Firelight

Book keeping and accounting was a huge joke to me. I was fine as long as I could invoice clients, pay the employees and the bills. Run rate, P&L, balance sheet, all a mystery to me. To hell with quarterly tax payments, or so I thought.

Initially, just like time sheets, each transaction ended up in a tabbed plain-text file. Pay a bill, record it in a text file. Pay an employee, record it in another text file. All of these files lived in DEVONNote by DEVONTechnologies. Each time I realized that I should record some other type of transaction, a new unrelated text file would be created.

The organic growth of my record keeping made things interesting. I would realize the value of recording something, then have to go back and look up all the historical data. As flexible as the text files were they lacked the defined fields and necessary constraints of real accounting software that encourages, dare I say, good practices. That and typical accounting packages get you in the habit of recording everything.

Even though I didn’t know much about accounting I did know that QuickBooks for the Mac was awful. A bunch of 2 star ratings at sites like MacUpdate and Version Tracker helped solidify that notion. As hard as I tried the search for a Mac compatible solution was to no avail.

A few days of research and some free trials later I decided to give QuickBooks Online Edition by Intuit a try. In addition to the traditional QuickBooks feature set the Online Edition offered web based time tracking. It wasn’t exactly the ideal solution but it let us move time tracking and invoicing out of iBiz. It wouldn’t do actual timing, but we had already purchased software to do that. The time tracking in iBiz was virtually unusable. As to be expected everything was integrated within QuickBooks. The time entries easily made their way onto invoices and for the first time it all worked properly.

Things could be a little better with QuickBooks Online. Not to give the the impression that Macs were equally as important as Windows PCs, they carefully crafted the service to not only require PC IE, but also an Active X plugin. Ha, take that Firefox, you lose too.

Despite the need for a PC and a sometimes questionable interface I began the process of entering in the company data. I took up the challenge because at the time I couldn’t see how anyone else would make sense of all of the loose receipts and text files. With a little help I was able to get started and despite a few mistakes able to get a fair amount of historical data entered.

The one thing that kept nagging me was the account balances in QuickBooks didn’t reflect the actual accounts in the slightest. I decided to start the books in 2005, for reasons I’m still unsure of. That was at least a year and a half ago at the time. Laurie began to help with the data entry too, but keeping up with the new data and locating all of the old records vastly exceeded the little free time we both had.

To make matters worse not all of the credit card statements were available. I had opted long ago to receive them online. How they let you turn off receiving paper statements if you can’t actually retrieve old ones online is confusing to say the least. Capital One doesn’t even offer a PDF version, and it wasn’t till recently that American Express provided a way to retrieve archived statements. This made reconciliation of early months impossible without ordering archived statements.

At its worst I was spending several days a week entering in historical transactions and current ones. That’s when I realized I should have used QuickBooks from day 0. Had I been recording things as I went along, instead of all at once, I wouldn’t have been hit by this tidal wave. I also would have had everything in order for tax time and probably saved some money. I also had to get a book keeper just to get all the historical information in and the accounts reconciled. The entire process took months. My mistake was thinking my business was too small for a complete accounting solution only to learn every business needs one.

Now that everything is in order it only takes a few hours a week for me to get invoices out, and a few hours every other week for the book keeper to put in new transactions. I hope someone is able to learn something from this. I’m not sure what lesson 3 will be yet.