The 3 Subscriptions Available for QuickBooks Online - dummies

The 3 Subscriptions Available for QuickBooks Online

By Elaine Marmel

QuickBooks Online (QBO) and QuickBooks Online Accountant (QBOA) fall into the category of Software as a Subscription (SaaS). As such, you don’t buy the software. Instead, you rent it; that is, you buy a subscription to use the software.

Traditionally, you buy a license to use software that you purchase and install on your computer, and typically, that license permits you to install the software on only one computer.

And, of course, a client can pay varying amounts for a subscription, depending on the subscription level she purchases.

QBO is available at three different subscription levels, and each subsequent subscription level costs more and contains more functionality. The QBO subscriptions available at this writing are

  • Simple Start

  • Essentials

  • Plus

Use the following information to identify the lowest subscription level that will meet your requirements. At this point in time, you can upgrade to a higher level, but you cannot downgrade to a lower level.

Accounting professionals signing up clients for QBO and creating client companies can’t switch client companies from one version of QBO to another if the accounting professional creates the client as part of the Intuit Wholesale Pricing program.

If you anticipate that your client might need more advanced features like the ability to track inventory or prepare 1099s, Intuit recommends that you sign up that client for QuickBooks Online Plus. If your client does not need those features now but might in the near future, consider letting your client be billed directly for QBO when you set up the company.

If an accounting professional creates a client QBO company outside the Intuit Wholesale Pricing program, the QBO company can be upgraded as necessary.

The Simple Start version

The most basic level of QBO is the Simple Start version, which is for those of you who have only one person who will use QBO. The Simple Start version is great for a new business with basic bookkeeping needs; with Simple Start, you can create an unlimited number of customers, estimates, and invoices, track expenses, and print checks, but you can’t track bills due in the future because the Simple Start version doesn’t include any Accounts Payable functions.

One other important consideration: The Simple Start version also has no general ledger.

The Simple Start version allows two accountants to work in the client’s company, but because the Simple Start is designed for a single user, the accountant cannot create the client’s company for the client. At the time the company is created in QBO, whoever creates the company becomes, in QBO parlance, the Master Administrator.

In addition to the single-user restriction, the Simple Start version offers fewer reports than other versions do, but those that it does offer include the following:

  • Account Listing

  • Balance Sheet

  • Profit & Loss

  • Statement of Cash Flows

  • Sales by Product/Service

  • Sales by Customer

  • Customer Balance Summary

  • Taxable Sales

  • Accounts Receivable Aging

  • Collections Report

  • Check Detail

  • Transaction List by Date

  • Reconciliation Reports

In addition, Simple Start users can memorize report settings and produce memorized reports.

For other subscription levels that support multiple users, the accountant can create the company for the client and then transfer the Master Administrator role back to the client.

The Essentials version

The Essentials version of QBO includes all the features found in Simple Start and as well as the following:

  • The addition of Accounts Payable functions

  • The ability to automate invoicing on a schedule

  • The ability to create and post recurring transactions

The Essentials version permits three simultaneous users and two accountant users. In addition, the Essentials version contains all the reports found in Simple Start, along with the following reports:

  • Profit & Loss Detail

  • Company Snapshot

  • Company Scorecard

  • Customer Balance Detail

  • Income by Customer Summary

  • Unbilled Charges

  • Accounts Payable Aging

  • Unpaid Bills

  • Bill Payment List

  • Vendor Balance

  • Expenses by Vendor

  • Terms Listing

  • Product/Service List

  • Payroll Summary by Employee

  • General Ledger

The Plus version

The Plus version of QBO is the most full-featured version of QBO. It contains all the features found in the Essentials version along with these additional features:

  • Purchase order tracking

  • Inventory tracking using the first in, first out (FIFO) inventory valuation method

QBO supports light job costing needs, but it does not allow you to automatically cost labor. QBO also supports light inventory needs: If you sell finished goods, QBO should be able to manage your needs. But if you need to assemble finished goods to sell, QBO won’t meet your needs on its own. You can look for an app to supplement your inventory needs:

  • Unlimited time-tracking and report-view-only users (users who can access only Time entry screens and reports).

  • Track profitability by class and location. You can assign only one location to a transaction, but you can assign multiple classes to a transaction.

  • Create budgets, and you can create multiple budgets per year, location, class, or customer.

  • Track, create, and send 1099-Misc forms.

  • Income tracking by customer and billable expenses.

The Plus version supports five simultaneous users and two accountant users and can be scaled up to support 20 users. The Plus version also contains all the reports found in both the Simple Start and the Essentials versions, and provides the following additional reports:

  • Budget Overview

  • Budget vs. Actuals

  • Class Listing

  • Collections Report

  • Profit & Loss by Class

  • Profit & Loss by Location

  • Open Purchase Orders

  • Purchases by Product/Service

  • Purchases by Vendor

  • Purchases by Location or Class

  • Time Activities by Employee

  • Time Activities by Customer

  • Transaction Detail by Account

Essentials and Plus with Payroll

If an end user signs up for QBO Essentials or Plus on his own and creates his own company, he can create the company using the “Plus Payroll” option, or later, he can sign up for QBO Payroll (QBOP) separately. An accountant also can create the company that uses QBOP for a client.