QuickBooks Online (QBO) Data Setup Suggestions

Below are some general guidelines on how to setup QBO for a construction or engineering firm with the intention of integrating it with Sage Construction Management. A PDF Download is also available which includes similar instructions.

QuickBooks Online Data Setup Suggestions and AccountingLink Overview

Contact Management - Customers, Vendors and Employees

Importing Vendors and Employees

Since AccountingLink can import Active Customers, Vendors and Employees from QBO, it is generally a good practice to review each list in regards to their status. For example, if a vendor is no longer used then it should be marked inactive in QuickBooks before performing the import function within the AccountingLink.

Auto Link QBO Customers and Vendors with Sage Construction Management Companies:

Sage Construction Management and QBO Awarded Job Setup

Sage Construction Management does not offer a Customer | Sub Customer import option which is why existing jobs should be completed in QBO. However, newly awarded projects should be setup in Sage Construction Management and then exported to QBO. The client referenced in the Prime Contract will become the Customer and the combination of the Project and Prime Contract numbers will be the Sub Customer in QBO.

Recommended Chart of Accounts

Account Type	Account Description	Comment
Bank	Checking Account
Accounts Receivable	Accounts Receivable
Other Current Asset	Retentions/Holdback Receivable	This account should be created if Prime Contract Invoices Retainage (ie Holdbacks) will be tracked in the accounting system.
Accounts Payable	Accounts Payable
Other Current Liability	Retentions/Holdback Payable	This account should be created if Sub Invoices Retainage (ie Holdbacks) will be tracked in the accounting system.
Other Current Liability	Sales Tax Payable	Potentially, there could be multiple sales tax payable accounts such is in the case or each region in Canada (ex. GST, PST, HST) or sales tax authority in the US.
Credit Card	Credit Card Name (ex. AMEX, VISA, MC)	Potentially, there could be multiple credit card accounts: one for each type of card.
Income	Construction Income	Cost Code Service Items would reference this account for the purpose of exporting Prime Contract Invoices.
Expense or COGS	Construction Expense	Cost Code Service Items would reference this account for the purpose of exporting Bills, Sub Invoices and Employee Misc. Expenses. Alternative to this account would be expense accounts for each resource: materials, labor, equipment, sub, and other.

Service Items - For Cost Codes

The Golden Rule of Job Costing is to have a master list of cost codes for categorizing work. These standard cost codes would be used by estimating, project management and accounting staff so information can flow easily between departments. To facilitate integration between Sage Construction Management and QBO, these cost codes would be entered as Service Items and reference expense and income chart of accounts as shown in the images below. Rules can then be established in the AccountingLink Sync Preferences area to determine how items should be set.

Importing Industry Standard Classification Systems

Click here for options and instructions.

Tracking Expenses By Cost Code and Resource Type (Material, Labor, Equipment, Sub, and Other)

Service Items in QBO do NOT need to have a resource identifier (ie Material, Labor, Equipment, Sub, and Other) since Sage Construction Management will track financials by job cost code and resource type. Thus, in the example below cost code 02000 or 03000 would be the only item needed if construction expenses and income will be tracked by type of work.

Example Item with Resource Identifier:

02000 Sitework
- 02000-M Sitework Materials
- 02000-L Sitework Labor
- 02000-E Sitework Equipment
- 02000-S Sitework Sub
03000 Concrete
- 03000-M Concrete Materials
- 03000-L Concrete Labor
- 03000-E Concrete Equipment
- 03000-S Concrete Sub

Service Item - For Missing Cost Code in QBO

If a master cost code structure will be setup in Sage Construction Management and QBO, the AccountingLink needs to have a "backup" item just in case the Sage Construction Management project cost code does not exist in the accounting system.

The construction unclassified or backup item needs to be set as the Default Item for AP, AR and Time Tracking within the Sync Preferences form. See image below for more details.

Service Item - For Exporting Bills, Sub Invoices and Misc. Expenses That Have Tax (US ONLY)

Since QuickBooks Online's Bills feature does not support Tax Codes, Sage Construction Management will add a line item to represent tax so the total is the same in both systems.

Item Name: AP Sales Tax: AP Sales Tax
AP Account Reference: Construction Expense
AR Account Reference: Not Applicable

Service Item - For Retainage (ie Holdback) Tracking

Applicable if Retainage (ie Holdbacks) for Sub Invoice and Prime Contract Invoices will be tracked in QuickBooks.

Click here for more details.

Classes

Classes are applicable to the AccountingLink for QBO and can be used for categorizing transaction details. If this feature will be implemented in QBO and used in conjuction with Sage Construction Management, then these type of records should either represent a resource (ie materials, labor, equipment, sub and other) or match a particular Sage Construction Management Project Classification system (see Sage Construction Management | Settings (gear icon) | Features tab | Lead and Project sub-tab).

In QBO, please do the following.

Go to Global Settings | Accounts and Settings | Advanced | Categories
Track Classes: Turn 'On'
Assign Classes: Select 'One to each row in transaction'
Optional: Track Locations: Turn 'Off'
Optional:
1. Go to Global Settings | Accounts and Settings | Advanced | Projects
2. Organize all job-related activity in on place: Turn 'Off'

Duplicate Prime Invoice Number Warning

In QBO, please do the following.

Go to Global Settings | Accounts and Settings | Sales Settings
Custom Transaction Numbers: Turn Off