Hi Bern,
What version of Quik Reports do you have (including the release date), and did you upgrade the System Manager as well as Payroll?
The problem is that all versions of Quik Reports older then QR6.5A (990428) has this problem running under System Manager 7.0. The solution would be to get the Quik Reports upgrade.
The issue has to do with sorting/subtotalling a report by the key field (ie Employee # in Payroll, Customer # in AR, Item # in IC, etc). QR6.5A (990428) fixes this.