Migrating from Quickbooks to Zoho Books is no easy feat especially for someone that is not a bookkeeper nor an accountant. I highly recommend you get familiar with COGS and Expenses by collaborating with your bookkeeper and perhaps optimizing (renaming) categories that are more geared towards your business needs than default QB or Zoho Books ones or whatever your bookkeeper chose.
Warning! Coding expenses in Zoho Books is not a viable option right now if you are trying to import expenses in bulk because Zoho Books does not accept CSVs with negative values. We have this as a feature request with Zoho Books. No ETA as of now. And really no plans even a year from now, possibly ever.
Request the Detailed P&L Report from your Accountant or Bookkeeper
This is where you start to analyze the P&L data from a business owner’s perspective and validate whether it’s correct. For instance, there were issues on how certain items on the P&L were categorized. The monthly subscription services my business subscribes to assist other businesses in their backup, virus protection, etc were being categorized as Office Supplies when really it’s a COGS. You can view our “categorizing transactions” post for our comprehensive list of the item’s bookkeepers track and code. Look for the following:
- Expense Categories
- COGS
- Fixed Assets
Make Adjustments on Categories and Duplicate in Other Systems
Some business may have a robust expense tracking system for tracking all expenses. Make sure you duplicate the agreed upon P&L categories in not only the expense tracking system but the bookkeeping system you are migrating to.
Preparation for Migration of Expense Data
The great thing about Zoho Books is they really do consider the client’s feedback and fast-track good ideas from their clients. To create or edit categories, I went into Zoho Books under Account -> Chart of Accounts. Note: Change to “all accounts” on the drop down or search for the expense category you are looking for. This step was recommended prior to encountering the importing of CSVs major road block. Locked expenses can be edited while new expenses can be created.
Make a list or correct category names for editing and creating your expense names
Defer to our list of categories for streamlining expenses across platforms such as Quickbooks, Divvy, and Zoho Books. Remember that some of those expense categories are COGS and need to place in the correct account.
Zoho Books Expense Account – Cost of Goods Sold:
Expense Category – COG
Note: Anything that you are reselling is COGS and would NOT be an expense. Remember that anything that is the “Cost Of Goods Sold” is not expensed. See blog post on categorizing transactions for more details.
- COG – Materials & Hardware *
- COG – Software for Resale – SaaS Stack
W2 are true EXPENSE not COGS – 1099 Subs are COGS
Zoho Books Expense Account – Expense Categories
The following categories were either renamed or created in Zoho Books.
- Advertising and Marketing
- Assets
- Automobile Expense
- Bad Debt
- Can’t delete but can edit > Finance Charges
- Bank Service Fees and Charges
- Consultation Expense
- Can’t delete but can edit > Professional Service & Legal Fees
- Continuing Education – Training *
- Credit Card Charges
- Can’t delete but can edit > Continuing Education – Training
- Depreciation Expense
- Can’t delete but can edit > Domain & Hosting
- Domain & Hosting *
- Dues & Subscriptions (SaaS) * Need to re-categorize some existing charges on here
- Finance Charges *
- Hardware-NFR *
- Insurance *
- IT and Internet Expenses
- Can’t delete but can edit > Dues & Subscriptions
- Janitorial Expenses
- Can’t delete but can edit > Hardware – NFR
- Lodging
- Can’t delete but can edit > zzz
- Meals and Entertainment *
- Miscellaneous (Already existing category: Other Expenses) *
- Office Expense Supplies – IT Supplies *
- Other Expenses (Might match with: Miscellaneous)
- Parking & Tolls *
- Payroll Fees *
- Payroll Taxes *
- Postage & Delivery *
- Printing and Stationary
- Can’t delete but can edit >
- Professional Services & Legal Fees *
- Rent Expense & Lease *
- Repairs and Maintenance *
- Salaries and Employee Wages
- Can’t delete but can edit > Wages
- Subcontracted Services *
- Taxes & Licenses *
- Telephone *
- Travel Expense *
- Utilities
- Wages *
Divvy Transactions
Divvy doesn’t care what we code. It’s all very flat when we import into the CSV.
Fixed Asset
This is an expense account field in Zoho Books. Should I have a code for this in Divvy?
It is not an expense – it is an asset – No need to create at this time
- Furniture and Equipment
We bought one of my team members a fancy office chair. That obviously sounds like “furniture and equipment” but does a new Dell computer qualify under that same category or is that “office expense – IT supplies”? Finally, how much other equipment is also consider under “furniture and equipment” ? A printer, a web cam, a monitor, a docking station or are these all office expense – IT supplies”?
We bought one of my team members a fancy office chair. That obviously sounds like “furniture and equipment” but does a new Dell computer qualify under that same category or is that “office expense – IT supplies”? Finally, how much other equipment is also consider under “furniture and equipment” ? A printer, a web cam, a monitor, a docking station or are these all office expense – IT supplies”?
When to use Vendors
Vendor names are also created for subcontractor and W2. How do I keep track 1099? That’s in the COGS section.
Step 1) Try to create a transaction in Zoho and see if it prompts to create a vendor. Example: record 1099 Blake $400 invoice as COGS (this is not an expense. It’s COGS or a subcontractor expense)
W2 are true EXPENSE not COGS – 1099 Subs are COGS
“A vendor is required to create bills, purchase orders”
- Q: Do internal operations SAAS under Office Supplies require a vendor name? A. No they don’t. See vendors names…
o Autopay is current set up with these vendors
- Is there an exercise in books where clicking is required to pay a bill for each month’s invoice
- Or is this an automated system? A. We simply export all coded Divvy expenses. They are not vendors in the bookkeeping sense of things. They are just another categorized expense
- Vendor names are created for subcontractors and W2 employees (not 1099-COGS) W2 are true EXPENSE not COGS – 1099 Subs are COGS
- SAAS resold is a COG
o COGS are not an expense. See blog post on categorizing transactions for more details.
Quickbooks Migration to Zoho Books Game Plan
Zoho Books always defers to the links below but the best game plan is start a new instance of Zoho Books and clear out all recorded expenses in Zoho Books if you don’t have much expenses in Zoho Books to begin with. Then performing an import expense from Quickbooks from last year. This avoids duplication.
https://www.zoho.com/us/books/help/migration/quickbooks-online.html#prerequisites
https://www.zoho.com/us/books/help/migration/quickbooks-online.html
Migrating from Quickbooks to Zoho Books Summary
Coding expenses in Zoho Books is not a viable option right now if you are trying to import expenses in bulk because Zoho Books does not accept CSVs with negative values. This makes no sense given that we all have business expenses and expense refunds that are both negative and positive values as illustrated in this CSV export from Chase. Same issue with my CSV from my expense management system Divvy. I expect the same issue to pop up again when some attempts to migrate away from Quickbooks.
Below is Zoho Books support explanation for the workflow blunder. BTW – – VE means negative values
“Let me explain this for you. Currently we don’t allow to post transactions with -ve amounts for all the modules. There can be line items with -ve values but the total of the transaction should be 0 or a +ve value.
In general, if invoices increases AR you can post credit notes to reverse it.
Likewise, you can add an expense and post an expense refund as a reverse entry.
As mentioned, we will take it as a feature request to post -ve expenses in Zoho Books. We will definitely forward it to our developers and ask them to prioritize it. At the moment, we will not be able to commit an immediate timeframe for this request. Sorry to disappoint you on this front.”
While I like Zoho Books support, there solution does not keep practicality in mind. They want me to manual record an expense refund and flip the negative to positives transactions in my CSV.
