Troubleshooting Cash Basis Accounts Receivable in QuickBooks

Accounts Receivable should not appear on your Balance Sheet on cash basis. But with QuickBooks any transaction that has these 2 characteristics will stay on your cash basis Balance Sheet report:

1. Open as of the report date, and
2. Tied to another balance sheet account .

That means that any Invoice that is unpaid and has Inventory on it will remain on your Balance Sheet in Accounts Receivable even when you run the report on cash basis.
Listen in to this GREAT Intuit podcast as two long-time QuickBooks experts talk about how they adjust and correct cash basis Accounts Receivable for their clients.
Here's a clip:
"To clear the cash basis Accounts Receivable start by running a filtered report to find out which transactions QuickBooks was unable to convert and then adjust, correct, or simply note them."

Here's the step-by-step instructions for identifying the transactions in your cash basis Accounts Receivable:

1. Double-click on “Accounts Receivable” on your cash basis Balance Sheet report
2. Click the “Modify Report” button at the top left of the report
3. Remove the date in the “From” field and keep the date in the "To" field
4. Click on the “Advanced” button at the bottom left and set the “Open Balance/Aging” to” Report Date”
5. Click “OK”
6. Click on the “Filters” tab at the top of the Modify Report window
7. On the left, chose the Filter “Paid Status”
8. Set the "Paid Status" filter to “Open” in the middle of window
9. Click “OK” to run the report

Click here to download a copy of the instructions or see a short video on how to identify the cash basis Accounts Receivable transactions.