How to use information that you have in Xero to your advantage The benefits of cloud accounting are wide ranging but one of the big advantages is the ability to take the information available in Xero to allow you to run your business more efficiently or, from an accountant’s point of view, to allow you to be more proactive when advising your clients as it is no longer necessary to work with historical data...
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The availability of up to date information assists in the running and management of a business as it allows management to view the current position at the touch of a button. Through the use of bank feeds and invoice processing apps such as Receipt Bank, the information in Xero can be much more up to date than traditional non-cloud based accounting systems. This in turn allows you to easily run reports to give you up to date information on the business. This could be the balance in the bank, the profit and loss for the month to date or a current suppliers report. For the accountant this is also a significant move forward as no longer is it necessary to wait for a back up to be sent in order to analyse last month’s information. Now they can log in and review the client’s “live” records. This all means that the business can receive up to date information and make informed and timely decisions based upon this information. As a result, the business can operate more efficiently and effectively as 84 / Issue 14
they are now reviewing current rather than historic data. Monitoring the Business Performance Through integrating Xero with apps such as Futrli or Spotlight, the business can monitor its key performance indicators and report on the business performance. As the information is real time, this can allow the business to have a snap shot of its position at any point in time. Apps such as Futrli allow the business owners or their accountants to build customised dashboards outlining the critical information that is important to that particular business’ growth and success. This could include analysis of their gross margins, sales revenue by employee for the month to date or return on investment. It is also possible to report on actual results compared to budget and thereby look into the variances and allocating resource to overcome business performance issues. As well as pulling real time information from Xero, it is also possible to upload non-financial data into apps such as Futrli which
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Caroline Harridence joined MHA MacIntyre Hudson Peterborough office in February 2017 having originally trained with PWC. Caroline is a Business Services Manager running the outsourcing team. Her team provides the full spectrum of services from general bookkeeping and payroll functions, through to the preparation of management accounts for presentation to clients at their monthly board meetings. Caroline has a keen interest in Cloud Accounting and is the Eastern Regional Cloud champion.
then gives the business the ability to analyse their performance further. Examples could include reviews of revenue compared to headcount, sales growth by product family and cost analysis by depot. The up to date information in Xero can also be used by the business to prepare business plans. These plans can then be used, for example, in presentations to banks or potential investors for fundraising or for updating shareholders on the plans for the business. This saves the business significant time and money as no longer is it necessary to spend long periods of time manually updating business plans and it also provides reassurance to those receiving the business plan that they are reviewing current rather than out of date information. Debtor Management Sales invoice processing is streamlined through the ability to raise sales invoices in Xero and send them directly to the customer. By adding payment services such as PayPal to their Xero account, the business can accept payments directly from the customer online. Therefore, when the invoice is
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