Cloud Accounting Software (Xero)
What is cloud accounting software? If you are familiar with Sage or SAP then it’s basically that but accessible anywhere. Xero is a lot more intuitive, serving a more rounded bookkeeping, payroll, cash flow role than a simple ledger. A sort of plug and play accounts department for your small business/start-up. I’ve only recently become accustomed to Xero (despite prior sage and SAP experience) through my role as a self employed bookkeeper for SME’s in the UK. Here I shall go through a few of the benefits and drawbacks to this complete accounts package so you can weigh up its value within your own company.
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Xero for UK Startups
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Firstly let’s get the drawbacks out of the way: Tax.
Now there may be a way around this and if anyone would enlighten me in the comments below I’d be tip top grateful. But when your company isn’t VAT registered (UK, implementing tax without it going through the main balance sheet) means adding it as a separate line in the invoice. Otherwise it assumes your Tax Exclusive value is to be taken off the main ledger as setup. A mild gripe but a gripe non the less.
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Considering I’ve gone from Sage 50 straight to Xero after a stint away from accounts this is a major leap. The software itself is rather intuitive. I’ve found it filling in description codes automatically as it sort of learns what I’ve been doing. The layout is clean throughout and the invoices/purchase ledger side is cleanly laid out in the initial screen. In the top right hand corner the ability to switch between companies is straight forward from a drop down menu (saving endless logging in and out) and the ability to reconcile accounts and the end is perfectly synced with bank accounts and automatically finds the transactions and tallies them up. This system really is an accounts department in a app. and makes doing accounts for a small business not just un-intimidating but a simple part of your daily business tasks, like taking stock or using Facebook ads. Its ability to link up to accounts such as paypal makes making payments and chasing them as simple as pressing buttons in one integrated system, its a bit like playing a game and that (considering how much modern start-up owners play games-that I know of) is recipe for success.
Did I mention its ability to collate and create information and reports. With lots of easy to read and follow graphs it really takes the strain out of the numbers. Not the most mind boggling thing being a natural progression for visuals but cool nonetheless.
So that’s my quick review. Check it out for yourself at Xero for UK Startups or google it. Get 50% off the first 12 months plus tonnes of money off perks like 20% of Shopify etc. by clicking that link right there!
Here’s a short youtube vid by someone else: