To merge your REACH data with Quickbooks (QBO) effectively, the easiest approach is to use a single monthly Journal Entry (JE). Yes, just one JE per month will suffice to transfer your REACH data into QBO!

Note: Using journal entries can make the suggestions in this article applicable to various accounting software systems. However, some systems may restrict certain types of entries if the funds do not balance within the entry. For assistance with these details, we recommend consulting with an accountant or bookkeeper. Tower Accounting can provide expert help in this area.

This article will guide you through things to consider before merging your data with Quickbooks, how to configure your data in both REACH and QBO, how to enter your monthly data into QBO, provide journal entry examples, discuss clearing account management and how to handle REACHpay fees (if applicable).

Things to Consider Before Merging your REACH data with QBO#

Before merging your REACH data with QBO, it’s crucial to define your organization’s specific needs and identify the key performance indicators(KPIs) you want to track. KPIs vary greatly depending on an organization’s size, mission, and complexity.

For instance, a small organization might track donations to its four main programs and the associated expenses. 

Another small organization could prioritize monitoring donations raised by each missionary, including records of missionary benefits and payroll. 

Larger organizations might require more intricate tracking, such as distinguishing income from donations, rent, sales, and dividends from donated stocks. Alternatively, they might need to track performance based on various sub-missions or different operational locations.

After identifying your KPIs, work with your accountant or bookkeeper to select the appropriate QBO subscription and customize your Chart of Accounts (COA) accordingly.

Important Note: Your COA will influence how your financial statements appear, which can impact federal and state filings, accreditations, and audits. It’s recommended to seek professional guidance for this. 

If you don’t already have an accountant or bookkeeper, we recommend Tower Accounting. They are a ministry of ICOM and specialize in providing bookkeeping and accounting services for nonprofits and churches in the United States.

Customizing your Data in QBO#

Customize your Chart of Accounts(COA)in QBO to include two clearing accounts – one for offline donations and another for online donations. 

These clearing accounts should be categorized as Other Current Assets and can be named Deposits Receivables for offline donations and Credit Card Receivables for online donations.

Once these are set up, you can configure your REACH account. 

Configuring your Data in REACH#

In REACH, the key data field to be aware of is the Purpose field. You will want to ensure your Purpose fields align with your income accounts in QBO and the appropriate classes if you use class tracking.

By default, REACH includes all Sponsorships, Campaigns, Projects, Places, and Donation Categories in the Purpose field. 

Note: To add more Donation Categories, go to Settings > Donation Categories.

Once your Purpose fields in REACH align with your income accounts in QBO, you can start entering in your monthly donations in QBO.

Enter Monthly Donations in QBO#

Here’s how to enter the previous month’s donations into QBO:

1. Gather Data from REACH

• Go to Reports > Donation Details report
• Set the Date Range to Last Month
• Click Select Columns to Display and check only: Date, Supporter, Payment Type, Item, and Base Total Amount
  • Note: Uncheck all others that are checked by default
• Click Search 
• Once generated, click the Export Filtered Results To CSV button
• A CSV file will be downloaded to your computer
• We then recommend importing the CSV file into Google Sheets for easier data review manipulation.

2. Prepare the Data in Google Sheets

• Select all data (Ctrl+A), hover over the Insert tab, and choose Pivot Table
• In the pop-up window that appears, select New Sheet and click Create
• On the new sheet Pivot Table 1, go to the Pivot Table Editor tab and add Item under Rows. This will populate Column A with all the funds that you track
• Under Columns, add Payment Type. This will populate the columns with all of the payment types that you are tracking. 
• Under Values, add Total Amount. This will complete the report that you need. 
• Adjust the column widths as preferred and download the Pivot Table as a PDF so you can attach it to your JE. 

3. Enter the Data into QBO

• Log in to QBO and select New > Journal Entry
• Enter the Journal Date and Number
• For the first line item, choose the Deposits Receivables account (account used for your offline donations) and enter the Total Amount from the REACH report.
• For the second line item, select the Credit Card Receivables account (account used for your online donations) and enter the Total Amount from the REACH report.
• Enter additional line items based on your tracked funds, using class or income accounts as applicable.
• Attach the REACH report and click Save

Examples of Journal Entries#

• Class Tracking:
  • Account and class-specific entries.

• Account Tracking:
  • Entries based on different revenue accounts.

• Mixed Tracking:
  • Combination of class and account-based entries.

Clearing Account Management#

Ensure all deposits in your checking account are transferred to the Deposits Receivables clearing account. When entering the monthly JE, this account should be zeroed out. 

Similarly, all online donations should be transferred to the Credit Card Receivables clearing account, which should also be zeroed out with the JE.

REACHpay and Payment Gateway Fees#

For REACHpay payment gateway users, record your donations just like other online donations, using a Journal Entry to credit the Credit Card Receivables clearing account.

For fees, use a separate Journal Entry:

• One line should debit the bank fees expense account (or equivalent).
• The other line should credit the Credit Card Receivables clearing account.

Payment gateway fees are generally recorded as bank charge.

Payment Gateway Fees Sample Entries: