Career Academy

Course DescriptionLearn how to use Xero, and FAST!Gain an intermediate level of knowledge and learn how to use Xero Accounting to manage your own business accounts or your client’s accounts. This Xero training will set you up with a strong understanding and practical knowledge of Xero to advance your business or career.  Course DurationFit study around your schedule, in your own time, and expect the course to take around 15 hours.

<h5><img alt="1540271505-abkx219-introduction-to-xero-online.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/1214105/1540271505/1540271505-abkx219-introduction-to-xero-online.png" /></h5>

 

<h3>Overview</h3>

This course will provide you with a practical understanding of Xero and an overview of the software package.

<h3> </h3>

<h3>Learning Outcomes</h3>

By the end of the course, you will be able to:

<ul>
	<li>
	Explain cloud computing and the benefits of using Xero.
	</li>
	<li>
	Identify what the system requirements are to use Xero.
	</li>
	<li>
	Recognise and navigate your Xero Dashboard.
	</li>
	<li>
	Explain how to set up Multi-factor authentication. 
	</li>
</ul>

Overview & Learning Outcomes

Xero is a New Zealand-based software company that has developed a cloud-based accounting program for small and medium-sized businesses, allowing them to work with accountants, business partners and staff in real time. It is a complete accounts system designed to help businesses manage their finances better. <img alt="1540271875-image.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/1214105/1540271875/1540271875-image.png" style="float:right;" />

 

All financial data is stored in the cloud in a single ledger, with live bank and credit card statement feeds connecting directly into the program, allowing users to work on the same live data regardless of location or operating system. This is a unique feature that many of the other accounting programs are yet to effectively offer.

 

One of the main benefits of Xero is its simple user interface and navigation, designed to be used and understood by business owners, not just accountants. There is no software to install, which makes it very accessible and easy to set up. Since Xero runs online, backups are all done automatically for free, with new features and enhancements released every 3-6 weeks based on feedback and ideas from their customers.

 

<img alt="1652657774-office-620822-640-3-1.jpg" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652657713/1652657774-office-620822-640-3-1.jpg" style="float:right;height:232px;width:350px;" />

Xero was founded by New Zealander Rod Drury, as an alternative to traditional desktop accounting software which he felt had become outdated. Officially formed in 2006 in Wellington, New Zealand, Xero now operates in over 180 countries with over 1.7 million subscribers worldwide.

 

Xero has multiple offices in New Zealand, Australia, the United Kingdom, the Americas, Asia and South Africa, and is only listed on the Australian Securities Exchange. The company entered the Australian market in 2011, and both the United Kingdom and United States in 2012.

 

Xero’s products are based on the Software as a Service (SaaS) model and sold by subscription. There are a range of subscription options available which we will look at further in this course.

 

<h3>Introduction to Xero Online</h3>

For a brief overview of what Xero is and what it has to offer, please watch this short video (please note there is no audio other than background music in this video):

 

<iframe allowfullscreen="" height="360" mozallowfullscreen="" src="https://player.vimeo.com/video/264905137" webkitallowfullscreen="" width="640"></iframe>

What is Xero?

Unlike traditional desktop software (think Microsoft Word), where all your data is stored locally (on the computer you use the software on) with cloud software, your data lives online, so it’s always accessible from anywhere at any time, if you have an internet connection. 

 

<h3>What is the Difference between the 'Cloud' and the Internet?</h3>

The Internet is your connection to the Cloud. Cloud applications are where you use the software and store your data online. 

 

A lot of businesses are moving their software into the cloud, as this gives users more freedom about how they access the application, which is on any computer that has access to the Internet. Also, because a lot of cloud companies, such as Xero, spend millions on systems and experts to protect your data, it can be considered a safer and more secure place to store your data.

 

There are many resources on the internet to help you understand cloud computing and to increase your confidence in the safety and security of your data in the cloud.

 

<h3>Xero's Guide to Understanding Cloud Accounting</h3>

Xero has created a short, easy-to-understand guide to cloud accounting. So, if you are a little unsure about what this really means then please have a look at the Xero site now and read through the information - <a href="https://www.xero.com/au/resources/small-business-guides/cloud-accounting/cloud-computing/" target="_blank" rel="noreferrer noopener">Xero's Guide to understanding Cloud Accounting</a>.

 

<a href="https://www.xero.com/au/guides/understand-cloud-computing/"><img alt="1652657973-cloud-1.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652657912/1652657973-cloud-1.png" /></a>

Understanding Cloud Accounting

The key features of Xero include:

<ul>
	<li>
	Automatic bank and credit card account feeds
	</li>
	<li>
	Invoicing – Create and send invoices automatically
	</li>
	<li>
	Accounts payable
	</li>
	<li>
	Inventory
	</li>
	<li>
	Expense claims
	</li>
	<li>
	Fixed asset maintenance
	</li>
	<li>
	Purchase orders
	</li>
	<li>
	Quoting
	</li>
	<li>
	Payroll (in some countries)
	</li>
	<li>
	Standard business and management reporting
	</li>
	<li>
	Multiple tax rates and currencies
	</li>
	<li>
	Bank reconciliation
	</li>
	<li>
	Contacts – Keep track of suppliers and customers
	</li>
	<li>
	Files – Attach documents to your financial data
	</li>
	<li>
	Financial reporting
	</li>
	<li>
	Free, unlimited email support
	</li>
	<li>
	Access from anywhere, any time
	</li>
	<li>
	Mobile apps (Android, iPhone/iPad)
	</li>
	<li>
	Smart lists – Segment contacts based on purchase history
	</li>
	<li>
	GST returns.
	</li>
</ul>

 

As mentioned in the previous section, Xero can automatically import bank and credit card statement feeds, which makes it incredibly easy to reconcile your transactions since both sides of the story are presented in the one system. 

 

<img alt="1652658120-person-holding-black-pen-and-notebook-3787327-1.jpg" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652658059/1652658120-person-holding-black-pen-and-notebook-3787327-1.jpg" style="float:right;height:214px;width:450px;" />

Financial reporting is one of Xero’s strongest advantages over other accounting programs, as it can summarise your activities using the filters you’d like to see included. There are many report options in Xero, and all can be tailored to your specific needs. They can be exported to PDF, Google Docs, XLS or XLSX format. To ensure you can export these reports, you will need to check that you have the right software and Google account access to export reports.

 

Xero also offers a free API that enables customers and 3rd-party software vendors to integrate external applications with Xero.  There are hundreds of 3rd-party software vendors that have built Xero add-ons. We will look at add-ons and integrations further in the course.

 

<h2>Xero Plans and Subscriptions</h2>

There are currently three pricing plans available in Xero, as well as an initial 30-day free trial with full access to all tools and Xero add-ons.

 

The three plans available are - Standard, Premium and Starter. 

 

<a href="https://www.xero.com/au/pricing-plans/"><img alt="1652658309-xero-plans-1-1.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652658248/1652658309-xero-plans-1-1.png" /></a>

 

 

<h3>Standard</h3>

Standard is Xero’s most popular plan. Under this plan a user can:

<ul>
	<li>
	Send invoices and quotes
	</li>
	<li>
	Enter bills
	</li>
	<li>
	Reconcile bank transactions
	</li>
	<li>
	Payroll for up to 2 people
	</li>
	<li>
	Capture bills and receipts with Hubdoc.
	</li>
</ul>

 

<h3>Premium</h3>

Premium includes full access to all features at a higher price. It includes all of the above Standard features plus the following extras:

<ul>
	<li>
	Payroll for up to 100 people (with an additional cost after 100 and a maximum of 200)
	</li>
	<li>
	Automate superannuation
	</li>
	<li>
	Ability to handle multiple currencies.
	</li>
</ul>

This is the best plan for those who do business internationally.

 

<h3>Starter</h3>

Under this lower-cost plan a user can:

<ul>
	<li>
	Send 5 invoices &amp; quotes
	</li>
	<li>
	Enter 5 bills
	</li>
	<li>
	Reconcile 20 bank transactions
	</li>
	<li>
	Payroll for 1 person.
	</li>
</ul>

This plan is best for those starting up a new business.

 

<h3>Optional Integrations to Add to a Subscription</h3>

<ul>
	<li>
	Xero Projects: Job costing software within Xero. You can link Xero invoices, bills, and spend money transactions to a project.
	</li>
	<li>
	Xero Expenses: For tracking, assigning and managing expense claims.
	</li>
</ul>

Key Features of Xero

Xero is a cloud-based program so you must have a device that can connect to the internet before you can use Xero. If you do not have an internet connection then you will not be able to access Xero, and there is no offline version.

<img alt="1652659144-latest-gadget-on-white-table-3774680-1.jpg" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652659083/1652659144-latest-gadget-on-white-table-3774680-1.jpg" style="float:right;height:238px;width:500px;" />

 

Xero is designed to be primarily used on a computer but you can also log in to Xero on your mobile device where you can perform many standard tasks while you are out of the office or away from the computer. Xero will work on most mobile devices and you'll get the best results with the latest version of Mozilla Firefox, Safari, Google Chrome, Internet Explorer or Opera Mini.

 

To ensure Xero runs as expected on your computer, you should access the program using the latest version of one of the following browsers:

<ul>
	<li>
	<a href="https://www.google.com/chrome/browser/desktop/index.html" target="_blank" rel="noreferrer noopener">Google Chrome</a>
	</li>
	<li>
	<a href="https://www.microsoft.com/en-us/download/details.aspx?id=41628" target="_blank" rel="noreferrer noopener">Internet Explorer (IE) 11</a>
	</li>
	<li>
	<a href="https://www.microsoft.com/en-nz/windows/microsoft-edge" target="_blank" rel="noreferrer noopener">Microsoft Edge</a>
	</li>
	<li>
	<a href="http://www.mozilla.com/en-US/firefox/all.html" target="_blank" rel="noreferrer noopener">Mozilla Firefox</a>
	</li>
	<li>
	<a href="https://support.apple.com/en-nz/HT204416" target="_blank" rel="noreferrer noopener">Safari 8 or later</a>
	</li>
</ul>

Xero does not support any beta versions of these browsers or alternative open source builds of them, so if you find you are having trouble accessing Xero, first check that you have the latest browser version and that it is not a beta version. You will also need to make sure that cookies and JavaScript are enabled in your browser.

 

<h3>Tips and Tricks</h3>

Here are some ways of working on your computer that will make tasks easier for you:

<ul>
	<li>
	If you have an old computer you may need to install or update Flash player to see Xero’s interactive graphs.
	</li>
</ul>

<ul>
	<li>
	If you are using Firefox, you may consider turning off firebug as it causes slower page loads.
	</li>
</ul>

<ul>
	<li>
	You can use MS Office 2007 or later (with .docx) to customise invoices.
	</li>
</ul>

<ul>
	<li>
	If you have speed issues, you may try clearing your cache (temporary internet files) and cookies (shortcuts available – e.g. to clear recent history in Firefox use shortcut = Ctrl+Shift+Del).
	</li>
</ul>

<ul>
	<li>
	If you are not able to find a report within Xero, you can print screens from your browser – file/print.
	</li>
</ul>

<ul>
	<li>
	Hold down Ctrl or right-click on menu options to open another tab on your browser.
	</li>
</ul>

<ul>
	<li>
	If you need to view multiple Xero organisations at the same time, you must open each organisation in a different browser. For example, log in to your first organisation in Chrome and your second organisation in Firefox. This ensures that each organisation has its own separate data session.
	</li>
</ul>

For more tips and tricks direct from Xero please have a look at these links - <a href="https://central.xero.com/s/article/Tips-and-shortcuts" target="_blank" rel="noreferrer noopener">Xero Tips</a> and <a href="https://central.xero.com/s/article/Tips-and-shortcuts#Dateentryshortcuts" target="_blank" rel="noreferrer noopener">Date Entry Tips.</a>

 

<h3>Xero's Inbuilt Calculator</h3>

Xero has an inbuilt calculator for your use, to work out your transaction and manual journal amounts.

You can use basic arithmetic functions such as the ones below:

 

<img alt="1652659207-calculator-1.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652659146/1652659207-calculator-1.png" />

 

In transactions such as invoices, you can enter a basic arithmetic operation into the Quantity, Unit Price and Discount fields. Xero calculates the result when you press Enter or Tab. You can also use the calculator in the Debit and Credit fields in manual journals.

<img alt="1652659257-abkx157-07-1-2.gif" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652659196/1652659257-abkx157-07-1-2.gif" />

 

<h3>Support</h3>

Xero is fairly logical and easy to use. However, like any new software, it will take time to get familiar with where the new features are and how to use it. 

 

This course will take you through the fundamentals to get up and running with Xero, but if at any time you have questions, Xero provides a variety of methods to support you:

<ul>
	<li>
	<a href="https://central.xero.com/s/" target="_blank" rel="noreferrer noopener">Xero Central - Online Support and Community</a>
	</li>
	<li>
	<a href="https://tv.xero.com/" target="_blank" rel="noreferrer noopener">Xero TV</a>
	</li>
	<li>
	<a href="https://tv.xero.com/#category/videos/customer-stories" target="_blank" rel="noreferrer noopener">Xero Customer Stories</a>
	</li>
	<li>
	<a href="https://www.xero.com/blog/?region=au" target="_blank" rel="noreferrer noopener">Xero Blog</a>
	</li>
	<li>
	<a href="https://central.xero.com/s/topic/0TO1N0000017kqKWAQ/xero-system-requirements#business" target="_blank" rel="noreferrer noopener">Xero System Requirements</a>
	</li>
	<li>
	<a href="https://www.xero.com/au/resources/small-business-guides/" target="_blank" rel="noreferrer noopener">Xero Small Business Guides</a>
	</li>
	<li>
	<a href="https://www.xero.com/au/resources/accountant-bookkeeper-guides/" target="_blank" rel="noreferrer noopener">Bookkeeper Resources</a>
	</li>
	<li>
	<a href="https://www.xero.com/au/resources/podcasts/" target="_blank" rel="noreferrer noopener">Podcasts</a>
	</li>
</ul>

 

<a href="https://www.xero.com/blog/?region=au"><img alt="1652659299-blog-2.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652659238/1652659299-blog-2.png" /></a>

 

<h3>Keep up to date with Xero</h3>

Xero is a cloud-based program and unlike desktop solutions, you are not sent a file to update your current version of the product. Xero updates its software often with no need for user intervention. This means you may go home one night and when you arrive in the morning there is a brand-new feature.

 

There are typically notifications in Xero but to ensure you know what is changing, and when, you should keep an eye on the <a href="https://central.xero.com/s/article/Xero-Releases" target="_blank" rel="noreferrer noopener">Xero Releases</a> page. This includes information on product releases, company updates and small business news. There is also a <a href="https://tv.xero.com/#category/videos/xero-updates" target="_blank" rel="noreferrer noopener">Xero Updates</a> page within Xero TV.

