Episode 33
Episode 33: QuickBooks in a Ditch? How to Clean Up Messy Books
Episode 33: QuickBooks in a Ditch? How to Clean Up Messy Books
What happens when a banker, lender, accountant, or business partner asks for financial statements—and you suddenly realize you do not trust the numbers in QuickBooks?
First, do not panic.
You are not the first business owner to end up with messy QuickBooks records, and the problem can be fixed. The key is to stop randomly changing transactions and begin with the foundation of the accounting file.
In this episode of QuickBooks Mastery for Small Business Success, father-daughter team Erica Northrup and Lee Davis explain how to approach a QuickBooks cleanup calmly and systematically.
They discuss why the chart of accounts is the backbone of your financial reporting, how to establish a reliable starting point using your prior-year tax return or accountant’s trial balance, and which financial documents you need to gather before beginning the cleanup.
Erica and Lee also explore one of the most common questions business owners ask: Should you clean up your current QuickBooks file or start over with a new one?
You will learn why that decision should be based on your accounting history, payroll setup, reporting requirements, available documentation, and the amount of work required—not simply on how frustrated you feel.
Most importantly, this episode explains how QuickBooks cleanup can become a valuable training opportunity. By understanding why mistakes happened, business owners can create better bookkeeping systems, maintain cleaner financial records, and make more confident decisions in the future.
Key Takeaways
- Do not begin a QuickBooks cleanup by randomly editing or deleting transactions.
- Review the chart of accounts before attempting to correct individual bookkeeping mistakes.
- Use your prior-year tax return, accountant’s work papers, or trial balance to establish a reliable starting point.
- Gather bank statements, credit card statements, loan documents, payroll records, asset information, and owner-equity details.
- Starting a new QuickBooks file is not always easier, especially when QuickBooks Payroll is involved.
- A cleanup should correct both the historical records and the processes that caused the problems.
- Seek professional help when the balance sheet is unreliable, multiple years are involved, payroll is affected, or financial statements are needed for an important decision.
- The ultimate goal is not simply a clean QuickBooks file. It is having reliable information that helps you make better business decisions.
Questions to Reflect On
- Do you trust the profit and loss statement and balance sheet currently coming from QuickBooks?
- Does your chart of accounts accurately reflect how your business earns, spends, owns, and owes money?
- Can the balances in QuickBooks be verified using bank statements, loan statements, tax returns, and other source documents?
- Are bookkeeping mistakes being corrected without addressing the process that caused them?
- Would you feel comfortable giving your current financial statements to a banker, lender, accountant, or potential business partner?
Mentioned in This Episode
Free QuickBooks Clarity Scorecard
Discover whether your QuickBooks setup is providing the financial clarity you need:
https://lee-davis-and-company.aweb.page/unlock-clarity-free-scorecard
Send Us Your QuickBooks Questions
support@leedavisandcompany.com
Visit Lee Davis & Company
leedavisandcompany.com
Timestamps
00:54 — What it means when your QuickBooks is “in a ditch”
Why business owners often discover a bookkeeping problem when they suddenly need reliable financial statements.
05:40 — Why you should not start fixing random transactions
Lee explains why changing transactions without understanding the accounting foundation can make a QuickBooks cleanup more difficult.
07:20 — Start with the chart of accounts
Learn why the chart of accounts is the backbone of your balance sheet, profit and loss statement, and overall financial reporting.
11:16 — Establishing a reliable financial starting point
How your prior-year tax return, accountant’s work papers, depreciation schedules, and trial balance can help establish accurate beginning balances.
16:50 — Should you clean up QuickBooks or start over?
The factors to consider before abandoning an existing QuickBooks company file, particularly when payroll is involved.
24:10 — The first steps for fixing messy QuickBooks
A practical action plan for stopping the panic, gathering records, reviewing the foundation, and moving forward one month at a time.
Call to Action
When your QuickBooks is a mess, the most important things to remember are that you are not alone and the problem is fixable.
Begin by downloading our free QuickBooks Clarity Scorecard. It will help you evaluate your current QuickBooks setup, identify potential weak spots, and determine which areas may require attention.
