![]() Your tax accountant doesn’t know that you made changes to your books. Unfortunately, you accidentally changed several transactions after your tax accountant started the tax return. Scenario #2 – your tax accountant prepares your tax returns based on the transactions recorded in QuickBooks. ![]() A couple of weeks later, you accidentally change transactions and now the reports look different – you can no longer rely on the reports because they have changed. You run reports based on the transactions you entered and you use these reports to make decisions for your business based on those reports. Scenario #1 – you enter transactions in QuickBooks for the month and reconcile them. The primary purpose of closing the books is to preserve the integrity of your transactions and financial reports. Why should I close my books in QuickBooks Online? Thankfully, we don’t have to do any bookkeeping using paper books! Closing the books in QuickBooks means setting up a password to prevent you or your employees from accidentally making changes to transactions in QuickBooks. When they finished working on the month’s transactions, they “closed the books” – meaning they were finished working on those books and could open new books for the next month. Long time ago, in a galaxy far far away…actually, back in the days before computers, accountants used to track financial transactions in really big books. I’ll show you how to close the books in QuickBooks Online so that you can prevent inadvertent changes to your financial data. Most untrained users at some point have inadvertently changed or deleted transactions and then found that their reconciliations are out of balance. Unfortunately, the ability to make changes after the fact can have dire consequences. In my opinion, the greatest feature of QuickBooks is that you can easily change and edit transactions after you have saved them.
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