 

You can also keep an eye on the <a href="https://central.xero.com/s/live-events" target="_blank" rel="noreferrer noopener">Live Events</a> page in Xero Central for upcoming webinars on new releases and updates as well as live discussions and trainings.

 

<img alt="1652659337-categories-1.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652659275/1652659337-categories-1.png" />

What do you need to use Xero?

Now that you know what Xero is and what you need in order to use Xero, let's get started and create a new trial for you to work with throughout this course.

If you have previously signed up with Xero or already have a paid subscription, you do not need to sign up again. You can skip the instructions below and log into your existing account.

 

<div style="color:#fff;background:#379BBB;padding:5px;border-bottom:none;">
<h2>Create a Xero Trial </h2>
</div>

<div style="color:#000;background:#FFFFFF;border:1px solid #379BBB;padding:0.9em;">
Click <a href="https://www.xero.com/au/login/" target="_blank" rel="noreferrer noopener">HERE</a> to go to the Xero website and then click Try Xero for free.
</div>

 

<h3>Create a Trial - Instructions</h3>

Complete the sign up details below and click confirmation

<h5><img alt="1652659683-start-a-free-trial.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652659622/1652659683-start-a-free-trial.png" style="height:502px;width:600px;" /></h5>

 

Remember to tick the reCAPTCHA and the 'terms of use, privacy policy &amp; offer details' agreement checkboxes.

<img alt="1652659729-2021-09-06-09h24-10.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652659668/1652659729-2021-09-06-09h24-10.png" />

 

 Next click on Confirmation.

<img alt="1652659756-2021-09-06-09h36-15.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652659695/1652659756-2021-09-06-09h36-15.png" style="height:469px;width:650px;" />

 

An email will be sent to your email address to verify your account, within the email click on Yes, it's me - let's get started.

 

<img alt="1652659794-lets-get-started.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652659733/1652659794-lets-get-started.png" style="height:514px;width:650px;" />

 

After clicking the link, you will be taken back to the Xero website to create a password and activate your account.

 

<img alt="1652659817-activate-your-account.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652659756/1652659817-activate-your-account.png" style="height:457px;width:350px;" />

 

On the next screen, you will enter your account details for your organisation such as name, the country in which you pay taxes, time zone, what your organisation does and whether you are registered for GST. When you have completed the form, click on 'Start Trial'.

 

Add details as follows:

<ul>
	<li>
	Enter the Business name as Xero Trial
	</li>
	<li>
	The industry is Higher Education
	</li>
	<li>
	Tick Yes I have employees
	</li>
	<li>
	Yes I am GST registered
	</li>
	<li>
	Then select Start trial
	</li>
</ul>

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1674576703/1674576762-new-trial-au.png" alt="1674576762-new-trial-au.png" />

 

You will be taken to your Xero Trial Dashboard.

 

<img alt="1652659898-xero-trial-dashboard.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652659837/1652659898-xero-trial-dashboard.png" style="height:89px;width:750px;" />

 

From here you can access the Demo company which is the account you need to use to complete your training. To access the Demo company, start by navigating to Xero Trial, then using the drop down box select Demo Company.

 

<img alt="1652659927-demo-company.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652659866/1652659927-demo-company.png" style="height:407px;width:300px;" />

Sign up with Xero

It is important to understand that the trial you created and the Demo company are two different files.

The trial account you created will be active for 30 days and then Xero will suspend this account.

The trial is a great place to test out transactions but all the work you will be asked to complete during this Xero course must be completed in the Demo Company. This is because there is data pre-populated in the Demo Company account and it will make it much easier to complete the practice exercises that have been created to accompany this course.

 

<h3>Accessing the Demo Company</h3>

To first access, the Demo Company log into Xero and then click on the Company Name at the top left and click Demo Company from the menu as shown below.

 

<img alt="1652822032-demo-company-1.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652821969/1652822032-demo-company-1.png" />

Note the Difference Between a Trial and the Demo Company

When you log in to Xero you will see a menu bar across the top with several tabs, depending on what user access you have and your country (take a look <a href="https://central.xero.com/s/article/User-roles-explained?userregion=true#Typesofuserroles" target="_blank" rel="noreferrer noopener">here</a> to learn more about the different user roles).

 

<h3>The Dashboard</h3>

The Dashboard is the main screen for each organisation in Xero and displays a snapshot of your organisation's financial position based on transactions entered into Xero. You can use the Dashboard to directly drill down into a transaction or do common tasks quickly like bank reconciliation or adding sales invoices or bills.

 

Before you get started with the Xero course work you should watch the short video below for a quick tour of the dashboard (please note there is no audio other than background music in this video):

<div><iframe allowfullscreen="" height="360" mozallowfullscreen="" src="https://player.vimeo.com/video/248029526" webkitallowfullscreen="" width="640"></iframe>

<h3>Settings </h3>

Under the Organisation tab you will find the Settings, which is where most of the functionality of your account is derived from. Here you can enter corporate information and adjust financial settings. Financial settings include your financial year end, GST details, time zone and lock dates.

<h5> </h5>

<h3>Business</h3>

Under the Business menu you’ll find daily tools such as:

<ul>
	<li>
	Invoices and quotes
	</li>
	<li>
	Bills and purchase orders
	</li>
	<li>
	Expense claims
	</li>
	<li>
	Inventory (labelled Products and services)
	</li>
</ul>

 

<h3>Accounting</h3>

The Accounting menu contains the advisory and compliance tools used by advisors and partners of the organisation. These include bank accounts, reports and advanced accounting tools and settings.

Any reports, tools or settings that have been set as favourites show in the Accounting menu. Each user can set their own favourites in the Advanced accounting settings.

 

<h3>Projects and Payroll Menus</h3>

If you use Projects or Payroll, your menu bar will include these. If you only use Projects or Payroll and have the admin role, your menu bar will also include a Reports menu.

 

<h3>Contacts</h3>

Here you can access your organisation’s customers, suppliers and other contact groups. You can also create a sales invoice, quote, bill, credit note or purchase order directly from your contacts' records.

 
</div>

Navigating Xero

When you create your Xero account you will be prompted to set up Multi-factor authentication (MFA).

Multi-factor authentication adds an extra layer of security to your Xero account and is available for mobile devices and Windows computers.

 

It combines something you know (your user name and password) with something you have (an authentication app on your smartphone or tablet). This second layer of security is designed to prevent anyone but you from accessing your account even if they know your password.

 

<h5>How it works:</h5>

To set up multi-factor authentication (MFA), you need:

<ul>
	<li>
	Your own Xero user account and login credentials. You can’t enable MFA for an organisation or practice.
	</li>
	<li>
	An authenticator app installed on a smartphone, device or computer with an internet connection.
	</li>
	<li>
	Access to your Xero organisation with a web browser.
	</li>
	<li>
	A backup email address, which is different to the one you use to log in to Xero. This is your backup method which you use if you don’t have access to your authenticator app. You can choose security questions and answers instead of a backup email address.
	</li>
</ul>

 

To set up multi-factor authentication,<a href="https://aus01.safelinks.protection.outlook.com/?url=https%3A%2F%2Fcentral.xero.com%2Fs%2Farticle%2FSet-up-multi-factor-authentication&amp;data=04%7C01%7Cjessie%40thecareeracademy.com%7C33cddbf85b114c1effeb08d91a9ad025%7C47ca99b8731b41ccaa75c0750201f6dd%7C0%7C0%7C637570074502762017%7CUnknown%7CTWFpbGZsb3d8eyJWIjoiMC4wLjAwMDAiLCJQIjoiV2luMzIiLCJBTiI6Ik1haWwiLCJXVCI6Mn0%3D%7C1000&amp;sdata=92fDkkDyUyuHbfv886r2KdTDs5dCN%2BqA2KPOteP5A1U%3D&amp;reserved=0" target="_blank" rel="noreferrer noopener"> follow these instructions</a> in Xero Central. Here you will find instructions for setting up MFA during login, instructions for setting up MFA once logged in, and instructions for setting up MFA without a smartphone or tablet.

For most users it is a simple process with your smartphone. Xero recommends <a href="https://aus01.safelinks.protection.outlook.com/?url=https%3A%2F%2Fwww.youtube.com%2Fwatch%3Fv%3DYPBBfycT7tg&amp;data=04%7C01%7Cjessie%40thecareeracademy.com%7C33cddbf85b114c1effeb08d91a9ad025%7C47ca99b8731b41ccaa75c0750201f6dd%7C0%7C0%7C637570074502772019%7CUnknown%7CTWFpbGZsb3d8eyJWIjoiMC4wLjAwMDAiLCJQIjoiV2luMzIiLCJBTiI6Ik1haWwiLCJXVCI6Mn0%3D%7C1000&amp;sdata=JjmmFwsV1RxGSeu0Mmw4VbaK1LCFzgsJuMIIquXo9ZE%3D&amp;reserved=0" target="_blank" rel="noreferrer noopener">Xero Verify</a> as it is faster for Xero access. <a href="https://aus01.safelinks.protection.outlook.com/?url=https%3A%2F%2Fwww.youtube.com%2Fwatch%3Fv%3DG4peeVyW9Ys&amp;data=04%7C01%7Cjessie%40thecareeracademy.com%7C33cddbf85b114c1effeb08d91a9ad025%7C47ca99b8731b41ccaa75c0750201f6dd%7C0%7C0%7C637570074502772019%7CUnknown%7CTWFpbGZsb3d8eyJWIjoiMC4wLjAwMDAiLCJQIjoiV2luMzIiLCJBTiI6Ik1haWwiLCJXVCI6Mn0%3D%7C1000&amp;sdata=5bZnOYS3VQ2cCEgYlpx5dIOHt1D%2Bbrhx47ZstuPPt%2Bk%3D&amp;reserved=0" target="_blank" rel="noreferrer noopener">Google Authenticator</a> is also effective however.

 

Please Note: The Career Academy does not offer any support for installation or use of the Authenticator Apps.

 

Below you will find a short video from Xero that provides further insight into multi-factor authentication (please open this video in YouTube to view the closed captions):

 

<iframe allowfullscreen="" height="315" src="https://www.youtube-nocookie.com/embed/Ln4JBnFj59Q?controls=0" width="560"></iframe>

Multi-factor Authentication

There are hundreds of apps, integrations and add-ons available in Xero to add to your subscription plan. Some of these are Xero products built and owned by Xero. Xero has also partnered with accounting systems and third-party apps, each relevant depending on a company’s operations and industry.

<a href="https://apps.xero.com/au/collection/xero-apps"><img alt="1652822569-marketplace-1.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652822506/1652822569-marketplace-1.png" /></a>

 

Just a few examples of add-ons and integrations include:

<ul>
	<li>
	HubDoc: A Xero product and data capture tool. Captures information from bills and receipts and publishes it to Xero; making it easy to match transactions to the Xero bank feed.
	</li>
	<li>
	WorkflowMax: A Xero product specialising in project management. An all-in-one workflow.
	</li>
	<li>
	Shopify: E-commerce businesses selling products online in Shopify can connect to Xero for a single, real-time view of sales and finances.
	</li>
	<li>
	Microsoft Outlook: An integration that lets you share attachments from OneDrive, access to contacts, and view LinkedIn profiles.
	</li>
	<li>
	Mailchimp: Establishes updated contact information between the two systems, ensuring all your communications and campaigns are sent to your most updated contact lists.
	</li>
</ul>

 

Take a look at the <a href="https://apps.xero.com/au/" target="_blank" rel="noreferrer noopener">Xero App Store</a> to view the vast selection of apps available. You can search by keyword, category or for industry specific solutions to find the most appropriate add-on for your business. There are also thousands of reviews for all the different add-ons and apps.

 

<h3>Xero Accounting App</h3>

The <a href="https://www.xero.com/au/features-and-tools/mobile/xero-touch/" target="_blank" rel="noreferrer noopener">Xero Accounting app </a>comes free with every Xero subscription and allows you to access most of the tasks you complete in Xero web; your user role is the same. It can be downloaded from the <a href="https://apps.apple.com/us/app/xero-accounting/id441880705" target="_blank" rel="noreferrer noopener">App store</a> or <a href="https://play.google.com/store/apps/details?id=com.xero.touch" target="_blank" rel="noreferrer noopener">Google Play</a>. 

Some of the tasks you can complete in Xero Accounting include:<img alt="1652822703-2021-06-03-16h40-29.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652822640/1652822703-2021-06-03-16h40-29.png" style="float:right;height:210px;width:400px;" />

<ul>
	<li>
	From the dashboard you can view your bank account balances, profit and loss, cash flow, outstanding invoices, and bills to pay
	</li>
	<li>
	Convert quotes into invoices 
	</li>
	<li>
	Manage your invoices and bills 
	</li>
	<li>
	Create and send invoices via email or messaging app
	</li>
	<li>
	Reconcile your bank accounts and code transactions.
	</li>
</ul>

 

Note: alternatively you can also log in to Xero web on your mobile device using a web browser. Go to the <a href="https://login.xero.com/" target="_blank" rel="noreferrer noopener">Xero website</a>, then log in to your organisation.

 

<h3>3D Touch on iOS devices</h3>

You can use 3D Touch in Xero Accounting for iOS to create or preview invoices, quotes, receipts and contacts. Note: this is only available on iPhone 6S or more recent models. For more information and instructions see <a href="https://central.xero.com/s/article/Xero-for-mobile" target="_blank" rel="noreferrer noopener">here</a>.

 

For more information on the Xero app, watch the below video:

<iframe allowfullscreen="" height="315" src="https://www.youtube.com/embed/00nPn4PX6_E" width="560"></iframe>

Xero Add-ons, Apps and Integrations

In this short quiz, you will be able to check your understanding of the content that has been covered. You must achieve a pass mark of 80% in this quiz.  If you do not achieve the required passing grade in the first attempt don't panic, simply go back over the course material and then try again.

Quiz: Introduction to Xero Online

Introduction to Xero Online

<img alt="1540271815-abkx130-xero-chart-of-accounts.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/1214105/1540271815/1540271815-abkx130-xero-chart-of-accounts.png" />

<h5> </h5>

<h3>Overview</h3>

In this course, you will be introduced to the Chart of Accounts. The Chart of Accounts is the list of all accounts available to record your transactions in Xero. You can leave the Chart of Accounts as it was originally set up when you created your organisation in Xero, or add, edit and delete items from it to suit your business.

 

<h3>Learning Outcomes</h3>

By the end of the course, you should understand how to:

<ul>
	<li>
	Describe the process for accessing the Chart of Accounts in Xero.
	</li>
	<li>
	List the account classification groups and the code ranges for each. 
	</li>
	<li>
	Describe the process for adding a new account, to the Chart of Accounts.
	</li>
	<li>
	Explain the automatic process that the Xero program applies for Tax settings.
	</li>
	<li>
	Apply the process for updating and editing accounts.
	</li>
	<li>
	Demonstrate an understanding of the implications of importing a chart of accounts. 
	</li>
</ul>

The Chart of Accounts is the list of all accounts your organisation has available to record your transactions in Xero. Having the right chart of accounts makes a big difference for your organisation. It helps you classify your transactions correctly, and generate meaningful reports to help you run your business better. Xero assigns your organisation a default chart of accounts when you start on Xero. If you prefer, you can import a chart from your previous accounting system, or your own custom chart.

