance in the past those things might be increasing advertising for example we might increase or decrease the cost of our products for example we might be looking into things that are outside of our control that we think will have an impact on our financial statements such as the economy such as politics and all that crazy stuff going on we're going to try to put that into the picture to make projections into the future and we want to make projections because we want the goal to see if we can hit the goal if we don't have our goals we're kind of shooting in the dark we're shooting from the hip we might not be totally invested in what we're doing therefore what we when we think of the budget we usually think of the profit and loss report format as the budget you'll remember that the balance sheet is as of a point in time that's where we stand as of a point in time the budget I mean the profit and loss is basically going back a year in history when you're looking at a standard budget we're going back a year or a month to see how we got to where we are currently standing on the balance sheet in terms of revenue generation and expenses that we had to incur in order to generate that revenue when we're projecting out into the future we're looking generally then mostly at the performance document that being the profit and loss this is what we are going to do this is the game plan this is the actions that will happen in the future represented in income and expenses and then we could have a balance sheet budget as well the balance sheet budget is where we're going to end up after the month or a year so so that's the general idea of the budget all right let's go to the first tab now note that if I go down to the reports on the left hand side and you don't have any budgets already in here if I type in budget there's nothing in here right because we don't have any we haven't set any up so you would need to basically set up the budgets now note that the one easy way you can set up the budget just within quickbooks I'll tell you where they're located you can go into the drop down here and you can find the budgeting under the tools and currently they also have it on the left hand side where you have the budgeting on the left hand side so here's where we have it we've got their little thing here it says plan better with budgets manage all your profit and loss and balance sheet budgets in one place the balance sheet by the way is a newer function or a newer feature within quickbooks online a lot of competitors still don't really have a balance sheet because a lot of people the first step is to think of it in terms of the income statement so that's kind of neat that they have that so use a last data of value available in quickbooks to make budgets see if you're on track by comparing actual performance with budgeted numbers bring in profit or loss budget created elsewhere into quickbooks now note that the general process if we were to create the budget here we're not usually going to go through the creation process totally within quickbooks we could we could just base the budget on the prior year numbers for example and just crank out a budget based on last year's numbers that we're going to kind of somehow allocate across the future period but if we really want to analyze the budget we probably want to do it externally somewhere in like excel for example so what you might do with the budget and we'll do this more in a future course and or section when we talk about budgets in more detail you might start off by taking the profit and loss for example export it to excel or possibly take the trial balance which you can then adjust export it to excel and then adjust it to just the profit and loss numbers so you don't have all the subtotals and then create your budget meaning think about what changes are going to happen going into the future versus what you did last year so one way that you might export this to excel for example as you might start off by saying I'm going to make this budget month by month for the last year here's last year's month by month budget there's not much happening in the beginning of the year because this only had data in the end of it but you can start by exporting this and if you're in a stable business meaning your year to year is pretty stable then that might be a good place to go especially if you have seasonal business because some months might be higher than other months just because of the seasonalness of your business on the other hand if you're a growing business it might be the case that your beginning months are no longer representative you have you might have a lot more income towards the end of the year not because you have a seasonal business but because you did better at the end of the year in that case you might try to take the end numbers and project that as what you think are going to happen going forward considering you think you're going to keep on and hold on to your gains that you've had throughout the year right or you might take the total the total over the entire year and say I'm just going to average it and make that an average divided by 12 for each month as your starting point and then from there you can then adjust it line by line to think about which lines are going to have an impact possibly because you're going to increase advertising for example possibly because you're going to hire more people possibly because you think your revenue is going to go up because of some other factor of the advertising most likely right so you can start to think about those types of changes that you might make in excel if you're going to do it in excel you might ask well why then what's quickbooks good for well once you do it in excel you want to put it back into quickbooks because quickbooks is good at running reports so if it's in quickbooks then you can then run budget versus actual reports so as time passes you have the target on a month by month basis you have what you actually did on a month by month basis and you can look at the difference between the two and see see what your shortfalls were so if I was to create the budget you can go in here notice that we have the select your profile you've got the profit and loss or income statement and now you have the balance sheet which is cool we never we didn't always used to have that before and then the period so you can make multiple budgets here but and so we can budget out into the future if we so choose but we're going to be looking at 2024 typically we're going to imagine 2023 has ended then go into 2024 budget format consolidated budget versus subdivided budget so this one being if we hover over this create an an org level financial plan meaning for the entire organization versus create individual budget based on location class department or customers so this would be a more advanced setting if you want to dig into the details of the budgets and try to break it out by location class or department so if you have location tracking on which is another feature we have another course or section on if you want to look at that or class tracking location tracking department tracking that's where you might use that type of format we have the custom budget create a budget from scratch that's what we'll look at here but you could also import the budget so you might try to think of a system where you can export the excel adjust it and then see if you can just import it back in so you don't have to do the data input of importing it back in we'll take a look at those things more in a future course or section when we're focused more just on the budget but if I go into here then up top we've got the period and here's our period we've got the compare reference data so we're comparing the reference data to this drop down which currently says actual there is nothing in 2024 right now for the year to date actual so you might compare it to the prior year 2023 so they've kind of again they've kind of updated this one which is kind of nice now so that we can see it as compared to the prior year so there it goes I had to toggle this back on and off again to see it so now you've got the prior year numbers we only have data in the last couple months but that might help us to do the data input so if we just want to mirror what happened last year I could just copy over the numbers from last year over into the into the current year or I can use that as my starting point and possibly make adjustments from that point we have then the yearly budget if we want to do yearly quarterly oftentimes the standard budget is going to be the monthly budget this number here hides the reference dates up top so it might make it a little bit cleaner but a little bit more less like confusing if you hit the drop down in the cog you've got the auto save is on so if you want to turn that off maybe if it's freezing up for whatever reason but it seems to work pretty well hide empty rows so that could be useful if you want to hide the rows that you're not using and you're doing a comparative type of thing but it's off by default so that we can see all the numbers on the chart of accounts here so all the things on the chart of accounts are currently here so now if I did the data input like if I put say 10,000 in the total then it'll divide out by month which is kind of nice we'll talk about some techniques to do the data input and so on in the future right now I just want to note that the general process would be you're probably going to export the profit and loss in excel to excel and then do your budget outside of QuickBooks and then use that information to do the data input back in QuickBooks like this so that you can then generate reports in QuickBooks so after you do this if I'm going to right click on this tab up top and then I'm going to go into the reports on the left hand side or close this out reports on the left and then when we search for the budget once we enter one we'll have the budget reports there'll be two major reports they won't let me save it in the test drive so we'll do a whole course or section on this later but once you then look this up you should have budget reports once you copy and save your budget reports there'll be two major reports generally that the normal budget and then the budget versus actual the budget versus actual is the report that's given you something over and above what you would just do in excel because then as time passes you can compare what you budgeted to happen to what has actually happened now again they've got both the profit and loss and income statement now so if you're doing a simple budget you're probably just looking at the income statement because you're trying to look at the performance and you're probably just thinking what do I want to do I want to maximize my revenues and I want to minimize my expenses as low as possible in order to maximize my revenues and whatever happens to the balance sheet from a simple level you'd say I'm just going to let that fly right I'm going to do what I can do and and try to just increase my revenue my net income in essence as much as I can from a year so that would be the the most simple way to first think about the budget however when you pull the when you get more advanced into the budgeting then oftentimes the question is when you're trying to increase your revenue you have questions such as do I need to invest more money to do that right invest money in fixed assets like property planting equipment might be part of your plan to generate more revenue and inventory right these are common and so so then so then if you pull the balance sheet into it then you got to think this is where I started at this point in time and then you can get into more and then the income statement will have an impact on the balance sheet because remember it's kind of part of the equity section so you can think about this is where we started on the balance sheet and then the income statement is basically the performance statement that is going to happen that's going to help us to get to where we're going to end at which will be represented by the balance sheet at the end point however it's a little bit more complicated than that as well because there could be balance sheet type transactions that you're taking into consideration cash flow type transaction that you're taking into consideration so when you really kind of dig down on the budgets you know you might have a full list of budgets could be the balance sheet the income statement purchases budgets and cash flow budgets and so on that you can that you can tie in all together so we'll talk about that a little bit more on the the the course or section with the budgets if you want that you can dive into a lot of depths on budgets in general different kinds of budgets how you might format your your projections out into the future to best be able to run different scenarios and so on we have other courses and sections just in terms of budgeting if you want to dive into that area noting that that area is a little bit different than simply bookkeeping it's going into kind of the land of finance corporate finance type of stuff ratio analysis and and that kind of thing which is intimately related to to bookkeeping because all of that stuff basically is going to use the same techniques of in essence the financial statements so i find if you go into those areas with an understanding of financial statements and debits and credits which many people who are in that area don't understand then you have a good that you know that's you have some advantages depending on what it is you're looking at but in any case that's the budgets