Document Management Tools For Accountants
In the new episode of QB PowerHour, Michelle Long and Hector Garcia break down Document Management in QuickBooks® Online Accountant and HubDoc, offer some valuable technical tips in QuickBooks Desktop with Attached Documents, cover some of the nuances with Accountant’s Copy vs. working with a portable file, and discuss sending Journal Entries as a form of collaborating with your clients’ books.
Michelle: Upcoming events, Hector and I both love to see you next month at Scaling New Heights down in New Orleans. It's going to be another great conference this year. QuickBooks Connect coming up in November and SleeterCon is also in Vegas this year and that's in November as well, love to have you join us for some of those as well.
Let's get into the meat of the session today, let's start talking about our collaboration. Some of the challenges that we have when we're working with our clients is always the paper, all these documents, all these receipts that we need to get from our clients or we need to see from our clients, especially when you have some clients that do billable expenses or they need job costing, we need to know who that was for, we need to know where to allocate it, a lot of times we need to see the bank and the credit card statement.
How are you guys getting that now? Are you logging in to your client's account to get the bank statement or the credit card statement so that you can reconcile? Are you logging in to their bank account? When you do, do you have a separate read only type of user account? Because for me, personally, I don't want my clients log in information to their bank or their credit card account, I worry about the security. If something happens, I don't want to be able to have their information. Some things now will allow you to have a read only access where you can just get in there and download, let's say, the statements and things like that. How are you guys getting the credit card or the bank statement? How are you getting those statements? Are you logging in? I actually have a poll question for you in just a minute.
Let's think about this, let's say you are logging in to your client's account to get those statements, the bank and the credit card statement, let's say you only have 10 clients and they have two accounts, one checking account and one credit card account, let's say you can do it five minutes each so 10 minutes, this is a very conservative estimate here, this is very conservative. You're spending about three and a third hours logging in to get bank statements or credit card statements, that is so time-consuming and so inefficient. We really spend a lot of time dealing with some of this stuff.
What about the cancelled checks, if you have clients that write checks still, the handwritten checks or printing them out? Sometimes you need to see that check, especially if a client is manually writing a check, you need to see who it's to because on the bank statement, a lot of times you're going to see the check number, the date and the amount, you're not going to see the name so you need to be able to see the cancelled check to know who that's to. How much time do you spend trying to find that out and figure out some of this?
I actually have a poll question for you here. I want to know how are you guys getting your paper from your clients now. Oops, wrong poll, just one second here. How do you get your documents from your clients now? Answer this poll question for me and let me know how you're getting them from your clients now. I remember back in the old days when I was doing monthly bookkeeping for clients and stuff, I remember I had my son and I would take my son and we go driving around every Tuesday and then on Friday. On Tuesday, we drive all around town picking up all these papers and documents from various clients and things. On Friday, we'd be driving around dropping things off and picking more things up. I mean, it was just very inefficient going around and picking up and dropping off and all that stuff.
How are you guys doing it now? Debra says she wants all of the above. I didn't think of it but we only have five choices on the poll question so pick the one that's most frequent for you. How are you getting these documents from your clients? How are we getting the documents from our clients? What are you guys doing? I'm going to share this with everybody else so you can see what everybody else is doing. Things have changed over the years in how we get our documents from our clients. Sometimes people don't want to see the documents at all. Go ahead and answer that poll question for me. Wendy says she does all the above as well.
Somebody says there's no section for directly going into their account and downloading it myself. Okay, [Lee 00:04:18], that would work for the bank statement but what if you need to see, say, the cancelled checks. Well, sometimes you can see those too. What if you need to see receipts? What if your client purchased a truck and you want to see the purchase agreement, see what they traded in and their down payment or something like that? What if you need things other than a bank statement? Brent says there's no option for getting them from their online account. You're right, Brent. What if you need to see documents other than bank statements, how do you get those from your client?
All right, I'm going to go ahead and close this poll and I want to share the poll results with you so you can see. 12% of you are still picking these up from the client, 23% gets them delivered or mailed to you. Look at that, that's 35% of you are still getting and dealing with visible documents, the actual paper documents. We got 32% of you, about a third, have taught your client how to scan and email them. Then 22%, they're scanning and uploading, you're using a file sharing service. Then we have 11% that put N/A, maybe you're not getting the receipts from your clients at all, maybe you're not working with clients, maybe you don't want to see the documents or something. That's interesting. Thank you for answering that poll question, that's interesting to see what you guys are doing. It looks about a third of you were still scanning and emailing them.
Let's talk about this, the pickup and delivery. First of all, it's just crazy. Why are we still getting all of these paper documents? First of all, if you have a paper receipt, let's say, from a retail store, a hardware store or McDonald's or Wendy's, what does that look like in six months from now or a year from now? It's blank, right? It's disappearing ink, it's that thermal paper and it's gone anyway so you can have a box of empty receipts. If you're getting those kind of receipts and stuff, they fade, they go away. We really do need to be saving these things electronically now. Ian says that looks like my office. You know what was really great is I recently moved and I had two four-drawer file cabinets plus I have this shelf in the closet of my office and I had a two-door file cabinet plus my desk, I had lots and lots and lots of paper. It took a long time but I'm thrilled to say I got rid of probably 90%, maybe 95% of all that paper. We just don't need the physical paper anymore, it is just not necessary.