 

For an overview of Chart of Accounts, watch the following video:

<iframe allowfullscreen="" height="315" src="https://www.youtube-nocookie.com/embed/AkxaN7JR35o" width="560"></iframe>

 

Your user role will determine whether you have access to the Chart of Accounts settings screen in your own Xero company, and if so, what you can do on it. However, you will have full access to the Chart of Accounts during this course.

 

To access the Chart of Accounts screen, go to: Accounting &gt; Advanced &gt; Chart of accounts

<img alt="1652849003-abkx130-01.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652848940/1652849003-abkx130-01.png" />

 

Your Chart of Accounts is arranged in tabs: a complete list of accounts, followed by the account types Assets, Liabilities, Equity, Expenses and Revenue.

<img alt="1652849050-abkx130-02.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652848987/1652849050-abkx130-02.png" style="height:342px;width:600px;" />

 

If you're using the Xero default Chart of Accounts, you'll see it contains a broad range of typical accounts that will be suitable to most businesses. You should seek the advice of your accountant if you are unsure how to use or customise the Chart of Accounts for your business or if you are unsure of which accounts to use on particular transactions or scenarios (e.g. processing loans). A user's role will determine whether that user can view the Chart of Accounts and if so, whether they can edit it.

Click on the Account Name to view the details of the account.

 

<img alt="1652849088-abka130-03.gif" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652849025/1652849088-abka130-03.gif" />

 

 

From here you can make a number of changes:

<ul>
	<li>
	Account type
	</li>
	<li>
	Account code
	</li>
	<li>
	Account name
	</li>
	<li>
	Account description
	</li>
	<li>
	Tax    
	</li>
</ul>

<img alt="1652849147-cixnz90.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652849084/1652849147-cixnz90.png" />

 

 

From the Chart of accounts screen, you can also see the Year to Date (YTD) balance in the far right column.

<img alt="1652849172-cixnz91.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652849109/1652849172-cixnz91.png" />

 

 

<h3>What are System Accounts?</h3>

System accounts are set by Xero. They're used for specific reporting or accounting purposes. You won't see all these accounts on your chart of accounts as some of them are used on reports or in the background by Xero. Also, some accounts only apply if you use multi-currency in Xero.

Xero allows you to enter transactions or manual journals to some system accounts. Xero blocks you from entering transactions or manual journals to other system accounts.

 

<h3>What are Locked Accounts?</h3>

Locked accounts are needed for specific purposes in your organisation. You can edit a locked account but you can't delete or archive the account. Locked accounts include system accounts.

 

Xero locks other accounts if you've used them for the following purposes:

<ul>
	<li>
	Repeating invoice.
	</li>
	<li>
	Bank rule that you have set up.
	</li>
	<li>
	Tracked inventory.
	</li>
	<li>
	Registered fixed asset.
	</li>
</ul>

 

If your organisation uses payroll in Xero, some other accounts will also be locked because they are:

<ul>
	<li>
	Default payroll accounts.
	</li>
	<li>
	Control accounts for pay items.
	</li>
	<li>
	Used on a pay template.
	</li>
	<li>
	Associated with any other line on a payslip.
	</li>
</ul>

 

If the locked account is not a system account, you can use it in transactions and manual journals.

Overview of Chart of Accounts

There are 50 default accounts in the Xero Chart of Accounts. Every account in your chart of accounts has several components. You can edit some components, and use components to learn more about the account.

 

<h3>Account Types</h3>

Each account has a type. Xero uses the account type to determine where the account appears in your financial reports. Xero also uses some account types for specific purposes, e.g. if you purchase an item and code it to an account with the Fixed Assets account type, Xero will add the item to the fixed asset register as a draft fixed asset.

 

You choose the account type when you add a new account, and you can change the account type at any time by editing the account. Changing the account type may move the account to a different section on reports. This won't affect reports already published. You should talk to your accountant or bookkeeper before changing the account type of a system account, or if you are unsure about the account’s classification type.

Accounts are classified according to their type as follows: 

<ul>
	<li>
	<h4>Assets</h4>

	-         Bank

	-         Current Asset

	-         Fixed Asset

	-         Non-current Asset

	-         Prepayment 
	</li>
</ul>

<ul>
	<li>
	<h3>Liabilities</h3>

	-         Current Liability

	-         Liability

	-         Non-current Liability 

	 
	</li>
	<li>
	<h3>Expenses</h3>

	-         Depreciation

	-         Direct Costs

	-         Expense

	-         Overhead 

	 
	</li>
	<li>
	<h3>Equity</h3>

	-         Equity 

	 
	</li>
	<li>
	<h3>Revenue</h3>

	-         Other Income

	-         Revenue

	-         Sales
	</li>
</ul>

 

Any purchases or expense claims coded to an account that has the type 'Fixed Asset' create a Draft fixed asset when the bill or expense claim is approved. You can delete the asset from your draft asset register if you don't want to track it or if you have the Adviser user role you can register the asset.

Note that transactions, like bills or expense claims, with a quantity of more than nine assets in a single line item, are created as a single asset. If you don't want these items combined into one asset make sure you have no more than nine assets in one bill or expense claim.

<img alt="1652849445-abkx130-06.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652849383/1652849445-abkx130-06.png" />

 

 

<h5> </h5>

<h3>Account Codes </h3>

Each account has an account code which can be up to 10 characters. This code is used to group similar or frequently used accounts together in your chart of accounts. There is no one 'right' code for each account.

If you are used to a different coding system, or would prefer to create your own, you can edit any of the accounts and change the code. Your accountant or bookkeeper may have a preferred set of codes that they would like you to use.

The code ranges used to group the Xero default Chart of Accounts are: 

<ul>
	<li>
	200’s – revenue
	</li>
	<li>
	400’s, 500’s – expenses
	</li>
	<li>
	600’s, 700’s – assets
	</li>
	<li>
	800’s, 900’s – liabilities
	</li>
	<li>
	900's – equity
	</li>
</ul>

 

<h3>Name and Description</h3>

Every account in Xero must have a name which can be up to 150 characters. The account description is optional, except for bank accounts (where you mustn't use it). You can use letters, numbers or symbols for the description, up to 1000 characters. You can also use symbols within the description, but not at the start.

 

For more information about the Chart of Accounts refer to the Xero help Centre <a href="https://central.xero.com/s/article/Components-of-an-account-in-your-chart-of-accounts" target="_blank" rel="noreferrer noopener">here</a> and watch the short video below on how to import and edit the chart of accounts.

<iframe allowfullscreen="" height="315" src="https://www.youtube-nocookie.com/embed/LS_-s3T6wMg" width="560"></iframe>

Default Accounts

Each account has a default tax type applied depending on the account type and determines how the transactions in each account should be treated with respect to tax.

If you add your own accounts to the Chart of Accounts, you choose the tax rate at the time. At any time you can change the tax rate by editing an account, or select multiple accounts and use the Change Tax Rate button to apply a new tax rate to them all at once.

By default, Xero applies the current GST rate to all appropriate accounts. If your organisation is not GST registered or changes its GST status go to Accounting &gt; Advanced &gt; Financial Settings to apply the correct status.

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652849674/1652849736-abkx130-09.png" alt="1652849736-abkx130-09.png" />

 

 

There is no need for you to set up other GST accounts (e.g. Input GST, Output GST, Paid GST, GST on Imports) as Xero's default GST account '820 - GST' is the only one you need. GST on purchases and sales is automatically picked up from any tax rate used on invoices, bills or transactions and is fed through the system to display in the appropriate places on the GST Return and GST Audit Report.

As part of this process Xero is constantly adjusting the single GST account to include all necessary transactions and payments in order to show your current liability or asset.

You can delete or archive each account individually by clicking on the account's YTD figure to get to the account: Accounting &gt; Advanced &gt; Chart of accounts &gt; click the YTD figure.

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652849746/1652849809-cixnz100.png" alt="1652849809-cixnz100.png" />

 

You can only delete an account which is not locked and has no transactions coded to it (and therefore no journals created).

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652849771/1652849834-cixnz101.png" alt="1652849834-cixnz101.png" />

 

If an account has (or has had) transactions in it, and is not locked, it can be archived, but not deleted.

If you need to restore an archived account, go to: Accounting &gt; Advanced &gt; Chart of accounts &gt; Archive tab &gt; select the account to be restored &gt; Restore.

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652849791/1652849854-abkx130-11.png" alt="1652849854-abkx130-11.png" />

 

You can also archive (or delete) an account directly from the main Chart of Accounts page. Simply tick the checkbox next to the account that you wish to archive (or delete) and then select Archive (or Delete). When the pop-up box appears, click OK.

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652849825/1652849888-abka130-12.gif" alt="1652849888-abka130-12.gif" />

Delete or Archive Individual Accounts

<h3>Importing a Chart of Accounts </h3>

If you don’t want to use the default Chart of Accounts in Xero, you can import your own. You can import a Xero Chart of Accounts that you are using for another Xero organisation. You can also import an MYOB or BankLink chart of accounts.

Be aware that if you are already using Xero and import a Chart of Accounts, the imported Chart of Accounts will overwrite the accounts and balances.

 

To import a Chart of Accounts, go to: Accounting &gt; Advanced &gt; Chart of accounts and click on the Import tab.

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652849979/1652850041-abkx130-14.png" alt="1652850041-abkx130-14.png" />

 

Click Browse to find and select the file to be imported. Then click Import.

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652850003/1652850066-cixnz103.png" alt="1652850066-cixnz103.png" />

Review the summary report to confirm the information. If you want to accept the new Chart of Accounts, click Confirm.

 

<h3>Exporting a Chart of Accounts</h3>

Xero allows you to export your chart of accounts from Xero to a CSV file. You may do this to make changes to many accounts at once, or so you can import the file into another organisation in Xero. Xero includes all chart of accounts information in the export file except YTD balances, bank account currency names and bank account numbers.

 

To export a chart of accounts to your computer, go to: Accounting &gt; Advanced &gt; Chart of accounts. Click on All Accounts and then click Export.

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652850034/1652850097-abkx130-15-1.png" alt="1652850097-abkx130-15-1.png" />

 

 

The Chart of Accounts will now be exported to your computer as an Excel file in csv format.

Import & Export a Chart of Accounts

Quiz: Xero Chart of Accounts

Xero Chart of Accounts

<h3>Overview</h3>

In this course, you will be introduced to managing contacts.  With Xero you can manage customers, suppliers and employees quickly and easily. You can even import a contact list to add to an already existing list. Grouping your contacts will ensure speed and efficiency when invoicing duplicate invoices to more than one customer.

 

<h3>Learning Outcomes</h3>

By the end of the course, you should understand how to:

<ul>
	<li>
	Describe the steps for creating new customers and suppliers in Xero.
	</li>
	<li>
	Explain the process for importing and exporting contacts.
	</li>
	<li>
	Summarise the steps for merging contacts and creating contact groups.
	</li>
	<li>
	Explain the purpose of Smart Lists and how to use them to run searches.
	</li>
	<li>
	Explain the process for archiving a contact, and restoring an archived or merged contact. 
	</li>
</ul>

The Contacts screen lists all Customers, Suppliers, Groups and Archived contacts.  It also records the outstanding amounts due for each contact; therefore, it is a useful tool for obtaining quick Accounts Receivable and Accounts Payable reports. Note that a contact in Xero can be both a Customer and a Supplier.

 

To access the contacts screen, go to Contacts &gt; All Contacts.  You will see each of the contact groups listed in tabs at the top of the screen. You can then click into any of the contact types for a full list of the contacts in that group, e.g. Customers and Suppliers.  

<img alt="1652919753-contacts.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652919693/1652919753-contacts.png" />

 

For an overview of how to manage contacts watch the following video from Xero (please open this video on YouTube to access the closed captions for this video):

<div style="max-width:100%;">
<iframe allowfullscreen="" height="315" src="https://www.youtube-nocookie.com/embed/kpRoqtUWKK0?controls=0" width="560"></iframe>
</div>

Contacts

The minimum information you need to create a contact is a name. However, you can add lots of other important information, including address, email address, phone numbers, and discounts allowed, ABN number and bank account details.

 

Go to Contacts &gt; All contacts &gt; New contact.

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1661856594/1661856654-new-contact.png" alt="1661856654-new-contact.png" />

 

When adding a contact, you will not be specifying whether they are a Supplier or a Customer.  They will become either a Supplier or Customer (or both) when you record a transaction with the contact.

 

Enter all the relevant contact information in the spaces provided from the tabs located on the left-hand side of the page beginning with basic Contact details and Addresses: 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1661856617/1661856676-contact-details.png" alt="1661856676-contact-details.png" />

 

Within the Contact details tab, enter the contact's ABN so it shows on the PDF version of invoices, credit notes and statements you send to them. There is also the option to enter an Australian Company Number, as well as a unique Account Number to help you identify and search for the contact. 

Enter the Xero Network Key if you wish to send invoices and bills from your Xero organisation to your contact's Xero organisation. Further information regarding the Xero network key can be found <a href="https://central.xero.com/s/article/Enter-a-Xero-network-key-received-from-another-Xero-organisation" target="_blank" rel="noreferrer noopener">here</a>.    

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1661856641/1661856700-xero-network-key-au.png" alt="1661856700-xero-network-key-au.png" />

 

In the Financial details section, you can add bank account details and a default currency. This is a useful feature if you make batch payments to a supplier.

 
<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1661856668/1661856727-financial-details-au.png" alt="1661856727-financial-details-au.png" />

 

From the Default settings, you can add default accounts for Sales (invoices, credit notes, quotes, receive money) and Purchases (purchase orders, bills, credit notes, spend money).

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1661857688/1661857746-purchase-defaults.gif" alt="1661857746-purchase-defaults.gif" />

 

Within the Default settings, you can also:

<ul>
	<li>
	<a href="https://central.xero.com/s/article/Set-due-dates-and-payment-terms-for-invoices-quotes?userregion=true" target="_blank" rel="noreferrer noopener">Set default due dates</a> for bills and invoices.
	</li>
</ul>

<ul>
	<li>
	Add a discount for sales to the contact.
	</li>
</ul>

<ul>
	<li>
	Set a credit limit to keep track of what your customer owes you. 
	</li>
</ul>

<ul>
	<li>
	Select a default template for the contact, if you've <a href="https://central.xero.com/s/article/Add-edit-or-delete-custom-invoice-quote-templates?userregion=true" target="_blank" rel="noreferrer noopener">set up more than one invoicing template</a>.
	</li>
</ul>

  

For more information on the various contact fields, visit <a href="https://central.xero.com/s/article/Contact-fields?userregion=true" target="_blank" rel="noreferrer noopener">Xero Central</a>.