Download the QuickBooks Clarity Scorecard:
https://lee-davis-and-company.aweb.page/unlock-clarity-free-scorecard
If you need accurate financial statements for a banker, lender, accountant, tax return, or important business decision, it may also be time to seek professional QuickBooks cleanup help.
Subscribe to QuickBooks Mastery for Small Business Success and visit leedavisandcompany.com for more practical guidance.
Have a QuickBooks question? Email support@leedavisandcompany.com. Your question may be featured in a future episode.
Transcript
Welcome to QuickBooks mastery for small Business Success.
Speaker A:I'm Erica Northrup.
Speaker B:And I'm Lee Davis.
Speaker A:I handle the tech and he handles the numbers.
Speaker A:And together as a father daughter team, we bring decades of experience helping small to medium sized businesses thrive.
Speaker B:We know that as a business owner, your time is best spent mastering your craft and growing your business, not getting lost in QuickBooks.
Speaker B:Managing finances can be confusing and you don't have hours to waste sorting through spreadsheets or fixing bookkeeping mistakes.
Speaker B:That's where we come in, helping you streamline QuickBooks so you can focus on building your business.
Speaker A:Each week we break it all down into simple, actionable steps so you can focus on growing your business, not fixing your books.
Speaker B:Let's embark on this journey together.
Speaker A:Welcome back to QuickBooks mastery for small Business Success.
Speaker A:My name is Erica Northrup and I'm here with my puppet, Lee Davis.
Speaker A:And today we are talking about something that I think a lot of business owners quietly panic about.
Speaker A:And that is what happens when your QuickBooks is in a ditch.
Speaker A:This is episode 33, what do I do when my QuickBooks is in a ditch?
Speaker A:So this is for the business owner who maybe has been avoiding their QuickBooks.
Speaker A:Is that you?
Speaker A:Are you avoiding your QuickBooks?
Speaker A:Or maybe they have someone helping with the bookkeeping and they still do not trust the numbers.
Speaker A:Then all of a sudden the banker asks for a balance sheet and income statement or the accountant needs information or they need to make a big business decision and they realize I cannot actually produce the reports I need.
Speaker A:So, Papa, let's start there.
Speaker A:When someone says my QuickBooks is a mess, what is usually going on?
Speaker B:Well, you know, Erica, there could be a number of things that are going on, probably to synthesize it down.
Speaker B:They have some kind of crisis.
Speaker B:Okay.
Speaker B:There's something that they are faced with, whether it's a business decision and their banker wants good financial statements, or they are just trying to answer a question of how is my business doing?
Speaker B:How much is my business making, how much do we owe?
Speaker B:There could be repeat crisis of information.
Speaker B:I guess we call it that.
Speaker A:Yep, yep, absolutely.
Speaker A:So good.
Speaker A:Okay, so what are the situations that usually force a business owner to finally look at their QuickBooks and realize that something is seriously wrong?
Speaker B:Certainly bankers want information and they want a balance sheet and a profit and loss.
Speaker B:And it's important to them that they have a complete picture.
Speaker B:Bankers don't like spreadsheets that you may have on Excel and they kind of work in a short term, situational basis, but they don't take care of what a banker will want in terms of their calculation of the numbers.
Speaker B:If you want to make sure that your accountant has the same information that you have, then you want to be giving them your profit and loss and balance sheet information that's both reconciled and verifiable.
Speaker B:So some accountants are.
Speaker B:Are willing to be more flexible, but I think the good accountants, they want to see information reconciled in your QuickBooks.
Speaker B:It also probably that when the owner is trying to get financing, clearly that's a moment of you might need a line of credit, and for some reason you need it quickly.
Speaker B:And again, when you need financing, the time to get financing is when you don't need it.
Speaker B:But quite frequently, frankly, that's not when people oftentimes are looking for it.
Speaker B:Also, the owner wants to know if the business is actually making money just looking at it.
Speaker B:They want to answer that question.
Speaker B:They see whatever reports they're getting, whether it's Excel or they're just keeping track of it in some kind of ledger book.
Speaker B:I've seen all different kinds of tracking, but it doesn't answer the question of how much is my business actually making.
