Conducting a Profitable QuickBooks Setup Engagement

One of the most common QuickBooks engagements we perform is the setup of our client's QuickBooks data file. This setup includes installing the software, configuring the Chart of Accounts and other lists, and entering opening balances. The engagement also commonly involves setting up inventory, sales tax and payroll.  Though this engagement sounds very straightforward, the condition of the businesses' financial information and their unique reporting and bookkeeping needs can complicate the setup, making it very time consuming and unprofitable.

Below are some strategies for protecting yourself from under-billing the setup engagement:

1. Conduct a thorough interview before you begin work on the client's setup. Asking questions about their use of Inventory Items, Sales Tax Items, and Payroll (including how many people the company employs) will help you to project the amount of time required to perform the setup engagement.
2. Ask for a complete list of information required to perform the setup engagement before you begin work. Make sure the client understands the distinction between after-the-fact accounting support (i.e. write-up services) and the setup of their QuickBooks data file. If the client needs help compiling their opening balances, conduct a separate engagement to provide this assistance.
3. Define the scope of the engagement and use an engagement letter to clearly communicate this scope. Make sure the client understands the following limitations, at a minimum:
   
   
   1. Setup of the Accounts Receivable feature includes the entry of no more than 15 outstanding Invoices
   2. Setup of the Accounts Payable feature includes the entry of no more than 15 unpaid Bills
   3. Setup includes the customization of only one sales form template. Additional sales form customization will involve additional fees.
   4. Setup does not include the customization of management reports specific to their business. Conduct all report customization as a separate engagement.
   5. Setup of the Inventory feature includes the entry of no more than 15 Inventory Items.
   6. Setup of the Sales Tax Feature includes the setup of no more than 15 Sales Tax Items (an issue in only certain states like Arizona, Georgia, and Louisiana)
   7. Setup does not include the integration of QuickBooks with other software solutions (e.g., QuickBooks POS or solutions available through the Intuit Developer Network). If the client needs to integrate QuickBooks with other solutions, perform this service as a separate engagement.
      
      
4. Have clients pre-pay for the engagement, or collect payment at the time that you perform the services.
5. If you value bill the service, bundle at least one hour of telephone support into the price of the engagement. The client will probably call you for assistance after the engagement is over whether or not they pay for the telephone time. Bundling this fee into the price of the engagement encourages them to pre-pay for these services, increases your profitability and sets the billing guidelines for all telephone support you provide the client in the future.
6. Retain copies of the clients' data file for use as templates when setting up additional clients. For example, when you setup a legal firm, you will create many special accounts and items specific to their industry (e.g. Trust Payable). Retain a copy of the client's data file, delete all opening balance transactions, and use this file as a starting point when setting up legal firms in the future.

The Sleeter Group offers comprehensive technical and engagement management information to assist you when setting up your client's QuickBooks data file. For technical information see The Sleeter Group's Consultants Reference Guide.