Adding a New Contact

<h3>Import Contacts into Xero</h3>

Xero allows importation of contacts and their details that haven't already been entered. First, you need to download the CSV file template from Xero by going to Contacts &gt; All Contacts. At the top right of the page, click on the ellipsis symbol and select Import and then click Download template.

<img alt="1652920200-import-contacts-gif.gif" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652920140/1652920200-import-contacts-gif.gif" />

 

After the Contacts.csv file has been downloaded and saved to your computer, open it and enter your contacts' details. The only compulsory information that must be entered is the Name of each contact, the other information is optional. But, if you're importing information from any of the columns shown in the table below, be sure to enter (or format) the information correctly so that the file is able to be imported without errors.

<table align="center" border="1" cellspacing="2" style="border-color:#000000;border-style:solid;border-width:1px;">
	<thead>
		<tr>
			<td>Column</td>
			<td>Description</td>
			<td>Format or Entry Details</td>
		</tr>
	</thead>
	<tbody>
		<tr>
			<td>PhoneNumber</td>
			<td>Contact's phone number</td>
			<td>Use spaces to separate country code, area code and the number</td>
		</tr>
		<tr>
			<td>BankAccountNumber</td>
			<td>Supplier's bank account for <a href="https://central.xero.com/s/article/Find-and-view-batch-payments" target="_blank" rel="noreferrer noopener">batch payments</a></td>
			<td>Enter full bank account number. Use hyphens when formatting the number as this avoids Excel converting it to scientific format because it's longer than 11 digits</td>
		</tr>
		<tr>
			<td>AccountsReceivableTaxCodeName</td>
			<td>Default tax for invoices</td>
			<td>Enter the exact <a href="https://central.xero.com/s/article/Add-or-edit-tax-rates">tax rate name</a></td>
		</tr>
		<tr>
			<td>AccountsPayableTaxCodeName</td>
			<td>Default tax for bills</td>
			<td>Enter the exact <a href="https://central.xero.com/s/article/Add-or-edit-tax-rates">tax rate name</a></td>
		</tr>
		<tr>
			<td>Website</td>
			<td>Contact's website</td>
			<td>Include http://</td>
		</tr>
		<tr>
			<td>Discount</td>
			<td>Default sales discount %</td>
			<td>Enter a number up to 2 decimal places</td>
		</tr>
		<tr>
			<td>DueDateBillDay</td>
			<td>Default bill payment term (due date or days after)</td>
			<td>Enter up to 2 numbers for the day of the month, or up to 3 numbers for days after. Make sure you also enter DueDateBillTerm</td>
		</tr>
		<tr>
			<td>DueDateBillTerm</td>
			<td>Default bill payment term</td>
			<td>Enter Current Month or Following Month or Days After or Days After End of Month. Make sure you also enter DueDateBillDay</td>
		</tr>
		<tr>
			<td>DueDateSalesDay</td>
			<td>Default invoice payment term (due date or days after)</td>
			<td>Enter up to 2 numbers for the day of the month, or up to 3 numbers for days after. Make sure you also enter DueDateSalesTerm</td>
		</tr>
		<tr>
			<td>DueDateSalesTerm</td>
			<td>Default invoice payment term</td>
			<td>Enter Current Month or Following Month or Days After or Days After End of Month. Make sure you also enter DueDateSalesDay</td>
		</tr>
		<tr>
			<td>SalesAccount</td>
			<td>Default account for sales transactions</td>
			<td>Enter just the <a href="https://central.xero.com/s/article/Components-of-an-account-in-your-chart-of-accounts?userregion=true">code from your chart of accounts</a></td>
		</tr>
		<tr>
			<td>PurchasesAccount</td>
			<td>Default account for purchase transactions</td>
			<td>Enter just the <a href="https://central.xero.com/s/article/Components-of-an-account-in-your-chart-of-accounts?userregion=true">code from your chart of accounts</a></td>
		</tr>
		<tr>
			<td>BrandingTheme</td>
			<td>Default invoice branding for invoices and other documents you send</td>
			<td>Enter the name of an invoice branding theme you have added</td>
		</tr>
		<tr>
			<td>DefaultTaxBills</td>
			<td>Default tax treatment for purchase transactions</td>
			<td>Enter Inclusive or Exclusive or No Tax</td>
		</tr>
		<tr>
			<td>DefaultTaxSales</td>
			<td>Default tax treatment for sales transactions</td>
			<td>Enter Inclusive or Exclusive or No Tax</td>
		</tr>
	</tbody>
</table>

 

When you are satisfied with the information entered into the csv file, close the file and save the changes.  In Xero, go to Contacts &gt; All Contacts &gt; click on the Ellipsis symbol &gt; Import. 

Under Upload contacts click 'Select file' and navigate to the saved Contacts.csv file (or drag and drop the file into this field). Choose 'Be ignored' regarding empty fields then select Next. 

<img alt="1652920530-select-file.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652920470/1652920530-select-file.png" style="height:724px;width:600px;" />

Review the information you're importing and if you are happy that it is correct, click Complete Import.

<img alt="1652920829-complete-import.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652920769/1652920829-complete-import.png" />

The newly imported contacts will display under the All contacts group. Once a sales invoice, bill or credit note transaction has been entered for them, they will also show in the Customers and/or Suppliers group. A contact's details can always be updated after they have been imported into Xero.

  

<h3>Export Contacts from Xero</h3>

You can choose to export:

<ul>
	<li>
	All contacts.
	</li>
	<li>
	Contacts Xero has classified as customers or suppliers.
	</li>
	<li>
	Contacts you've added to a contact group.
	</li>
</ul>

To export contacts and their details from Xero to a CSV file, click on Contacts. From the Contacts menu, select the group of contacts you want to export, i.e. to export contacts you've created sales invoices and sales credit notes for, you would select Customers. Then select the ellipsis and click Export to download and save the Contact.csv file to your computer.

<img alt="1652920628-export-suppliers.gif" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652920567/1652920628-export-suppliers.gif" />

 

This feature would also be beneficial if you wanted to update multiple contacts' details all at once as opposed to individually. Just export as above, open the file and edit the relevant contact details then import your saved file back into Xero.

Importing and Exporting Contacts

<h5>Merging Contacts</h5>

In Xero, a contact can be both a Customer and a Supplier, so this makes it possible to merge the two. This allows you to keep all contact information and related transactions together, instead of across multiple records for the same contact. No transactions are deleted when you merge contacts, including invoices, bills, and other financial transactions. They are added to the activity details of the contact you keep. 

 

For example, in the Demo Company you have Bayside Club and Bayside Wholesale who are in fact the same contact. In Xero you can merge these two contacts into one. Duplications can occur when contacts are created. You may discover that a contact has been duplicated due to different spelling.

 

To merge Bayside Club and Bayside Wholesale you can complete this from the Contacts &gt; All contacts page:

<ul>
	<li>
	Select the checkbox for Bayside Wholesale
	</li>
</ul>

<ul>
	<li>
	Select Merge. 
	</li>
</ul>

<ul>
	<li>
	Start typing the name of Bayside Club, then select the contact.
	</li>
</ul>

<ul>
	<li>
	Click Merge, then click Confirm merge.
	</li>
</ul>

Xero will always archive the contact selected first and retain the second contact.  

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1661857854/1661857913-merge-new.gif" alt="1661857913-merge-new.gif" />

 

You can also merge two contacts from the Options menu in the individual contact record:

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1661857881/1661857940-bayside-merged.gif" alt="1661857940-bayside-merged.gif" />

 

If you use Classic invoicing (the default setting for the Demo Company), transactions created before merging the contacts will remain under the original contact name. To change this, edit these transactions and update the contact details. If you use New invoicing these invoices, as well as bills and other financial transactions created before merging the contacts, inherit the name of the contact that they were merged into.  

 

<h3>Create a Group</h3>

You can create a group of contacts to view together in a list or to generate the same invoice for all the customers in a group. This is a great time saver as it allows you to send an invoice for a subscription (or similar) where the amount and description would be the same for each contact in the group.

 

Go to Contacts &gt; All Contacts and at the top of the screen select Groups &gt;+ Create group. Create a name for the group, for example, it could be for a membership. Name the group Club Members. Click Create group. You will now see the new group listed under the Group tab at the top of the Contacts screen and you can add contacts to the group.

 

<img alt="1652921044-new-group.gif" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652920984/1652921044-new-group.gif" />

 

From the All tab, select four customers by ticking the check box to the left the contact name. Then select + Add to group. Select the newly created Club Members group and click Add.

 

<img alt="1652921069-add-members-to-group.gif" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652921009/1652921069-add-members-to-group.gif" />

 

Go to the Business tab &gt; Invoices&gt; select Club Members from the drop-down list under New Invoice:

 

<img alt="1652921090-invoice-to-group-1.gif" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652921030/1652921090-invoice-to-group-1.gif" />

 

After selecting the group, you can then create an invoice that will be sent to all members of that group. This is a great way to send an invoice for subscriptions or similar where the amount and description will be the same for each contact.

 

<img alt="1652921134-mc-02.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652921074/1652921134-mc-02.png" />

 

You can easily add a new customer to an existing group by going to Contacts &gt; All Contacts. Tick the check box next to the contact that you would like to add to a group and click on + Add to group. Select the relevant group from the list by ticking the check box and then click Add.

 

<img alt="1652921158-add-1-contact-to-group.gif" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652921098/1652921158-add-1-contact-to-group.gif" />

Merging and Groups

<h3>Archive a Contact</h3>

You can't delete a contact from Xero, but you can archive a contact you no longer do business with. Archived contacts (and transactions that have been entered for them) are still able to be viewed and they will still be shown in reports. No transactions are deleted, including any outstanding invoices and bills.

 

To archive a contact, go to Contacts &gt; All Contacts and tick the check box next to the contact you want to archive. Select Archive, then click Archive again to confirm.

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652921237/1652921297-archive-contact.gif" alt="1652921297-archive-contact.gif" />

 

<h3>Restore an Archived or Merged Contact</h3>

You can restore a contact (and their activity details) that has been previously archived or merged, as long as no other contact exists with the same name. Restoring a contact makes their name available to select again when entering sales invoices, bills or other transactions.

To restore a contact, go to Contacts &gt; All Contacts. Select the Archived tab from the top of the screen. Click on the contact's name to open their details, then click Restore. Select Restore again to confirm.

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652921273/1652921333-restore-contact.gif" alt="1652921333-restore-contact.gif" />

Archiving and Restoring Contacts

You can use Smart Lists to run searches across sales transactions you’ve entered for customers. In Xero there are some default Smart List searches already set up, and you can create your own custom searches. You can also run the existing default searches and use them as a starting point to create your own search.

When running a search using a smart list, only customers that you've entered sales transactions for, appear in the results. The results display as a list and can be filtered using conditions.

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652921416/1652921476-smart-lists-snapshot.png" alt="1652921476-smart-lists-snapshot.png" />

 

The following searches are already set up in Xero:

<ul>
	<li>
	Customers who have purchased an inventory item
	</li>
</ul>

<ul>
	<li>
	Customers who have had sales invoices outstanding for more than 30 days
	</li>
</ul>

<ul>
	<li>
	Customers who have had sales invoices overdue for more than 7 days
	</li>
</ul>

<ul>
	<li>
	Customers who have paid you in the last year
	</li>
</ul>

 

You can also search for customers based in a particular location, and customers who are not part of a contact group.

 

<h3>Run a Search already set up in Xero</h3>

To run a default search set up in Xero, complete the following:

<ul>
	<li>
	Go to Contacts &gt; All contacts
	</li>
</ul>

<ul>
	<li>
	Under Smart Lists, choose one of the searches to run, e.g. ‘Have purchased an item’
	</li>
</ul>

<ul>
	<li>
	You can select, change or add conditions, then click Run Search
	</li>
</ul>

<ul>
	<li>
	You can Save as a new search, or update the existing default search (optional)
	</li>
</ul>

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652921482/1652921542-have-purchased-an-item.png" alt="1652921542-have-purchased-an-item.png" />

 

 

<h3>Create a new Smart List</h3>

To create your own new smart list, complete the following:

<ul>
	<li>
	Go to Contacts &gt; All contacts
	</li>
</ul>

<ul>
	<li>
	Select the Smart lists tab, then select an existing smart list.
	</li>
</ul>

<ul>
	<li>
	Select All to search for customers matching all of the conditions you add, or Any to search for customers matching any of the conditions.
	</li>
</ul>

<ul>
	<li>
	Click Add a condition, then select a condition and its details.
	</li>
</ul>

<ul>
	<li>
	(Optional) Add more conditions.
	</li>
</ul>

<ul>
	<li>
	Click Run Search.
	</li>
</ul>

<ul>
	<li>
	(Optional) Save your search.
	</li>
</ul>

 

<h3>Delete a Saved Search</h3>

To delete a saved search, complete the following:

<ul>
	<li>
	Go to Contacts, then click All contacts.
	</li>
</ul>

<ul>
	<li>
	Select the Smart lists tab, then select an existing smart list.
	</li>
</ul>

<ul>
	<li>
	Click Options, then click Delete saved search.
	</li>
</ul>

Smart Lists

Quiz: Managing Contacts with Xero

Managing Contacts with Xero

<img alt="1540337078-abkx198-xero-sales-invoices-quotes-inventory.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/1214105/1540337078/1540337078-abkx198-xero-sales-invoices-quotes-inventory.png" />

 

<h3>Overview</h3>

In Xero invoicing, you can get paid faster and receive updates when the invoice is opened. You can create professional repeating invoices and schedule bill payments so you can manage cash flow. Xero also tracks payments, returns and credits automatically. Inventory in Xero allows you to speed up invoicing while tracking goods and services sold.

<h3> </h3>

<h3>Learning Outcomes</h3>

By the end of the course, you should understand how to:

<ul>
	<li>
	List the different invoice types available in Xero and describe each of their definitions.
	</li>
	<li>
	Explain how to create invoices, repeating invoices and invoices for groups.
	</li>
	<li>
	Give examples of the invoice details that can be customised to suit.
	</li>
	<li>
	Demonstrate how to customise templates and apply branding themes.
	</li>
	<li>
	Identify the two customer statement types. 
	</li>
	<li>
	Explain how to create a quote.
	</li>
	<li>
	Differentiate between tracked and untracked inventory.
	</li>
	<li>
	Describe the process of adding new inventory items.
	</li>
	<li>
	Explain the options for multi-currency and tax rates in Xero.
	</li>
</ul>

Note: For this course you MUST make sure you are using the Classic Invoicing System.

There are a number of invoice types in Xero so let's look at some of the definitions you need to know:

<ul>
	<li>
	Invoice: Standard sales invoice.
	</li>
	<li>
	Repeating Invoice:  Repeating criteria are defined and then Invoice is saved as Draft, Approve or Approve &amp; Send.
	</li>
	<li>
	Credit Note:  Create an adjustment note or credit for a customer
	</li>
	<li>
	Invoice to Contact Group: Create one invoice only and have the system automatically create a draft invoice for each contact in the group.
	</li>
</ul>

This video demonstrates how invoicing works in Xero:

<iframe allowfullscreen="" height="315" src="https://www.youtube.com/embed/l3Bi9DjaJxU" width="560"></iframe>

 

Invoices can be created from Business &gt; Invoices &gt; New Invoice.