Speaker B:And if a business is growing and the owner cannot make decisions with sort of spreadsheets or messy numbers, then they are in some type of crisis.
Speaker A:Yeah, absolutely.
Speaker A:So when business owners are in these kind of situations, what do you think is the most important thing that they remember when they encounter these kind of situations?
Speaker B:Papa, they're not alone.
Speaker B:Okay.
Speaker B:Don't panic.
Speaker A:Right.
Speaker A:Don't panic.
Speaker B:And don't panic.
Speaker B:And you're not alone.
Speaker A:Yeah.
Speaker B:And yeah, and go back and listen to a few of our other podcasts, because you're probably going to have to start at the beginning, whether it's at the beginning of the year being the end of last year, and you're going to have to recreate the information in QuickBooks.
Speaker A:Yeah, absolutely.
Speaker A:You know, I think that is such an important point, to not panic, to not be embarrassed, because people can feel embarrassed.
Speaker A:They almost feel like they have failed because their books are messy.
Speaker A:What do you say to the business owner who feels that way?
Speaker B:I tell them they're again, they're not alone and just explain to whoever needs the information you're going to need some kind of window to get it done and so you don't feel stressed and that you begin to put the information together and get it created accurately.
Speaker A:Yeah, absolutely.
Speaker A:That is so good for us to remember and even myself to remember about all kinds of situations.
Speaker A:Right.
Speaker A:So when people first realize their QuickBooks is wrong, I can imagine they want to jump in and start fixing random transactions.
Speaker A:Is that the right place to start, Papa?
Speaker B:You know it isn't.
Speaker B:No.
Speaker B:Don't start entering if you've used QuickBooks, and some people will.
Speaker B:If I'm asking if they've used QuickBooks, I know what they're saying is they really haven't used it to its full potential or correctly.
Speaker B:So the answer is usually no.
Speaker B:They don't sometimes understand how it fits together and.
Speaker B:And they need to start again at the beginning and work on getting their QuickBooks in order.
Speaker A:I'm sure it's about laying that foundation right, if you think about anything.
Speaker A:You know, I've been doing a lot of building.
Speaker A:If you don't know my little building story before a year and a half ago, I had never even so much truly picked up a drill.
Speaker A:I don't know how I got to the age of 43 with never having ever used a drill, but I did.
Speaker A:And now I have used everything.
Speaker A:I've used a table saw, a miter saw, all the things.
Speaker A:But it's all about laying the right foundation.
Speaker A:So when you're building a house, if you don't have the foundation right in me, building this range hood cover, if I didn't have everything level and flush and perfectly square, everything else that I built on top of it would have been a lot worse.
Speaker A:It would not have come out right.
Speaker A:But because I took my time and I laid the foundation out first, it just went so much better than I could ever imagine.
Speaker A:So I feel like that is really how we should be treating QuickBooks is really looking at that foundation and starting from the foundation and building upon that.
Speaker A:You say that pretty accurate, Papa?
Speaker B:Yes.
Speaker B:And I think when you look at the foundation, you need to begin with a chart of accounts.
Speaker B:Quite frankly, when I'm looking at somebody's books that they're in a ditch, I'm going to kind of look at their setup, but I'm also going to print out their chart of accounts, and I'm going to look at their balance sheet and their income statement, because they'll all originate from the chart of Accounts.
Speaker B:And the chart of accounts is so important because it's the structure behind the financial statements.
Speaker B:And oftentimes people really don't understand when they set up the chart of accounts, the kinds of answers they should have given to each account.
Speaker B:It's important to understand some basic accounting when setting up your chart of accounts, and that can go a long way.
Speaker B:But QuickBooks has its own structure in setting up the chart of accounts.
Speaker B:It's important to understand what's needed in QuickBooks.
Speaker A:Yeah, absolutely.
Speaker B:It will determine where money is going and how the business expenses and income are being reported.
Speaker A:Yeah, it is all about that.
Speaker A:Money in, money out.
Speaker A:That's the flow of money.
Speaker A:Right.
Speaker A:QuickBooks.
Speaker A:That's what QuickBooks does so well.
Speaker A:Okay, so before we worry about every individual transaction, we need to ask whether the file is even set up correctly.
