IN THIS CHAPTER

Utilising expert help

Getting your head around differences in terms

Knowing how bank reconciliation autosuggestions work

Keeping track of how users access your Xero file and when to delete a user account

Storing emails and owning data

Understanding the differences between Xero and your old system

In this chapter, I highlight mistakes, myths and misconceptions about working with Xero. And I explain how you can identify and avoid them — ensuring you’re working efficiently and effectively.

Not Making Use of Expert Help

The philosophy behind using Xero is, because it’s in the cloud, you can invite experts to work on your data and provide ongoing advice during the year about your financial position. No longer do you need to wait till the end of the year to speak to your accountant!

So make sure you take advantage of expert help, when and where you need it. If you need help with the set-up, contact a Xero-certified adviser (check out www.xero.com/advisors for options) to work with you during the process. This adviser can assist in identifying issues you need to be aware of, and work with you to set the file up to suit your specific business processes.

Engage a Xero-certified accountant for help with setting and monitoring goals, developing tax-mitigating strategies, and preparing financial year accounts.

If your existing accountant doesn’t know Xero, introduce them to it and encourage them to embrace the cloud with you. I’ve worked with a number of accountants who’ve got their first taste of Xero from a client — and they’ve all said working with Xero was straightforward and that they picked it up quickly. (Of course, you could always get them to buy a copy of this book!)

Refer to Chapter 4 for more on inviting other users (such as your accountant) to access your accounts, and Chapter 11 for more on working with your accountant on end of financial year reporting.

Not Understanding Terminology Differences

I’ve been fortunate enough to work in accounts departments all over the world, and work with numerous accounting software — from ACCPAC to Xero, and lots in-between! Debits and credits are an international accounting language but, as you move through different systems, different clients and different countries, terminology changes. Income becomes Revenue and Proprietorship becomes Equity — you can have lots of terms with generally the same meaning.

In Australia, for example, the term credit note was replaced with adjustment note with the introduction of GST — but people colloquially still call it a credit note.

In the same area, debit notes are issued to a supplier to reduce the amount you owe. The terminology Xero uses for both adjustment notes and debit notes is simply credit notes.

Pay slips are referred to as payslips in Xero, which seems to be the US rendering. You may uncover other instances; however, because of the areas the terminology is within, you should be able to easily understand what Xero is referring to. Sometimes, as with the Chart of Accounts, you can override the default terminology and replace it with what you’re comfortable with. However, some of the terminology can’t be changed. The important thing is to understand what is meant — and, hopefully, you won’t even notice it after using Xero for a while.

Messing Up Bank Reconciliation Autosuggestions

Xero helpfully recognises regular transactions and, when you’re reconciling these transactions in the future, makes autosuggestions appear beside the transactions. Where this can cause problems is if you incorrectly code a transaction, or code it in an unusual manner. Xero may remember the mistake and keep suggesting it for similar transactions. (Dammit, Janet!)

You can’t delete Xero’s autosuggestions, but you can overwrite them in the bank reconciliation screen. If Xero has memorised an incorrect autosuggestion you need to avoid using it — otherwise, you perpetuate the situation. The next time you see the incorrect autosuggestion while reconciling, you need to carefully correct and record over the autosuggestion so that it replaces the one you don’t want remembered.

Alternatively, at the bottom of the reconciliation screen, uncheck the box beside Suggest Previous Entries — this turns autosuggestions off.

Using a Communal User Account

If all users access via a communal, generic user name, such as ABC Bookkeeping, you can’t tell who is actually accessing your file or what they are doing. You want anyone accessing your Xero file and financial data to be accountable and tagged in the audit trail.

So, instead, make sure everyone who accesses your Xero file uses their own user account, set up specifically for them with the access level you’ve allocated.

Not Deleting Old User Accounts

As soon as you have an inkling someone no longer needs access to your Xero file, you need to promptly act, and remove their access. Sometimes even the most normal of people end their time with a business in an unfavourable manner and do some terrible things out of spite. While users can’t actually access any of your financial funds through Xero, and a limited trace of their user activity is maintained in Xero, it’s much better to be careful than sorry.

To delete a user in Xero, follow these steps:

1. From the home dashboard, go to Organisation menu → Settings → Users and click on the name of the user to be deleted from the file.

   The Users dashboard opens.

2. Click the red Delete User button.

   The Delete User window opens, checking if you’re sure you want to delete the user. Confirm by clicking the red Delete User button again. You’re returned to the Users dashboard and the deleted user has vanished!

Thinking Your Xero Emails Are Stored

The details of emails sent from Xero are not stored anywhere within Xero, although a note about the email sent is maintained in the History & Notes area. If you deal with hundreds of transactions, this is probably fine. If you’re bespoke and like to personalise your messages, you may want to keep a copy of the email — in this case, when you send an email, simply opt for a copy to be sent to your defined Xero email address (which is the email address you log in to Xero with) by checking the Send Me a Copy box (refer to Chapter 6 for more information).

Not Realising the Subscriber Owns and Controls the Data

If you pay your Xero subscription to a Xero partner — let’s call her Katherine — due to Xero’s legal framework, the subscriber (Katherine) owns and controls access to the data. Check out Xero’s Terms of Use (www.xero.com/about/terms) to see how this is clearly spelt out.

Let’s play devil’s advocate — if the partner sold her business, she would sell on the subscriptions, and thus the control of your data. If the new owner did not pay the Xero bills, your Xero data file would be deactivated — even if you had paid the partner. You may have some trouble reactivating your data file because you don’t own and control the data. Of course, many people subscribe through a reseller and the relationship works without a hitch, but data ownership, control and access is something I highlight to all my clients and is something to think about.

Trying to Make Xero Do What Your Old System Did

If you’re moving from another accounting system or a paper-based system, adapting to a new system can be difficult. But don’t get stuck in a rut of trying to make Xero do what your other system did. Work towards learning the new processes and names within the Xero system, so you’re working with it rather than against it.

Try to find 15 or 30 minutes each day for learning new aspects of Xero. Pick an issue (or a section of a chapter from this book) to work on. Embrace the change.

Watching Your Bank Feeds Refresh

If you’re using third party bank feeds, you may benefit from refreshing these on a regular basis. If they’re taking too long to refresh, cancel the refresh and give it another go. If you know your bank feed refreshes can take a few moments, don’t sit and watch the screen twiddling your thumbs. If you have a high-speed internet connection, you can open another tab on your computer and carry on working while the bank feed refreshes. If you have a slow connection, plan to have something productive you can do without touching your computer — while still staying close by (because you’re still logged in to Xero). Sort out your paperwork, return a phone call or brainstorm goals on a whiteboard.

Paying Full Price If You’re a NFP

If you’re a charity, not-for-profit or have multiple Xero subscriptions, you’re eligible for a discount on your monthly subscription charge! For more information, contact the Xero Billing Team.