 

<img alt="1652928770-abkx198-01.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652928710/1652928770-abkx198-01.png" />

 

You will be presented with a blank invoice that you then need to complete the details for.

 

<img alt="1652928794-abkx198-02.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652928734/1652928794-abkx198-02.png" />

 

The individual details on the invoice are outlined below:

<ul>
	<li>
	To - this is the specific client that the invoice will be sent to. 
	</li>
	<li>
	Date - this will populate with today's date by default but can be changed to a date in the past or in the future.
	</li>
	<li>
	Due date - If you have set up default payment terms in the Company tab &gt; Settings &gt; Features section &gt; Invoice Settings &gt; Default Settings screen then this will populate with the default due date. This date can be edited.
	</li>
</ul>

<img alt="1652928822-abkx198-03.gif" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652928762/1652928822-abkx198-03.gif" />

 

<ul>
	<li>
	Invoice # - This is the next invoice number in the sequence, and the sequence can be altered in the Company tab &gt; Settings &gt; Features section &gt; Invoice Settings &gt; Default Settings also.
	</li>
	<li>
	Reference - If you want to add a reference to the invoice you can do so here. This reference will present on the main invoice screen also.
	</li>
	<li>
	Branding - You are able to select the branding that will apply to the invoice when it is printed. You can choose the default branding or you can create your own suite of templates and then select this custom branding here.
	</li>
	<li>
	Currency - By default the currency will be that of the country the account relates to but you can change this to any of the currencies supported by Xero by clicking on the drop-down option and + Add Currency.
	</li>
	<li>
	Amounts are - This allows you to define whether the invoice is tax inclusive (the selling price of the item includes tax), tax exclusive (the selling price of the item does not include tax and it will be added to the invoice) or No Tax (no tax is charged on the item) and this impacts each line item added to the invoice. 
	</li>
	<li>
	Item - If you have set up inventory items then you can select the item code here.
	</li>
	<li>
	Description - This is a description that you can enter to specify the goods or services you are invoicing for.
	</li>
	<li>
	Qty - If you are invoicing inventory items then this will be the number of units you are selling. If you are invoicing for services then this will typically be "1".
	</li>
	<li>
	Unit Price - This is the cost per unit.
	</li>
	<li>
	Disc % - If you are offering a discount on an item then this is where you would enter the discount percentage. The percentage is entered in whole numbers. For example, if there was a 5% discount then you would simply enter in 5, not 0.05.
	</li>
	<li>
	Account - This is the account code that the items will be mapped to when the invoice is approved.
	</li>
	<li>
	Tax rate - This is the tax rate that applies to the specific item and will default to the tax rate defined on the account code in the Chart of Accounts.
	</li>
	<li>
	Region - In the Demo Account, this column presents because there is a tracking category set up called Region. You would need to create Tracking Categories before this option displays in a live Xero account.
	</li>
	<li>
	Amount - This is the total per line item.
	</li>
	<li>
	Add a new line - Where you are invoicing a number of items you may need to add additional lines to the invoice as only five line items populate by default.
	</li>
</ul>

 

<h3>Repeating Invoice</h3>

Repeating Invoices are a great way to deal with invoices that occur at regular intervals such as Rent or Insurance payments, or any invoices that you send regularly.

 

If you select New Repeating Invoice from the New Invoice dropdown menu then you will be provided with a blank invoice very similar to the standard one, except for an additional section at the top of the invoice that allows you to specify the repeating details.

 

<img alt="1652928903-abkx198-04.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652928844/1652928903-abkx198-04.png" />

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1674578505/1674578563-new-repeating-invoice.png" alt="1674578563-new-repeating-invoice.png" />

 

From here you can fill in the details of your repeating invoice:

<ul>
	<li>
	Select the frequency in numbers of weeks or months that you would like the invoice to repeat (if you have annual invoices this will be set to 12 months).
	</li>
	<li>
	Select the Invoice Date. This will be the date of the first invoice.
	</li>
	<li>
	Select how the Due Date will be set. You can choose from an amount of days after the invoice date, or on a particular date of the current or following month. 
	</li>
	<li>
	If you know when these invoices are due to stop you can also choose an End Date. If there is no set end date then you can leave this blank.
	</li>
</ul>

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1674578619/1674578678-new-repeating-inv-gif-1.gif" alt="1674578678-new-repeating-inv-gif-1.gif" />

 

You can set sales invoices to Save as Draft, to Approve, or to Approve and be automatically emailed to customers. All fields are mandatory except for the End Date and Reference. 

 

You can also <a href="https://central.xero.com/s/article/Manage-your-file-library?userregion=true" target="_blank" rel="noreferrer noopener">attach files</a> to the template, however they're not attached to each transaction so you will have to do that each time it's created. Note: if you create a repeating invoice from one with an attachment, the attachment isn't copied to the other transactions.

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1674578671/1674578730-attach-file.png" alt="1674578730-attach-file.png" />

 

All repeating invoices you are create will be shown on the Repeating tab with the date of the next transaction:

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1674578703/1674578762-repeating-tab.png" alt="1674578762-repeating-tab.png" />

 

Note: It is not recommended to create repeating invoices for dates in the past. You can set the Invoice Date to a date in the past and Xero will create these invoices as far back as you need, but backdated ones can't be sent.

Creating Invoices

When Invoices, Bills, and Purchase Orders are created in Xero, there is an option to select the tax treatment on the Invoice, Bill or Purchase Order as Tax Inclusive, Tax Exclusive, or No Tax.

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652929790/1652929850-picture1.png" alt="1652929850-picture1.png" />

 

This is a very important setting and it is vital that all users understand when to select each of these options.

When the Xero account is created the business should make a conscious decision in respect of whether the selling price of the items they sell are added to Xero as including tax or excluding tax. This decision will then influence all invoices that are created moving forward.

Similarly, if there are items that the business purchases the business should make a conscious decision in respect of whether the purchase price of the items they buy are added to Xero as including tax or excluding tax. This decision will then influence all bills/purchase orders that are created moving forward.

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652929844/1652929904-new-item-1.png" alt="1652929904-new-item-1.png" />

 

When the business decides on whether the items they buy and/or sell will be added to Xero as including tax or excluding tax this treatment should be consistently applied to all new items that are added.

The implications of the decision to include tax or exclude tax on the items is illustrated in the examples below:

<h3>Example 1 – Selling items (Item selling price Excludes Tax)</h3>

If ABC Limited sets up Xero and they decide that the selling price of all of the items they sell will be added to Xero as Tax Exclusive then when an invoice is created the invoice should also be created as Tax Exclusive so that the tax can be added correctly.

Let’s look at this in practice.

<ul>
	<li>
	Item: CODE123
	</li>
	<li>
	Selling price: $25 excluding tax
	</li>
	<li>
	Amounts are: Tax Exclusive
	</li>
</ul>

You can see that the line item shows the tax exclusive selling price of the item as $25 and tax is then added to this amount to give a Total of $27.50:

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652929897/1652929957-2020-10-16-13h32-28.png" alt="1652929957-2020-10-16-13h32-28.png" />

 

If ABC Limited were to change the tax treatment of this invoice to Tax Inclusive, this tells Xero that the line items on the invoice already include tax and you can see in the example below that the Total of the invoice is now $25 and the tax is included in this amount which is incorrect:

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652929940/1652930000-2020-10-16-13h33-08.png" alt="1652930000-2020-10-16-13h33-08.png" />

 

If ABC limited wanted to change the tax treatment of this invoice to Tax Inclusive then they would also need to edit the Unit Price of the item so that it included tax. In this example, the Unit Price would need to be changed to $27.50 to accurately reflect the tax component of the item being sold:

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652929963/1652930023-2020-10-16-13h33-54.png" alt="1652930023-2020-10-16-13h33-54.png" />

 

 

<h3>Example 2 – Selling items (Item selling price Includes Tax)</h3>

If ABC Limited sets up Xero and they decide that the selling price of all of the items they sell will be added to Xero as Tax Inclusive then when an invoice is created the invoice should also be created as Tax Inclusive so that the tax can be added correctly.

Let’s look at this in practice.

<ul>
	<li>
	Item: CODE456
	</li>
	<li>
	Selling price: $75 including tax
	</li>
	<li>
	Amounts are: Tax Inclusive
	</li>
</ul>

You can see that the line item shows the tax inclusive selling price of the item as $75 and tax is included in this amount meaning that the Total is $75 and the tax component is $6.82:

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652930000/1652930060-2020-10-16-13h36-34.png" alt="1652930060-2020-10-16-13h36-34.png" />

 

If ABC Limited were to change the tax treatment of this invoice to Tax Exclusive, this tells Xero that the line items on the invoice do not include tax and you can see in the example below that the Total of the invoice is now $82.50 and the tax amount is now $7.50 which is incorrect:

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652930028/1652930088-2020-10-16-13h37-07.png" alt="1652930088-2020-10-16-13h37-07.png" />

 

If ABC limited wanted to change the tax treatment of this invoice to Tax Exclusive then they would also need to edit the Unit Price of the item so that it excluded tax. In this example, the Unit Price would need to be changed to $68.18 to accurately reflect the tax component of the item being sold:

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652930052/1652930112-2020-10-16-13h38-22.png" alt="1652930112-2020-10-16-13h38-22.png" />

<h3> </h3>

<h3>Example 3 – Selling products/services not saved as an Item</h3>

There may be instances where the business sells a product or service that is not saved in Xero as an Item and is simply entered into the invoice “freehand”. When these products/services are entered on the invoice the person entering the information will need to ensure that the Unit Price tax status is the same as the invoice tax setting.

Let’s assume ABC Limited is providing some training on-site to their customer. This training is charged at $100 per hour plus tax, with a minimum of one hour charged. In the invoice below you can see that the Training on-site is listed as the line item with a Unit Price of $100. The tax setting for the invoice is set as Tax Exclusive and the Total on the invoice is $110 which is correct.

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652930087/1652930147-2020-10-16-13h39-13.png" alt="1652930147-2020-10-16-13h39-13.png" />

 

If the tax setting for this invoice was changed to Tax Inclusive the Unit Price is still $100 but because Xero is now being told that the unit price includes tax the total of the invoice is $100 also and this is incorrect:

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652930117/1652930177-2020-10-16-13h39-46.png" alt="1652930177-2020-10-16-13h39-46.png" />

 

<h3>Example 4 – Selling items (Item selling price has No Tax)</h3>

There may be instances where the business sells an item that has no tax. Where this is the case the tax setting for the invoice should be set as No Tax.

If there are a number of items on the invoice and some include tax and some do not, then the invoice setting should be set as Tax Exclusive and the tax on each item in the invoice that has no tax should be edited to reflect that it is GST Free Income.

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652930146/1652930206-2020-10-16-13h40-44.png" alt="1652930206-2020-10-16-13h40-44.png" />

 

<h3>Summary</h3>

<ul>
	<li>
	When an invoice, bill, or purchase order is created you will need to know if the unit price of the Item set up in Xero includes tax or not.
	</li>
	<li>
	If the Item includes tax then the invoice, bill or purchase order must be created as Tax Inclusive
	</li>
	<li>
	If the Item excludes tax then the invoice, bill or purchase order must be created as Tax Exclusive.
	</li>
	<li>
	If a product/service is manually added to the invoice, bill, or purchase order (not stored as an Item) then the tax status of the product/service must match the invoice tax setting.
	</li>
	<li>
	If there are items that do not have tax then the No Tax option can be selected on the invoice if this setting applies to all items.
	</li>
</ul>

Tax Inclusive, Exclusive or No Tax

You can create a group of contacts to view together in a list or to generate the same invoice for all the customers in a group. This is a great time saver as it allows you to send an invoice for a subscription (or similar) where the amount and description would be the same for each contact in the group. Once the group is created you can create one invoice that will be sent to all members of the group. 

 

To create the invoice for the group go to the Business tab &gt; Invoices &gt; select Club Members from the New Invoice drop down list:

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652931143/1652931202-abkx198-06.gif" alt="1652931202-abkx198-06.gif" />

 

After selecting the group, you can then create an invoice that will be sent to all members of that group.

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652931165/1652931225-2-au.png" alt="1652931225-2-au.png" />

Creating Invoices for Groups

When you create an invoice, you will want to print this and either print a hard copy to send to the client or send this via email. 

In Xero you are able to create your own branded themes so that when you print the invoice (and other items like quotes, purchase orders etc..) this populates using the format you want.

You can change the invoice branding theme name, add your logo to Xero's invoice templates or take full control and customise whole new templates, in any language. This allows you to apply different layouts for various types of transactions and customers. 
 

Watch the following video that shows you how to do this (please note there is no audio in this video other than background music):

<iframe allowfullscreen="" height="360" mozallowfullscreen="" src="https://player.vimeo.com/video/227001257" webkitallowfullscreen="" width="640"></iframe>

<h5> </h5>

<h5>How do you change the Branding Theme?</h5>

To edit the branding theme you've created: 

Go to Company tab &gt; Settings &gt; Features section &gt; Invoice settings. Find the theme you want to change. Select Options &gt; Edit. 

<img alt="1543447071-abkx198-07.gif" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/1214105/1543447071/1543447071-abkx198-07.gif" />

 

When you select "Edit" you will be presented with the following screen which you can quickly edit and then save:

<img alt="1540274442-cixnz10.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/1214105/1540274442/1540274442-cixnz10.png" />

 

If you create multiple Branding themes in Xero, it is possible to re-order these. The theme that is listed at the top of the Invoice Settings screen will be the default used when you print an invoice.

To change the default theme go to Company tab &gt; Settings &gt; Features section &gt; Invoice settings and then click on the arrows beside the theme name and drag this up or down.

<img alt="1543447126-abkx198-08.gif" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/1214105/1543447126/1543447126-abkx198-08.gif" />

 

Note: Edits to branding themes will affect all draft documents that use this theme.

Customise Invoice Templates

Watch the following Xero video for an overview of customer statements (please open this video on YouTube to access the closed captions for this video):

<iframe allowfullscreen="" height="315" src="https://www.youtube.com/embed/E1OZrH9WS2M" width="560"></iframe>

 

<h4>There are two types of statement to choose from:</h4>

Activity - Shows all activity for that customer within your choice of date range, including any fully paid invoices.

Outstanding - Shows only what's outstanding for the customer as at a certain date. They don't show fully paid invoices.

 

To send a statement, go to Contacts &gt; Customers. Search for your customer then click on their name. Click on Options and then select Send Statement.

 

<img alt="1652931425-send-statements-to-contact-1.gif" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652931365/1652931425-send-statements-to-contact-1.gif" />

 

Select the Statement Type (Outstanding or Activity) and ensure the correct date/s are showing. Click Update and Email.