Scanning and emailing, that was a great option, however, then you got stuff all over your email and you're searching through your email. Maybe you've setup some rules but you still have to worry about now finding it, downloading it, saving it to a folder and making sure that it's organized and then maybe attaching it to a transaction in QuickBooks. That, it's better because we're getting away from the paper when they scan and email it to us but it's still inefficient. If we want to be able to operate efficiently especially as we're all talking about going more to value pricing, we have to improve our processes and we have to operate more efficiently.
Hector: Michelle, don't forget about the security problems, the safety issues of having bank statements and checks and stuff like that in your client's email and your email, both.
Michelle: That's a very good point because email is not secure unless you're paying for an encrypted email service. That's a great point, Hector. It's not secure at all. That's a really good point as well.
Now, I know a lot of us have started using a file sharing service like, say, Dropbox or Google Drive or OneDrive or Box or SugarSync, there's a whole lot of them out there now. That might be okay because then they're not coming into your email, you can teach the client how instead of scanning and emailing it. Teach the client how to take a picture of their receipts or get those receipts together, save them in that shared folder and then you can have access to them. That might be okay but, again, that's not very efficient. Then when you're in QuickBooks, it's not attached to anything, you have to go looking for it and stuff.
There's some different methods here that we're using but we need to keep [combining 00:08:43] when we're working with our client, when we're collaborating with clients. We need to improve our efficiency and we need to work faster and work smarter and that's how we're getting into doing the value pricing and creating these packages is by improving our processes and working more efficiently. That's what we want to help you with here in the next few minutes. I'm going to show you in the new QBOA some features that are available in there. We're going to talk about that and then you're going to learn more from Jamie about things to take it a step further to really eliminate a lot of these inefficiencies and these problems as we've been talking about.
I'm going to go into the new QuickBooks Online Accountant. Now, you should be getting this soon if you don't have it already, Intuit has been rolling this out over the last six months or so. If your QBOA doesn't look like mine yet, soon it will. This is the new one, when you got this green title bar going across the top here. I'm going to talk to you about QBOA, Hector's going to talk to you about QB Desktop a little bit later.
In the new QuickBooks Online Accountant, we have a document center in here. Over here, this Alvarez Books, you can see they are QuickBooks Online clients of mine and I have some documents over here that I've requested from them. I also have down here is Long for Success. I set my company up, a pretend one, here. These are all fake companies. I set my own company up and you can see there's no QuickBooks icon here. This is not a QuickBooks Online client, maybe I only do their tax returns year in. You can have any and all of your clients listed here whether they use QuickBooks Online or not.
Here's Long for Success. Over here, you can see I have some open document request. I can use this document center here for any client that you have. Here's a request, see how it says requests and documents. Here's a request that I sent requesting some documents. When you want to request documents from your client, instead of going into your email, you can come up here and choose which user you want to send it to. You can give it a due date because if you don't give your clients a due date, they're not going to do it, they're going to drag their tails. You can come here and say, "Need statements," or whatever, "Please send." You come in here and you type in what you want. You can tell them what you need, the bank statement and maybe you need the credit card statement. You go through here and you put in here what you want. Here's a preview of what this is going to look like. Then when you click on send the requests, it will email this to your client. The nice thing is it's all contained here in your document center.
Now, let me show you what your client is going to get. Your client is going to get an email like this, it says, "Please upload this stuff," this is what we want. Look how easy this is, upload document. Hopefully, it's foolproof for your clients but some clients are still going to hit reply and they're going to attach them. The good news is no matter which way they do it, it still will get into QuickBooks [Ray 00:11:50]. Even if they reply and attach it, it will get those.
Let me go back ... Oops, wrong QuickBook. Here's some older ones that I sent. When they send them back to you, it's going to show that they've been sent and they're going to show up here in this document center. Here in the documents, you'll see I have a folder that's shared with ... This is the client user. When I open that, I can see the transactions or the things that they have uploaded. Best of all, if you have team members, let's say you have your staff or your employees or maybe you have other providers that you're subcontracting with, all of the team members who have access to this company ... You can see we got 15 employees up here that have access to this, they all have access to these documents as well.
It improves our efficiency because we're not emailing things back and forth and back and forth, it's uploading them right here into QuickBooks Online where all of our team can see the request that have been sent out, when was it sent, when's it due, has the client sent it back yet. Let's go look at a couple of other ones here where they've actually sent it back. There's some that has more here. We have two open out of five. Pinney Hardware actually had some that have been sent back. You can see at a glance ... All right, that's not a good one either but you would see the ones that have been sent back. I'm sorry, I should have picked a good example for you. You can see what was requested, what was sent back, what is still open and it's all contained in one central location. It helps improve our efficiency, it helps improve our document management and get things all together there.
There's several questions coming in here. Is this only for Accountant version? Is this available in QuickBooks Pro? This is QuickBooks Online Accountant. Hector's going to talk about QuickBooks Desktop in a little while, this is QuickBooks Online Accountant. Can the email be recurring? No, Ray, not at this time but let Intuit know, I think that's a great idea. The other thing I would like, Ray, is the ability to have a template so when I get a new client, I have a new client request that says, "Welcome. These are the things that we need," or a tax client template that says, "We appreciate you having us do your tax returns, here's the things that we need from you." I would like to have some standard templates that we can create to send out to our clients, we don't have to redo it all the time. Intuit is listening to us when we have requests like that, go up and click on the gear in the upper-right corner and send feedback to Intuit to let them know what it is you like to see improved.
