Quickbooks Set-up & Workflow for architects

Quickbooks Set-up &
Workflow for Architects
Presented by: Terry Chong
Focus-Grow Bookkeeping
@ AIA SF on 8/4/16

A business has 3 legs:
Operations Marketing
Finance
@focus-grow bookkeeping 2

If any one of the 3 legs is not
strong…

An owner stands on top of the organization
• on top of the world!
• He gets things done
through other people.

The top job of a CEO
The only job I cannot delegate is
on hiring people.
• Get the right people on the bus
• Get the wrong people off the bus
Photo credit: Tim Cook @ twitter

Team
Each team member brings with him / her a unique skill set.
A leader’s job is to help each achieve his / her full
potential, by providing guidance & resources.

2 major reasons employees quit:
1. Don’t agree with the boss(es).
2. Don’t feel appreciated.

Our knowledge:
What I know.
I don’t know what I don’t
know.
I seek to know what I don’t
know.

2 things that make us wiser:
• Books that we read
• People who we hang out with
Image credit: Himani A. Gupta

2 good closing questions:
1. What should I have asked you but I haven’t?
2. What are somethings very important that you wish I know
by now?

Bookkeeping
• Tasks (chores)
– Invoicing clients
– Paying bills
– Bank reconciliation
• Vs.
• End Goals:
- TIMELY and ACCURATE financial reports

Reports serve 2 purposes:
• For monitoring purpose - Weekly reports:
– Cash balance
– A/Receivable reports: A/R Open invoices, Aging.
– A/Payable reports: A/P unpaid bills.
• For strategic purpose – Monthly & Yearly Reports
- Understand how the company performed.
- Then, make strategic decisions; i.e. what actions should be
taken? (i.e. take out loan, hire more staff, buy equipment?)

Monitoring A/Receivable (Aging):

Monitoring Open Invoices & Past-Due:

Balance Sheet -
shows the company’s
financial positions;
assets, liabilities, equity.
On being strategic:
1. We seek to
understand the
company ‘s
performance.
2. We make decisions
accordingly.

Profit & Loss -
shows the Profitability
of the company; how
profitable the
company is.

Numbers tell a story:
They tell 2 things:
• Quantity = how big are they?
• Quality = how good is the company performing?

Accounting 101:
• Accounting is quite simple:
• 5 major types of accounts:
- Asset, liability, equity, income and expenses
• 2 major types of financial reports:
- Balance Sheet – showing assets, liabilities & equity
- Profit & Loss – showing income & expenses

Quickbooks Demo

Chart-of-accounts
• Is the back bone for
financial statements.
• Everything listed on
Balance Sheet or Profit
& Loss needs to be set
up as an Account first.
• Asset, liability, equity
accounts will be listed
on Balance Sheet.
• Income and expenses
accounts will be listed
on Profit & Loss.

Items List:
• Every thing you use on your “invoices” need to be set up as an “item”.
• Item is linked to chart-of-accounts.
• (Accounts on chart-of-accounts make up Balance Sheet and Profit & Loss.)

To set up New Item:
• To set up a new item, go to List menu, select Item, then “New” or Ctrl+N.
• By default, only “Income account” is provided.
• Put a checkmark on “This service is … performed by a subcontractor” to open
up “Expense account” side. This is called “double-sided item set-up”.

2 types of billing:
• T&M Billing (Time & Materials Billing)
• Fixed Price / Progress Billing (Contract Billing)

Time & Material Billing: It starts with gathering time
on a time sheet

T&M Billing: Enter weekly time sheet
• Enter time by job and by task (item; i.e. SD, DD, CA, etc.)
• Checking the box “Billable” allows us to pull these times into T& M invoices.
• Enter employees and contractors’ time in the same way. (Pull contractor’s time into a
vendor’s bill.)

Entering a Reimbursable Bill:
• For Job Costing
purpose, use
“Items” tab
instead of
“Expense” tab.
Expense tab is
for general &
administrative
expenses; i.e.
rent, utilities.
• Checking the
box “Billable”
allows us to pull
the expense into
an invoice later.

T&M Billing:
While creating a
T&M invoice:
• Every thing listed
on Time tab,
Expense tab,
Mileage tab and
Items tab can be
pulled into the
invoice.
• Put a check mark
on each line to
include it.

Progress Billing:
• Turn on this feature: Edit  Preference  Job & Estimate  Company
Preference  “Yes” on “Progress Billing”
• Uncheck “Don’t print zero amount” (to show full contract value)

Fixed Price / Progress Billing:
• Step 1: create an
Estimate
• Amount = hard costs
• Markup = can be in $
or %
• Total = Contract
Value
When it is time to bill:
•Step 2: Click on
“Create Invoice” to flip
this “estimate” into a
“progress billing
invoice.”

Step 3: Enter
Percentage (in
fraction) you want to
bill here, or in
previous pop-up
window.
“Prior Amt” column
shows amount
previously billed for
each item.
Progress Billing:

Financial Reports:
Under Report 
Company &
Financial are various
Balance Sheet, Profit
& Loss and Cash
Flow Reports which
show the overall
company’s
performance.

Job Reports:
Under Report  Jobs are
various job reports.
• “Detail” reports are for
one specific job.
• “Summary” reports are
summary for all jobs.

Job Profitability Summary report
lists ALL jobs, showing how
profitable each one is.

Job Detail Report shows 1 job at a time.
Example: Job Estimates vs. Actuals Detail Report
• 3 columns on the left are on costs comparison.
• 3 columns on the right are on revenue comparison.

The Estimated Costs & Revenue came from Estimate:
@focus-grow bookkeeping
35

Q&A

Terry Chong
415 516 2689
tchong@focus-grow.com
Thank You!

Quickbooks Set-up & Workflow for architects

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