As a small business owner you no doubt wear many different hats during your day-to-day responsibilities, especially during the early stages. Accountant, HR, legal, business development, sales – are probably just some of the roles you have to take on.
Because of this typical small business environment it is common for some parts of a business to suffer and for some reason, in spite of its huge importance; it is often the financial accounts that suffer the most. You may be overwhelmed by monotonous jobs and hidden responsibilities that the accounting role requires; you might not have time – after all – “that’s what the accountant is for”.
Most business owners using traditional bookkeeping software have the same complaints. They say the process of entering data and then sorting it is a nightmare. Not to mention all the headaches involved in getting it prepared for their accountant. In a world where computers are connected online, these problems should not exist anymore. As the business world accelerates into the cloud, accounting is evolving with it.
Tech-savvy businesses are now using Xero and other innovative cloud tools and apps to manage and monitor their financial accounts. As a small-business owner, financial statements are your most important tools – and Xero makes the process much easier. Here are four things you can do with Xero to make financial accounts easier:
- Connect your bank account to Xero and it automatically organizes your transactions
Once connected, Xero automatically imports all your bank statement lines, and matches them with your sales invoice or bill. As long as you separate your business account from your personal expenses and make sure all income and expenses are going through the account, no deduction will be missed. Xero will also remind you to record any missing transaction.
- Do a bank reconciliation as often as possible, to see your cash flow in real-time
The key to staying on top of cash flow is to reconcile as often as possible – ideally every day. A bank reconciliation is when you organize all the payments that have gone through your bank account. You should know exactly what money has or hasn’t been paid or received. When you know what’s coming, you can take action before things get messy.
- Use online invoicing for quicker and easier payments
With online invoicing, your customers tap “Pay Now” and their payment is immediately processed. There’s also nothing to get lost in the mail – you know exactly when your customers have opened an invoice.
- Connect your business systems to Xero so all your data is accurate and up-to-date
Data should flow from other sources, not just your bank account. Depending on what type of business you run, you probably have other financial systems like CRM, debtor tracking, HR or inventory management. When data from those systems integrates with your bookkeeping software, everything is faster, easier and more accurate. Xero integrates with hundreds of add-on business applications so that you can easily sync and streamline your data.
With the right software, accounting can go from tedious to simple; from confusing to clear; and from boring to fun. These are just four things you can do with Xero. Want to do more? Give us a call, we will work it through with you or do it for you!