Discussion:Client didn't record assets on Quickbooks
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Revision as of 13:14, 4 September 2009 Seaside CPA (Talk | contribs) (My first thought) Next diff → |
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| + | {{ForumReplyPost|UserID=Seaside CPA|Date=4 September 2009|Text=My first thought would be that Quickbooks & the 990 are correct, and assets previously disposed of did not get taken off of personal property return. I have lots of clients that I do bookkeeping and tax returns for, but they choose to prepare the personal property tax returns. I never see them, but I can assure you that they would probably not match my records. Did previous accountant prepare their personal property returns? If so, then not sure what the problem is.}} | ||
Revision as of 13:14, 4 September 2009
Discussion Forum Index --> Accounting Questions --> Client didn't record assets on Quickbooks
| 2 September 2009 | |
| This is a nightmare.
Client has assets that it has never recorded in Quickbooks. The prior accountant never reconciled Quickbooks with the tax return (this is the same client I am compiling the financial statements for to deliver to the bank). Of course, the assets are substantial. I have the building and land figures and can record those, but the other figures, which is mostly some additional buildings added to the property over the years, I don't have, but I have previous years figures for the information. I know I will contact the prior accountant for the depreciation schedules, but having those assets on the books will improve my client's position with the bank. What the heck do I do now? Tom | |
| 2 September 2009 | |
| explain why this will cost 3 times as much as you originally quoted | |
| 2 September 2009 | |
| Kevin,
That's not a bad idea! Of course, it's a non-profit... Tom | |
| 2 September 2009 | |
| I suppose so, but let's just screw this up so they don't!
Tom | |
| September 2, 2009 | |
| I would go back and match the Balance Sheet in Quickbooks to the tax return, starting two years back, with the adjustment(s) going thru Fund Balance, or even suspense.
In theory (!!), it should all balance out, assuming that the 'unrecorded" assets were just run thru QB as an expense (rather than capitalized), which would just end up reducing the fund balance anyway in the long run. See how much of a 'net' adjustment you end up with, and how far off the QB fund balance is from the tax return. Compare this difference to the amount of E & O insurance you have (just kidding - maybe), then decide if you need this headache in your professional life or not. I've tried this before; sometimes the difference is small enough for my comfort level. PS - good luck | |
| September 3, 2009 | |
| I would take last year's balances per QBs, line them up with the 990 balances, and then do one big JE on the last day of the prior year so that your beginning balances are correct. It shouldn't take very long, unless there are a lot of accounts that you have a hard time telling how they are grouped on the 990. | |
Seaside CPA (talk|edits) said: | 3 September 2009 |
| Chances are whoever prepared prior year tax return made some journal entries, & they probably just never got posted to clients books. If you have to get depreciation schedules from prior accountant, I would sure ask about copies of journal entries as well! | |
| 3 September 2009 | |
| What I think I am will do is, after consulting with the client last night, is act like a bookkeeper, make the entries and hand it back to them. Then they can take it from there.
Of course, they balked only after I told them all the hoops I was going to jump through and how much it would cost. Tom | |
| 3 September 2009 | |
| Is the tax return correct? If so then I would do as Natalie suggests and make one big entry to get the beginning balances correct. If the tax return is not correct I would still make the entry to get Qbooks to agree with the 990. Then I would make further adjustments to get Qbooks correct. Then you just issue a compilation report like usual. If you don't have a prior year F/S that you are correcting there is no prior period adjustment. If you are correcting a prior year, so what, issue the report and move on, it's no big deal and it wasn't your screw up. | |
| 3 September 2009 | |
| In reviewing my original post, I should not have said "the tax return" meaning the 990.
It comes from the state personal property return. The prior accountants office never reconciled the three together. I was taught over 25 years ago to match the books to the tax return to the personal property return. So, net assets being left off amount to approximately $360K. That's why I want to back away from a compilation until I satisfy myself that I have all the correct information. Tom | |
| September 4, 2009 | |
| Now I'm confused. What does a personal property return have to do with a 990? Is that something special in Maryland? | |
| 4 September 2009 | |
| Maryland has a personal property return. I don't know if Hawaii does, but when I was reviewing the client information I stumbled across a MD personal property from the previous year with $560K of net equipment and Quickbooks and the 990 only listed net equipment of $200K. Hence, the net equipment and therefore, net assets are understated by $360K.
I have to stop writing these when I'm tired I suppose. I really didn't realize how badly this thing has gotten to me. Tom | |
Seaside CPA (talk|edits) said: | 4 September 2009 |
| My first thought would be that Quickbooks & the 990 are correct, and assets previously disposed of did not get taken off of personal property return. I have lots of clients that I do bookkeeping and tax returns for, but they choose to prepare the personal property tax returns. I never see them, but I can assure you that they would probably not match my records. Did previous accountant prepare their personal property returns? If so, then not sure what the problem is. | |