It's a great start when it comes to document management. I think it helps us be more efficient than what we're doing currently but like we just talked about, there's room for improvement here, there's still a lot of areas where we could be more efficient and things could be better for it. I think this is a great first step but if you got a lot of clients and a lot of documents, I think that's where Hubdoc comes into play and it can really help improve your efficiencies and save you time. I wanted to introduce you to this in the new QBOA and then I want to go ahead and turn it over to Hubdoc. I'll answer some of your questions while Jamie is speaking and wait till you see what this can do. Because if you like some of the stuff in QBOA, wait till what Jamie's got for you in Hubdoc, it is really amazing. Jamie, are you there?
Jamie: I am here. Can you guys hear me?
Michelle: Yes, I can hear you and I can see your screen. I'm going to go ahead and mute myself and let you share Hubdoc with them.
Jamie: Perfect. Thanks, Michelle, thank you, Hector, for giving us the opportunity to talk a little bit about documents and collaboration. It's amazing seeing what Intuit's doing with the QBOA Accountant edition and those requests for documents. It's super super cool.
I think our application is that application on steroids and I'd love to share with the group what that is right now. First of all, who am I? I'm Jamie, I'm the co-founder of Hubdoc. What is Hubdoc? This sends all your financials in one place, all your financial documents in one place automatically. What does that mean? I want to talk a little bit about our vision for accountants. There's our persona of an accountant, sitting with his boxes that are empty of paper. The promise that Hubdoc makes to accountants is never ask your clients for document again. We just saw that request documents feature in QBOA which is interesting but wouldn't it be great if you have access to the bank statement automatically the second they became available. If every time your client wrote a check and post it to the bank, that was also available.
Then the second half of the Hubdoc vision is to automatically create transactions in your accounting platform and to have the source documents attached to them. A Verizon bill comes in for a client for $250, Hubdoc fetches it automatically, creates a transaction in QuickBooks and attaches the document to it for reference later. That's the vision that we're trying to execute on.
What's the benefit to accountants and bookkeepers? It's really three things. It's about productivity so being able to scale your practice with the same amount of labor and add more clients or serve a client that used to take you 10 hours per month and two hours per month. Then all of that allows you to become the advisor you want to be, a trusted advisor instead of one that's waiting for documents to arrive and you're endlessly asking for things from your clients.
Quick product overview, I'm going to show you this slide. It's a bit of a busy slide but I'll break it into two or three things. In the middle here, we pull all your historical bills and statements. Hubdoc supports 500 connections right now and we're adding five or 10 a week to financial institutions, credit card companies, utilities, telcos, software companies, you name it and I'll show you how that works.
There's other ways to get a document into Hubdoc though, for those ones that we don't support. We got iOS and Android apps so you can take a picture of that Starbucks receipt and upload it, you can forward it in via email if you got your invoices in your email and you can also scan and upload documents just by dragging them and dropping them into Hubdoc.
The last thing, a couple more points to hit on here. Collaborate with others easily, you're going to be able to invite your clients to your Hubdoc account where they only see their documents. You guys share the same document workspace, basically. You have access to the document at the same time which is super valuable.
The last thing I want to talk about is cloud backup made easy. You can store the documents in Hubdoc, you can send them to your accounting platform. If you use Box and then soon we're going to support Google Drive, SmartVault, ShareFile and Dropbox, you can also store a copy of the documents in those locations.
Just before we jump in to the demo and I'll show this screen at the end as well, one thing that we're offering for attendees of the webinar is the VIP account for you. That means one free Hubdoc account for accountants and bookkeepers. All you have to do to get it is sign up at that link and there's a checkbox saying tell us you're an accountant or bookkeeper. Our hope is that once you try it out and you love Hubdoc, that you're going to start to add your clients and all the results of that is supercharging your practice. There's my contact information but I'll show that again at the end. You can find me on Twitter @jamiemcdonald, via email email@example.com or there's my cellphone number which is 416-825-4819.
Let's jump in and show you how the product works. I'm going to log in to Hubdoc as a fictional bookkeeper or accountant rather named Homer Simpson and Homer got a bunch of clients. He's going to log in. Much like Michelle just showed you, the QBOA partner portal, we have a partner portal as well. Homer has logged in now and he's able to quickly navigate to any of his client accounts. He can add a new client account by simply putting in a company name and email address and we email that client with an invitation to set up a Hubdoc account. If you got multiple employees in your business, it's trivial to add a new user or to give your employees access to specific clients.
Let's get right into it and look at an actual Hubdoc account and I'll show you how our feeds work, our robots. This is one of Homer's clients called Duff Stadium. I'm going to add a couple of accounts and just show you what that looks like. We'll start with an American Express account. Right now, when I hit add account, what Hubdoc is doing is logging into American Express on behalf of your customer, it's checking the account, see if there's any new documents. The first time we connect, we'll download all of the available history from that website. I'll just add another one, I'm going to add Amazon so you can see what that looks like. Right now, the application is working to grab those documents. People always love that Amazon robot because you never know what the client's bought from Amazon and you need the receipts to tell you what it is. I'm going to close that.
What you'll see here is the documents start to flow in. Hubdoc automatically creates a folder called American Express. It's found one card there and it's now downloading those documents. You can see that all of the available Amex documents are there. I can actually look at my last one. There's an Amex that we've gone and gotten on behalf of that customer.
