How to Set Accounting Preferences in QuickBooks 2011
You can specify how QuickBooks works for you by setting preferences. In fact, much of what you do when you run the QuickBooks 2011 EasyStep Interview (when you set up QuickBooks) is provide information that QuickBooks uses to set your preferences.
For example, if you indicate that you charge customers sales tax, the EasyStep Interview describes how sales tax should work for your business by using the sales tax preferences.
The My Preferences tab of the Accounting Preferences set provides a single option: You can tell QuickBooks you want it to autofill information when recording a general journal entry.
The Company Preferences tab provides the following five general accounting check boxes as well as closing date settings.
Use Account Numbers: The Use Account Numbers check box, if selected, enables you to enter an account number for a transaction.
Require Accounts: The Require Accounts check box, if selected, tells QuickBooks that you must specify an account for a transaction.
Use Class Tracking: The Use Class Tracking check box lets you tell QuickBooks that you want to use not only accounts to track your financial information but also classes. You may track expenses by using categories such as wages, rent, and supplies. Classes, therefore, provide you with a way to track this information in another dimension.
Automatically Assign General Journal Entry Number: This check box tells QuickBooks to assign numbers to the general journal entries that you enter using the Make Journal Entry command. You want to leave this check box selected.
Warn when posting a transaction to Retained Earnings: This check box tells QuickBooks to display a warning message whenever you or someone else attempts to directly debit or credit its retained earnings account.
Date Warnings: The Date Warning boxes tell QuickBooks to warn you when you or someone else enters a transaction with a date too far in the past or too far into the future. You also want to specify how many days is too far into the past or too far into the future.
Closing Date settings: The Closing Date box lets you identify a date before which your QuickBooks data file can't be changed. In other words, if you set the closing date to December 31, 2010, you're telling QuickBooks that you don't want any changes made to the QuickBooks data file before this date.
Past versions of QuickBooks also let you turn on and off an audit trail feature by using the Company Preferences tab of the Accounting Preferences. However, since 2007, QuickBooks provides an always-on audit trail, so you don't see an Audit Trail check box in accounting preference any more. An audit trail, by the way, simply keeps a list of who makes which changes to transactions. Accountants, predictably, love audit trails. Audit trails enable someone, such as your CPA, to come in after the fact and figure out why an account balance is what it is.