How to Generate Financial Reports in QuickBooks Desktop
Financial reports are crucial for any business to track its performance and make data-driven decisions. QuickBooks Desktop is one of the most popular accounting software used by small businesses to manage their finances. It provides a host of features to generate detailed financial reports that give insights into the health of your business.In this comprehensive guide, I will walk you through the step-by-step process of generating key financial reports in QuickBooks Desktop. Whether you are new to QuickBooks or have been using it for years, this guide will help you become a pro at creating financial reports in QuickBooks Desktop.
Prerequisites for Financial Reporting
Before you generate financial reports in QuickBooks Desktop, ensure that the following prerequisites are met:
- Your QuickBooks data file is up-to-date with all transactions categorized and accounted for. This provides an accurate base for reports.
- The accounts and inventory items are properly set up and updated. Any discrepancies will reflect in the reports.
- If you need reports for specific accounts, customers, items etc. they should be created or updated in QuickBooks.
- Decide the correct basis of accounting for your reports – cash or accrual. Accrual is recommended for accurate financials.
- Set the correct fiscal year and accounting periods in QuickBooks preferences. The reports will follow this timeline.
Now that the foundation is set up correctly, let us look at the various kinds of financial reports you can create in QuickBooks Desktop.
Key Types of Financial Reports in QuickBooks
QuickBooks Desktop offers a wide array of financial reports that provide insights into different aspects of your business finances. Here are some of the most commonly used financial reports:
- Profit and Loss Report: This shows your revenue, expenses, and profit for a specified period. It is important to track your net earnings.
- Balance Sheet: This provides a snapshot of your company’s financial position with assets, liabilities and equity on a certain date. It is vital to assess the financial health.
- Cash Flow Statement: This tracks the inflows and outflows of cash. With this report, you can analyze your liquidity position.
- Accounts Receivable and Accounts Payable Aging Reports: These reports provide an overview of outstanding invoices and bills respectively. Use it to manage collections and payments.
- Sales Reports: These reports break down sales by customers, items, territories etc. Analyze sales trends with these reports.
- Budget vs Actuals Report: This report compares your actual financials against budgets set for revenues, expenses, profit etc. Identify variances for corrective action.
- Inventory Valuation Report: This report shows the value of inventory items on hand as on a certain date. Use this for accurate inventory accounting.
- Purchase and Sales Order Report: Review open sales orders and purchase orders with these reports. Plan procurements accordingly.
- Customer and Vendor Balance Reports: These provide a summary of closing balances for all customers and vendors. Useful for collections and payments follow-up.
- Trial Balance: This report lists all accounts with ending debit and credit balances. Use it to identify and rectify accounting errors.
These are the 10 key types of financial reports that QuickBooks users should be aware of. The software provides several other reports too for bank reconciliation, fixed assets tracking, and detailed operational insights.
Steps to Generate Financial Reports in QuickBooks Desktop
Without further ado, let us look at the step-by-step process to generate financial reports in QuickBooks Desktop:
- Open the QuickBooks Desktop application and open the company file for which you want to create reports. Ensure all data is up to date.
- Click on ‘Reports’ in the Menu Bar and select ‘Company & Financial’. This will open the financial reports window.
- The list of financial report groups will appear on the left panel. Click on the report category you want to generate the report for.
- In the right pane, you will see the various report types within the selected category. Click on the specific report type you want to create.
- A report window will open. By default, the report will be for the entire fiscal period. To customize the report duration, click ‘Customize Report’.
- In the customize window, select the correct report basis – cash or accrual. Choose the start and end dates for the report. You can also filter by accounts, customers, items etc. and make other customizations. Click ‘OK’ when done.
- The customized report will be generated. Review the report carefully to analyze the insights from the report.
- If you want to print the report, click the ‘Print’ option in the top menu bar. Choose the printer and other settings and click ‘Print’.
- To export the report for sharing or emailing, click the ‘Export’ button. Select the file format – Excel, PDF etc. and save the exported file.
- Make sure to save custom reports by clicking ‘Memorize’ for quick access in the future. Give an appropriate name and save it.
- When done, click the ‘Close’ icon to close the report. The report will also be saved within QuickBooks for future reference.
And that’s it! By following these 10 simple steps, you can easily generate a wide range of financial reports in QuickBooks Desktop.
Here are some key takeaways from this guide:
- Set up QuickBooks correctly before generating reports for accurate insights
- Make use of both standard and customized reports for financial analysis
- Memorize customized reports for frequently used time periods or filters
- Learn how to print, export and share reports with relevant stakeholders
- Always review reports thoroughly and take corrective actions on variances
- Make financial reporting a regular habit, not just a month-end ritual
So now you are ready to become a financial reporting pro in QuickBooks Desktop! Feel free to reach out for any assistance on creating advanced reports for management decision making. Here’s to successfully tracking your business finances.