 QuickBooks Online 2022 financial reports generated from bank fees. Get ready because it's go time with QuickBooks Online 2022. Here we are in the bank fee practice file we set up with a 30-day free trial holding down control scrolling up a bit to get to the 125% currently in the home page otherwise known as the get things done page and the business view as compared to the accountant view changing to the accountant view is something you can do by going to the cog up top switch to the accountant view down below we will be tackling back and forth between the two views either here or by jumping to the sample company file currently in the accountant view back on over we're going to be opening up reports to specifically look at the end product those being the reports including the financial statement reports the balance sheet and the income statement to see how they are constructed and then we'll take a look at some of the prior reports or the reports that are connected not the prior reports reports that are supporting in some way the balance sheet and the income statement reports and how they have been created as we have entered the data primarily directly from the bank feeds in other words we've been entering data in the bank feeds by going to the bookkeeping down below in the business view the transactions up top and in the banking tab we've got our bank feeds I'm going to close the hamburger for now you could get to that same location in the accountant view by going to the banking tab on the left hand side banking tab up top the double banking tab tapped the left tab to the top on banking and then we pulled in this data from the bank from the bank from the financial institutions for our items that have bank feeds capability including checking accounts and the credit card accounts and possibly a PayPal account which is kind of like a checking account these days and then we put them into the bank feed limbo added them into the system I call this bank feed limbo that's not a technical QuickBooks term by the way and then we added them into the system to create the financial statements remember as you do so you might have an accounting system we and we try to do this primarily using an accounting system where we are dependent on the bank feeds to actually build the full financial statements in other words we're waiting till things clear the banks waiting till the deposits happened and the actual expense forms go through the system before we record them on our side and we're going to record them based on the bank information that is a system that is not just a cash basis system it's a step further in terms of the ease of data input than a cash basis system for example if you were on the if we're looking at the revenue side of things even if you were on a cash base system normally under a full service system using QuickBooks you would want to enter these sales using a create sales receipt form as opposed to waiting till something is deposited into the bank however most of the data we put inside was waiting till it clears the bank to record it which you can only do if you're in a certain type of industry where you can basically wait till something clears the bank so we did then enter a few transactions where we entered a sales receipt and a few transactions when we went into an accrual basis and entered an invoice so as we look at the end product the forms that have been created from the data input most of it is going to be created directly from the bank feed data and something there's a couple transactions that we did on the cruel basis and we did on a cash basis that wasn't related to the bank fees and we'll try to kind of point those out and see what the differences are in the end product now that has been created the balance sheet in the income statement so obviously when you enter data into QuickBooks what you're trying to do is build the financial statements possibly for tax needs at the end of the year and your own reporting needs and internal tracking it needs let's open up a couple tabs up top I'm gonna right click on the tab up top and duplicate it go to the tab to the left I'm gonna right-click and duplicate again I'm gonna go to the tab to the left I'm gonna do it one more time right-click and duplicate again I'm gonna open up the balance sheet the income statement and then the trial balance let's go and see what the reports are located as that is thinking over here on the sample company which is in the accountant view reports would be located on the left-hand side under reports if we go back on over to the business view I'm in the second tab it's still thinking but that's okay the reports are gonna be over here under the business overview the business overview and then in the reports so business overview and then in the reports then I'm gonna close up the hamburger it's still thinking so it's not in the reports yet because it's thinking it'll get there my computer's slow but steady just like the turtle that wins all the races I'm gonna go back up top let's do the range change let's make this let's do the three month time frame here so we'll take this from 0901 2 1 2 11 30 2 1 hit the drop down boom hit it we're gonna go down to the months and then run that one so we got the side by side on the months September October November go into the tab to the right let's go into the reports it's on the business overview and then into the reports which is the profit and loss reports and then profit and loss close in the hamburger these are the two primary reports I'm gonna do a do a month by month on this one too so from 0901 2 1 2 let's say 11 30 2 1 and then run these are the primary 2 reports now you also have people are always have to say well isn't that isn't the cash flow statement also a primary report it is a primary financial statement report so when you hear financial statements you're gonna say well there's the balance sheet there's the income statement and there's the statement of cash flows but the statement of cash flows is kind of something when you think about constructing these reports it's something that you typically construct after the balance sheet