 

<img alt="1652931456-abkx198-11.gif" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652931396/1652931456-abkx198-11.gif" />

You can also access the statements section by going to Business &gt; Sales overview &gt; Send Statements. Search for the relevant customer then click on their name. Select the Statement Type (Outstanding or Activity), ensure the date is correct and click Update. Then select Print PDF or Email.

 

<img alt="1652931493-abkx198-12.gif" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652931433/1652931493-abkx198-12.gif" />

Statements

<h5>Awaiting Payment Tab</h5>

Once an invoice is approved in Xero, it will move to the Awaiting Payment tab until it is paid in full. You can access the awaiting payment tab by going to the Business &gt; Sales overview &gt; Awaiting Payment. The Awaiting Payment tab name is normally coloured blue. When you click on the Awaiting Payment tab, you will see a listing of all the sales invoices outstanding with the number of unpaid invoices also presented in brackets after the heading.

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652931517/1652931577-abkx198-13-1.gif" alt="1652931577-abkx198-13-1.gif" />

<h5> </h5>

<h5>Overdue Tab</h5>

You can access the Overdue tab by going to the Business &gt; Sales overview &gt; Overdue. The Overdue tab name is normally coloured red. This provides a visual indication that some amounts on the Awaiting Payment screen are overdue.

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652931543/1652931603-abkx198-14.gif" alt="1652931603-abkx198-14.gif" />

 

To bulk print the overdue invoices, select the invoices from the overdue screen and then click the Print button.

 

Three methods for selecting multiple customers are:

<ol>
	<li>
	Tick the top checkbox which will select all invoices.
	</li>
	<li>
	Individually tick the relevant checkboxes on the left-hand side.
	</li>
	<li>
	Tick the checkbox for the first customer, hold the Shift key down and then tick the last customer. This action will select all customers in between.
	</li>
</ol>

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652931573/1652931633-cixnz18.png" alt="1652931633-cixnz18.png" />

 

To bulk email, select Customers and then click on the Email button. Enter any message, tick the Send me a copy checkbox (if applicable) and then click the Send button. All selected items will be marked as sent.

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1652931606/1652931666-cixnz19-1.png" alt="1652931666-cixnz19-1.png" />

Awaiting Payments and Overdue Tabs

In addition to creating Invoices you can also create quotes in Xero. The quoting module within Xero is relatively basic but offers all the requirements necessary to provide a client or customer with a quote for work that you will perform for them.

You can create basic quotes in Xero by customising draft sales invoices. To review how to create basic quotes in Xero, view the following (please open this video on YouTube to access the closed captions for this video):

 

<iframe allowfullscreen="" height="315" src="https://www.youtube.com/embed/r0fuDNQ42BQ" width="560"></iframe>

 

To create a quote, go to Business &gt; Quotes &gt; +New Quote.

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1674579086/1674579145-new-quote-gif.gif" alt="1674579145-new-quote-gif.gif" />

 

To set up a quote template that will be used when you print a quote please refer back to the section on customising templates.

To access the branding go to Company tab &gt; Settings &gt; Features section &gt; Invoice Settings.

Make changes to the way PDF invoices will display - just change the title of draft invoices to QUOTE or similar, or you can remove elements of the invoice that are not relevant to the quote (e.g. tear-off payment advice) or change your invoice terms to be text relevant to your quote terms. You could even set up a DOCX invoice branding theme specifically for quotes.   

Enter as much or as little information as you need to display on your quote. You might like to use the Reference field to display a quote number. As a tip, keep your quote reference numbers in sync with your (automatically generated) invoice numbers, that way you can search or sort by quote or invoice number as required. If you have added more than one document branding theme, you will be able to select which one apply to this invoice.

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1674579132/1674579191-quote-1.png" alt="1674579191-quote-1.png" />

 

Save the quote so that it remains in a draft status once all relevant data has been entered. Do not approve it at this stage in case you need to make alterations to the quote before you finally invoice the customer.  Email or print your quote, which will have the theme you applied to it.

You can also <a href="https://central.xero.com/s/article/Attach-view-and-download-files?userregion=true" target="_blank" rel="noreferrer noopener">send files as email attachments</a> with your quotes. This means your customers can open attachments (such as terms and conditions, or a sales brochure) from an email you send them, rather than via a web page.

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1674579243/1674579302-quote-2.png" alt="1674579302-quote-2.png" />

 

When the quote has been accepted, make any necessary changes and then mark it as such.

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1674579293/1674579352-quote-3.png" alt="1674579352-quote-3.png" />

 

Create an invoice from the quote so it moves to Awaiting Payment status.

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1674579325/1674579385-quote-4.png" alt="1674579385-quote-4.png" />

 

Leave the 'Mark as invoiced' checkbox blank or tick, as appropriate. Then click Create.

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1674579356/1674579415-quote-5.png" alt="1674579415-quote-5.png" />

 

You will be taken to the invoice screen where all the quote information has been transferred to. Make any required changes and then click Approve. Once approved, the quote will convert to an invoice.

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1674579400/1674579459-quote-6.png" alt="1674579459-quote-6.png" />

Quotes

On some occasions you may need to create a credit note in Xero. You may need to reduce the amount of an invoice or your supplier may send you a credit note, due to damaged goods or a cancellation in the sale or purchase agreement. In Xero you can also <a href="https://central.xero.com/s/article/Refund-a-credit-note-for-a-customer" target="_blank" rel="noreferrer noopener">process </a><a href="https://central.xero.com/s/article/Refund-a-credit-note-for-a-customer" target="_blank" rel="noreferrer noopener">a cash refund</a>, or <a href="https://central.xero.com/s/article/Allocate-a-credit-note-to-a-purchase-bill" target="_blank" rel="noreferrer noopener">offset it against an invoice or bill</a>. You can read more about common scenarios for credit notes <a href="https://central.xero.com/s/article/Common-scenarios-for-credit-notes" target="_blank" rel="noreferrer noopener">here</a>.

 

There are a few places in Xero where you can create a credit note from, such as:

<ul>
	<li>
	An awaiting payment invoice or bill
	</li>
	<li>
	The Sales or Purchases overview
	</li>
	<li>
	A contact’s details
	</li>
	<li>
	By copying an existing credit note.
	</li>
</ul>

 

Note: If you haven't sent the invoice to your customer but need to correct an error, you can <a href="https://central.xero.com/s/article/Edit-an-invoice?userregion=true" target="_blank" rel="noreferrer noopener">edit</a> the invoice instead.

 

<h3>Create a Credit Note from an Invoice or Bill</h3>

If you need to make a correction to an invoice you’ve sent, issue a credit note by completing the following:

<ul>
	<li>
	Go to Business &gt; Invoices.
	</li>
	<li>
	Click the Awaiting Payment tab.
	</li>
	<li>
	Select the invoice you want to credit.
	</li>
	<li>
	Under Invoice Options, select Add Credit Note.
	</li>
	<li>
	Confirm the credit note details and edit them if you need. You can click the x to remove a line item. 
	</li>
	<li>
	Click Approve to approve the credit note and automatically allocate the credit to the invoice. Or click Save to <a href="https://central.xero.com/s/article/Allocate-a-credit-note-to-a-sales-invoice?userregion=true" target="_self" rel="noreferrer noopener">allocate the credit</a> later.
	</li>
</ul>

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653012719/1653012779-credit-note-invoice-1.gif" alt="1653012779-credit-note-invoice-1.gif" />

 

You can follow the same process for adding a credit note to a bill. Go to Business &gt; Bills to pay &gt; open the bill and under Bill Options, select Add Credit Note.

Once you’ve created and saved your credit note, you’ll see this appear in any sales or purchases reports you run. You can then allocate your credit note to an existing invoice or bill to reduce the amount outstanding, or apply a cash refund.

Credit note details will appear in the History &amp; Notes section the first time it is saved and any changes made to the credit note will be recorded here.

 

<h3>Create a Credit Note from the Sales or Purchases Overview</h3>

To create a credit note from your sales overview:

<ul>
	<li>
	Go to Business &gt; Sales overview.
	</li>
	<li>
	From New, select the dropdown menu &gt; Credit note.
	</li>
	<li>
	Enter the credit note details, similar to how you would enter details into an invoice.
	</li>
	<li>
	Optional - you can click the file icon to <a href="https://central.xero.com/s/article/Attach-view-and-download-files?userregion=true" target="_self" rel="noreferrer noopener">upload files</a> related to the credit note.
	</li>
	<li>
	Approve to save the credit note as awaiting payment, or Save it as a draft. You can also Save &amp; submit for approval to have another user approve the credit note.
	</li>
</ul>

If you’ve approved the credit note and have an awaiting payment invoice for the customer, you'll be prompted to apply the credit. You can either enter the amount to credit and click Allocate Credit or click Cancel to <a href="https://central.xero.com/s/article/Allocate-a-credit-note-to-a-sales-invoice?userregion=true" target="_blank" rel="noreferrer noopener">allocate the credit note</a> later.

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653012777/1653012837-sales-overview-cn.png" alt="1653012837-sales-overview-cn.png" />

 

You can follow the same process above for adding a credit note from the Purchase Overview. Go to Business &gt; Purchases Overview. From New select Credit Note.

 

<h3>Copy an existing Credit Note</h3>

You can also create a credit note by copying an existing one:

<ul>
	<li>
	Go to Business &gt; Invoices.
	</li>
	<li>
	Open the credit note you want to copy. You can <a href="https://central.xero.com/s/article/View-voided-or-deleted-customer-credit-notes?userregion=true" target="_blank" rel="noreferrer noopener">search for any deleted or voided credit notes</a> from the All tab in Sales.
	</li>
	<li>
	Under Credit Note Options, select Copy.
	</li>
	<li>
	Edit and/or confirm the credit note details.
	</li>
	<li>
	Click Approve to approve the credit note or click Save to save a draft.
	</li>
</ul>

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653012811/1653012872-copy-cn-1.png" alt="1653012872-copy-cn-1.png" />

 

<h3>Add a Credit Note via a Contact</h3>

Another way to create a credit note is directly from a supplier's contact details. You may need to add a credit note to reduce the amount you owe your supplier, or record a refund received from a supplier:

<ul>
	<li>
	Go to Contacts &gt; Suppliers and open the contact details for your supplier.
	</li>
	<li>
	From New, select Bill credit note.
	</li>
	<li>
	Enter the credit note details, similar to how you would enter information for a bill.
	</li>
	<li>
	Approve to save the credit note in an awaiting payment status, or Save to save this as a draft. You can also Save &amp; submit for approval to have another user approve the credit note.
	</li>
</ul>

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653012853/1653012913-bill-cn-1.png" alt="1653012913-bill-cn-1.png" />

Credit Notes

While inventory is not required to create invoices, you will find that the process is a lot easier if you set up inventory items beforehand. The Products and services module in Xero allows you to set up items that you regularly buy and sell. Once created, they can be used to quickly pre-populate fields in your Sales invoices and bills.

Xero accounts for tracked and untracked inventory transactions in different ways. With tracked inventory, Xero keeps track of the quantity of items on hand, and calculates their value using the average cost method. With untracked inventory, Xero records purchases and sales, but does not keep track of quantities or values on hand.

Note: Once an inventory item is tracked, it cannot be un-tracked.

To access the inventory go to: Business &gt; Products and services. From here, you can look up and edit existing product or service items or add new items.

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1674579656/1674579716-products-services.gif" alt="1674579716-products-services.gif" />

 

To add a new item, complete the following:

<ul>
	<li>
	Go to Business &gt; Products and services.
	</li>
	<li>
	Click New item.
	</li>
	<li>
	Enter the item's Code and Name.
	</li>
	<li>
	To <a href="https://central.xero.com/s/article/Track-your-inventory" target="_blank" rel="noreferrer noopener">track the item</a>, select the Track inventory item checkbox. You must then select an Inventory Asset account and Cost of Goods Sold account. 
	</li>
	<li>
	If you want to use the item in purchase transactions, select the Purchase checkbox, and complete each of the fields you want to set a default value for.
	</li>
	<li>
	If you want to use the item in sales transactions, select the Sell checkbox, and complete each of the fields you want to set a default value for.
	</li>
	<li>
	Click Save.
	</li>
</ul>

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1674579717/1674579776-new-item-1.gif" alt="1674579776-new-item-1.gif" />

 

If you have many inventory items to add in Xero, you can use Xero's CSV template to <a href="https://central.xero.com/s/article/Import-inventory-items-into-Xero?userregion=true" target="_blank" rel="noreferrer noopener">add them in bulk</a>. 
 

Inventory can also be used to track the quantity of items purchased and sold (Note that this function does not record opening/closing stock amounts). You can use the Inventory Item Summary Report to list untracked inventory items you've used in transactions.

To view the Inventory Item Summary Report go to, Accounting &gt; Reports &gt; Transactions section &gt; Inventory Item Summary.

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1674579765/1674579825-inventory-item-summary-report.gif" alt="1674579825-inventory-item-summary-report.gif" />

 

For more in-depth explanation on this topic please refer to the following help files:

<ul>
	<li><a href="https://central.xero.com/s/article/Options-for-managing-inventory-in-Xero" target="_blank" rel="noreferrer noopener">Inventory</a></li>
	<li><a href="https://central.xero.com/s/article/Export-inventory-items-out-of-Xero" target="_blank" rel="noreferrer noopener">Exporting Inventory Items out of Xero</a></li>
	<li><a href="https://central.xero.com/s/article/Import-inventory-items-into-Xero" target="_blank" rel="noreferrer noopener">Importing Inventory Items into Xero</a></li>
	<li><a href="https://central.xero.com/s/article/Inventory-Item-Summary-report-New#Olderversion" target="_blank" rel="noreferrer noopener">Inventory Items Summary Report</a></li>
</ul>

Products and Services Overview

<h3>Add an Un-tracked Inventory Item</h3>

If you have the Financial Adviser or Standard User role, you can add an inventory item to your list by going to the Business tab &gt; Products and services &gt; New Item.

<img alt="1653014738-new-item-2.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653014678/1653014738-new-item-2.png" />

 

<h3>View, Sort, Search for or Edit your Inventory Items</h3>

If you have the Financial Adviser or Standard User role, you can view, sort, search for and print a list of your inventory items.

 

<h3>Sort &amp; Search</h3>

Click on column title to sort by that column ie. Item Name or Item Code.  You can also search for an item by typing in the Search box.

<img alt="1653024173-products-and-services-search-1.gif" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653024113/1653024173-products-and-services-search-1.gif" />

 

<h3>View &amp; Edit an Inventory Item</h3>

You can view details on inventory items in your account by going to Business tab &gt; Products and services. Click on an item. If you need to edit the item for any reason such as a price update or description change, this can be done by selecting Edit item.

<img alt="1653024278-edit-item-1.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653024218/1653024278-edit-item-1.png" />

 

<h3>Delete an Inventory Item</h3>

You can delete an inventory item in your account by going to the Business tab &gt; Products and services &gt; tick the checkbox to the left of the Product and services item &gt; select Delete.

