QUICKBOOKS BANK FEED: THE NAMING ALGORITHM IS KEY

We continue our quest toward building a Business Management practice that is leveraged with automated accounting and bookkeeping. The more that we can automate the inner workings of the back office, the less that we will incur in labor costs and the lower will be our fees.  Since my last post we have fiddled with the vendor naming algorithm in the Quickbooks data feed application. We are learning a few tricks here and there with the naming rules. And with these tweaks we are seeing a substantial boost in the percentage of client transactions that require no editing when downloaded into QuickBooks. The percentage of transactions that are complete upon download (meaning that the bank feed name has been properly matched to the QuickBooks vendor name and then auto-coded to the proper expense category) is approaching 75%, especially for those clients having a routine and predictable monthly spending pattern (I.e., they tend to frequent the same restaurants, gas stations, doctors, department stores, etc.).

The new QuickBooks data feed program, introduced with QES 14, is a substantial improvement over the previous versions. The layout of the spreadsheet is user-friendly and provides useful statistics on the composition of the transactions, identifying the number that are deemed "complete" and those that require additional editing.  The overall graphical interface and color coding is quite helpful.  And the application provides the familiar customization that is a hallmark of Quickbooks including the ability to sort the bank feed data by any of a number of criteria.  We find that sorting the transactions by vendor name is particularly productive as you get an immediate snapshot of the overall composition of the data. In future blogs we will discuss some of the tricks that can further speed up the coding of transactions.

With the impressive speed and accuracy of the QB bank feed application, there is clearly no justification for the manual entry of banking or credit data into QuickBooks. The bank feed application drastically cuts the number of labor hours required to record financial activity. For clients with substantial credit card and banking activity (i.e., 400 transactions or more per month), the bank feed will turn a 4 - 8 hour project into a 30 - 60 minute project. And the program eliminates human error (transpositions, incorrect dates, decimal placement errors, etc.)

In the face of this user-friendly, time-saving, productivity-enhancing software, why do bookkeepers and accountants continue to endure the tedium and frustration of manual data entry?  When I ask around the universal response I get is: it just ends up being easier to manually enter the data. This is absurd and flies in the face of logic. It is not possible for manual data entry to be just as fast as electronic data import. We are saving dozens of hours a month by using the bank feed.  Habits are hard to break and manually entering data is, I suppose, a habit.  We all get stuck in a comfort zone and gravitate toward what is familiar.  There is a learning curve with any new application, but the Quickbooks data feed is about as user friendly as a program can be.  I am confident that anyone who uses the application for a couple of accounting cycles will realize the benefits and see the light.  Firms that continue to plod along with an archaic approach to data entry will eventually face a day of reckoning. They either adopt technology of the 21st century, or they see their profit margins shrink from wasting expensive labor hours on unnecessary and time consuming work. The Robo-bookkeepers are marching forward and are in no mood to turn back.