Linda Carrington, Practice Management Director at Wessex Commercial Solutions, takes a look at what Xero users in Somerset and the South West should expect from their accountant.
Is your business using Xero? Or are you planning to make the switch? It’s a great accounting platform, but as with every tool, it’s what you do with it that counts.
Here are some of the areas we are concerned about, and that we look at when we carry out a Xero review.
Often the last thing people think about when they set up Xero. Businesses already know that the platform offers multiple layers of security, but you’ll need to implement some of the most important ones yourself.
Check that your users have access appropriate to their roles. That means making the most of the fine-grained levels on offer, covering business users and advisers, as well as offering access to payroll.
Set up two step authentication. This helps protect your account in the event that your password is compromised. Unfortunately, it’s not as widely-used as it should be.
2. Automate data entry in Xero
Ask your accountant to look at how efficiently you’re using Xero, as well as whether the data it holds is up-to-date and accurate.
By using tools like Receipt Bank, you can reduce manual data entry to a minimum, and eliminate re-keying. That will save you vital time to focus on your business and customers.
However your accountant can also help you set up other tools. An inventory will make it easier and more efficient even for service businesses to provide quotations, as will a range of templates. Repeating invoices are also a time-saver, even if the amount you bill varies each time. Other valuable tools are direct bank feeds, expense management, and e-commerce integrations.
As well as saving time, these tools will also help reduce unwanted surprises, helping you forecast cashflow with greater confidence.
Xero themselves publish a helpful guide to choosing an accountant. As well as accounting qualifications, look for:
- Xero Certification
- Migration Certification (if you’re changing systems)
- Payroll Certification
- Trade & Construction industry specialists
Specialist firms will not only understand how to optimise the system, but will be aware of its limitations too.
Xero has an extensive marketplace of apps which compliment it. Your accountant should be able to advise which ones are most likely to meet your needs, and will have experience implementing them.
4. Training and Support
Implementation is key, but once the system is ready to use, how will you ensure your team know what to do?
That’s where training and support come in. As daily users of the platform, your accountant should be well placed to provide not just initial training, but ongoing support for you and your team.
While you’ll have access to online support direct from Xero, many Somerset and South West businesses appreciate the more personal touch associated with local support from their accountant. Look at how easy it will be to contact them – are they available on the phone, by email, and can you chat with them online?
5. Insight into your business
Crucially, your Xero account must provide an insight into your business performance.
Xero is not just an administrative tool (although it offers everything you need to run your payroll, carry out credit control, and manage supplier payments etc). Nor is it simply there to help your accountant to prepare your year-end accounts.
It is vital that it helps you understand:
- your cashflow
- the profitability of each product, service, location etc.
Company directors will often talk about the ‘gut feel’ they have about their figures as their business grows. However it’s valuable to check whether the data supports or challenges those views.
This is particularly important when you are making changes to the business, such as pricing for new work, making an investment, or expanding your operations.