<img alt="1653024299-delete-item.gif" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653024239/1653024299-delete-item.gif" />

Key Tasks with Inventory

Xero offers multicurrency accounting with the ability to accept payments, receive bills, send invoices, quotes and purchase orders in over 160 different currencies. You need to have a <a href="https://www.xero.com/au/pricing/" target="_blank" rel="noreferrer noopener">subscription with multi-currency</a> (or trial account) in order to have access to multicurrency.

<h5> </h5>

<h3>Multi-currency</h3>

Multicurrency features include:

<ul>
	<li>
	Add foreign currency bank accounts into Xero, alongside your local currency accounts.
	</li>
	<li>
	Create invoices using an automatic exchange rate or enter your own rate manually.
	</li>
	<li>
	Add a default foreign currency to a specific contact, making all your invoices, bills, quotes and purchase orders for that contact default to that currency.
	</li>
	<li>
	All foreign currency transactions are converted into your local currency in real time. Foreign exchange rates are updated hourly from <a href="https://www.xe.com/" target="_blank" rel="noreferrer noopener">XE.com</a>.
	</li>
</ul>

<ul>
	<li>
	Currency movements display on your transactions and in reports, so you can always see how changes affect your company’s cashflow.
	</li>
</ul>

<ul>
	<li>
	Foreign currency reports make it easy to complete complicated reconciliations. You can choose which currency you want reports in, and your reports will automatically be revalued using the latest currency conversions and exchange rates.
	</li>
</ul>

For an overview on multicurrency in Xero, watch <a href="https://tv.xero.com/detail/video/5127806488001/multi-currency-in-xero">this video</a> from Xero.

 

<h3>Add a Foreign Currency</h3>

When you add an organisation in Xero you will choose a base currency. This is your default currency and is used in most reports. You can't change this after you've added your organisation. After you’ve added it you can then add foreign currencies. Reminder: you’ll need the right subscription in order to access foreign currencies.

To add a foreign currency you would complete the following:

<ul>
	<li>
	Click on the company name &gt; Settings &gt; Currencies
	</li>
</ul>

<ul>
	<li>
	Click Add Currency
	</li>
</ul>

<ul>
	<li>
	Select a currency
	</li>
</ul>

<ul>
	<li>
	Click Add Currency.
	</li>
</ul>

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653024517/1653024577-currency-aus.png" alt="1653024577-currency-aus.png" />

 

You can also <a href="https://central.xero.com/s/article/Create-a-foreign-currency-transaction" target="_blank" rel="noreferrer noopener">create transactions</a> in a foreign currency, and run reports in multicurrency, such as the <a href="https://central.xero.com/s/article/Profit-and-Loss-New?userregion=true#Olderversion" target="_blank" rel="noreferrer noopener">Profit and Loss report</a> (older version).

 

<h3>Tax Rates</h3>

Xero has default tax rates built into the system; these are the most commonly used tax rates. You can also add your own if they don’t meet your company’s needs. Your tax rates can apply to both sales and purchases. You can also make changes to your existing tax rates. You need to have the advisor or standard user role to access tax rates in Xero.

To view your default tax rates and their accounts, complete the following:

<ul>
	<li>
	Go to Accounting &gt; Advanced &gt; Tax rates.
	</li>
</ul>

<ul>
	<li>
	Under Accounts using this Tax Rate, click the number alongside each tax rate to view the list of accounts.
	</li>
</ul>

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653024623/1653024683-tax-rates.png" alt="1653024683-tax-rates.png" />

Multiple Currencies and Tax Rates in Xero

Quiz: Xero Sales, Invoicing, Quotes & Inventory

Xero Sales, Invoices, Quotes & Inventory

<h5><img alt="1540337132-abkx220-xero-purchases-and-bills.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/1214105/1540337132/1540337132-abkx220-xero-purchases-and-bills.png" /></h5>

 

<h3>Overview</h3>

In this course you will be introduced to working with purchases and bills in Xero. An interactive graph of your accounts payable helps you decide what bills need to be paid and when. Suppliers can also send their invoices directly to your accounts. Create a batch payment to bundle one or more bills together into one transaction for payment.

 

<h3>Learning Outcomes</h3>

By the end of the course, you should understand how to:

<ul>
	<li>
	Explain the processes for managing bills, repeating bills and credit notes with Xero.
	</li>
	<li>
	Convert source documents to bills, repeating bills and credit notes.
	</li>
	<li>
	Apply payments and partial payments to bills.
	</li>
	<li>
	Describe how to perform batch payments and send remittance advice.
	</li>
	<li>
	Summarise how to modify payments to bills made in error.
	</li>
</ul>

Managing your accounts payable in Xero is easy with the Purchases and Bills features. These include:

<ul>
	<li>
	Pay multiple bills in one transaction
	</li>
	<li>
	Schedule batch payments
	</li>
	<li>
	Make partial payments to outstanding bills
	</li>
	<li>
	Create Product and Service items and use them when you enter bills and invoices, to track movement of products and services you frequently buy and sell
	</li>
	<li>
	View a complete overview of bills and purchase orders in the purchases dashboard, with charts and graphs showing bills due for payment, helping you to pay bills on time
	</li>
	<li>
	Send remittance advice and credit notes
	</li>
</ul>

View the following video for an overview of how Xero handles bills:

<iframe allowfullscreen="" height="315" src="https://www.youtube-nocookie.com/embed/vPcfpcfGOGQ" width="560"></iframe>

Introduction to Purchases and Bills

When you receive a bill that needs to be paid, go to the Business  &gt; Bills to pay &gt; New Bill. As with the new invoice screen, you are presented with a blank bill that you then need to complete the details for.

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653026206/1653026266-abkx220-01.gif" alt="1653026266-abkx220-01.gif" />

 

 

You will see the following fields to complete:

<ul>
	<li>
	From - The specific supplier that the bill was received from.
	</li>
	<li>
	Date - The date that is displayed on the bill.
	</li>
	<li>
	Due date - The date the bill is due for payment.
	</li>
	<li>
	Reference - You can add a reference to help you search for the bill, and to match with your bank account transactions. It will show on the bill and any related customer statements. If the reference and customer name match one or more existing bills, Xero shows links to the bills.
	</li>
	<li>
	Total - The overall amount that you owe which includes all line items and tax (depending on your selected setting).
	</li>
	<li>
	Currency - By default, the currency will be that of the country the account relates to. You can change this to any of the currencies supported by Xero by clicking on the drop-down option and + Add Currency.
	</li>
	<li>
	Amounts are - This allows you to define whether the Unit Price of an item on the bill is tax inclusive (the unit price of the item includes tax), tax exclusive (the unit price of the item does not include tax and it will be added to the bill) or No Tax (no tax is applicable to the unit price of the item). This impacts each line item added to the bill.
	</li>
</ul>

Creating New Bills

The purchases overview gives you a complete overview of your bills and purchase orders and helps you to understand and manage your cashflow. This overview snapshot also helps you to see what bills are due for payment and avoid late fees. From here you can create a new bill, repeating bill, credit note or purchase order.

Graphs in the purchases overview show you a snapshot of bills coming up for payment and ones you are planning to pay. You can hover over a bar to see the bills making up that total. Blue shows any unpaid bills with a due date that day, or a planned payment that day. Green shows any bills marked as paid that day in Xero or with a future-dated payment that day.

<img alt="1653026572-bills.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653026512/1653026572-bills.png" />

From the Business &gt; Purchases overview screen, click on the down arrow to the right of the +New button to display menu options. Here you can create a Bill, Repeating bill, Credit note or Purchase order.   

 

<img alt="1653026592-abkx220-02.gif" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653026532/1653026592-abkx220-02.gif" />

 

<ul>
	<li>
	New Bill: Standard invoice.
	</li>
	<li>
	New Repeating Bill: Repeating criteria are defined and then Invoice is saved as Draft (where the amount differs each period) or Approve (creates an approved invoice automatically each period).
	</li>
	<li>
	Credit Note: Create an adjustment note or enter a credit note from a supplier.
	</li>
	<li>
	Purchase Order: Let your suppliers know you want to buy specific goods or services from them.
	</li>
</ul>

All bills that have been entered have a particular status, as seen on the purchases dashboard. They are either Draft, Awaiting Approval, Awaiting Payment or Overdue.

<img alt="1653026629-abkx220e-04.gif" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653026569/1653026629-abkx220e-04.gif" />

 

<h3>Inventory</h3>

You can create Product and Service items and use them when you enter bills and invoices, to track movement of products and services you frequently buy and sell.  Get to your Product and Service item list from Business &gt; Products and services. Use the New item button to enter the details of each item.

<img alt="1653027174-new-item-au.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653027114/1653027174-new-item-au.png" />

 

Alternatively, you can add a new inventory item directly when creating the bill from the Item column. See the image below for further explanation. 
 

<img alt="1653026683-abkx220-06-2.gif" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653026623/1653026683-abkx220-06-2.gif" />

 

For a reminder on how to work with inventory, refer back to the Products and Services Overview and Key Tasks with Inventory topics in the Xero Sales, Invoicing, Quotes and Inventory section.

Purchases Overview

You can record a full or part payment on an Awaiting Payment bill. A payment transaction will be created in the bank account for a payment you enter. If the bill is fully paid, its status will change to ‘Paid’ and it will move to the Paid tab.

If you are recording a payment for a bill that was automatically generated to repeat, the payment is applied to the individual transaction only and not to any others in the series.

The fields and process for paying an Awaiting Payment invoice or bill is the same. To pay a bill go to Business &gt; Purchases overview (or Bills to pay) &gt; Awaiting Payment.

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653027230/1653027290-abkx220-07.png" alt="1653027290-abkx220-07.png" />

 

Click on your bill to open it, then scroll to the Make a payment section at the bottom.

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653027252/1653027312-xu-55.png" alt="1653027312-xu-55.png" />

 

Bills marked as Paid will no longer display on Bills you need to pay graph on the main Dashboard.

Amount Paid: Enter the amount paid. The Amount Paid field defaults to the total amount due on the bill, taking into account any payments already made or credit notes attached to it. You can change this to another amount if a part payment was made. If you enter an amount greater than the amount due, you will be prompted to create an overpayment for the surplus amount.

Date Paid: The date on which you made the payment or part payment. If the Date Paid on a bill you are paying is in the future, it will display with the amount being paid on the Upcoming bills graph (in green).

Paid From: Choose the account from which you made the payment. If you are recording a cash payment, choose the bank account the money will be paid from. Amounts paid or received (whether full or partial) will display in the list of bank account transactions for the chosen account.

Reference: If you're paying a bill by cheque, this is a useful place to put the cheque number or payment reference number from your online banking payment confirmation. This will display during bank reconciliation so that you can match the payment with the processed cheque or bank payment on your downloaded bank statement line.

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653027275/1653027335-xu-53.png" alt="1653027335-xu-53.png" />

Record Payment of a Bill

<h3>Partial Payments</h3>

Applying partial payments to bills can be done the same way that full payments are applied, as you performed in the prior exercise. But instead of paying (and recording) the total amount owed, you would only pay a portion of the outstanding bill and record that amount in the Amount Paid box. 

<img alt="1653027401-xu-58.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653027341/1653027401-xu-58.png" />

 

Since partial payments can be recorded directly onto an invoice or bill, the payment transaction is then likely to match the bank statement line (and be automatically suggested as a match) during bank reconciliation, as previously covered.

Bills that have been partially paid, i.e. have an amount outstanding, will remain on the Awaiting Payment tab until the full amount has been recorded as paid. The amount paid, and amount due will display.

<img alt="1653027425-xu-60.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653027365/1653027425-xu-60.png" />

 

The bill will reflect any partial payments made or credit notes attached. You can record partial payments as often as necessary until it is fully paid - but no more than the total amount due.

<img alt="1653027444-xu-59.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653027384/1653027444-xu-59.png" />

 

<h3>Overpayments</h3>

If a bill is overpaid for any reason when you enter the total payment amount, a new screen will open which asks you to enter a description for the overpayment amount. Enter a description to explain the overpayment and then click OK.

<img alt="1653027465-xu-61-1.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653027405/1653027465-xu-61-1.png" />

 

Bills that have been overpaid will go straight to the Paid tab. The overpayment transaction will go to the Awaiting Payment tab. It will stay there until you refund the overpayment or use it as credit on another bill. This amount will have "OP" to the left to indicate that it is an overpayment.

 

<img alt="1653027499-xu-62-3.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653027440/1653027499-xu-62-3.png" />

 

 

The paid bill will show the amount paid, less the overpayment amount. The overpayment is a separate transaction and not an amount owed on the invoice or bill.

Partial Payments and Overpayments

<h3>Batch Payments</h3>

Create a batch payment to bundle one or more bills together into one transaction for payment.

Watch the video below to see how convenient it is to make batch payments (please note that there is no audio in this video other than background music):

 

<iframe allowfullscreen="" height="360" mozallowfullscreen="" src="https://player.vimeo.com/video/257058105" webkitallowfullscreen="" width="640"></iframe>

 

As advised in the video, please click <a href="https://central.xero.com/s/article/Pay-multiple-bills-AU" target="_blank" rel="noreferrer noopener">here</a> to view the Xero Create a batch payment web page.

 

<h3>Create a Batch Payment</h3>

Follow these steps to create a batch payment.

Go to Business &gt; Purchases overview (or Bills to pay) &gt; Awaiting Payment. Tick the check box next to each bill you want to include in the batch payment and then click Batch Payment.

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653027562/1653027622-xu-64-1.png" alt="1653027622-xu-64-1.png" />

  

In the pop-up box, click Pay X bills to confirm. 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653027603/1653027663-screen-shot-2020-05-06-at-10-38-18-am.png" alt="1653027663-screen-shot-2020-05-06-at-10-38-18-am.png" />

 

Select payment date and bank account. Enter bank statement Particulars, Code and Reference details if desired and then click Make Payments.

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653027622/1653027682-xu-65-1.png" alt="1653027682-xu-65-1.png" />

 

 

<h3>Deleting Bills</h3>

If a bill is yet to be paid, select the bill to be deleted.

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653027666/1653027725-xu-66.png" alt="1653027725-xu-66.png" />

 

Click on Bill Options and select Void.

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653027685/1653027745-xu-67-1.png" alt="1653027745-xu-67-1.png" />

 

 

<h3>Notes about Deleting Bills</h3>

<ul>
	<li>
	You cannot edit any part of a bill that has been paid, except for the account it has been assigned to and the tracking (and file attachments on bills). If you have entered a payment in error, you can delete the payment from the list of transactions in the relevant bank account.
	</li>
</ul>

<ul>
	<li>
	You cannot delete a bill that has been paid. However, you can delete the payment, which will return the bill to the Awaiting Payment tab, where it can be voided. For best accounting practice you should credit a bill rather than voiding it. You should only void a bill you have not sent.
	</li>
</ul>

Batch Payments and Deleting Bills

<h3>Sending Remittance Advice</h3>

After you have made a payment against one of your bills, you can then email a copy of the remittance advice to your supplier to let them know that they have been paid.

