After many years of using QuickBooks Desktop software, there can be several million data pieces in the database.  This data accumulation can cause the software to run slowly and make users wonder if they should convert to a different program.  Before switching systems, consider condensing the data first – then see if further action is still desired.

The QuickBooks definition of “condensing” the data includes taking all transactions for a particular client or vendor and summarizing it into a single journal entry.  There is an option to have the entries posted by year or by month – and some transaction types are available for exclusion.  (This exclusion is global – not by vendor/customer/account basis.)

Before running the condense process, the files should be reviewed and adjustments made where necessary.  Following is a step-by-step guide to condensing QuickBooks files.  The instructions are based on QuickBooks Desktop 2019 – however, versions 2016 – 2018 should be able to follow them as well.

Clean up the files

  • Look at outstanding/uncleared checks and deposits that may be hanging around.
  • If they cannot be cleaned up before the files are condensed – the archive date selected should be older than the outstanding items.

Create a Local Backup to an external (USB) drive

  • Name it whatever you like, and add “Archived” at the beginning so the file can be easily identified.
  • This will be the “go-to” for review of any detailed pre-condense date information.

Sign into QuickBooks Desktop as Administrator.

With all other windows closed – go to File / Utilities / Condense Data.

A window will pop up with options to “Condense your company file.”

  • Option 1: Keep all transactions, but remove Audit Trail Information to date – this option does just what it describes – and identifies how the choice will affect file size.
        1. NOTE: This option does not allow for date options.  The transactions will remain intact, but existing transactions will no longer have edit history for later review.
        2. This option is not typically recommended due to the minimal space gain and the extensive history loss.
  • Option 2: Remove the transactions you select from your company file – Condense Data
        1. Remove “Transactions before a specific date” – Choose the first day of the year for the data being kept (For example: if keeping (5) calendar years – then choose 1/1/2014).
        2. “All Transactions” – This will remove all detail, leave only lists and preferences, and may be used if copying company files but not transaction detail.
        3. “Transactions outside of a date range” – This will keep the data within the range and remove everything else. Companies wanting to prepare a period copy of the file would use this option.
        4. Once the best choice has been made and related dates selected – click “Next.”
  • How Transactions Should Be Summarized: On the next screen, choose whether to have one summary journal entry or monthly journal entries – and the system defaults to creating one journal entry. This option is not recommended.  (See ii. Below)
        1. The single journal entry option will compress all previous transactions into one journal entry as of the beginning date selected.
        2. The recommended option is the summary journal entry for each month.
          This will allow for a Balance Sheet and Profit & Loss statement to be created for the periods condensed.
          It replaces the transaction details for that month.
        3. DO NOT CHOOSE THE “Don’t Create a summary” entry – using this option will result in having to create opening balances for every account.
  • How Should Inventory Be Condensed?
      1. If you use inventory items – this will be your next screen.
      2. Choose to either Summarize the inventory or Keep the transactions.
  • Do You Want To Remove The Following Transactions?:
      1. This screen will either follow the inventory options (d.) or – if you do not use inventory items – this will be the next screen after the Transactions Summary screen (c.).
      2. This screen provides the opportunity to remove uncleared bank and credit card transactions, unprinted transactions, and so forth.
      3. The removal of these items has the potential to cause issues with bank reconciliations invoices, and so forth.
      4. Click on the “Select None” button to let these outstanding items remain, and click Next.
  • Do You Want To Remove Unused List Entries? Screen allows for the cleanup of cluttered lists.
    1. Review and decide if you’re okay with paring down the respective lists and don’t see any issues with removing them.
    2. Unclick any that should be kept whether they’re used or not.
    3. Then click “Next.”
  • The final screen Begin Condense is advising that your data will be condensed and may take several minutes/hours.
      1. This is the final opportunity to go back and adjust or cancel the condense process.
      2. If the files are large – expect it to take a long time – maybe start it before leaving for the night and let the condensing process run.
  • The screen will go grey for a short time, and then the working/condensing screens will appear.
  • When the process has been completed – a message will appear that advises of a backup made, where it’s located, and confirms the condensed transaction date.
    1. If you didn’t make a backup of the files before you started – make a note of the file location.
    2. Click “OK,” and the screen goes grey again.
  • Click “Home,” and you’re back in business.

To Summarize – running this process will remove all transactions before the specific date chosen and replace them with the single monthly or final summary journal entry – depending upon which option was selected.  This is preferable over the costly and time-consuming process of converting to new software or creating a new company.  The archive data is still available from the backup, the software should run better and faster, and the recent years’ details are still easily accessible.

If this seems like it will help speed-up the QuickBooks software performance – but is not something you want to tackle – feel free to contact Ketel Thorstenson LLP and let one of our QuickBooks ProAdvisors do the heavy lifting!