The next thing I'm going to show you is an actual bank feed. This client banks with TD. With the top 10 banks in the United States, we support what's called an enhanced feed where we get checks, a CSB once a month, any electronic transfers or payments so I'll show you that. On a monthly basis, we're grabbing a statement which automatically comes in to the account and is available to you on the first day of the month. We're also grabbing check images so every time the client writes a check, we're grabbing that from the website as well. Instead of just seeing the bank feed, the check number and the amount, you can actually see who the client has written a check to, what the amount is, what the check number is and what the [posting 00:23:54] date is.
The next thing that we support is a monthly CSB. In the event that your bank feed goes down or is not available, Hubdoc has a stored CSB file of the month's transaction that's available to you as backup should you need it. We're also supporting e-transfers so electronic transfers and electronic payments as well.
Homer is going to navigate back to his My Hubdoc account and one of his clients is a software company called Hubdoc. Now, I'm going to show you how Hubdoc integrates with QBO. I think it's important to talk about the value of Hubdoc as a standalone application. In the Duff Stadium application, you got bank statements, credit card bills, here's you see these Amazon transactions starting to flow in. If I click on one of those, the second it happened you can see that this client has bought a pair of running shoes, I'm not sure if that's deductible. The value of Hubdoc not connected to your accounting platform is immediate access to all of your client's bills and statements, automatically delivered when they're available. Then the bank feed, we support obviously statements, check images and CSB for the big banks like Wells, B of A, Chase, Citi, et cetera as well as TD.
Now, though, Hubdoc charged up and connected to QBO is really something special to watch. I'm navigating to a specific Hubdoc account and I'm going to show you what it looks like when the account is connected to QBO. We advertise on LinkedIn, there's a bill. Every night, Hubdoc logs into LinkedIn and says, "Is there a new transaction from LinkedIn?" I'm just showing you the manage account section. We've gone and coded this and said, "Any bill from LinkedIn goes to the account advertising, vendor LinkedIn," and it automatically hits one of our business credit cards. What happens when Hubdoc goes there and gets that LinkedIn document is, "Hey, there's a document for $21, let's see what it looks like in QBO."
I'm going to log in to QBO now and we'll show you what that looks like. Okay. I'm in my partner's banking transaction records, there's his credit card. If we look, LinkedIn is actually matched and there's an expense. Let's take a look at that expense, I'm going to click on it. What I'm going to find is the bills have been created under LinkedIn, the amount is $21. Don't be put off by our date and format in Canada but that's the way it is. It's coded to advertising. Then the magic thing is we've actually added an attachment to this transaction so that if I click on the actual bill from LinkedIn as [sitting 00:27:24] attached to the transaction, it's been coded properly. All you have to do is really hit that match button and you're done.
Let's take a look at a couple more examples. We're flying to a conference in, I can't remember where, Denver I think in a few days or rather at the beginning of June. I don't know where that receipt is, I'm just going to search and look for it on Hubdoc. There it is. I've emailed this in or my partner has for his trip from Toronto to Denver, it's got the amount. What Hubdoc has done with this type of ... It runs through our OCR process, we've extracted the vendor, the bill date and the amount. Since this account is connected to QBO, a transaction is automatically been created here for Air Canada. Let's take a look at that Air Canada receipt. It looks like it might be a match, let's just make sure. We're going to code this, it's coded to travel, there's the Hubdoc reference number. If I click on the attachment, there's the actual bill. This is a real example of the second component of our vision which is creating transactions automatically in your accounting platform with the source document attached. Imagine client ...
Jamie: Yeah, go ahead, Michelle.
Michelle: Can I just get you to slow down and repeat that one more time? I don't want anybody to miss that because I love that. I mean, you're right, Hubdoc is awesome as a standalone but can you repeat and tell them what you've just said again.
Jamie: Yeah. I mean, the magic, like I said, is transactions automatically created in your QBO account with the source document attached. What if there've been an error on that document, it's just a question of correcting it and then matching it to your bank feed. What we're hoping is if you got a client with 100 transactions a month, imagine if you can automate accurately 75 of those 100. Then this is really about your transition as an accountant, bookkeeper from a data entry person to a data management person and being able to shrink the amount of time it takes to serve a client on a monthly basis. That's really what we're building the app for.
Michelle: I think it's an amazing time-saver. I think this is just awesome, I absolutely love it. Can you also talk to them about setting up those rules when it sees the transaction and you're telling it which account to go to? Like on that Air Canada, how did it know to go to travel?
Jamie: Right now, our OCR system is guessing which account it goes to but we're shifting a product that we call workflow in the next, honestly, two or three weeks which will enable you to make rules by vendor so Air Canada is always travel, Starbucks is always meals and entertainment and will enable you to edit that data that we've extracted which we try and get it as right as possible but it's not always right and then push it to QBO. As it is right now, you have to trust us. When we make mistakes, you correct them.
When you have a feed set up like in that LinkedIn example I showed you or I'll show you another one, we use GitHub for a software company, you can actually set up the rule for GitHub so that it goes to the account software and then what credit card is being paid out of. Every time a new transaction comes in from that vendor, it's automatically created in QuickBooks Online.
Michelle: This is just amazing. You got a lot of people in here saying how this is the answer to their prayers.
Jamie: I love answering prayers. We feel lucky telling the story. It feels like we've been in market for the past 15 months so a year and three months and it really feels like accountants and bookkeepers, when they see the product universally are like, "Wow, I don't have to drive to a client anymore, I can get them to upload my documents."
