Is anyone having issues with accurate inventory valuation reporting using the cash balance sheet? Is there a work around? Data is pulling correct on the accrual Bal sheet

Glad to have you here in the Community, anna112.

I understand the importance of having accurate data for your reports.

In QuickBooks Online (QBO), COGS is realized upon invoice payment when using the cash basis, eliminating the need for an inventory asset. Also, there's no inventory asset on a cash basis since it'll be automatically recognized as expenses upon product purchase. With Accrual, COGS is realized regardless of invoice status, and the inventory asset account decreases accordingly.

Additionally, the difference between cash and accrual reports lies in how transactions are recorded and reflected in financial reports. Cash basis reports reflect transactions based on when money is received or paid out. Here is the list of transactions to show in the cash basis report:

• Income is recorded upon receipt of payment.
• Record expenses when payment is made.
• Transactions involving cash payments or receipts.

Accrual basis reports reflect transactions when earned or incurred, irrespective of cash timing. Here's the list of transactions shown in accrual basis reports:

• Income is recorded when it is earned, regardless of when payment is received.
• Record expenses when they are incurred, regardless of when payment is made.
• Transactions that are recognized before any cash exchange occurs, such as accounts receivable or accounts payable.

If your data still appears incorrect, I suggest contacting our Customer Support Team for additional assistance in identifying and resolving the issue.

Furthermore, you can run reports to give you a snapshot of your business. Then, personalize them to focus on the details that matter most to you.

I'm always here if you need more help getting the balanced data your business needs. It's always a pleasure to help.

@anna112 

Just to confirm, cash basis accounting does not have inventory, so the only accurate inventory valuation on cash basis should be QB showing $0 in inventory.  Only accrual basis accounting has inventory. 

The issue is that QB can only accurately switch between cash and accrual (as it relates to inventory) if all inventory entries are item-based.  This is the same as QB Desktop.  Any entries to inventory such as a journal entry or an entry on a bill, expense, etc. posted directly to your Inventory Asset account will bypass QBs ability to remove the inventory on cash basis reports.  If you have a beginning balance entry, QB must have created an entry that bypasses the item/product.  Are you able to locate the beginning balance entry that QB created?  If so, can you run a Transaction Journal report on it?  I'm curious to see what entry QB created and whether there's a workaround for it.