Making sure that the account mapping from Ivy to your QBO account is one of the most important first steps in setting up the integration. Continue reading to keep your books in order :)
What is Category Based Account Mapping?
QBO is an item based system. This means that EVERY single item you add to your products and services list on QBO needs to be pre-defined with it's associated income and expense accounts. Yes, this means that every single time you add another lamp, tile, or sofa to QBO, you would need to define it's accounting elements as well.
For interior designers, this process is overly cumbersome because we are constantly adding all sorts of products and services to our system, so Ivy does not require you to choose a specific income and expense account per item, rather, YOU ONLY HAVE TO CHOOSE A CATEGORY.
The category-based account mapping will let you pre-define which accounts you want items with specific categories to be mapped to.
How do I Set Up My Account Mapping?
After you connect to QBO the Quickbooks tab (in your Ivy Account Settings) will show you a list of Ivy Categories that you can map to specific QBO accounts.
The Defaults Section: Products and Services
Ivy splits up Products and Services each one with their own subset of categories. For each one - Here you will choose the default income and expense accounts for both Products and Services. The defaults are used in two scenarios.
- You do not give a specific product or service a category that item's use on an invoice or Purchase Orders will post income or expense to the accounts set on the defaults, respectively.
- You are happy to send a category's items to the defaults - so you allow items with that category to automatically map to the set defaults and not some where specific.
What if I want to send items associated with specific categories to their own accounts?
A great example for this is shipping vs design fee. In Ivy both shipping and design fee, as they are not physical products, are considered services. However, you may not want to send income from both shipping fees and design time to the same income account. While both shipping and design fee are both services in Ivy, they have different categories and you can map them to two different accounts.
Next to every category on the QB mapping page, you have a check box that allows you to indicate that you do NOT want income or expense from items with that category to map to the defaults, rather you want them to map to a different income and expense account on QBO.
When you check the box you will have the option to choose a separate income and expense account that will be used for items labeled with that category.
In this example, you would want shipping to map to a shipping income account while you would want the design fee to map to a design fee income account.
Here is a VIDEO to show the process above: