Are you considering moving your business across to Xero Cloud Accounting? It can be a tough decision. We know, because we went through exactly the same decision making process here at Grassroots IT before we made the switch to Xero.
We are grateful to Jac Gallagher from Notch Above Bookkeeping who presented a webinar for us on Xero for Small Business.
Here's a replay of the webinar:
Here is a rundown of what Jac discussed in the webinar:
Xero is a cloud based system, so there is nothing to install and updates to the Xero system are done in the cloud, without causing any downtime for the user. Backups are also done automatically, so you don't need to manually backup any of your data.
You can log in to Xero through any web interface. This is great if you're on the road, as you can do most financial tasks, such as invoicing a client, from your smart phone. Xero has bank level security, and it's possible to add an additional level of authentication if you'd like to.
Jac walked us through using Xero from the perspective of 'A Day in the Life of a Small Business Owner'. Starting from the dashboard, we were able to see her complete a number of transactions, including:
- Reconciliation of bank transactions, using the bank information that comes in automatically each night from our own bank account.
- Matching transactions, including split payments or one payment for multiple invoices
- After manually entering vendor details, the system remembers the vendor details for future transactions
- Being able to collaborate - write a note to your bookkeeper or accounting using the 'discuss' box
- Xero can remember particular transactions and where they need to be coded to without having to manually enter account code each time.
- Xero can make suggestions on where items should be coded, but the user needs to double check it's going to the right place.
- Sales - who owes you what and who your major debtors are.
- Diagrams for visual representations of the information.
- Based on daily reconciliation, an automatic system can be setup to reminder debtors that payments are due.
- As you're creating invoices, you can customise line items as you go
- You can track particular sales staff or offices and report on that later.
- Invoices can be tailored with your own company branding.
- Invoices can be printed or turned into a PDF and emailed.
- 'Pay Now' is add-on option in invoices so that clients can click a button and connect with payment system, such as PayPal.
- The system can track when invoices are sent and opened/viewed by the debtor.
- Purchases - shows who you owe money to
- PDF version of invoices from suppliers can be attached to the transaction, so that paper copies can be destroyed but you still have a copy. Great for audit time, and searchable through Xero.
- Receipts can also be attached to transactions.
- Each Xero file has its own email address, so if you're shopping and you receive an invoice, you can forward the invoice through to Xero via email and it sits on your file until you get a chance to process.
- Employees can use the Xero Me app and send in leave applications or submit time sheets electronically.
- If leave is approved, you can allocate the leave to a particular date and it will be allocated in that time period.
- Pay Run - can look through prior pay runs for history, and look over draft pay runs before saving and approving to post the pay run.
- You can email the pay slips, which are customisable with company branding and fully compliant for what needs to be included for ATO.
- Xero is compliant with SuperStream, and superannuation can be paid directly from your business bank account into multiple superannuation funds, which is a huge time saver.
- Can be run on a cash or accruals basis.
- Categories can be tracked so that you can run profit and loss per region, salesperson, etc.
- Aged Receivables report can be annotated (ie. 'This payment is considerably overdue. Shall we call them?') and notes can be included in printout/PDF.
Every business is different and Xero may not be able to cover every function of a business, but there are other add-on functions that can integrate well with your Xero accounting package, eg. an inventory app for retail businesses, a payment gateway, invoicing software. Whatever business you're in, there will be an app to suit. Jac recommends consulting an expert in the particular app you require to ensure the integration is setup correctly from the beginning.
At Grassroots IT, we are really happy that we made the switch to Xero Cloud Accounting. But, as Ben says, it's not right for every business and it's important to make an informed decision before making a change to your accounting package. We hope that listening to Jac's overview of Xero in the webinar is helping your decision making process.
If you'd like a copy of our two page handout from the Xero for Small Business webinar, you can view and download it by clicking on this Xero Webinar Handout link.