Speaker A:Would you say that's correct, Bubba?
Speaker B:That's correct, yeah.
Speaker B:Start at the beginning.
Speaker A:Right?
Speaker A:Start at the beginning.
Speaker A:So look at the major sections like assets, liabilities, owner's equity income, cost of goods, sold and exchanged, expenses.
Speaker A:I feel like those are some of the main categories to start to look at.
Speaker A:Would you say that's pretty on point?
Speaker B:That's pretty on point, yeah.
Speaker A:So good.
Speaker A: July, we'll just say July of: Speaker A:Where should they begin?
Speaker A:Papa?
Speaker B:It may not be realistic to think about last year's numbers doing them the way you're going to work on the first six months.
Speaker B:The way to handle last year's numbers may be putting them through a journal entry so you have something to compare to last year.
Speaker B:And if that's the case, then you could perhaps do a summary of.
Speaker B: et's say you're talking about: Speaker B: really to say, okay, start at: Speaker B:And one thing that I think is helpful is just a quick chart of accounts overview.
Speaker B:And we've talked about, I think, in another podcast, but I think it's worth repeating that QuickBooks is not a modular accounting program with separate general ledger functionality and complicated posting procedures.
Speaker B:Instead, you set up the chart of account and items and QuickBooks handles all the posting behind the scenes.
Speaker B:And I think that's really critical because oftentimes people don't know where the numbers.
Speaker B:It's not a modular accounting system.
Speaker B:It's not a debit and credit system, so to speak.
Speaker B:QuickBooks does a lot of the work behind the scenes, but you've got to set up the right forms and use the list function in QuickBooks.
Speaker A:Right, right.
Speaker B:And that chart of accounts is the backbone of an accounting system.
Speaker B:And that's why it's important to understand how it works.
Speaker B:It's complete list of the company's general ledger accounts and their balances.
Speaker B:It tracks how much money a company has, how much money it owes and how much money coming in and how much money is going out.
Speaker A:Yeah, absolutely.
Speaker B:So it's important.
Speaker B:That's just a kind of a good, just overview for our listeners to keep in mind.
Speaker A:Yeah.
Speaker A:Really understand what the chart of counts is.
Speaker A:Yeah.
Speaker B:Yes.
Speaker A:That's so good.
Speaker A:Yeah.
Speaker A:Just going back to where people kind of begin and how they start working through all these QuickBooks issues that they might have.
Speaker A:Is there something that they can ask their accountant for that would help this process of working through QuickBooks?
Speaker B:Yeah, absolutely.
Speaker B:They can go back to the work papers that their accountant prepared in doing their tax return.
Speaker B:And oftentimes as part of their tax return, they have a lot of information that you can use on, for example, their fixed assets.
Speaker B:If you're trying to get a list of their complete assets, then while they may not have cash and so forth, but they will probably have a historical record of their fixed assets and that will include the depreciation schedule and so forth.
Speaker B:So that will be extremely helpful in setting up the balance sheet.
Speaker A:What about a trial balance?
Speaker A:Is that something that would be helpful in this process?
Speaker B:The accountant may or may not have a trial balance if they didn't use QuickBooks, but we'll have some kind of accounting.
Speaker B:And I don't know that they'll have a trial balance unless they happen to use another accounting square.
Speaker B:But yeah, a trial balance would be extremely helpful because that gives the year end number and all of the associated accounts and that would be great to load into QuickBooks.
Speaker A:Hmm.
Speaker A:It appears that that trial balance is almost like saying, here's the line in the sand.
Speaker A:These are the numbers we are going to use as the starting place.
Speaker A:Is that pretty on point when you think about.
Speaker A:Yeah, nice.
Speaker B:Yeah, that's pretty on point.
Speaker A:Yeah, that's good.
Speaker A:Okay.
Speaker A:So once they have that starting point, what documents should the business owner begin gathering?
Speaker B:They're going to need to pull their cash, bank statements and their credit card statement.
Speaker B:And they will also need to outline how they handle their accounts receivable and their invoicing.
Speaker B:And because if you're recreating the work, you need to use the correct form because as I've said, QuickBooks isn't modular software.
