Xero Accounting for Businesses
What is Xero?
Xero is a cloud based accounting package, similar to but not quite the same as Sage, Quick Books, Free Agent, etc. I first started using accounting packages for accountants back in the early 1980’s. In those days there were only four players in the market: Sage, Star and the company I initially worked for, Alton Computers, and CMG, who I worked for after leaving Alton Computers. During my time at these companies we moved from mini main frames (DEC PDP11’s) with tape drives and teletypes to screens and removable 15” hard disks and later to the original 7” floppy discs (and they really were floppy!).
The cloud as we know it nowadays did not really originate until about 2012.
What can Xero do for your business?
You run your own business. When you first started it was all a bit of a wheeze and great fun, but now things have got tougher. You’re having problems with:
- understanding where your business is and, more importantly, where it’s going
- understanding why you’re making a profit but you always seem to be scrabbling around looking for money to pay staff wages or bills
- understanding why your debtors seem to get bigger and bigger each month
- understanding why your cashflow seems to be on a downward trajectory
Xero, or to be more precise, Xero together with one or other of its related apps, can help you with all these problems. They probably cannot remove the problems completely, but they can let you know why the problems are there and what you can do to make things better for yourself.
What is an app? An app (short for “application”) is a program or a suite of programs that can integrate with Xero (and often with each other) and abstract accounting data from Xero in order to manipulate the data is some way or other, often to produce more meaningful reports than those produced solely from Xero.
A group of apps working together is often referred to as an app stack or a tech stack.
What apps should I use?
With over 500 apps that integrate with Xero the choice is enormous.
We have distilled all these down to a few apps that ourselves and other accountants consider to be the “best of breed”.
The most basic app stack we would recommend is:
XERO + RECEIPT BANK
Receipt Bank is a truly awesome piece of software. At its most basic it enables you to scan a receipt with your iPhone or Android and then for the receipt to appear in Xero ready for you to authorise. Like Xero, Receipt Bank comes in a mobile version and so is very useful for small tradesmen as they can scan receipts as they call in at the wholesaler or fill up the van with fuel. No more lost receipts or scrunched up bits of paper that are virtually illegible!
If you need a better picture of the state of play of your business we would recommend:
XERO + RECEIPT BANK + FATHOM
Fathom enables you to drill down, to fathom as it were, into Xero and then produce some very meaningful reports which will help answer the questions you might be asking yourself. It presents a wide range of KPIs and profitability, cash flow and growth reports.
If you would like to talk to us about Xero (or even have a demonstration), please call us on 01869 222830.