I'll show you one more example that was came in via a mobile phone. I think my partner was parking. He used his mobile phone to take a picture of the receipt, it's $5.75 on the date of May 7th. Hubdoc has its run through [OCR 00:32:23]. Jamie took a picture with his mobile phone, the other Jamie, there are two of us, uploaded it to Hubdoc, it goes through our OCR process. Again, when I go, I see that there's the Toronto Parking Authority. I think I just click on that, waiting. There it is, Toronto Parking Authority. If I look at that, I'm seeing the transaction, should come up as parking. My connection is just a little bit slow.
Michelle: Jamie, while it's doing that, let me ask you a really quick question. Somebody said, "When we're first setting it up, how far back can you go and can we limit the time frame for historical transactions to prevent duplicate?" When you're first setting somebody up, how far back in history can you go and can you specify the period of time so that you avoid duplicates?
Jamie: That's a really good question. The answer to the question is we gather as much history as we can from the website. The first time you connect, we don't push anything to the accounting platform, we only push subsequent bills. Again, with that workflow product we're shifting shortly, you'll be able to select two or three documents that you want to publish to your accounting platform and push those manually. I can go back to that, as an example of that the Duff Stadium account where I created an American Express account. First time I've connected, it hasn't actually push anything to the accounting platform but if I wanted to set up QBO now, this particular account isn't actually connected to QBO, I would just click that box and then code how I want the Amex bill to be delivered to the accounting platform.
Michelle: This is so awesome. We had a general question about is the security good for CPAs and tax professionals?
Jamie: I can refer people to our website which talks about our security policy and how we secure it. I think versus hosting these documents onsite and keeping your passwords yourself, I think Hubdoc offers a much more secure solution. Our application was built largely by a developer and a team of developers who came from Symantec which is the largest [anti-spam 00:35:14] organization in the world, that's just the way of saying that we know security. The fact that we're hosting these documents and customer log-ins is inevitably, you know, it's a risk for us and it's something that we focus on every single day. If people want to talk more in-depth about how we handle stuff, I'm happy to get out in a phone call as we demo to individual people.
Michelle: Very cool. We have several people, like I said, saying they just love this and Ian says, "I want this yesterday." Do you have some special offers for some of our attendees today?
Jamie: Yeah. I mean, I brought up the VIP account just for you. Our special offer is anyone on the call who's actually an accountant or bookkeeper gets to use Hubdoc for free forever which is great. The way you get access to that is you simply sign up by going to www.hubdoc.com and clicking the sign up button. Note, there's a checkbox there saying, "Tell us your an accountant or bookkeeper." I mean, anyone who signs up today and checks that box will just automatically make your account a VIP account. Then if you get to it in a couple of days, you can just email support at hubdoc.com and say, hey, you listen to the QB Power Hour and you're interested in giving us a try.
Michelle: Great. Everybody should go ahead. We'll put that sign up link in there for you as well but I encourage you, as soon as we get off the webinar today, to go sign up for that because it's an amazing thing. We have some people in here saying that, "And it's free forever?" People are just loving this, this is amazing. How much does it cost the client, somebody ask?
Jamie: Sure, it's worth talking about how we charge people. The price for Hubdoc is $20 per month per client right now and we offer a wholesale price with price breaks, more than five clients gets 10% off that so 18 a month, more than 25 clients would get 20% off so 16 a month per client.
Michelle: When I think about how much time this is going to save people and how much more efficient it makes us when we're doing our job, I mean it's kind of like a no-brainer. It's a tool that is just really going to help you to do your job a lot faster as well as having everything organized in one central location where you can go find anything at any time. I think it is simply amazing. Somebody else says, "I love it. I have five clients added already and it is such a time saver. Been using it for a few months, it really does work." Two thumbs up from somebody else. Lot of excited people here, Jamie. I'm so happy that we had you on to share this with people because it is an amazing application. I hope more people will sign up and check it out and stuff.
Jamie will stick around for some more questions. Let's hear from Hector, he's going to answer some of the questions some of you have had about what about desktop. We got people asking, well, what about the desktop side of things. We do need to get Hector on here and we need to do the CPE keyword. The CPE keyword, Hector, are you ready for the PowerPoint here [crosstalk 00:38:51]?
Hector: Yes, I'm ready. Go ahead and [present there 00:38:54].
Michelle: Okay. I just pass it to you. We need to tell you the CPE keyword, it's Alejandro, little Alex. Congratulations to Hector who is the proud papa of another little boy last week. They have Alejandro. Hector, you're going to show us your screen and show us the picture, there we go. Isn't he cute? I love that picture. Write down Alejandro for the CPE keyword. Congratulations to Hector and your wife and your family, he's so so so cute. We're glad to have you joining us today, Hector. Go ahead and take it away.
Hector: Okay, all right. I'll leave the CPE keyword up so if you're not looking at the screen and you're walking around your office or whatever, just go look at the screen, write this down. Alejandro is my son's name. This was a huge fight because I wanted my name to be named Hector but I can tell a woman that just gave birth and witnessed the miracle of giving me a third child, no, so whatever my wife chooses is what it is. I love the name though, it's a really really cool name.