Speaker B:If you use the correct form that handles the other side of the entry.
Speaker B:So understanding that they will need to create some invoices and they might have to go back and recreate some bills, but they'll need their bank statements, their credit card statements, their loan statements.
Speaker B:Yep.
Speaker B:And they also need to look at Their equipment that's owned by the business.
Speaker B:Again, that might come off their tax return.
Speaker B:If they use the CPA to do their taxes and they'll their vehicle loans and major purchases.
Speaker B:And certainly if they had made improvements to their business, that will be important.
Speaker B:Also something to keep in mind is you have to make sure you take a look at your liabilities, your loans, your line of credit, credit cards, bills, tax payable and the whole payroll process.
Speaker B:How do you handle your payroll liabilities?
Speaker A:Yeah.
Speaker B:And then a question that people always oftentimes don't understand is how they should record when an owner gets paid.
Speaker B:If the owner is an LLC or a sole proprietor provider, then they're going to be paid by an owner draw.
Speaker B:So that's critical and in how you determine how much the owner puts in the business and so forth.
Speaker B:And sometimes the owner will run personal expenses through the business.
Speaker B:I try and coach against that, but usually we're cleaning up work.
Speaker B:So we want to take a look at if people have used their business for personal use, then we want to record that correctly.
Speaker A:Yeah, absolutely.
Speaker A:It does seem, and I feel like this applies to most areas of our life, but the more organized that we can be in our businesses, the faster the cleanup can move along.
Speaker A:Yeah, for sure.
Speaker A:I feel like that is definitely important.
Speaker A:So creating systems in your business and to think about books as a system I think is super important and can just help you in general in your business and just make everything that more efficient.
Speaker A:So it is not just give someone access to QuickBooks and let them figure it out.
Speaker A:The business owner still has to help provide the story and the documents.
Speaker A:Do you feel like that's a pretty fair statement?
Speaker B:Yeah.
Speaker B:I find the most successful conversions when we get people back on the right track is involving them in the process.
Speaker B:Don't just do it for them.
Speaker B:Make sure what you can hear their story and look at their documents.
Speaker B:Make sure they are hands on that.
Speaker B:You know, you see one, you do one and you teach one.
Speaker B:So you know, involving the business owner in the process I think is gives us an 80 to 90% success rate.
Speaker A:I love that I have a saying at home.
Speaker A:I do.
Speaker A:We do, you do.
Speaker A:So I think it's important that the kids see me do the thing.
Speaker A:Whatever the thing is.
Speaker A:We'll just say dishes.
Speaker A:Yeah, they see me do dishes 100 million times.
Speaker A:But then I think it's important that you do the dishes with them because it's how we model to our kids, it's how we do things together.
Speaker A:It's how they learn it's how I learn.
Speaker A:So by doing it together, I'm going to see how to actually do that thing.
Speaker A:And then it's important that they step out on their own and they do the thing by themselves.
Speaker A:So I think that is equally important for our clients that, you know, I do.
Speaker A:We do.
Speaker A:You do.
Speaker A:You got to get to that point where you feel confident enough to do your own QuickBooks, if that.
Speaker A:That's the place that you want to be.
Speaker A:So.
Speaker A:Yeah, I love that.
Speaker A:Papa.
Speaker A:That's a really great call out.
Speaker A:Okay, so one question I think people ask is, should I just start over with a new QuickBooks file?
Speaker A:How do you answer that one?
Speaker A:Papa?
Speaker B:It depends.
Speaker B:I like to use that word a lot.
Speaker B:Yeah, I have to take a look at it and then I have to find out, for example, if they have used payroll through Intuit.
Speaker B:Now we're in July.
Speaker B:The answer is no.
Speaker B:We're just going to have to clean up because they've already used QuickBooks in a way that we can't make any changes.
Speaker B:All right.
Speaker B:To that.
Speaker B:It's important because QuickBooks has been set up for payroll and that transaction work has been done that we just have to work with what they've got.
Speaker A:Love that.
Speaker A:So good.
Speaker A:Papa.
Speaker A:So the answer is not always clean it up.
Speaker A:Right.
Speaker A:Or always start over.
Speaker A:It is that someone needs to look at the file and help the business owner make the right call.
