Let’s face it – bookkeeping, for most business owners, is boring. People go into business because they are good at a particular skill or have a passion for something. They rarely also have a passion for balancing books. This is why it is so vital to find the right software to help manage your accounts. It will give you maximum results for minimum effort. We have put together reviews of some of the software packages available and how they can impact your business. Let's start with our Xero review.
Xero is a cloud-based small business accounting software with robust accounting features, allowing small business owners to manage their cash flows, bank reconciliation process, invoices, inventory, payroll online, and more. It also enables small business entrepreneurs to view their financial statements in real-time, allowing them to make informed decisions quickly.
To start, I’ve compiled a quick Xero bookkeeping software review to look at one of the newer options available that are increasing in popularity. So let’s look at what features Xero has:
Xero is a cloud-based program. For those unfamiliar with the term ‘cloud’, this simply means that Xero is an online program. All of your data is stored on a ‘cloud’ or a remote server. For more detail see Wikipedia's article on cloud-based software.
Some of the major benefits of using cloud-based software are:
We at Darcy Bookkeeping & Business Services particularly like the cloud-based functioning of Xero. It allows us to better assist our clients to have a more hands-on approach to managing their accounts. We like that we can access the file to create reports and prepare and lodge the BAS while the client is able to continue to add in their invoices etc. At the same time, the accountant can also be preparing the tax return, all simultaneously, without interruption to the maintenance of the company file.
Another reason we like this feature is that, if queries arise about transactions, you can make a simple phone call and all parties can have the file open in front of them at the same time while discussing. This makes the process of answering specific questions much smoother.
Xero dashboard screenshot
One of the most valuable features of Xero is the bank feed. Basically, you just have to sync your Xero account with your bank account. The online nature of the program means that your bank account transactions are imported in real-time into your Xero file.
The benefits of this system are:
Xero offers free online support. It's great to know that you can access help online if you need it. The support is, however, email support only, rather than chat. Xero staff will try to get back to you within 24-48 hours. If your question is complex, then it may require further emails. This can be slow in solving issues. They also do not offer telephone support, which is great on your phone bill. But, if something pops up that you urgently need help with, their support systems may not suffice your needs.
If you want personalised support with Xero, our experienced and certified Xero bookkeepers can help. Give us a call at 1300 728 875 or fill out a contact form to get started.
Let Xero manage all of your payroll needs, including:
Creating invoices is easy in Xero. The program has the capability to track receivables and produce customer statements along with other reports. Xero also has multi-currency options for those trading internationally. This makes currency conversions simple and reducing the workload for businesses that frequently buy or sell from overseas. Xero can also export invoices created for clients who also use Xero. It automatically enters the invoice data into their file to await approval for payment. This reduces the risk of invoices being overlooked or being paid late due to not being entered into the client’s accounting systems.
One of the benefits of Xero is that the pricing differs based on the number of transactions per month in combination with the number of employees within the business. Many other systems offer similar pricing tiers, however, require a complete update of all files as the business grows. Not so with Xero. As your business grows beyond the capacity of the level of service you have access to, all you need to do to step up to the next tier of capacity and pay the extra subscription fees. The program will then allow the extra employee files to be activated or the extra transactions to be entered. This makes for a seamless transition from small to medium to large business.
Pricing for a Xero subscription ranges from $35 to $115 including GST. However, if you set up your subscription through a Xero partner like Darcy Bookkeeping and Business Services, you have the option of subscribing to the lower-cost cash book, which is suitable for micro-businesses. Further to this, subscribing through a Xero partner may also enable you to receive your Xero subscription at a discounted rate if the Xero partner chooses to pass on the discount.
Xero also offers a free trial, which limits the number of transactions you can perform with the program. Once the business reaches the number of transactions allowed, the trial period ends. Then, a you will need a subscription to maintain the file.
Xero produces most standard reports easily, giving the viewer a realistic real-time impression of the state of the business. We have found, however, that the reporting capabilities in Xero are still very basic. They do not really offer the ability to customise reports to suit beyond changing the dates. One way to bypass this limitation is by exporting the report to Microsoft Excel to manipulate the data. One great feature that Xero does have is the ability to publish reports. This means that, regardless of changes made to the Xero file, you can look back at a later date and view the report as it was originally published.
The software allows business owners to easily track and pay their bills on time, helping to maintain cash flow and time spending. This makes cash flow forecasting easier, allowing companies to understand potential cash in-flows and out-flows accurately.
Xero bookkeeping lets you accept payments online and get paid faster by integrating with popular payment gateways like Stripe, GoCardless, and others.
With this bookkeeping software, you can quickly generate accurate quotes, and with one click, you can convert them into invoices for online payment. Plus, keep a close eye on the cost and profitability of each job, so you know exactly how much money is coming in.
Xero bookkeeping allows you to track your finances anytime with accurate financial reports. And you can even collaborate with your accounting advisors in real time.
Xero offers powerful analytics that helps you quickly get an idea of your short-term cash flow, an overview of your sales, expenses, fixed assets, unpaid bills in one place, and much more.
You can also connect your bank accounts to Xero and set up bank feeds to let your transactions flow easily into Xero each business day without manual recordings.
Xero has many advantages. Below are just a few you can expect when using this user-friendly software.
It allows you to easily convert different currencies and send invoices in the currencies of your customers. This helps improve the accuracy of transactions and eventually saves time.
While we’re on the topic of automation, Xero has gone the whole hog and chosen to automate bank feeds. This means that instead of sitting down to manually import bank statements into Xero, you can set up a bank feed for Xero to do it all for you. Automation is going to make you far more efficient with your accounting, and by automating your bank feed, you save yourself a lot of time.
The most crucial benefit of accounting software is that it’s user-friendly. It needs to be easy, or people won’t buy the software. A lot of Xero users have found that even without an in-depth accounting knowledge, Xero is easy to use. It’s this feature that keeps people coming back for more. All of the terminologies in Xero is easy to follow, and there are plenty of options to upload files and supporting documentation for simple transactions.
Xero integrates with a wide range of popular apps and software, making it easy to track all your finances in one place.
The software helps you accurately track payments, manage your cash flows, and ensure that customers pay on time.
One of the main concerns around cloud computing is whether or not it’s secure. The simple answer is: Yes, Xero cloud accounting software is secure. Why? Because Xero stores your data securely online and encrypts it using industry standard data encryption. The servers your data is stored in also have a high level of physical security.
Like any cloud accounting software, the company’s reputation hangs on whether or not they can guarantee that your data is adequately protected. So it’s in Xero’s best interests to maintain the highest level of security to protect its customers.
It makes it easy to stay compliant with tax regulations, so you don't have to worry about potential legal issues when filing taxes.
Considering the above benefits, Xero offers a robust, secure, and reliable accounting solution that can help you streamline the process and save time. If you're looking for an efficient way to keep your small business books in order, then Xero bookkeeping is worth considering.
It automates tedious accounting processes, eliminating manually-entered errors and minimising potential mistakes caused by human error.
Concluding our Xero review, we find Xero to be relatively user-friendly and a great system for managing the accounts for most businesses. We like the cloud-based nature of the program. We find that most of our clients using Xero have been able to lower fees associated with managing their accounts. This wasn't always the the case with those using the likes of MYOB or QuickBooks desktop accounting software. We do find that reporting capabilities are limited. However, when traded off against the benefits of Xero, we believe this is a positive net result in value for Xero subscribers.
Want to get more out of Xero? These guides will teach you to master some of the best that Xero has to offer.