1.0 What is Xero Accounting
Xero Accounting is a cloud accounting software for small businesses which allows business owners to share their access towards the financial information with their employees and accountant. Since all the financial information is stored in the cloud, there is no risk of theft or data loss. Furthermore, Xero introduces their own Xero App Marketplace where users can find additional applications which suit their needs. Users could simply browse the applications in the marketplace by functions that they are looking for. Moreover, Xero accounting makes real time changes towards the data stored in the cloud, therefore every user is always accessing the latest version of the data. This would boost productivity for the team, as there is no need to inform where each user made their corresponding amendment.
2.0 Features of Xero
2.1 Xero Dashboard
Xero Dashboard allows users to keep in watch up-to-date key performance indicators of the business. Moreover, users are also able to review their monthly cash in and out easily from the dashboard. This would help them to easily keep track with the company’s performance by comparing to their budgeted cash flows. Accounts watchlist, pending bills and payment from customers are also available on the dashboard for users to read them easily.
2.2 Xero Bank Feeds
Xero Bank Feeds automatically imports bank statement lines directly into user’s Xero organization, therefore eliminating the risk of errors in entering the transactions manually. To check if a bank feed is available for user’s bank account, add the bank account into Xero and search for the bank name. If the bank name appears in the search results, this means that bank feeds are available for this bank. However, if unfortunately, there were no feeds available for the bank account, users would have to consider entering the bank statement lines manually into Xero.
2.3 Easy bank reconciliation
It is easy to reconcile bank statement in Xero as Xero always provides suggestion match of transactions entered in Xero such as bills paid, sales received, expense claims to each bank statement line. If the suggestion was correct, users simply have to click the “OK” button to reconcile the line with the corresponding transaction. If it was not correct, users would have other options such as Create, Transfer, Discuss, Find & Match to reconcile the bank statement line. For instances where the bank statement line consists of more than one transaction, users are required to click “Find & Match” to find transactions that are related to that particular bank statement line.
Other instances such as amount received in split payment by customers or amount paid to suppliers in split, Xero also provides searches on the invoice where users can click on “split payment” to split the bills to match with the bank statement line.
2.4 Easy to trace source files
Xero accounting provides feature where users can upload their source documents and attach the relevant one to each invoice and bill. This makes searching for relevant documents so much easier as users could always access to the relevant source document when clicking into the invoice or bill.
2.5 Customizable invoices
Moreover, Xero accounting allows users to customize their own invoices by uploading their company’s logo into Xero. Users are allowed to create many different styles of invoices and select items they wish to display on their invoices. Then, they can specifically choose the style of invoice for each different customer.
2.6 Automatic payment reminders
Furthermore, Xero accounting also provides feature where it can be set to automatically email payment reminders to customers. Users are free to choose on how often they want the reminders to be sent to the customers.
Online invoices allow customers to pay business owners straightway by clicking on the “Pay Now” button, using third-party payment services.
3.0 Benefits of Xero
3.1 Always accessible
Xero allows users to access to their data anywhere, using any device.
3.2 Same data
With data stored in cloud, all users are able to work from the same information at the same time. Xero made real-time changes to ensure every user works with the most up-to-date information.
3.3 Secure storage
The cloud stores data securely and provides automatic back up. Hence, there is no risk of theft or data loss.
3.4 Data flow
Xero connects to data sources like financial institutions, to provide benefits to users such as bank feeds that bring information straight into the organization. This reduces chances of errors and reduce information processing time.
Xero provides users with features such as Xero Dashboard, following up overdue invoices by setting up automatic email payment reminders to customers, customizing different styles of invoices for specific customers.
3.6 Less maintenance
Cloud software updates are automatic and seamless, so it saves users time and money from keeping the software up to date.
4.0 Safety and reliability of Xero
4.1 Security assurance
Xero is certified as compliant with ISO/IEC 27001:2013 which is globally recognized as the premier information security management system (ISMS) standard. Xero has produced a Service Organization Control (SOC 2) report. The report is the result of an independent auditor’s examination of Xero’s cloud based accounting system relevant to the Trust Services Criteria for Security, Availability, and Confidentiality.
4.2 Trusted source of data
Direct bank feeds from banks would ensure the data is kept untouched by others and also eliminated from human errors.
4.3 Access controls
Business owners could control what users can see by only inviting those they want them to access with the financial information. Besides, by providing user roles, business owners could actually limit each person accessibility to the data. Hence, they can ensure some important data remains untouched by others. For instance, when business owners invite a new user into the organization, they would have to assign a role for them. This role would limit the level of access the user has towards the data and functions in Xero. Roles such as full access to all or most features, access to only enter customer invoices or supplier bills, or both, the ability to only view existing transactions and full or restricted access to Xero Expenses, Projects or Payroll.
4.4 Extra security at login
There is a multi-factor authentication feature available in Xero, which adds an extra layer of security that helps to protect user’s accounts. This can be set up by installing an authenticator application and follow the steps in Xero to complete the process. Once users have set up their multi-factor authentication, they need to authenticate every time they log in to Xero.
4.5 Data encryption
Xero encrypts all data between that goes between users and Xero using industry-standard TLS (Transport Layer Security), which protects users’ personal and financial data. Xero also assures users’ data is encrypted at rest when it is stored on the servers and encrypted when Xero transfers it between data centres for backup and replication.
4.6 Secure data centres
Xero’s servers are located within enterprise-grade hosting facilities that employ robust physical security controls to prevent physical access to the servers they house. These controls include 24/7/365 monitoring and surveillance, on-site security staff and regular ongoing security audits. Xero maintains multiple geographically separated data replicas and hosting environments to minimise the risk of data loss or outages.
Xero accounting offers three plans for business owners to choose from, which are the Starter, Standard and Premium plan. Besides, Xero also provides free trial that allows owners to access all Xero features for 30 days.
5.1 Starter Plan
Starter plan suits users who are freelancers, sole traders and operating new businesses. As there is limitation for signing up for this plan, which are sending limited invoices and bills, capped at 20 and 5 respectively. Therefore, this plan suits businesses which has just started operating and does not have large number of customers and suppliers.
5.2 Standard Plan
Standard plan, which is the most popular plan in Xero, is suitable for all growing businesses. This plan offers users to send unlimited invoices and enter unlimited bills in their Xero organization. Since this plan does not offer users to use multiple currencies feature, it suits the needs for local companies or companies which do not have international transactions.
5.3 Premium Plan
Premium plan allows users to assess all Xero features, including the multi currencies feature which is unavailable in standard plan. Therefore, premium plan is suitable for all established businesses of all sizes.