Jennifer runs a multi-channel skincare brand selling on Shopify, Amazon, and Faire. When her accountant switched QuickBooks to an accrual basis before tax season, her profit and loss report showed revenue $22,000 higher than her bank account. Expenses spiked by $8,000.
Her balance sheet, bloated with $18,000 in "unbilled income" she could not trace. Nothing made sense.
The problem was not QuickBooks. It was timing. Accrual accounting reveals mistakes that cash-basis workflows hide: late bill entry, missing reversals, and delayed invoice recording.
For multi-channel sellers managing hundreds of orders monthly, these errors compound quickly. Manual fixes work for small operations, but as you scale past 500 orders per month or add more channels, accrual errors multiply faster than you can correct them.
This guide breaks down the five most common QuickBooks accrual mistakes, shows how to spot them, and explains when automation becomes the only sustainable solution as you grow.
Switching to accrual accounting exposes timing gaps that cash-basis reporting masks. For multi-channel sellers juggling Shopify orders, Amazon payouts, and supplier bills, these gaps multiply fast, turning simple reconciliation into a forensic investigation.
Cash-basis accounting records revenue when customers pay and expenses when you pay bills. It tracks money movement, not business activity. Accrual-basis accounting records revenue when earned (when orders ship) and expenses when incurred (when bills arrive), regardless of payment timing.
QuickBooks lets you toggle between methods instantly, but the resulting reports tell completely different financial stories.
Real example: Multi-channel seller managing Shopify, Amazon, and wholesale accounts
|
Metric |
Cash Basis |
Accrual Basis |
Difference |
|
Revenue |
$80,000 |
$102,000 |
+$22,000 |
|
Expenses |
$50,000 |
$58,000 |
+$8,000 |
|
Profit |
$30,000 |
$44,000 |
+$14,000 |
The $22,000 revenue gap comes from Shopify and Amazon orders that shipped but have not settled. These are unpaid invoices sitting in Accounts Receivable. The $8,000 expense difference reflects unpaid supplier bills for inventory already sold.
The accrual basis shows true profitability because it captures all earned revenue and incurred costs, not just completed cash transactions.
Multi-channel sellers typically encounter three major discrepancies:
Amazon orders shipped on day 28 appear in accrual revenue but settle 14 days later. Your profit and loss shows $102,000 earned, but your bank account shows $80,000 received. The $22,000 gap is real income, just not yet cash.
You received $12,000 in inventory bills three weeks ago but have not paid them yet. Cash basis ignores these bills until payment clears. Accrual basis records them immediately, showing the accurate cost of goods sold and gross margins.
If you delay bill entry by two weeks, expenses from September bunch into October reports. Your September profit looks artificially high, while October expenses spike unexpectedly. Neither month reflects reality.
Most confusion stems from mixing cash-basis habits with accrual-basis expectations. When you manage three sales channels, two payment gateways, and dozens of suppliers, delayed bill entry creates cascading timing errors.
For example: You wait three weeks to enter vendor invoices because you are busy fulfilling orders. When you finally batch-enter 47 bills, they post to the current month, not when you actually incurred the expenses.
Your cost of goods sold jumps 40 percent in one month, while margins look impossibly high in the previous month. Your accountant flags the discrepancy. You spend four hours tracking down original invoice dates and creating journal entries to fix timing.
Real-time order and bill syncing tools like Webgility eliminate these timing gaps by posting transactions when they occur, not when you remember to enter them.
But how do you identify which errors are affecting your specific reports?
You can quickly diagnose accrual errors by looking for specific red flags in your profit and loss and balance sheet reports. Knowing what to look for is half the battle.
If the two versions differ by more than 10 percent, you likely have timing issues or missing entries. For example, if marketplace deposits do not match reported revenue, the discrepancy typically stems from incorrect accrual entries or fee mapping errors.
If you see multiple red flags across channels, manual fixes may only be a temporary solution. Automation tools can reduce risk as you scale.
Now that you know what to look for, let us break down the five most common mistakes and how to fix them.
Most QuickBooks accrual errors come from five repeatable mistakes. Here is how to fix each one and prevent them as you grow.