and the income statement the balance in the income statement are basically using the chart of accounts that you have set up so these are the primary first basically two reports that you're gonna put into play the statement of cash flows is really trying to take whatever's on an accrual basis that you put the financial statements in and adjusting it to a cash basis system so it's kind of reworking what you've already done on more of an accrual basis or whatever basis you are using to get more of a cash flow basis so it's an important report but the primary two reports you're thinking about when you're building this are the balance sheet and the income statement and then everything other than that all other reports will take a look at are going to be typically variants supporting in some way giving more detail about some line item on the major financial statement reports the balance sheet the income statement otherwise known the income statement that is as the profit and loss so the balance sheet shows where we stand at a point in time so let's just go through here you know quickly and see how it's been constructed from the bank feed data so obviously the checking account is is what we can easily see most easily see constructed from the bank the bank deposits that we put into the system and the checks the bank feeds in other words so if I was to go into it you can see the detail in it this is also the account that's going to have the most variation diversity of activity so if I go up top for example put this from 010121 to 123121 and I run this report on the transaction detail what I mean is that the transactions because cash is the lifeblood of the company it's going to be involved in all cycles within the company which includes you know the the revenue cycle the paid purchase a cycle or expenses cycle and the employee cycle that's why but basically entering things with bank feeds can allow you in some cases to actually construct basically the whole financial statements because it's the lifeblood of the company and it's involved with every other side of the transaction so you can see we have expense forms and deposit forms if you're dependent on the bank feeds those are the primary forms that you'll see in here but you'll also possibly have transfer forms that's when it's going from one account to another account in here now this is the bill pay form this is something you would not typically see if you're completely dependent on the bank because this is an accrual type of transaction that is taking place it's still just a check kind of form but it's paying down accounts payable which is an accrual type of account and then we've got a credit card payment which is kind of like a transfer payment in that it's paying off another item a credit card item so that's going to be the cash going back on up let's check out some other accounts that were that were put together paypal is the same thing as the checking account because we have a bank feed related to it note that accounts receivable would not be here if we were completely reliant on the bank accounts receivable is only going to be there if you have to do the work first and then invoice the client which means or a customer or whatever which means that you're gonna have to deviate from just being reliant on the bank because you're gonna have to track the outstanding items in accounts receivable so if I go into accounts receivable then and if I go in there the typical activity 010121 to 123121 and run it is that it's going to be increasing with invoices and then it's going to go down with the payments the invoices don't have any cash flow involved in them so we can't record them with the cash information it's increasing accounts receivable and revenue the payments are could have a cash component if they're going into the checking account but they might go into the undeposited funds so this whole account is an accrual type of account we also have sub ledgers that we would be tracking this by breaking it out by customer so we can determine who owes us money the whole process of accounts receivable adds another level of complication and would only be there if we're in the type of industry where we have to do the work first build the client and then try to collect on what has been built such as a law firm such as the CPA firm an account firm for example so then we're going to go down and say okay inventory another one of these items that is a deviation from being able to usually depend purely on a cash basis system so and remember we have different things with inventory that we different ways you can track inventory we talked about you could track inventory out you could try to stay in a cash basis system and not actually track inventory even though you sell inventory expensing the inventory when you purchase it if possibly you don't have a lot of inventory on hand you could try to track inventory on a periodic basis using an excel worksheet outside of the system to make periodic adjustments you could track inventory on a perpetual inventory system tracking the inventory in the system if you did that then you would have to you would have to enter the transactions using either on the sales side either an invoice or sales receipt because those are the forms that are allowing you to track the inventory on a perpetual inventory system with the use of inventory items in other words you can't just wait till the deposit enters into the system so it's going to add complexity as we talked about with the inventory so then then we've got gains and losses so obviously if you have some if well if you have some kind of investment type of activity that you're investing in stocks and bonds and whatnot that's another area that can be a little bit of a deviation from us just being able to rely on the bank feeds because if we want to track real time or basically adjust for gains and losses that are unrealized we would have to do those periodically and they're not cash related items so so we didn't get anything going to the checking account because we didn't actually receive say dividends and interest we're just saying that the value of the stocks and bonds went up or down for example that means we'd have to enter transactions that are not cash related so it's a little bit more complex then we've got the payments to deposit that's that clearing account that that used to be undeposited funds that we would only be using if we're not if we're not on just completely dependent on the bank equipment is another kind of deviation that we saw that we have to input periodically we might see the equipment that we purchase going through cash if we purchased it with cash but if we purchase the equipment with a loan for example that's another area that could deviate from a pure cash basis system because we'd have to put the loan on the books which is in essence an accrual kind of component accounts payable on the liability side is another accrual type of thing it's a deviation from a cash basis thing it wouldn't be there in other words unless you're tracking the accounts payable unless you're entering the bills into the system in other words before you actually pay them and that means you add a level of complexity because you have to enter the bills track the bills and then pay the bills in the future the credit card is something that we can also do with the bank feeds as well because they're typically going to be tied to the financial institution so we'll have the same kind of activity as the bank in that we're going to be paying for items with oftentimes that are expenses but the other side instead of decreasing an asset account it's increased on the liability account and then we've got the sales tax the sales tax is also something that as we saw when we looked at the sales tax is usually going to cause people problems when they're trying to rely specifically on the bank to comply with their sales tax obligations although we looked at some some ways that you might be able to get a workaround on the sales tax to try to calculate that if you still want to be kind of reliant on the banks to have a more simplified accounting method then the loan payable any kind of loan that you put on the books is going to be a deviation from the the cash basis system in other words when you pay off the loan cash will be affected when you first get the loan cash might be affected it might go through the checking account if you got the actual cash but if you took out the loan to pay for equipment then no cash was received right you can kind of imagine that would be like getting the cash and then taking out a loan or something like that or taking out a loan and then buying the equipment but the uh that's not you know you never see the cash actually hit the checking account so that adds a little bit more complexity you're basically doing a a cruel kind of thing by tracking the loan and then we've got the the equity which represents basically the owner's value in the company so remember if that you were looking at this in terms of the accounting equation assets liabilities and equity like this there's your accounting equation you could think of it as assets minus liabilities equals equity is the other way to write the accounting equation therefore the equity section down here represents basically the owner's claims to the assets as opposed to to the third party claims to the assets that's kind of like your book value in the company on a book basis type of thing if we go to the income statement go into the income statement we've got the revenue accounts which obviously have been constructed as we entered the deposits remember that the revenue side of things if we're just reliant on the bank we're entering them and increasing them with simply the deposit form if we were doing a full service system we would have to enter revenue with a create sales receipts or an invoice even if we're on a cash basis we would be using the create sales receipt but if we're trying to be dependent on the bank we increase the revenue with the deposit form let's make this a month by month i thought i did a month by month thing on this one so did i so there we go and so and then of course we have all the expenses down below and all the expenses are generally being input into the system usually from decreases to the checking account that we're then entering into the system so if i go into any of these items then we can see it's an expense type of form that we entered into the system these are decreases to the checking account that's why it's so important to get the detail in not just to get the ending balance of the checking account correct because the detail is building the other statement is building the activity statement which is going to be the income statement so in essence you got the income minus the expenses and then we put a couple items into the other category down below which is other income and expenses so the the general idea with the income if you break it down to its its basics you've got the income minus the expenses and they typically put like a subcategory so you could think about it as a one one-step system or a multi-step system if it was one step you could think of everything as either income and expenses income minus expenses gets you down to net income we also often have a few steps along the way including cost of goods sold which would only be there if you sell inventory if you sell inventory that often throws a bit of a problem into your accounting system if you want to be completely reliant on the bank for the same reasons we talked about when we looked at the inventory side of things then you've got all your expenses to get us down to the net operating income this is the income from operations and then you might put some stuff into the other income and other expenses down below things that aren't part of your normal operations like unearned revenue if you're tracking that on the income statement might go down here because you don't want to include it in your operating income because it's not what you actually kind of do so you kind of put it down here into other and then you get down to the bottom line of net income the net income 43 567 80 is going to tie into well actually we'd have to do it on a year to date here and this was a little bit tricky because normally the net income wouldn't be populated on the balance sheet like this but QuickBooks puts it in there to kind of help you to tie it out so 01 01 2 1 let's do a year to date and as of november 30th so if i go back on over and so now net income for that time frame is 44 68188 and so if i go back on 44 68188 out for november you can see it's taken not like the it's taken like the year to date number now the tricky thing is this net income usually rolls into retained earnings so you usually see it kind of in retained earnings here you don't typically break out the net income but i think QuickBooks tries to do that so you can see how the income statement is tied into the balance sheet so in other words if i if i bring this up to the following year 2022 going from 01 01 22 to 12 31 22 and let's make this just the totals only and run it then i'm going to get down here it rolled it in out of net income to the retained earnings so that net income is trying to help you out to see the link between the balance sheet and the income statement because it's all part of the double entry accounting system so let's go back up top and let's go back to what we had before which is 01 01 21 to 11 30 21 and then let's bring this on back to the months and run it i was running and then i'm going to go tap to the right and we'll change this on back to 0901 21 0901 21 the trial balance you'll recall is the balance sheet on top of the income statement i didn't open that one up yet let's open the trial balance the trustee tb trial balance so this is basically the same thing but balance sheet on top of the income statement and you can see how much easier if i just take this for the year 01 01 21 to 12 31 21 it's got debits and credits in it but it's a really good report to look at when you're just doing data input because it doesn't have all the subtotals and you you can use just this one report instead of having two reports to see the accounts that are impacted because it's basically the balance sheet on top of the income statement so really useful report for the data input you might want to practice using that now let's just take a look at some of the other reports and see how they're going to be complementing what we put in place with the balance sheet in the income statement so i'm going to duplicate the tab again and just let's just review some of the other reports the number of reports can get kind of overwhelming so let's just give a quick recap a cap a recap so we're going to go on top the cap that reads recaps it's a special cap that reads i don't know what i'm talking about okay so we got the business overview so we've got the balance sheet comparison this would just be a form of a balance sheet side by side we saw that we created kind of some comparison reports here month by month comparisons we've got the balance sheet detail so that's the standard balance sheet the balance sheet summary which is just a little bit more compressed balance sheet the standard balance sheet the business snapshot which you know a snapshot in time was kind of another point in time it would be another indication you would think of a balance sheet type of report where you stand at a point in time profit and loss as a percentage of total income that's just adding a percentage column to it which can be useful profit and loss comparisons side by side we've basically built a similar or a type of profit and loss comparison with the months profit and loss detail reports profit and loss year to date comparison another comparison type of report profit and loss by class we took a look at a couple of those if you have class tracking on profit and loss by customer now this is trying to break it out and out by customer which might be a little bit more difficult this report you might not have as much detail if we entered the system based on the bank feeds rather than doing the full service system and entering it in with the sales receipt and the invoice because because it might not track that customer information without basically the sales forms so we might lose a little bit of detail for a report like that even though we could still construct the balance sheet and the income statement so those are the pros and cons of trying to rely on the bank feeds as opposed to a full service system profit loss by month profit loss by tag we didn't get into tags here profit loss and then accordingly profit loss so another kind of comparison report statement of cash flows that's the other big financial statement report which is basically going to be constructed from the data input that we entered into the system that was used to construct the balance sheet and the income statement so who owes you money most of these reports you would think would be complimenting or supporting the line item on the balance sheet of accounts receivable which you wouldn't even have if you were dependent entirely on the bank feeds so so all of these reports here then uh you may not you may not need them if you're not tracking the accounts receivable so accounts receivable aging is an accrual account accounts receivable aging summary collections reports customer balance detail you don't really need that if you don't if you're not trying to collect on the customers but you get paid at the same point in time you do the work customer balance summary invoice listing invoice receipts open invoices statement list and so on so then we have the sales and customers customer contact list so that would just that wouldn't even be financial statements it's just a list of the contacts deposit detail so that's going to be the information that's going to be increasing the checking account which you could kind of get by just formatting the gl account by just going to the balance sheet drilling down on it and then sorting by deposits or other inflows in essence so but it might have more detail in the detail report estimated and progress invoicing you wouldn't even have that unless you were actually invoicing invoicing being an accounts receivable type of activity which is an accrual type of activity and then we got estimates by customers which is an industry specific kind of report income by customer summary so now we've got the income by customer again which you might not be able to generate as easily if you were making your financial statements based on the bank feeds because you would you be using the deposit form as opposed to an invoice or sales receipt form might not have the detail then to run that report if in that instance invoice valuation detail uh in or sorry inventory now inventory reports would only be there if you're tracking inventory in the system using a perpetual inventory system which would be a deviation typically from a pure cash basis system in which you're reliant on the bank feeds the payment method list physical inventory worksheet product service lists and then we've got the sales by class so sales by class detail this is another area that it's going to be a little bit more difficult we might we're not going to be able to run in essence sales by item or sales by customers as easily if we're using the bank feeds to create our financial statements because once again we're entering the sales revenue the income's going up with a deposit form as opposed to using the sales receipts or the invoices so we don't have the items that are going to help us out to enter into generate reports by like what we sold sales by class summary sales by customer detail so we might not be able to have that kind of sales breakout detail again if we're dependent on the bank feeds because we're not using the invoice of the sales receipt but a deposit sales by customer summary sales by customer type sales by product and service so again we're not going to have typically the product and service detail on the sales as nicely populated for us as we would if we were using the the invoices and sales receipts as opposed to deposits to record the sales time activity by customer transaction list by customer transaction list by tag these are also a little bit you know more distorted because we're we're not going to have the normal transactions for customers which would be invoices and sales receipts but deposits so what you owe this whole section of reports typically is going to be supporting the liability of accounts payable which is an accrual account and we wouldn't be using we wouldn't even have it if we were entering this are stuff into the system dependent directly on the bank feeds because these are accrual accounts so contractor balance detail contractor balance summary this is the accounts payable agent report so breaking out the accounts payable by how old they are accounts payable agent summary bill payment list bills and applied payments unpaid bills these are things that we owe which we wouldn't have there unless we were on an accrual basis the vendor balance detail vendor balance summary expense and vendors 1099 transaction detail reports helping you to comply with your 1099 needs and this is supporting line items that are on the income statement now on the expense side expenses by vendor summary so so you should be able to get still this detailed report on even not on a cash basis even though we had problems on the sale side because you're even when you're reliant on the bank feeds you're entering expense forms which is the normal form that we would use to enter vendor transactions payments for stuff so we could still typically get the vendor by the expenses by vendor detail i would think open purchase order list we're not going to have purchase orders unless we're dealing with inventory open purchase order detail purchased by class detail so if we had class tracking purchased by product service detail would only be applicable if we're buying inventory purchased by vendor detail so we can possibly still break that out purchased by vendor breaking it out not by the category utilities telephone and so on but by vendor who we paid which means you can only do that if when using bank feeds you make sure to add the vendors that you're paying for transaction list by vendor and vendor contact list sales tax reports the sales tax as we talked about can be a little bit of a problem if you're trying to be reliant specifically on the bank feed so you'll have problems with the reports as well we talked about some workarounds on that and the sales tax employees would only be applicable these employee reports if you're running payroll within the system again payroll would often force you to deviate from a cash basis unless you're doing the payroll from an outside someone outside was doing a third party payroll provider instead of doing it within QuickBooks so we talked about that a bit in the past and then the accountant reports balance sheet comparison we looked at balance sheet we already looked at class list the general ledger is going to give you the detail of the activity breaking all the information by date it's kind of like the similar reports we saw when you drill down on a report that's on the income statement like cash the journal is going to give everything in terms of a journal entry same kind of thing as a general ledger but it gives it by journal entry which is really good if you want to learn debits and credits profit and loss comparison we already saw profit loss we already saw recent transactions gives you the recent transactions entered reconciliation reports possibly being a bounty in the bank reconciliation recurring transaction list statement of cash flows we already saw transaction detailed by account transaction list by date transaction with splits and the trial balance which we already saw and then the payroll reports which would only be applicable if you're processing payroll within the QuickBooks system so the general idea is that you can see how we can construct you know the financial statements majorly being the balance sheet in the income statement from primarily you can do depending on the type of business through the bank feeds and then see how all the other reports are basically supporting generally in some way some line item on the primary financial statements to balance sheet the income statement income statement otherwise known in QuickBooks as the P&L the profit and loss