Archive Copy of QuickBooks Files: What it is, Why it’s there, and the Dangers of Client Misunderstanding and Misuse

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• October 2008 Issue
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From the Oct. 2008 Issue

As my friend Greg LaFollette puts it, “It’s a great time to be in public accounting.”

If you’ve followed The Sleeter Group for long, you know that our group of more than 600 consultants serve somewhere around 180,000 small and mid-sized businesses. We focus where the rubber meets the road. That is, we provide the critical link between what businesses require, what software products can do, and how the software is used by each client. What makes this field so fun is working with so many different types of businesses, people and technology solutions. So yes, it really is a great time to be in public accounting, and I think the part that is the most fun is accounting software consulting. Specifically, the area of helping people find the right solutions, and then getting them set up and teaching them how to properly use the software to manage their business.

What continually surprises me is just how crazy things get when seemingly simple parts of the software are misunderstood by clients, and how that leads to “misuse” and often disaster. I suppose it underscores the difficulties of creating software that is, on one hand, powerful and feature-rich but, on the other hand, so simple that every user understands how to use it, without any training or manual-reading. Ha! I’ve spent my lifetime on this topic, and although we’re seeing great progress, I don’t think we’ll ever really get there. Consultants who help troubleshoot and fix disasters will never be out of a job.

Here is a great example from our consultants’ forum that shows how the Archive Copy in QuickBooks is one of those powerful features that is simple to use, but when misunderstood can be quite dangerous.

The Question
I have a client who had his company archived back in 2002 because of file space. The person who archived it, however, started using the archive company instead of the new smaller company file. Is there any way that I can archive this copy now and possibly get rid of the “Archive Copy” line across the top without setting up a new company file, or is that my only option at this point?

The Answer
The short answer is no. The archive copy of the company file will always have the words “Archive Copy XX/XX/XXXX of Companyname.QBW” at the top of the window in QuickBooks. You can rename the file on the hard drive, but you won’t be able to remove the words Archive Copy from the top of the QuickBooks window for that file.

For the long answer, and for the fix to the problem, you have to go much deeper. So let’s go on a little journey of why archive files exist, how they’re created, how they should be used and, finally, how you can unwind a client who has unwittingly gotten mixed up between their real company file and the archive of their file.

Archive Files: The Process, Purpose & Problem
When you use the Clean Up Data Utility, QuickBooks “condenses” the data file by deleting all the transactions you no longer need and replacing them with monthly summary entries. At the same time, this utility will create two files. One is an archive of the data file (in QBW format), and the other is a backup of the file (QBB).

If your company file is called DougsCompany.QBW, then two things happen when you run the Clean Up Company Data function. First, QuickBooks forces you to create a backup (QBB) of the file, which will be named DougsCompany (Backup Dec 31, 2008 2:00pm).QBB. Then QuickBooks creates the “archive file.” This is a complete copy of the pre-condensed data file, named “Archive Copy 12-31-2008 DougsCompany.QBW.” Then, QuickBooks continues with the “condense” process, removing old transactions from the original file (DougsCompany.QBW) according to the options you select in the wizard.