While I leave this up, I wanted to clarify something. I never type so much so fast as I've done in the past 20 minutes as Jamie was doing the demo in Hubdoc, there are so many questions and comments specifically around QuickBooks Desktop. I want to make sure we don't miss out the point here, Hubdoc, primarily, it's main purpose for existence, the value proposition. What makes Hubdoc unique and great is not the QuickBooks Online sync, again this is my opinion so Jamie already [his 00:40:44] opinion, I'm telling you mine. I think Hubdoc's value proposition is their document aggregation system. It's having the client put their username and password once and just once and having you, as the accountant, just log in whenever you want to Hubdoc and have a repository of documents are automatically been downloaded and saved in a place where you don't have to chase clients down for paperwork. That is the true, great, amazing value of Hubdoc.
As an added bonus, it will sync with QuickBooks Online. If you want Hubdoc to also be pushing this individual document into QBO transactions, it can do that. However, there's no mechanism in place, Intuit has never opened the ability for a developer to push attachments into QuickBooks Desktop, therefore, it will not be any useful at all to have Hubdoc sync with QuickBooks Desktop. That's exactly why it doesn't matter if you have 100 QuickBooks Desktop clients. If you work with QuickBooks Desktop clients 100% and you don't even care about QBO, you don't use QBO, Hubdoc is still a really useful tool because it is a repository, an aggregator, automatically logging in to all these banks and vendors and downloading those documents. I want to make sure I clarify that because there was just way too many questions around does it work with desktop and I want to make sure you're not feeling disappointed because of that.
Now, let me talk about document management in QuickBooks Desktop so we're talking about how Desktop manages documents that are attached to transactions. Again, if you have your client's documents beyond the cloud via Dropbox or via Hubdoc or via Box.net or via the QBOA document management system, you will not have those documents physically attached to a QuickBooks transaction. Just let me know if you cannot see my screen. I just have QuickBooks Desktop up in the screen, can you see it?
Michelle: Yes, we can see it just fine, Hector.
Hector: What I mean by that is if I was, for example, buying a computer from Apple for $500, whatever happens to be, and I wanted to click on this attach button here ... This attach feature was introduced back in 2011 and it was meant to be a web based document management system but Intuit, I think, realized this wasn't really going to work too well so they actually converted it fully to desktop based. They actually discontinued the web portion of it.
Now, all these documents that you attached to your QuickBooks Desktop are stored within your physical computer where your QuickBooks file is. Once I select the attach file button, I get to choose if I want to scan it, if I want to pull it from the document center, I'm going to show you how the document center works, or if I want to pull it from the computer. I'm going to click on computer here and I'm going to go into the desktop and just find the document that ... For example, I just happen to scan. Let's say, for example, that document right there, that's the invoice for whatever I'm buying. I'm going to attach it in there. Then once it's attached, I will get a one button up there. When I click on that, I can double-click and I can see the physical receipt that I used to buy whatever it was that I was buying.
I think for the most part, people already know this, there's really not much new there. One of the interesting things about how this system works is I wanted to show you the guts of how attach document works. I'm going to hit control 1 here [for a second 00:44:39] and I'm going to take a look at the path where physically my QuickBooks file is. I wanted to show you some of the technical nuances of how attach documents work in QuickBooks Desktop.
I'm going to browse through the folder where my QuickBooks files are, this is it right here. I'm going to look for a folder called attach. The way QuickBooks works is it creates a folder inside where your QuickBooks is, the folder is called attach. When you double-click on the attach folder, whichever QuickBooks files you have with attach documents, assuming you're managing multiple companies, each of them is going to have its own folder. I could right click in the folder itself and I could see how big it is and how many files are in there, that would all be clearly stated in there.
If I double-click on that folder, it's going to be split into two types of attachments. They have what's called a transaction attachment and a transaction attachment will be ... I'm going to pull up that check again that I wrote just now, it will be an attachment that is specifically tied to a specific transaction. That's what that TXN means is a transaction attachment. I'm going to double-click on that. Unfortunately, this is kind of a techie part. QuickBooks codifies every single transaction with this special code or address and this is how QuickBooks knows what transaction is attached to. From here, you really can't tell, literally be a guessing game for you to figure out which one it is. I'm just going to double-click on this one and I'm going to get to see, this is the actual document that was attached in there.
I'm going to show you this, it's kind of interesting. If I was to take a physical document, another document, let's say this Costco receipt here, if I was going to take this Costco receipt you're seeing on the screen and I actually manually move it into that folder ... Again, this is getting really techie and geeky into how QuickBooks Desktop functions. If I do that and I go into QuickBooks Desktop, what's going to happen is now this attachment is going to show up attached to this transaction. Now, unfortunately, QuickBooks didn't have the chance to do it itself so it's not indexed so I would have to click this button here called repair attached document links. Anytime you manually modify or add or remove a file or something like that and you go back into the attached files, now I get to see that this file is attached in there.
Now, I'm not trying to encourage you or suggest that you manually move the files in there. Obviously, the easiest thing to do is to click on attach and drag and drop it and add it from here. I'm not suggesting you go into the folder and do it that way, however, I think it is important for you to know how the mechanics work. The most important point to know about this is if you are going to move a QuickBooks file ... Let me go back here for a second. We're talking about moving the actual company file which normally gets done through a backup or something like that. Keep in mind that attachments are not stuck to the QuickBooks file itself, you also have to move this attach folder file if you're physically moving your QuickBooks file, if you're moving it to another folder or to another computer or to another server. It's important to know that this folder here also needs to be moved in order for QuickBooks to be able to pick up those attachments after the file is moved.
The other piece that's important to know is that if you have some sort of automatic backup system in your computer that takes all your files and uploads it to the cloud or sends it to external hard drive or whatever document backup system you have, make sure that you're also backing up data attach folder because all your documents are there. It's not sufficient for you to backup your QuickBooks file to be able to keep those files, you also have to backup that specific attach folder.
