What Is Xero And How Will It Help My Business

accounting and financial planning

Xero is a cloud-based accounting software for small businesses that has gained immense popularity in recent times. It allows small businesses to automate all their accounting and bookkeeping tasks that take a lot of time when done manually. Xero can take care of all your accounting needs, including payroll, invoicing, and more.

But apart from the usual, Xero has some extremely useful features that can give your small business an edge and save you a lot of time. Whether you rely on a cash-based or accrual accounting system, Xero works perfectly well with both.

So, how does Xero help your small business? Here are a few benefits you enjoy with this accounting software.

Automated data entry from supplier bills and employee claims

All users on the premium plan of Xero accounting software can enjoy this feature where the software automatically extracts billing information from supplier emails or PDF bills. You don’t need to add the billing details manually, the software can auto-populate the bills on the platform.

Developers of the software claim that during their initial user tests of this feature, users saved almost 25% of the time they otherwise spend on filling billing information.

Xero can also automatically fill employees’ expenses claims. All they need to do is take a picture of their receipts and Xero automatically scans the details and creates the claim. This minimizes the chance of errors occurring and reduces your hidden costs.

Quick approval of transactions on bank rules

One of the major reasons behind delays in transactions in a business is the hassle of bank reconciliation. Most businesses agree that bank reconciliation causes their business to slow down.

Xero allows you to get rid of manual approvals for your transactions. It can automatically approve transaction matches based on the bank rules applied by you.

Easier payments of contract-based workers

A very time-consuming task for payroll teams is to calculate the hours of work and subsequent payments for the contract workers. Employees are already added to the payroll, but others have to be paid per hour of work. Calculating these manually increases the chances of errors as well.

Xero has different tools like Xero Projects that can integrate with Xero Payroll. The software can pull in data such as workers’ time entries from Xero Projects to Payroll, making the task much easier. This makes it possible to pay all employees and contract workers from a single platform and a single, error-free set of data.

Automated bank feeds

Xero can also automate bank feeds for you. This means that instead of manually having to download bank statements or importing them to the software, Xero allows you to set up a bank feed. The software can automatically import the statement when needed, be it credit card details or Paypal accounts.

Inventory management

Xero makes inventory management extremely simple. This accounting software also allows you to add and manage inventory in just a few clicks. You can simply add a new item to the products/ services list, add the product name and item code, add details about buying or selling the item, and it’s almost done. You can choose to track the quantity and value on the hand of the item and save the details.

Why small businesses love using Xero

These are just some of the features of the accounting software that we’ve listed. Apart from these too, Xero has a long list of convenient and thoughtful features. Small businesses are truly benefiting from this software, mostly because it is –

  • User-friendly
  • Cloud-based and accessible
  • Integrated easily with several other programs
  • Affordable with a transparent three-tier pricing system

Conclusion

Accounting and bookkeeping are two of the most important areas of any business. For small businesses, hiring an experienced or skilled accountant may prove to be quite expensive. That is where software like Xero can come in very handy. It reduces the amount of manual work required in accounting, eliminates errors, and maximizes the time you can dedicate to other business processes. Xero has earned its position as perfect accounting software for small businesses, and for the right reasons.

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Acro Accounting & Financial Planning (AAFP) offers a one stop solution right from accounting, taxation, financial planning to other business advisory services.

As Certified Practicing Accountants (CPA’s) and professional tax advisors, we pride ourselves on being experts with the latest developments relating to business and taxation.


We as professional public practice firm, provide high quality taxation and business advice to our clients through a personalised service at competitive rates.

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