Speaker A:Would you say that's correct?
Speaker B:Papa?
Speaker B:Yeah.
Speaker B:And weigh out how much time is it going to take?
Speaker B:What's the owner willing to do to help clean it up?
Speaker B:If they have any interest in cleaning it up at all, then you know what you have to work with.
Speaker B:And because it is time consuming, it's.
Speaker B:It's not a short term.
Speaker B:There's no quick fix for a QuickBooks mess.
Speaker B:It's getting the data and looking at the process and just beginning with month one and going forward.
Speaker A:Okay, so, Papa, I actually really like something you said in the recording when you were working through this podcast, coming up with the creation of this podcast, this idea.
Speaker A:So.
Speaker A:And that was that cleaning up the file can actually become a training tool.
Speaker A:What do you mean by that?
Speaker A:Expand on that for our listeners.
Speaker B:Because people are often not trained on QuickBooks.
Speaker B:That's why their QuickBooks is in a ditch.
Speaker B:For whatever reason, they've avoided it or somebody set it up for them and, you know, maybe in some way or shape.
Speaker B:Shape using it.
Speaker B:If you teach them how to do it correctly and they understand the process, then it can be a great training tool and Absolutely.
Speaker B:And they start to understand and ask great questions.
Speaker A:Yeah, absolutely.
Speaker A:That is so very true.
Speaker A:So good.
Speaker A:You know, that makes so much sense because if we only fix the past but do not change the process, they are going to be right back in the same position six months later.
Speaker A:And there's so much truth to the fact that.
Speaker A:And I would sometimes wish this wasn't true, but we learn more through our mistakes than we do through our successes.
Speaker A:There's a whole mindset shift that you have to make, especially as a business owner.
Speaker A:You have to be okay.
Speaker A:You have to really get comfortable with failure and understand that there's nothing wrong with failure.
Speaker A:Failure is only a part of the process.
Speaker A:It's never really failing if you're learning from the 999 million ways that just didn't work.
Speaker A:I think about Edison a lot in the light bulb.
Speaker A:Someone asked him, Edison was famous for this quote, and someone asked him, tell us about that light bulb.
Speaker A:So he said, I have not failed.
Speaker A:So someone was asking him about all these different attempts he made to make this light bulb, and he said, I have not failed.
Speaker A:I've just found 10,000 ways that won't work so good.
Speaker A:Right.
Speaker A:You know, he didn't fail.
Speaker A:He just found 10,000 ways that just weren't the right way.
Speaker A:So that just didn't work for him in that moment.
Speaker A:So I think we need to adopt that mentality when it comes to our businesses.
Speaker A:We didn't fail in QuickBooks.
Speaker A:We only found 10,000 ways that just didn't work for us.
Speaker A:So very good.
Speaker B:I think that's a great example, because when people are.
Speaker B:Are looking to fix something or learn something, it's never the same path for each person.
Speaker B:No, everybody kind of learns differently.
Speaker B:And a good example is somebody may think before they can start on January 1st and start looking at their transactions, they have to go through their complete chart of accounts and make decisions.
Speaker B:And while that may be one option, you can also start by looking at the transactional work and saying, okay, what account?
Speaker B:And if you have an account in your chart of account, then just start building on your.
Speaker B:Your comfort level with your chart of accounts.
Speaker B:Because there's a certain amount of teaching that as you start looking at some of the transactional work and ask the question to say a very simple question, what is this for?
Speaker B:And then you say, okay, if you know what it's for and you know what is happening, then you can pick the correct account.
Speaker B:Yeah, it's kind of like some building blocks, you know what I mean?
Speaker B:And by the time you get through Month one.
Speaker B:You've got a good basis to go through months two through seven.
Speaker A:Yeah.
Speaker A:So good.
Speaker A:So good.
Speaker A:Okay.
Speaker A:So how does a business owner know when this is something they can fix themselves versus when they need to bring in the big guns?
Speaker B:Papa.
Speaker A:When they need to bring in the help.
Speaker A:How do they know that?
Speaker B:Usually they're.
Speaker B:They kind of know because they're overwhelmed.
Speaker A:Yeah.
