Is your QuickBooks file telling you the truth?

Every check below is one you can run yourself in a few minutes. None of them need an accountant, and none of them need me. Work down the list and tick anything that is true of your file.

1. Undeposited Funds has a balance sitting in it

   Where to look: Reports → Balance Sheet, look for Undeposited Funds.

   This account is a waiting room. Money lands there when a payment is recorded and leaves when it is matched to the deposit that actually hit the bank. A balance that only grows means payments were recorded but never matched, and your income is being counted twice.

2. Opening Balance Equity is not zero

   Where to look: Reports → Balance Sheet, under Equity.

   This account exists only during setup and should be emptied once. Anything left in it is a setup entry nobody ever assigned to a real account. It is one of the fastest ways to tell a file was set up in a hurry.

3. Uncategorised Expense, Income or Asset has real money in it

   Where to look: Reports → Profit and Loss and Balance Sheet.

   These are the accounts QuickBooks uses when it does not know what something is. Every dollar in them is a transaction nobody sorted, which means your reports are wrong by exactly that amount.

4. Your last reconciliation had a discrepancy

   Where to look: Reports → Reconciliation Discrepancy Report.

   A reconciliation should tie to zero. If one was forced to balance with an adjusting entry, the underlying difference is still there, now buried under an entry that makes it harder to find.

5. There are uncleared transactions more than 90 days old

   Where to look: Open a reconciliation and look at the oldest uncleared items.

   A cheque that never cleared after three months usually did not exist, was voided outside QuickBooks, or was entered twice. Old uncleared items are the single most common reason a bank balance never quite agrees.

6. Accounts Receivable shows invoices you know were paid

   Where to look: Reports → A/R Ageing Summary.

   Payment received but never applied to the invoice. The customer thinks they paid, your books say they owe, and you either chase someone who paid or write off revenue you already earned.

7. Accounts Payable shows bills you know you settled

   Where to look: Reports → A/P Ageing Summary.

   Same problem in reverse, usually from paying a bill by cheque or card without matching it to the bill in QuickBooks. It overstates what you owe and distorts every cash forecast built on it.

8. An asset or liability account has a negative balance

   Where to look: Reports → Balance Sheet, scan for minus signs.

   A negative bank balance you did not actually overdraw, or a negative loan, means transactions are posting to the wrong side. It is nearly always a sign of miscoded entries rather than a real position.

9. Your chart of accounts has duplicates or accounts nobody can define

   Where to look: Settings → Chart of Accounts.

   Two accounts for the same thing splits your reporting in half. If nobody can say what an account is for, nothing coded to it can be trusted, and it usually got created on the fly while matching a bank feed.

10. There is a gap or an overlap in your bank feed history

    Where to look: Compare the transaction list against your statements, month by month.

    When a feed drops and is reconnected later you get either missing weeks or the same transactions imported twice. Both are invisible until you look, and both make every report after that date wrong.

11. Personal spending is mixed into business accounts

    Where to look: Scan the expense detail for anything you would not defend to a lender.

    Not necessarily improper, but it means the business cannot tell you what it really earns. It also makes the numbers useless for a loan application, a sale, or bringing in a partner.

12. Sales Tax Payable has a balance that never moves

    Where to look: Reports → Balance Sheet, under Liabilities.

    Tax collected but not remitted, or remitted outside QuickBooks and never recorded. Either way the liability on your balance sheet stops matching reality, and this is the kind of error that compounds quietly.

Nothing ticked yet.

If the check turns up more than a couple of these, the fix is usually catch-up and cleanup rather than a monthly service, and it gets quoted as its own project.

If you ticked more than a few

None of this is unusual. QuickBooks rarely breaks loudly; it drifts, and a file that has been running for a few years without someone watching it will almost always show three or four of these. The point of the list is that it is specific: you now know what is wrong rather than just suspecting the numbers are off.

Plenty of owners work through this themselves, and if you want to, the list above is genuinely all of it. If you would rather not, QuickBooks cleanup is what fixing this looks like as a scoped, flat-fee project, and telling me what you ticked is the fastest way to get a quote that is not a guess.

Before you start fixing anything

Two things worth knowing. First, do not delete transactions to make a balance go away. It almost always breaks a reconciliation somewhere behind it and turns a small problem into a long one. Second, if the file covers a year you have already filed a tax return on, changes to that period can put your books out of step with your return. That is a conversation for your CPA before, not after.