Using Classes in QuickBooks

How many pages are your financial reports? If you’re like me, most of the time I look at the first page and the last page and just skim any middle pages…and I’m an account that likes financial reports. If any of your financial reports are longer than two pages, they’re probably too long.

What can be done about to shorten up some reports? In a previous post I talked about using subaccounts. Subaccounts can summarize information. For some churches, Classes may help. This is especially true if your church has multiple locations or multiple congregations where you want to track things separately. Here’s an example:

Downtown ChurchUptown ChurchTotal
Pastor Compensation-40,000-40,000-80,000
Worship Exp-16,000-4,000-20,000
Building Exp-20,000-18,500-38,500
Admin Exp-7,500-7,500-15,000
Net Income/(Loss)-19,750+20,525+775

Not only is this report half as long, you get the bonus of being able to easily compare the different ministries. This way you can ask questions like, “Why is Worship so expensive at the Downtown Church?” Or “Are we okay with the Uptown Church subsidizing the Downtown Church?”

Many times different locations might maintain their own accounting records so it would be an extra step to make combined financial reports. I remember one time working with four separate little churches that shared the same building. They had four treasurers, four accounting systems, four checking accounts, and four investment accounts. Three of the four were worried about finances and possibly needing to close. I compiled some combined financial statements, and these four little churches found out they had a combined $200,000 in cash! Long story short, they just decided to merge to make it easier, but they could have also just switched to QuickBooks Online and used classes if they wanted to remain separate but maintain one set of accounting records.

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