Speaker B:They don't know how to fix it.
Speaker B:They know what they have, they know what they've done.
Speaker A:Yeah.
Speaker B:But they just don't know what to do.
Speaker B:So it.
Speaker B:It pays to have somebody come in, take a look at it, lay out the process for them, and help them to move forward.
Speaker A:It does feel like the right person is someone who can ask the right questions and build the right plan.
Speaker A:Would you say that is the kind of person you're wanting to seek out, Papa?
Speaker B:Yeah.
Speaker B:Somebody can work with people and maximize their strengths.
Speaker B:Do you know what I mean?
Speaker B:Really, it's a situation where you can just begin.
Speaker B:Start at the beginning and help people come up with the process to move through whatever their challenges are.
Speaker A:Yeah.
Speaker B:That's really just the answer.
Speaker A:Yeah.
Speaker A:I love this, and I feel like this is one of your superpowers, Papa.
Speaker A:This is something that Lee Davis and company helps with.
Speaker A:Right.
Speaker A:Not just the cleanup, but helping the owner understand what happened and what needs to happen going forward.
Speaker A:I feel like that is something we do really well.
Speaker A:Is that old saying, right?
Speaker A:If you fish for someone, they'll eat for a day, but if you teach someone to fish, they'll eat for a lifetime.
Speaker A:Right.
Speaker A:And I feel like that's what we're doing.
Speaker A:We're empowering business owners to help them understand how they can really run their own businesses efficiently and effectively.
Speaker A:Absolutely huge.
Speaker A:Would you say there's a lot of wisdom in that, a lot of goodness in that?
Speaker B:Yeah.
Speaker B:In some cases, for companies that are just starting out or they've been in business for a while and maybe they lost their bookkeeper, or maybe they're trying to wrestle with the fact, do they need a bookkeeper?
Speaker B:If the business owner is empowered and they understand what needs to be done, then they can make those decisions going forward.
Speaker A:Right.
Speaker A:You know, the end goal is not just a clean file.
Speaker A:The end goal is really better decisions.
Speaker A:That is what QuickBooks really helps you, powers you to do, is to make better decisions inside of your business so you can grow it, so you can expand it to whatever aspirations you have for your business, for the people that you want to serve and help and the life that you want to live for you and your family.
Speaker A:That's what it's all about.
Speaker A:So good.
Speaker A:So, papa, can you give us the simple version?
Speaker A:If someone is listening and thinking, this is me, what are the first few steps they should take?
Speaker B:First of all, don't panic.
Speaker B:Don't panic.
Speaker B:And don't randomly start clicking buttons and changing things.
Speaker B:I find sometimes people start creating their own systems where QuickBooks already has a system for that.
Speaker A:Reinvent the wheel.
Speaker A:Keep the wheel the same.
Speaker B:Don't change things just because you think it might be a shortcut for you.
Speaker B:Identify what you need.
Speaker B:And I think most people, if they've gotten to this point, they're willing to invest in doing it correctly and I think don't feel like it's gotta be done in a day or a week or a month.
Speaker B:Month.
Speaker B:It might take six weeks.
Speaker B:Yeah, absolutely.
Speaker B:And.
Speaker B:But once you understand what you're doing, then you're willing to invest the time in and it's less stressful.
Speaker A:Yeah, absolutely.
Speaker B:And I think just having an understanding of the chart of accounts.
Speaker A:Yep.
Speaker B:And getting your prior year tax return or your accountant's trial balance.
Speaker A:Yep.
Speaker B:When just get some of the basic building blocks like your bank statements, your credit card loans, payroll and asset documents and just start at the beginning.
Speaker B:Determine, you know, whether to clean up what it will take.
Speaker A:And clean up on aisle nine.
Speaker A:Clean up on aisle nine.
Speaker A:Clean up on aisle nine.
Speaker B:And once you start seeing some progress.
Speaker B:Yeah.
Speaker B:It's amazing how better you feel.
Speaker A:It does have that snowball effect.
Speaker A:Right.
Speaker A:We start doing a little bit of something and then we just get encouraged by the results we see.
Speaker A:And then.
Speaker A:But it's the what comes first.