The other one I want to show you is the folder here called inbox. This folder called inbox is for anytime that we bring documents into QuickBooks but we're not attaching to a specific document. Let me show you how that works. If I go into the document center, right here in the company menu, documents, document center, and I upload a file or add a file here so I'm going to click on add document and I'll click one of these Barnes & Noble's receipt and hit open, what I'm doing is I'm essentially uploading it to QuickBooks. It's now in my QuickBooks Desktop document center, however, it is not attached to any transaction. This is why you're going to see the little paper clip there, letting you know that there's a transaction attached to it. What that means is by doing just an upload to the document center, it leaves it on queue or in an inbox per se.
For example, let's say the transaction comes in and I'm actually going to enter my debit card charge to Barnes & Noble's, whatever happens to be, and now I'm going to attach it. This is attaching something after it's been uploaded into QuickBooks. I click on attach and I don't have to go find it in the computer, I click on document center. I click on document center, basically all the documents are pending for me to attach to a transaction will be there. I select that and click on attach. Now, the document will no longer be in the inbox, it is now attached to the transaction itself. When I go back into my folder here and I go into inbox, you see that that PDF for Barnes & Noble's is no longer there because it's been moved from inbox to the specific transaction.
Okay, that is really what I wanted to talk to you about on the documents, try to keep the conversation on document management in an advance level and hope you actually did learn something different. I have a question here that says, "How do I attach an email?" If you have Gmail or Yahoo or something like that, you will have to save the document into the desktop and then copy it into QuickBooks. In this particular case, if you were using Outlook, you can actually drag and drop the Outlook email into the attachment and you will save the entire email. The email itself will be saved and you can always obviously reference it and that sort of thing.
Okay, I got about seven minutes left and I want to talk about the other piece of collaboration that's important which is talking about this accountant's copy and portable file and I think it's all relevant. I think the last important point I wanted to make is when you backup your QuickBooks file, when you go to backup and it creates a backup and you save it in a USB drive or Dropbox or external hard drive or the cloud or whatever, just remember that backup does not contain any attached documents, you have to physically manually go into that folder and back it up.
The other piece I want to show you actually, I didn't want to forget about this and this is kind of a trick. Let me just go back and look for that path again. If I go into this attach documents here and I look for this inbox, one of the real neat things you can do is you can grab this inbox folder and you can move it into your favorites. Basically, what that does is if I'm doing something else, let's say, for example, I happen to be browsing a document here and I want to push this into QuickBooks in a real fast way, this is without QuickBooks even being open, I basically grab this Office Depot receipt and I push it into that inbox folder. What the system will do is it will now put it in my document center.
I'm going to go into my document center to show you. Let me just do the repair again. I don't even have to have QuickBooks open and now I'm going to have the Office Depot right here sitting in my inbox folder. That's kind of an interesting piece that I wanted to talk to you about, manipulating how this folder works.
Again, I'm not suggesting that you work the documents directly into its folder, I think it is important that you know that. If you have something that's very common, we have a somebody with a scanner in the office and the scanner is programmed that when you click scan, it automatically saves it into some folder into the computer and it's typically a folder you choose. That's a great folder for you to put it in. You can actually program your network scanner to go straight into that folder. That's really much what I wanted to show you about that.
Michelle: Okay. Then, Hector, I had a question come in and I'm not sure without testing it but when you get an accountant's copy from somebody, does that include the attachments so that you could see an attached document [crosstalk 00:53:32] accountant's copy?
Hector: Right. Absolutely, without a shadow of a doubt, it does not. The accountant's copy is so small, the file itself, it is so small. It's such a small file in terms of megabytes so we're transferring via email. No documents come in through there. If you're collaborating with your QuickBooks Desktop clients and you want to use the document ... This collaboration piece in this episode has been 100% document-centric because that's the source of our work, those our working papers. If you're collaborating with a client ... I mean, he's working on your client's QuickBooks file and his QuickBooks Desktop and they have documents and you want to use your documents, the really only way you're going to be able to achieve this is by logging in remotely. There's really not going to be any other choice. With accountant's copy, that serves an entirely different purpose. I think we can put the polling question.
Michelle: Yeah, I was going to say, "Let's go ahead and close the poll question," and we're seeing your slides again now.
Hector: Accountant's copy, basically the way it works is the client chooses a division date. That division date creates restrictions, and I'm going to talk about those restrictions in a second. The copy gets sent to the accountant, this copy is called a .QBX file, that's the file format, that it is. This .QBX file is an ultra compressed version of your QuickBooks file that could actually be converted into a full working file, that's a whole another story. .QBX is a fully compressed version of the file that can be emailed or sent in a USB drive to an accountant or it can be sent into its server if the accountant has an active ProAdvisor subscription or an Accountant Plus subscription.
I'm going to finish this up. The accountant opens it and converts it to a .QBA file, that's truly what they call the accountant's copy. The accountant works on the accountant's copy which is basically with the purpose of eventually moving to ... I have to have access to be able to move the slides around, I'm not sure what's wrong with the resolution. Then once their accountant is finished with it, they're going to do something called the changes file which is a .QBY file. That .QBY file that has the changes, the customer will now import and then the restrictions are lifted.
