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Note - Versions 2000 and older do not have the "time and basis" stamp. The accounting basis will have to be specified in the report title by changing the report header or footer content.

Users can select or change the accounting basis for summary reports by (a) selecting "Preferences" from the "Edit" menu, (b) selecting "Reports & Graphs" from the scroll box, (c) selecting the "Company Preferences" tab, and (d) selecting either "Accrual" or "Cash" as the "Summary Reports Basis." Summary reports summarize transaction amounts rather than listing each transaction. Selecting a preference for summary reports does not affect reports that list individual transactions, such as the following financial reports:

• Profit & Loss Detail
• Income by Customer Detail
• Expenses by Vendor Detail
• Balance Sheet Detail
• General Ledger
• Transaction Detail by Account

QuickBooks automatically generates transaction detail reports, such as the preceding reports, on an accrual basis even if the cash basis preference is selected for summary reports. However, Users can change the basis for individual transaction detail reports to the cash basis. However, the change must be made each time the report is generated. QuickBooks automatically defaults to the accrual basis for transaction detail reports. Users who routinely generate cash basis transaction detail reports should consider memorizing such reports for future use.

Accrual basis transaction detail reports present a single amount for each transaction, while cash basis transaction detail reports present two amount columns (an "Original Amount" and a "Paid Amount" column) for each transaction. The amounts in the "Original Amount" column generally represent an invoice amount for a sales transaction or a bill amount for a purchase transaction. The amounts in the "Paid Amount" column represent the amounts actually received or paid. The amounts in cash basis transaction reports are fairly straightforward for income and expense transactions. However, the amounts can be difficult to understand when a transaction involves balance sheet accounts. For example, assume that a client sells an inventory item that costs $50 to a customer on June 30 and receives a $75 payment for the full sales price on July 15. Balances in cash basis transaction reports for June 30 will reflect the $50 decrease to the inventory asset with an offsetting $50 increase to accounts receivable. (As illustrated by this example, cash basis transaction reports may reflect accrual accounts, such as accounts receivable. However, the accrual balances do not necessarily represent the actual amount due. In this example, the actual amount due of $75 will be reflected as the accounts receivable amount in an accrual basis transaction report. However, only $50 is reflected in the cash basis transaction report.) Balances in cash basis transaction reports for July 15 will reflect a $50 increase in cost of goods sold and a corresponding $50 decrease to accounts receivable (thus zeroing out the accounts receivable balance). Balances in cash basis transaction reports for July 15 also will reflect $75 of sales income (offset by a $75 temporary increase to accounts receivable) and a $75 increase to undeposited funds or cash (offset by a $75 decrease to accounts receivable). In addition to inventory items, Users should be aware that sales taxes also may result in accrual balances on cash basis transaction reports if the "Owe Sales Tax" preference is set to "As of invoice date."

Note - Due to the way QuickBooks handles items linked to balance sheet accounts on invoices or bills, QuickBooks cash basis balance sheets may include accounts receivable and accounts payable balances. When generating cash basis reports using condensed data, users should be aware that the report amounts may not be accurate since condensing data deletes detail transactions that are needed to determine whether transactions are collected or paid. Condensing data replaces detail transactions dated on or before a specified date with transactions summarized by month.