A Fishbowl/QuickBooks environment can be a match made in heaven.With both programs in place you get a robust inventory management system and a proven accounting system. But as I’ve mentioned before, for this environment to be a happy one, you’re likely to need to change some of your habits and ideas about the “right” way to do things. Because the right way to do things with Fishbowl is different than the right way to do things in QuickBooks alone.
A great example of this is dating…meaning, of course, how you date your transactions.
Everything starts with Fishbowl
Always keep in mind that Fishbowl controls everything except the chart of accounts, and that Fishbowl pushes information through to QuickBooks. If something is done in QuickBooks that should have been done in Fishbowl, your books will not be accurate.
Some important Fishbowl dating tips
Here are some useful tips to keep in mind:
- Never backdate a transaction in Fishbowl. If you do so, due to the nature of the Fishbowl database, you will lose your ability to get an accurate inventory valuation report.
- Never change dates in QuickBooks. If you change dates in QuickBooks, these changes will not flow back to Fishbowl. As a result, your QuickBooks and Fishbowl will not balance.For example, shipping products from a Fishbowl Sales Order drives two transactions to QuickBooks: an Invoice to record the sale, and a Journal Entry to record the cost of goods sold. These entries are independent of each other. So if you change the date on an Invoice after it is posted to QuickBooks, the Journal Entry for the cost of goods sold will retain the original shipping date, while the Invoice will have the new date. As a result, you can get revenue showing in one time period and its associated cost of goods sold showing in different time period.
- Always use the inventory received date as the vendor bill date. As I explained in a previous article, if you don’t do this you can end up with what I call the “dancing dollars” problem.
Be sure to “chaperone” your non-accounting personnel
A situation that came up with one of my clients is a great illustration of the “never change dates in QuickBooks” principle. This client’s Fishbowl and QuickBooks accounts were not reconciling. It turns out that the management and sales people were messing with the Invoice dates so that it would appear as though they had met their sales goals. It never occurred to these employees that changing the Invoice dates would create a serious accounting problem.
As mentioned above, in the Fishbowl/QuickBooks world, the Invoice only drives the sales transaction. The cost of goods sold transaction is a separate Journal Entry. By changing the Invoice date, things no longer matched up – and my client was left with books that were wrong.