Business Questions

Carl Parrish cparrish@pcl-enterprises.com
13 Dec 2002 18:47:57 -0700


Thanks Conrand, 
That helps *alot*. New question my CPA uses QuickBooks. how hard is it
to import / export data between the two apps? I guess worst case I could
simple make a hard copy of my reports send them to him then he would
send me back a hard copy with any changes he's made. However I think it
would be much eaiser if I could simply email him a file. Speaking of
which does gnucash support anyway of transfering info in a gpg or pgp
format? I don't think the rpm I installed has OFX support. How would I
know for sure?

Carl P. 

On Fri, 2002-12-13 at 18:14, Conrad Canterford wrote:
> On Sat, 2002-12-14 at 10:45, Carl Parrish wrote:
> > For instance since I'm trying to track four companies
> > should I set up seperate AP/AR for each company? Can I share Vendors
> > across Companies? Sometimes I have to Invoice a Client from two
> > different companies. Should I just create separe invoices? If you were
> > tracking business expenses would you create separte accounts for each
> > company? Is there a good reason why phone and cable aren't listed as
> > utilities? For company utilities would you list them as vendors or
> > simply set up new accounts for them?
> 
> Carl,
> A lot of how you answer these questions depends on your specific
> requirements and what you'd like to achieve.
> 
> You have three alternatives that I can see:
> 1. You could set up completely independent accounts for each entity - by
> this I mean you'd have files: accounts-coy1, accounts-coy2, etc. This
> would keep them all independent and would give you very good details on
> what each companys figures are, but has the disadvantage that the files
> won't interact with each other, and you can't share anything between
> them. Gnucash is not set up to deal with this sort of thing, although it
> may happen in the future.
> 
> 2. You could set up one gnucash file, but duplicate the account
> structure within it. So, you'd have: Assets:Bank_accounts:Coy1, and
> Assets:Bank_accounts:Coy2, etc; and: Income: Coy1, Income:Coy2, etc.
> There are actually two approaches within this. The way I do it (I have
> one company with 3 divisions) is as I describe above - 1 Assets top
> level account, and then the divisions have their own sub-accounts. The
> other alternative (which will give a better picture of things, in my
> mind) would be to have seperate Asset, Liability, Expense, Income, and
> Equity top level accounts for each company. Both work much the same way,
> it just a matter of how its structured.
> Using this approach, you can share Vendors, Customers, etc between the
> companies (as far as gnucash is concerned, there is only one set of
> books, and the companies are just an organisation you've applied to the
> accounts). The disadvantage is that it is very easy to "cross-over" by
> accident - Income:Coy1 gets deposited to Bank_Account:Coy2 due to
> clicking the wrong account in a moment of brain-fade. Chasing these
> sorts of mistakes can be a real pain (trust me... ). However, if you're
> careful, this approach works very well in my experience.
> 
> 3. You could just have one consolidated set of accounts, and not
> diferentiate between the companies at all. This has the advantage of
> simplicity, but that is also its disadvantage - you cannot (easily)
> differentiate between the different companies, and if that is important
> to you or is possibly going to be important in the future (for tax or
> other reasons), I'd strongly advise against it.
> 
> There is a fourth alternative, really - a combination of 2 and 3, which
> is how my accounts work. I have common bank accounts between bits, and
> some shared expenses. Since I have only one top level account in each
> class, I can mix and match these quite easily and it all works.
> 
> Now, to some of your specific questions:
> Invoicing one client between two companies - I'd strongly recommend two
> invoices if you really do run them as separate entities. Keeps the two
> seperate in the customers mind, and makes allocating the payments to the
> different entities much easier (since the customer pays the invoice for
> each entity seperately).
> 
> A/R and A/P - much the same answer as with invoices really. If they're
> seperate entities, keep them seperate in the accounts.
> 
> Phone and Cable - They're just sample accounts, and whoever set them up
> for some reason didn't categorise them that way. You'd be best checking
> with your accountant to see in which way they classify them, and then
> follow that (saves on confusion later).
> 
> Vendors for company utilities - Strictly speaking, most of the time
> these are actually accounts payable and should probably be treated as
> such, but the proviso on that is that it really depends on how your
> accounts are done (there are tax implications, in Australia at least).
> Check with your accountant.
> 
> Hope that helps. Its long and detailed, hope it all makes sense. Feel
> free to ask further questions on gnucash-user if you need to.
> 
> Conrad.
> 
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-- 
Carl Parrish <cparrish@pcl-enterprises.com>
PCL Enterprises