Speaker A:Right.
Speaker A:You have to be willing to get in there and do the thing even without seeing results.
Speaker A:But they will come, they will happen.
Speaker A:You just got to keep pursuing it.
Speaker A:Yeah, yeah.
Speaker B:And I think it depends for each particular individual.
Speaker B:But sometimes they like working through the balance sheet first, but other people like looking at their profit and loss, especially if they've done some good work in it and they've got an interface like with a third party software.
Speaker A:Yeah.
Speaker B:And so build on the process that, you know, works, works and then start filling in the boxes, if you will.
Speaker A:Absolutely.
Speaker A:That does feel so very doable.
Speaker A:Not easy necessarily, but doable.
Speaker A:And I think that is the goal.
Speaker A:If we just try to avoid what is hard, we're only putting off what is hard.
Speaker A:It'll just get harder later.
Speaker A:That is the way things work.
Speaker A:Right.
Speaker A:So we want doable.
Speaker A:Yeah, Love that.
Speaker A:Yeah.
Speaker A:That is so good.
Speaker A:So if you are listening to this and thinking my QuickBooks might be in a ditch.
Speaker A:The first thing I want you to know is that you are not alone and it is fixable.
Speaker A:We have seen this so many times from so many clients and you just.
Speaker A:You need to remember you are not alone in this.
Speaker A:If there's any two things you take away from this episode, I think those two things need to be you are not alone.
Speaker A:And don't panic.
Speaker A:Do not panic because you will get through this.
Speaker A:You will figure it out.
Speaker A:I promise you.
Speaker A:Everything is is figureoutable.
Speaker A:Love that so much.
Speaker A:And a great place to start is with our free QuickBooks Clarity Scorecard.
Speaker A:Can I say that louder for you guys?
Speaker A:It is free so if you have not downloaded this resource, please go and download it.
Speaker A:I created this just for you.
Speaker A:It will help you begin thinking through where your QuickBooks file stands, where the weak spots might be and what areas may need attention.
Speaker A:I will put the link in the show notes and it's also on our website leedavis and company.com and and if your QuickBooks file is at that point where you need financial statements for a banker, an accountant or a major business decision, it may be time to get professional help so you can move forward with confidence.
Speaker B:The important thing is to get a plan and start with a foundation and build from there.
Speaker A:Yeah, that is so good, Papa.
Speaker A:This was so good.
Speaker A:I'm sad that our episode that we recorded in New Hampshire together, it failed somehow.
Speaker A:The audio didn't record, but I feel like we brought some stronger nuggets in this one.
Speaker A:So that was so good.
Speaker A:So next time we are going to talk about what happens when QuickBooks itself is not the problem, but the way a service business is trying to invoice, schedule and manage jobs inside of QuickBooks is creating frustration.
Speaker A:We will talk about when an app might be the missing piece.
Speaker A:This is going to be a really great idea.
Speaker A:Episodes, I do want you to tune in because there are some great integrations that you can integrate into QuickBooks and we want to start highlighting some of those great resources that you can connect to QuickBooks to actually make your life easier.
Speaker A:Because that's what we are all about.
Speaker A:We are not about making your life harder.
Speaker A:We want to make it easier.
Speaker A:And this is going to be a powerful episode.
Speaker A:So stay tuned you guys.
Speaker A:Awesome you guys.
Speaker A:Thank you so much for listening and we will see you next week.
Speaker A:Bye for now.
Speaker A:Thanks for tuning in to QuickBooks mastery for small Business Success.
Speaker B:If you enjoyed this episode, hit subscribe and stay connected with us@leedavisandcompany.com we know.
Speaker A:QuickBooks can be overwhelming, so we've put together a free resource to help you get started right away.
Speaker A:Grab your copy@leedavisoncompany.com and when you do, you'll also get access to our VIP email list, where we share exclusive QuickBooks tips, business strategies, and support.
Speaker B:And we'd love to hear from you.
Speaker B:If you have a QuickBooks question or a business challenge, send it our way@supporteadavidsoncompany.com we might feature it in a future episode.
Speaker A:We're here to help you simplify QuickBooks and grow your business one step at a time.
Speaker A:See you next time.
