Most of the problems I just outlined for the A/R side of the house exist respectively for the A/P side after condense. While in theory, the A/R balance subsequent to the condense process should be correct, the collective A/R summarized in the condense transaction journal entries are recorded under “no name.” Therefore, you cannot trace back A/R on a customer-by-customer basis within the condensed file.Ī similar situation occurs in terms of Accounts Payable, bills and bill payment checks no longer exist and the expenses are no longer linked to cash payments, so QuickBooks cannot know when to report cash basis related expenses. One additional side effect impacts "customer-based" accounts receivable. Accordingly, sales tax reports will be inaccurate in terms of taxable sales and tax liability. Since the Invoices no longer exist, the details related to sales tax no longer exist including the amount collected for the invoice. While the condense journal entries created via the Condense Utility credits income for invoices condensed, the details do not exist to determine which portions of that income are taxable and which were non-taxable. In reality, QuickBooks doesn’t even know the original invoice and payment ever existed.Ī side effect of this impacts Sales Tax reportability. Neither the invoice or payment exist any longer in QuickBooks, so the program doesn't know that an invoice for March 1 was paid on April 1.
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QuickBooks knows to include the invoice in cash basis income for April 1. But after running Condense Data, your cash basis reports will be inaccurate, because the income is condensed into the March (condensed transaction) journal entry and the cash is condensed into the April (condensed transaction) journal entry.
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If you enter an invoice on March 1 and a payment on April 1, the histories show they are linked. There are no links from Cash-in to Income, or from Cash-out to Expenses. Let’s look at some examples of why this can occur. Many users, and even ProAdvisors, report they had no idea that the actual values could change. This means the negative history becomes a permanent part of the value of the inventory and it cannot be corrected in the manner that's appropriate for such transactions.Įven under the best of conditions, the Condense Data Utility still negatively impacts your financials.
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Take for example a common form of QuickBooks file corruption related to the actual quality of the data as opposed to the integrity of the data. If your file contains historical negative inventory and you condense the data, the impact of that negative history is captured in the summation of the inventory transactions. An all too often reason why some people try to condense is the presence of corrupted data they believe will be eliminated or resolved as part of the condense process. In reality, corrupted data prior to condense is likely to be omitted from the condense process and may well be unrepairable after condense.