Now, what are some of the restrictions around this? The accountant must have QuickBooks Accountant edition, it doesn't work with Pro, it doesn't work with Premier. The accountant itself needs to have Accountant edition. In this case, the client can have Pro, Premier, Enterprise, it doesn't matter. The accountant must have the current year version the same client has or one year exceeding. For example, if the client is working on QuickBooks Pro 2013, as the accountant, you can open that file in 2013 or 2014 but you cannot open it in 2015 because it will not send it back.
Let's talk about some of the restrictions that you get with accountant's copy. Well, number one, obviously the clients cannot work with any transactions before the dividing date. They can only work for transactions after the dividing date. You cannot change, edit, merge or make existing accounts inactive; however, if there's a new account created by the client after the accountant's copy was created, then the user will be able to make changes to that account but they cannot delete it. It's kind of weird type of restrictions that can be done. Any other list that's not the chart of accounts can be edited or sorted or you can make it inactive but you cannot merge or you cannot delete them.
The most important piece is if an accountant's copy is out and the customer or the client, the business owner, does reconciliations to any banks after the fact and then the accountant actually modifies any reconciliations in the accountant's copy, when those changes come back, any reconciliation that the client does gets lost. That's an extremely important piece to remember about that because it's one of the frustrating pieces.
Then the accountant can essentially convert a .QBA, an accountant's copy, to a working file and they will basically be working on in a full functional file and then the client can lift the restrictions. Then, obviously, the whole process of sending the changes over will not work anymore but you can send the journal entries. That's the last demo I like to show you is how to send the journal entries.
The pros and cons of working with accountant's copy. In my opinion, the pro is you're sort of working on your own pace, you're working with your own file and your own hardware, you don't have to deal with remote access, you don't have to interrupt the client. The con is the clients get very impatient, very frustrated with these restrictions. Sometimes they inadvertently just remove them. They just don't know what the repercussions are to the accountants, they just simply just remove them and then, basically, any work the accountant did was render useless.
The proposal I have and I typically like this better ... This is going to be my last couple of minutes. Can you just tell me if you can see my screen here?
Michelle: Yes, I can see your screen.
Hector: It's okay, it doesn't have weird resolution issues, right?
Michelle: You need to pull it up and over to the left. There you go, we can see it great. Thank you.
Hector: Okay. What ends up happening is if I am working on a client's copy of their file, I'm working on a portable file, on a backup file, on an accountant's copy that was converted to a working copy, if I create any journal entries ... Let's say, for example, I'm creating this journal entry as an accountant. I am, in fact, not changing any transactions, I'm not reclassifying any transactions, I am not moving anything around, all I'm doing as an accountant is making journal entries for tax returns or whatever. I can actually avoid using accountant's copy and all that stuff. I can basically send the journal entries straight from QuickBooks Account. Basically, the way it works is QuickBooks will now create a special file, a new file called a QBJ file that actually contains the journal entry and the client can just import it. This is, in my opinion, the best way to go about doing this.
I'm just going to save us a file here and I'm going to show you exactly how this works. I'm going to save this journal entry or a set of journal entries, I'm going to save them ... I am the accountant making adjustments to my client's file. What I'll do here is I'm going to delete it from the client's file and I'm just going to assume for a second that I am now the client, I am now working on my own QuickBooks file and this is what I was left with when I send it to my accountant.
Once my accountant is done fixing things to journal entries, I can go to file, I'll go to utilities, import and I click on import journal entries. Then I'll choose that file that the accountant created on their version of QuickBooks and I click on open here and the system will basically give me a preview of all the journal entries that are going to be imported. The user can choose which ones they want to import which that can be a whole another issue because if you're going to import some, they should import all. They'll click there and the system simply just creates a journal entry and makes the adjustments to the client's books.
Obviously, in other webinars, we talked about working remotely. That's my weapon of choice is working remotely. When working remotely is too cumbersome, you can work with accountant's copy but there's this really high chance that the client will get frustrated and undo those changes and basically it being really frustrating for you, the accountant. I suggest that if you work with a portable file and the client doesn't touch anything before that period, that you work with the sent journal entries. Michelle, I'm going to send it back to you so you can do the last two slides because of the resolution issue.
Michelle: All right, that sounds great. Thank you. There were a lot of questions in there. I would encourage people to read help in QuickBooks. If you're in QuickBooks Desktop and you click on help accountant's copy, read the details and make sure that you understand what does and does not go back. Bank reps especially, read the help in there to find out that information.
We do have upcoming webinars. The next one is on May 28th, Excel Tips for QB Power Users part two. Then we'll probably have some more collaboration tips and tools coming up in June as well. Thank you, guys, for joining us on this webinar today. Jamie, we have several questions come in. Would you like to share any last thoughts or comments with this as well?
Jamie: I've just been frantically answering questions here on the chat. We had lots of great questions. I don't think there's anything to say except sign up and give it a try. The VIP process is a manual one so just be patient with us while we upgrade your accounts. If you're interested in a demo, the link for that is booknow.so/jamiehubdoc.
Jamie: Just email support at hubdoc.com and tell us you're interested in a demo and we'll set that up. I really appreciate it, Hector and Michelle. This has been great.
Michelle: Thank you. Jamie, somebody said, "Thanks for the presentation, they look forward to trying Hubdoc." Thank you, Jamie, for joining us today. It is an awesome application and I encourage you guys all to check it out. Like he said, call him and email him and schedule up a demo so you can learn more about it. Thank you very much, Jamie. Hector, thank you. Thank you, everybody, for joining us. Hope everybody has a great day.