Do I have to change to QBO?

First off, the answer is No, you don’t have to, but you might want to.  There is a big movement occurring in QuickBooks with clients moving from the Desktop program to the Online program QuickBooks offers.  Some people I work with are excited about this transition, some are fearful and some are lost on what QBO is and why they should or shouldn’t consider making the change.

Let me first explain that QBO, also known as QuickBooks Online, is what I foresee as the way of the future in QuickBooks programming.  Like many other computer programs, they are becoming cloud based and monthly fee based.  I am not saying I like it, but it is something that we as users are going to have to adjust to if we want to continue to utilize the program.  Now don’t jump ahead of me, QBO is not all bad.  One major feature that is driving many people to switch is the ability for multiple members of an organization to be able to access the bookkeeping records from various locations and computers.  Desktop has always forced users to have to access the program from a single computer or server.  Now ranchers and farmers that have multiple operation locations stretching hundreds of miles apart can share access of QuickBooks with their team members.  Yes, there are ways to get QuickBooks Desktop hosted through a remote server so you can share access to the desktop program.  However, to put it in simple terms, QuickBooks is not user friendly with the technology required to host the program.  Many of the resources I have researched that offer this type of hosted service are not cost effective.  Overall, the cost of QBO is less than the other hosting programs I have priced.  Yes, the setup of QBO is much different from Desktop, but it is all there.  The method in which you open a check or deposit, how you access your chart of accounts or where you go to reconcile your bank account is different than the Desktop program, but it is simply getting familiar with the new layout.

Let’s start with the negatives.  QBO charges a monthly fee.  Desktop was a single purchase software that you upgraded and purchased the new version every 3-5 years, typically, so you could stretch the software cost.  QBO has a range of products stretching from Self-Employed to Advanced.  The Essentials or Plus product fit most of my clients and are the middle packages as far as cost go.  Payroll, same as it was with desktop, is a separate add on feature that has additional costs.  The Payroll feature can be good or bad.  As a payroll expert it does not allow me the flexibility to adjust items, however if you know very little on payroll its structure and guidance may keep you in line.  One negative is that QBO does not support the 943 form for agriculture annual filers.  I work around it as a preparer; however, it does add some challenges.  Internet quality is a big discussion in most of my client’s rural lives and plays a big part on making the switch to QBO as it does require internet to access it.  Poor internet would make using QBO an issue.  Also, customizing your tool bar or short cuts that I teach about on the QB Desktop program, are not an option in QBO.  The dashboard is a set feature that has very few customizable options.

Enough negativity, let’s look at the positives.  It is cloud based so no more worrying about backing up your data.  Multiple users can access the same QB program from any location.  Bank Feeds, which is the linking of QBO to your online banking accounts, works in a much more streamlined fashion.  I love being able to keep up to date on transactions clearing the bank without having to open my online banking constantly.  My accountant can access my file directly from their office and make changes without any need to email files back and forth and upload or manual enter transactions.  If using bank feeds the reconciliation function acknowledges things that clear the bank and check mark the transactions off for you.  Typically, if everything is done correctly, I only have to enter the ending balance of my bank statement and QBO basically reconciles the account for me.  There is a bill pay function within QBO that does have an additional service charge, but can be a really great feature to streamline paying your vendors.  You simply enter your bills, select which ones to pay via Bill Pay and the checks are printed and mailed by their service.  No buying checks, envelopes, stamps or flipping through a pile of checks to sign and then transport to the mail box.  This feature is not an option in QB Desktop.  While QBO charges you for each company you set up, which can get expensive, there are discounts that you can access by purchasing QBO products through a ProAdvisor such as myself that help mitigate those costs.  Another positive is QBO has a phone app so you can do some tasks while on the go.  One of my favorites is that you, or a team member, can snap a picture of a receipt on the road and have it upload to the cloud.  QBO is able to read most the data off the receipt, record it and have it sit in waiting for you to categorize to an expense account and finalize posting from your computer at a later date.  The image of the receipt will then be attached to the recorded transaction forever.  I love being able to try and keep records of receipts in this fashion as most of us are always on the go.  App also offers features like, track your mileage, create estimates or invoices to send to clients, pay bills and much more.  If your business needs to be able to accept credit card payments the app offers that feature too. 

Contrary to popular belief, old dogs can learn new tricks.  Change is scary and sometimes frustrating.  I won’t sugar coat it, there will probably be a few hiccups in the transition, some tasks you will be slower at completing as you learn QBO, and there will be an increase in cost for the program.  Keep in mind there are inevitable costs at running a business.  In the long term would changing programs solve current problems in your business?  Would it help you expand in the future?  There is no right answer.  Switching QB programs or starting to use QB period may simplify your accounting and your time.  Never forget that your time has a value.  However, it helps to know about features of each program when you are making this decision.  I hope during this time of working through your records for taxes, starting your 2021 budget, sorting through your list of 1099s that need prepared and the many other chores that come with this time of year, that this helps lead you in a direction that will streamline your desk work.  Feel free to email me with questions, product pricing or long-term real estate loans any time!

Cassi Johnson

Pacific Intermountain Mortgage Company

3 Bar Consulting