I am the first person to rave about how much I love QuickBooks, but some of the quirks about it can just drive you nuts. Over the next few blogs, I will give you some of the good and some of the bad about QuickBooks Online Banking to help save time and avoid frustration.
The online banking function in QuickBooks can save you hours of painful data entry when updating bank and credit card accounts. QuickBooks’ online banking function is intuitive when reoccurring transactions upload into the file by posting these to proper accounts automatically. This increases both efficiency and accuracy . . . but at times you must monitor this function. QuickBooks will try to be too helpful and could post similar transactions (i.e. similar or identical memos on banking transactions) to the account in which it connects with these triggers. Keep in mind, when an item is posted incorrectly in the system, it takes you three times as long to fix it as it would have to enter it correctly the first time. Confirm you have items mapping correctly and you’ll love online banking.
Using the Online Bank: Vendor Names
One great online banking feature that is great but can go terribly wrong is Payee Alias Naming for vendors. Alias naming allows you to assign different names to one vendor in the “Vendor List.” When downloading a transaction from the online banking register, each transaction has been given a name from the credit card processor or the banking institution (this usually contains the vendors name and a transaction ID but can include other details of the transaction as well). For some vendors, this information is consistent each time you make a purchase, but for others, it changes. QuickBooks will prompt you to create a new vendor with the name of the details of the transaction. If you create a new vendor for each transaction, your vendor list will have hundreds of items, preventing your from running any good reports by vendor. An example would be if you made a purchase from Home Depot in San Diego and the banking institution named it “Home Depot SD”; then you make a purchase from Home Depot in Los Angeles and the banking institution names it “Home Depot LA”. If you follow these names, you’ll have created two vendor names for vendor, when the name should simply be “Home Depot”.
To toggle on the Alias Naming function click “Edit>Preferences” from the main menu. In the Preferences menu, click on the “Company Tab”, then “Checking” from the left side menu. In the Online Banking Area, click “On” next to “Payee Alias Naming” or “Off” if you decide you don’t want to use this function. Best practice is to have this function “On” because it is so useful and saves valuable time.
After you have downloaded your most recent transactions through online banking, you can begin to sort transactions through the Download Transactions queue and into the Account Register by clicking “add a transaction”. If the vendor name isn’t recognized, you will get a message box, “Name Not Found”. From here, click “Create Alias,” and a box will come up for you to choose the vendors name you want this transaction to link to. You can type the vendor name or scroll from the drop down menu like other QuickBooks entry screens. Find the vendor that you want to match and click “OK”. If the vendor is not already in the system, type out the name and when prompted, select “Quick Add” or “Set Up” and add the vendor as you normally would when adding a new vendor into the system. Then, fill out the remaining information to add the transaction into the register.
Now you have linked the transaction name to the vendor name. The next time you make a purchase with the same vendor, the transaction name will come up in the online banking center and will automatically post the account used the last three times when being entered. Usually most businesses purchase from the same vendors, so after the first few transaction cycles, online banking is doing most of the work for you.
Using “Payee Alias Naming” can be a valuable tool and save large amounts of time. Before you jump in with this tool, check out my next blog to learn how this function can go bad.Written by: Bridgette Cerles TGG Accounting