New QBO Adv. Certification Badge
All my regular readers know that I have written two previous articles about the New QuickBooks Online Advanced ProAdvisor Exam since it was first announced just a few months ago. We have speculated as to the requirements for the exam and what type of exam it might be; and to some extent the potential difficulty. Well I can finally share with you some of those details having participated in the inaugural Certification Preparation Course for QuickBooks Online Advanced Certification instructed by Michelle Long, here at QuickBooks Connect.
To qualify for the exam you must be a member of the QuickBooks ProAdvisor or QuickBooks Cloud ProAdvisor program. If you read my article published on Tuesday 10/21 you know that Intuit is merging these two programs into one starting in December, so ProAdvisor membership is the key point here. You must also have ‘passed’ the QuickBooks Online Certification (which I assume most people will call ‘basic’ QBO Certification from now on). With those two requirements in place you qualify to take the QBO-Advanced Exam. Intuit will offer training in preparation for the exam, I think you can expect some live Webinars as well as some Pre-recorded sessions, along with study materials.
A lot of the ProAdvisors participating in Michelle’s class had both ‘desktop’ and ‘QBO’ ProAdvisor certifications already, and many even had ‘desktop’ “Advanced ProAdvisor” status. Some voiced their concerns over the fact that unlike the ‘desktop advanced’ certification, the process to gain QBO-Advanced is much shorter. Desktop advanced certification requires the certification in the most current 3 years of QuickBooks ‘basic’ in order to even qualify to take the advanced exam. A person who passed the QBO Certification on one day could realistically sit for the QBO-Advanced exam the very next day; there is NO minimum time requirement between QBO and QBO-Adv. ProAdvisor certification status.
With that behind us let’s look at the basics of the QBO-Adv. Exam itself. The exam is 33 questions, and will require a passing score of 80% on each of 5 ‘exam modules’. Candidates will have 4 attempts to pass each module of the exam. There is no time requirement related to the exam, and candidates may save and exit the exam as many times as they wish. Seven questions will come from Module 1 – Complex Conversions and seven questions will come from Module 2 – Customization. Module 3 – Special Transactions will be the source of five questions on the exam, and seven questions will be taken from Module 4 – Reporting and Complex Problem Solving. Module 5 – Advisory Services will be responsible for 7 questions. Those passing the QBO-Advanced ProAdvisor exam will be certified for two years; a final decision regarding the mechanism for re-certification has not yet been announced.
This new exam is much more than the ‘how to’ multiple choice exam associated with QBO Certification; this exam is built upon real world case scenarios. But in the few examples of test questions we were briefly shown, the questions are very complex. Many may have 4 or 5 parts that must be completed for each question ‘scenario’ posed. Some will require analysis of downloaded data and posting in the QBO sample file in order to ascertain the correct answers. Unfortunately for test takers, each of the 33 questions must be answered completely correct in all of their parts; there will be no partial credit for individual parts, only the question as a whole.
So what about the complexity of the exam? Well, I haven’t actually seen any more the exam other than what I mentioned we were briefly shown, so I can’t speak to the complexity of the exam questions themselves other than from the formatting I just discussed in the prior paragraph; however, I will say that I did NOT find the ‘content’ of today’s course ‘all that advanced’. In fact I felt like much of the material was identical in scope to the QBO ‘basic’ certification content with the exception of a few areas that are all too familiar with QuickBooks ProAdvisors who have been using the desktop products for any substantial length of time with the exception of Module 5 – Advisory Services, but we will come to that a little later in this article. Obviously I am not going to condense all of the details from a 5+ hours of training in the content of 2 short articles, but I do want to give you some basics concerning each module.
So let’s look at some of what was covered today on a Module by Module basis beginning with Module 1 – Complex Conversions. Many of the details outlined in this section I had seen before in a webinar titled “Converting to QBO: What to Expect” which outlined the basic when a QB-desktop file could or could not be upgraded to QBO, as well as some of the cases when QBO isn’t a good fit for a client. Changes in the structure of the data during conversion were also covered including things like Group item transactions being posted in QBO as the individual items from the ‘group’ since QBO doesn’t offer group items. Additional details like desktop product paychecks being recorded as regular checks in QBO, inability to convert sales orders, and a variety of inventory issues were also presented. To me this was all stuff that a QBO-ProAdvisor should already know even if these questions were not included in the QBO study materials or certification test before now.
This module also deal with feature and function differences ranging from QBO’s inability to handle price levels and billing rates, batch invoicing, and mileage tracking were contrasted QBO with features not found in traditional desktop versions like Auto Send Invoices, posting journal entries with more than one A/R or A/P transaction line, an improved Audit log (trail) and FIFO vs. Average Cost (even though FIFO is offered in QuickBooks Enterprise-Advanced Inventory). Problems associated with using the new desktop conversion method, vs. the older tool, steps to verify conversion results, and post-conversion changes and adjustments were also presented. The alternative of transitioning to QBO by starting a new file with imported lists, beginning balances and limited transactional postings was outlined.
Now let’s turn our attention to Module 2 – Customization. It seemed to me that most of this information had been covered in both the QBO Certification preparation materials and examination. I distinctly recall the differences between locations and classes in QBO as compared to 'class' in QB Desktop. I will say that the materials for this section covered what seems like ‘advanced concepts’ to some people even though I teach my own ‘basic users of QuickBooks’ about the importance of understanding “Source and Target” relationships in QuickBooks data. How QBO implements these concepts is much of the reason why there are differences in how QBO locations and classes differ in terms of their outcome on reports.
Since QBO doesn’t at present offer real ‘job tracking’, the work around of using ‘sub-customers’ was presented along with the importance of properly configuring items as 2-sided. While estimates are a function of QBO, many QBO users may choose to alternatively create a ‘budget’ for a Customer (or sub-customer) project since QBO, unlike QB-desktop, permits multiple budgets based on differing criteria (by customer, by location, etc.). Necessary preference settings to perform these functions and work-arounds were emphasized.
Similarly a work-around for progress invoicing, not found in QBO, which uses multiple copies of an estimate and partial invoices for individual component line items was presented. This process seems overly complex and really burdensome as it requires re-numbering of documents; most members of the class expressed their dislike for this method and indicated that they didn’t feel their clients would ever use it. Still Michelle indicated that it was very important that class participants learn this method (if that gives you any hint).
The importance of understanding how QuickBooks inventory is valued using FIFO and ‘FIFO layers of cost’ (what many people refer to as ‘cost lots’) was demonstrated by several repeated examples of purchasing/sales transactions. FIFO costing of inventory has been around for a long time and is widely accepted as probably a more accurate method of valuation than ‘average cost’, but because so many people have used QuickBooks desktop which makes use of a highly ‘time sensitive weighted average cost’ method of valuation the fundamentals of FIFO seemed to have been forgotten by many, so I found this a worthy exercise within the training. But little more than a mention was given to the fact that changing from Average Cost to FIFO is rather a ‘big deal’ and one which may be forgotten by ProAdvisors dealing with clients who want to move from desktop to the cloud. A small business that has previously elected to file taxes using the average cost method of inventory valuation cannot simply ‘change at will’ the method of valuation; they must file IRS Form 3115-Application for Change in Accounting Method and justify the reason for the change and valuation restatement prior to making such changes.
This is a good stopping point; you will want to look for Part-2 of this article in Thursday’s edition of Intuitive Accountant when we will review various details from Modules 3, 4 and 5.