In order to get the highest quality conversion, there are a number of essential steps that need to be done in your system beforehand. It is essential that the source system data is in a clean and healthy state prior to conversion to avoid the migration of unorderly data.
So with the following steps, your data should be in the best shape for the conversion. Please ensure you follow the steps in the order in which they are outlined below. Each step indicates whether the procedure is mandatory or optional. An optional step can be corrected when the conversion is done.
Normally, our customers need about 20 minutes for these tasks.
Step 1: Purge your company and configure required settings (MANDATORY)
Data cannot be migrated into a QuickBooks Online Company file that has existing data contained within it. Therefore, it is important that there should be no pre-existing transactions in the QuickBooks Online company file.
If you have an existing QuickBooks Online (Canada) Company file that you have used in any way, you will need to cancel your subscription and create a new account.
For existing QuickBooks Online (UK or USA) Company file, it is important that there are no pre-existing transactions in the company file. Depending on how old the QBO file is, the file may be purged to make sure there is no data left behind. Please check the length of time that the QBO file has been active, click on the links below and carefully read the details on how to do this:
It is highly recommended to make sure there is no data in your file. It will also mean you get a cleaner conversion result (less default accounts in QBO file). Depending on the options that are supported for your conversion and the options you are planning to select, some extra settings might be required in your QuickBooks Online file.
Step 2: Make a pre-conversion backup (MANDATORY)
Make sure to keep audit data backup when switching between accounting systems for tax or any auditing purposes.
If you are coming from a system that allows backup files such as Sage 50, Reckon Hosted, MYOB Account Right, or MYOB BankLink, please keep the data backup in a safe place.
If you are coming from a system that does not allow backup files such as Xero, MYOB Essentials, or Reckon One, please export audit data reports (e.g. account transactions, tax audit reports, etc.)
Step 3: Reconcile your accounts (MANDATORY)
Reconcile bank accounts
Reconciling your bank accounts prior to conversion makes work a lot easier in QuickBooks Online.
After reconciling, make a note of the balances of your bank accounts. This information will be needed when preparing the post-conversion reconciliation in the QuickBooks Online company file.
This is also important when you are using the cash accounting scheme. Otherwise, reconciling your tax accounts will not contain accurate details (tax - VAT/GST reporting).
If a full bank reconciliation is completed prior to the conversion, the post-conversion step will be a lot easier (since all entries can be checked with only one click).
If a bank reconciliation is partially completed, then there is a need look through a lot of entries in QuickBooks to uncheck them. Both processes are supported but reconciliation before conversion can save time.
Reconcile tax (VAT/GST) accounts
Reconciling your tax accounts prior to conversion makes work a lot easier in QuickBooks Online. This is due to QuickBooks Online using only one (VAT/GST) control account, as opposed to a control account for Sales Tax/Purchase Tax/VAT Liability.
Step 4: Clean up nominal codes (Optional)
There are several accounts you need to clean up prior to the conversion. This will make the post-conversion results easier to check and will ensure that there is no unneeded data in the new system:
- Suspense account: The suspense account is used when there is no way to determine where the transaction belongs. These transactions need to be classified to the right accounts after conversion.
Step 5: Match entries (Optional)
For the best quality conversion, we advise you to match all your outstanding payments/sales on accounts to their respective invoices. If you do not match these, they will be brought over as journal entries to close the conversion, and you will have to match them manually post-conversion.
Also, when these entries are brought over as journal entries, your historical A/P and A/R might not be correct. The converted balance of A/P and A/R will always be correct, however, some entries will appear in QuickBooks under the wrong column (ie. might show as 30 days overdue when in reality they are 60 days overdue). The same goes for credit notes; apply these to the corresponding invoices to get a better quality conversion.
Step 6: Continue with your system specific pre-conversion checklist (MANDATORY)
Check the articles on the right hand side in the Related Articles section or check in our Knowledge Base - Pre-conversion category section.