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Handling Uncategorized Transactions at MyBuilderCPA



Hello, Jon Markee here, founder and CEO of MyBuilderCPA. Today, I want to discuss a situation that inevitably arises when managing your finances: uncategorized transactions. At some point, we'll come across transactions that lack proper documentation or context, making it unclear how to categorize them. Here's how we handle these scenarios at MyBuilderCPA.

The Challenge of Uncategorized Transactions

Uncategorized transactions occur when there's missing information about a transaction. This can happen if you forget to upload a receipt, if we can't identify the transaction, or if it’s unclear whether it should be booked to a specific job. These transactions can impact the accuracy of your financial statements, so it’s crucial to address them promptly.

Using UnCat to Resolve Uncategorized Transactions

To efficiently manage uncategorized transactions, we use a service called UnCat, which integrates with QuickBooks to handle uncategorized income, expenses, and assets. UnCat is user-friendly and doesn’t require you to create a login or password. Instead, you sign in with a magic link each time.

When a transaction is categorized as uncategorized, you’ll receive a notification from UnCat. This tool allows you to provide details about the transaction, such as what it is, which job it's related to (if applicable), and any necessary attachments. You can visit UnCat.com to learn more about this intuitive tool.

Special Considerations for BuilderTrend Users

For our BuilderTrend users, uncategorized transactions can be particularly tricky. When transactions come into the bank feed and are booked to uncategorized categories, they appear as expense categories rather than items, products, or services. This can disrupt the sync with BuilderTrend, as all transactions need to be accurately classified.

Once you provide the necessary information via UnCat, we’ll review the transaction in QuickBooks. We’ll determine if it needs to be deleted and re-entered to include the appropriate item, product, or service for BuilderTrend, or if it can simply be re-categorized.

Importance of Accurate Categorization

Accurate categorization is essential for maintaining reliable financials. For example, if a drawdown on a line of credit is mistakenly booked as income, it can inflate your net income. Later reclassification will correct this, but in the meantime, your financial reports might be misleading.

Always pay attention to any uncategorized transactions in your QuickBooks. They can give you a distorted view of your profitability if not handled promptly.

Common Scenarios for Uncategorized Transactions

Online purchases are a common source of uncategorized transactions. For instance, Amazon purchases can be particularly confusing, as they often charge your credit card only when items ship, and the total might not match the electronic receipt. This is where UnCat becomes invaluable, helping you sort through these transactions efficiently.

Utilizing Receipt Capture Tools

When making online purchases, remember that electronic receipts are typically sent to your email. Our receipt capture tools can help you forward these receipts directly to us, eliminating the need for physical copies. We’ll discuss our receipt capture feature in more detail in the next video.

Conclusion

Handling uncategorized transactions is a vital part of maintaining accurate financial records. By using tools like UnCat, we streamline the process and ensure that every transaction is correctly categorized. If you have any questions about managing uncategorized transactions, please don’t hesitate to reach out.

Thank you for watching, and have a great day!

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