When you delay entering bills or invoices, expenses and revenue appear in the wrong periods. This can understate revenue and distort your margins
Mini-case:
A multi-channel seller delayed invoice entry for three weeks and missed $18,000 in revenue on their monthly report. Their gross margin looked 15 percent lower than reality.
Manual fix:
Enter bills and invoices as soon as you receive or send them. Set a daily or weekly schedule to review unpaid bills and unrecorded invoices. Use QuickBooks bank feeds to catch missed bills.
Webgility integration:
Webgility syncs orders as invoices in real time, eliminating unbilled income gaps. Users save 10–15 hours per week on manual data entry by automating invoice creation.
Suggested Read: Top 8 Ecommerce Accounting Software in 2025
Some expenses and revenues span reporting periods. If you do not record them with journal entries, your reports will understate or overstate results.
Manual fix:
At month-end, review recurring expenses that cross periods (like utilities or payroll). Create a journal entry to record the estimated expense. In QuickBooks:
Webgility integration:
Webgility automates recurring accruals based on rules you define, reducing manual work by 80 percent or more. Users report closing their books three times faster by automating month-end processes.
Suggested Read: The Complete Guide to the Month-End Close Process in 2025
If you do not reverse accrual entries, you double-count expenses. This inflates costs and makes financial statements unreliable.
Mini-case:
One retailer fell eight months behind on reversals. Their accrued liabilities account grew to over $40,000, and their profit and loss statement overstated expenses by thousands each month.
Manual fix:
At the start of each month, reverse every accrual entry from the prior month. In QuickBooks, open the original journal entry, click More, and select Reverse. QuickBooks creates a new entry dated the first day of the new month with debits and credits swapped.
Webgility integration:
Webgility schedules reversals automatically or flags them for review, preventing double-counting. Accounting firms using Webgility reduce month-end close time by up to 90 percent by automating accrual and reversal workflows.
Switching between cash and accrual basis in reports without consistency creates confusion and makes it hard to compare results.
Manual fix:
Set your company-wide accounting method in QuickBooks settings. Go to the Gear icon, select Account and Settings, then Advanced. Choose your preferred method and save. Always check the accounting method before saving or sharing reports.
Webgility integration:
Webgility ensures consistent posting and reporting across all channels. When you configure your integrations, you specify whether to post transactions on a cash or accrual basis, and Webgility applies this setting uniformly to every order, payout, and fee.
Recurring expenses like rent, insurance, and payroll often require accruals. Missing these distorts monthly profitability and makes it hard to compare performance.
Manual fix:
Identify all recurring expenses that span multiple periods. Create a schedule and record journal entries to allocate costs each month. Use QuickBooks’ recurring transaction feature to automate where possible.
Webgility integration:
Webgility handles recurring entries and syncs them automatically. You can define rules for allocating recurring costs, and the system posts journal entries at month-end without manual intervention.
Suggested Read: Ecommerce Automation Software Explained | Webgility Blog
Manual fixes work for smaller operations, but when do they break down? Let us look at the tipping point.
Manual processes work for smaller operations, but as your order volume or channel complexity grows, manual accrual fixes break down. Automation becomes essential for accuracy and speed.
A simple checklist ensures you never miss a step, whether you manage accruals manually or with automation.
Still have questions? Here are the most common ones from QuickBooks users.
Accurate QuickBooks accrual reports drive better decisions. Manual fixes work for small teams, but automation is the only way to scale as your business grows. Evaluate your order volume, channel count, and team capacity. Choose the approach that keeps your books clean as you grow.
For businesses ready to scale, automation tools like Webgility keep every order, payout, and fee synced in real time. No more double entry or missed accruals.
Ready to eliminate manual work? Explore automation options or revisit your current process to ensure accuracy as you grow. Book a demo.
Cash-basis reports show revenue when paid; accrual-basis when earned. For example, $50,000 in unpaid invoices means accrual revenue will be $50,000 higher than cash-basis revenue.
Your balance sheet’s accrued liability account should show zero after reversal. If not, review your journal entries for errors or missing reversals.
Use bills for known vendors and recurring expenses. Use journal entries for estimates or non-vendor accruals, such as utilities or payroll earned but not yet billed.
If you spend 10 or more hours per month on accruals, automation tools like Webgility deliver ROI in 30 days.
Automation tools sync orders, fees, and payouts in real time, eliminating manual entry and reconciliation.