The easiest way to do this is by clicking "Send Remittance Advice" in the green notification box that appears after recording a payment against the bill.

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653027768/1653027828-abkx220-09.png" alt="1653027828-abkx220-09.png" />

If you need to send the Remittance Advice at a later date you can do this by going to Accounting &gt; Bank accounts &gt; then click on the bank account the payment was made from:

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653027791/1653027851-abkx220-10.png" alt="1653027851-abkx220-10.png" />

 

Find the payment that you want to send the remittance for under the Account Transactions tab and click on the payment link.

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653027809/1653027868-accounts-transactions.png" alt="1653027868-accounts-transactions.png" />

 

Click Options &gt; Send Remittance.

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653027830/1653027890-abkx220-11.png" alt="1653027890-abkx220-11.png" />

 

Enter the email address and customise the message if required and then click Send.

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653027852/1653027912-xu-69.png" alt="1653027912-xu-69.png" />

 

<h3>Credit Notes</h3>

You can add a credit note directly from a bill to credit some or the entire bill. Go to Business &gt; Purchases overview (or Bills to pay) &gt; Awaiting Payment. Then select the bill you want to add a credit note to.

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653027887/1653027947-xu-66-1.png" alt="1653027947-xu-66-1.png" />

 

Under the Bill Options menu select Add Credit Note.

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653027914/1653027974-xu-68-1.png" alt="1653027974-xu-68-1.png" />

 

Enter the details as per the credit note you have received from your supplier and click Approve.

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653027932/1653027992-credit-note.JPG" alt="1653027992-credit-note.JPG" />

Sending Remittance Advice and Credit Notes

In this short quiz, you will be able to check your understanding of the content that has been covered. You must achieve a pass mark of 80% in this quiz. If you do not achieve the required passing grade in the first attempt don't panic, simply go back over the course material and then try again.

Quiz: Xero Purchases & Bills

Xero Purchases & Bills

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653029512/1653029572-rec.png" alt="1653029572-rec.png" />

 

 

<h3>Overview</h3>

In this course, you will be introduced to Bank Reconciliation. Bank reconciliation is the accounting process that checks that the transactions in your Bank General Ledger account are the same as what is in your bank using the downloaded bank statement lines.

 

<h3>Learning Outcomes</h3>

By the end of the course, you should understand how to:

<ul>
	<li>
	Briefly explain how bank feeds work in Xero.
	</li>
	<li>
	Explain the purpose of bank reconciliation and how this works in Xero.
	</li>
	<li>
	Provide an overview on how overpayments and prepayments are treated in Xero.
	</li>
	<li>
	Complete various bank reconciliation processes including create, transfer, match &amp; discuss.
	</li>
	<li>
	Explain how to create and apply bank rules to a range of transactions.
	</li>
</ul>

A bank reconciliation is a process performed by a company to ensure that the company's records are correct and that the bank's records are also correct. It confirms that all the transactions in your bank accounts are recorded in your business accounting records.

Using Xero allows you to quickly and easily reconcile the bank account since all of the spend money and receive money transactions are recorded, as well as all the actual bank transactions. These are received via a bank feed once this has been set up.

In Xero, bank reconciliation is completed from the Reconcile tab, by matching bank statement lines from your bank account on the left against transactions in Xero on the right. Statement lines are the bank transactions imported from your bank account via a bank feed (or manually imported). Transactions are created in Xero, such as invoices, bills, expense claims or cash transactions. The aim of bank reconciliation in Xero is to match each statement line in the bank account to an existing transaction in Xero or create a transaction during the reconciliation process.

It is recommended to reconcile your bank accounts on a regular basis to keep your accounts up to date and to quickly identify any errors that might come up.

 

For an overview of the Bank Reconciliation process, view the following video from Xero:

<iframe allowfullscreen="" height="315" src="https://www.youtube.com/embed/PdiDsvlrKe0" width="560"></iframe>

 

Xero Bank Reconciliation allows you to get your bank statements imported, categorised and matched to the appropriate transaction. It assists you in the reconciliation of large numbers of transactions. If you use foreign currencies, you will immediately see the effects of currency rates as it automatically updates over 160 currencies every hour.

How does Bank Reconciliation work in Xero?

In Xero, you can link as many bank accounts as you like for no extra cost. The first step is to set up all of your bank accounts, credit cards, petty cash accounts, PayPal accounts etc. that you use.

You can add these bank accounts by going to Accounting &gt; Bank accounts &gt; + Add Bank Account.

 

<img alt="1543797674-abkx174-01.gif" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/1214105/1543797674/1543797674-abkx174-01.gif" />

 

Follow the prompts to search for your Bank and then add the:

<ul>
	<li>
	Account Name (i.e. the name on your bank account),
	</li>
	<li>
	Account Type (choose from the drop-down box),
	</li>
	<li>
	Bank Account Number and
	</li>
	<li>
	Country Currency (choose from the drop-down box).
	</li>
</ul>

Add another account if required and click Continue. Your bank account/s will then be added to the Dashboard.

To assign a unique <a href="https://central.xero.com/s/article/Components-of-an-account-in-your-chart-of-accounts?userregion=true" target="_blank" rel="noreferrer noopener">Account Code</a> to your bank account you can <a href="https://central.xero.com/s/article/Add-or-edit-an-account-in-your-chart-of-accounts?userregion=true" target="_blank" rel="noreferrer noopener">edit your bank account in the chart of accounts</a>. 

<img alt="1653029895-capture2.PNG" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653029835/1653029895-capture2.PNG" />

After your accounts have been added, you are able to select "Get Bank Feeds" which allows you to set up daily automatic bank feeds (if your bank supplies them). Bank feeds let you automatically import bank statement transactions directly into your Xero organisation.

A prompt will appear from the Dashboard (or Accounting&gt; Bank accounts) after you add your bank account, reminding you to select the "Get Bank Feeds" option. While the use of Bank Feeds is optional, it is preferable for a more cohesive user experience in Xero.

If Xero has a direct relationship with the bank, you must fill out the relevant bank feeds form to authorise the bank to send data. Otherwise bank feeds may still be available by using a third party provider through <a href="https://central.xero.com/s/article/Yodlee-feeds-overview" target="_blank" rel="noreferrer noopener">Yodlee</a>.

 

<img alt="1543799078-abkx174-02.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/1214105/1543799078/1543799078-abkx174-02.png" />

 

We recommend that you set up the bank accounts in Xero and fill out the bank feeds authority form as soon as possible. Most bank feeds in Australia are not retrospective and take approximately 10 working days to activate.

A bank feeds form can be downloaded from the links below, or you can click on the "Get Bank Feeds" link in Xero and this will take you to the relevant bank feeds form.

<ul>
	<li>
	<a href="https://central.xero.com/s/article/ANZ-Australia-direct-feeds" target="_blank" rel="noreferrer noopener">ANZ (Australia)</a>
	</li>
	<li>
	<a href="https://central.xero.com/s/article/BankSA-direct-feeds" target="_blank" rel="noreferrer noopener">BankSA</a>
	</li>
	<li>
	<a href="https://central.xero.com/s/article/Bankwest-direct-feeds" target="_blank" rel="noreferrer noopener">Bankwest</a>
	</li>
	<li>
	<a href="https://central.xero.com/s/article/Bank-of-Melbourne-direct-feeds" target="_blank" rel="noreferrer noopener">Bank of Melbourne</a>
	</li>
	<li>
	<a href="https://central.xero.com/s/article/Bank-of-Queensland-direct-feeds" target="_blank" rel="noreferrer noopener">Bank of Queensland (BOQ)</a>
	</li>
	<li>
	<a href="https://central.xero.com/s/article/BOQ-Specialist-direct-feeds" target="_blank" rel="noreferrer noopener">BOQ Specialist</a>
	</li>
	<li>
	<a href="https://central.xero.com/s/article/Bank-of-us-direct-feeds" target="_blank" rel="noreferrer noopener">Bank of us</a>
	</li>
	<li>
	<a href="https://central.xero.com/s/article/Coastline-Credit-Union-direct-feeds" target="_blank" rel="noreferrer noopener">Coastline Credit Union</a>
	</li>
	<li>
	<a href="https://central.xero.com/s/article/Commonwealth-Bank-CBA-direct-feeds" target="_blank" rel="noreferrer noopener">Commonwealth Bank CBA</a>
	</li>
	<li>
	<a href="https://central.xero.com/s/article/First-Option-Credit-Union-direct-feeds" target="_blank" rel="noreferrer noopener">First Option Credit Union</a>
	</li>
	<li>
	<a href="https://central.xero.com/s/article/Goulburn-Murray-Credit-Union-direct-feeds" target="_blank" rel="noreferrer noopener">Goulburn Murray Credit Union (GMCU)</a>
	</li>
	<li>
	<a href="https://central.xero.com/s/article/Greater-Bank-direct-feeds" target="_blank" rel="noreferrer noopener">Greater Bank</a>
	</li>
	<li>
	<a href="https://central.xero.com/s/article/Hume-Bank-direct-feeds" target="_blank" rel="noreferrer noopener">Hume Bank</a>
	</li>
	<li>
	<a href="https://central.xero.com/s/article/IMB-Building-Society-direct-feeds" target="_blank" rel="noreferrer noopener">IMB Building Society</a>
	</li>
	<li>
	<a href="https://central.xero.com/s/article/Macquarie-Bank-direct-feeds" target="_blank" rel="noreferrer noopener">Macquarie Bank</a>
	</li>
	<li>
	<a href="https://central.xero.com/s/article/Maitland-Mutual-Building-Society-direct-feeds" target="_blank" rel="noreferrer noopener">Maitland Mutual Building Society</a>
	</li>
	<li>
	<a href="https://central.xero.com/s/article/National-Australia-Bank-NAB-direct-feeds" target="_blank" rel="noreferrer noopener">National Australia Bank NAB</a>
	</li>
	<li>
	<a href="https://central.xero.com/s/article/Rabobank-direct-feeds-AU" target="_blank" rel="noreferrer noopener">Rabobank</a>
	</li>
	<li>
	<a href="https://central.xero.com/s/article/Regional-Australia-Bank-direct-feeds" target="_blank" rel="noreferrer noopener">Regional Australia Bank</a>
	</li>
	<li>
	<a href="https://central.xero.com/s/article/Rural-Bank-direct-feeds" target="_blank" rel="noreferrer noopener">Rural Bank (Australia)</a>
	</li>
	<li>
	<a href="https://central.xero.com/s/article/St-George-direct-feeds" target="_blank" rel="noreferrer noopener">St George</a>
	</li>
	<li>
	<a href="https://central.xero.com/s/article/WAW-Credit-Union-direct-feeds" target="_blank" rel="noreferrer noopener">WAW Credit Union</a>
	</li>
	<li>
	<a href="https://central.xero.com/s/article/Westpac-Australia-direct-feeds" target="_blank" rel="noreferrer noopener">Westpac (Australia)</a>
	</li>
</ul>

 

If you want to import transactions for any periods prior to your bank feeds commencement date, this will have to be done manually. You can <a href="https://central.xero.com/s/article/About-manually-importing-bank-statements" target="_blank" rel="noreferrer noopener">download bank transactions</a> through internet banking and import them into Xero (formats: OFX, QIF or CSV).

Please note: Bank Feeds are not available to practice within the Demo Company. For the purpose of completing this course, it is not a compulsory requirement to set up Bank Feeds. However, feel free to practice adding your own bank account into your Xero Trial account (not Demo) and then set up a bank feed to see how it works. Remember that there will be a delay with the bank feed activation and be assured that no payment to Xero is necessary should you choose to do this.

 

<h3>What if you are Not Automatically Linked to your Bank?</h3>

If your bank offers OFX file exports, you should choose this over any other format because it recognises duplicates. Please watch this short Xero tutorial to learn how to import an OFX bank statement.

 

<iframe allowfullscreen="" height="360" src="https://player.vimeo.com/video/160799397" width="640"></iframe>

 

If your bank allows you to export your account in a CSV format, then you will be able to import the file into Xero. Please watch this short tutorial to learn how to import a CSV bank statement.

 

<iframe allowfullscreen="" height="360" mozallowfullscreen="" src="https://player.vimeo.com/video/78879131" webkitallowfullscreen="" width="640"></iframe>

 

If your bank allows QIF file exports, then you will be able to import the file into Xero. Please refer to the <a href="https://central.xero.com/s/article/Import-a-QIF-bank-statement#:~:text=What%20is%20a%20QIF%20file,your%20bank%20account%20in%20Xero." target="_blank" rel="noreferrer noopener">Xero Central guide</a> for importing instructions.

 

If you make multiple imports of bank statements and you get the same line imported more than once, you can delete the imported statement or the individual lines from the statement. Click <a href="https://central.xero.com/s/article/Delete-or-restore-a-bank-statement-line" target="_blank" rel="noreferrer noopener">HERE</a> to find out how.

 

Please watch this short Xero tutorial on how to set up your bank feeds:

<iframe allowfullscreen="" height="315" src="https://www.youtube.com/embed/MD8Cx02LATc" width="560"></iframe>

Connecting Xero with Your Bank Accounts

The Dashboard displays a snapshot of your organisation's financial position based on the transactions that have been entered into Xero. It is possible to reorder the content on the dashboard so that you are provided with a quick view of what is important to you.

 

There are two ways you can do this:

<ol>
	<li>
	From the Dashboard scroll to the bottom of the screen and select Edit Dashboard. You can then drag and drop (or hide) items on the screen to your desired layout. Then click Save Changes at the bottom of the screen.
	</li>
	<li>
	Go to Accounting &gt; Bank accounts. Use the up/down buttons to change the order of Bank Accounts showing on the Dashboard. The up/down button is immediately below each of the bank accounts.
	</li>
</ol>

 

Within the Bank Accounts, you can also check/uncheck the tick-box to show or hide particular accounts on the Dashboard. This check box function is useful when a Bank Account has been closed (or when using a test account for internal account purposes) and you do not want it displayed on the Dashboard.

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653030476/1653030535-abkx174-13-2.gif" alt="1653030535-abkx174-13-2.gif" />

Change the Bank Account Display on the Dashboard

Xero makes the bank reconciliation process easier by letting you know when bank statement lines are ready to reconcile. When a bank statement is imported, the bank account panel on your dashboard shows the number of bank statement lines ready to be reconciled. Your aim is to match each statement line in the bank account to an existing transaction in Xero or create a transaction during the reconciliation process.

 

You can easily navigate to the Bank Reconciliation screen using one of the following: 

<ul>
	<li>
	Blue Reconcile items button on the Dashboard
	</li>
	<li>
	Reconcile link on any of the bank account screens
	</li>
	<li>
	Reconcile Account link from the Manage Account menu. 
	</li>
</ul>

<img alt="1653030617-reconcile-dashboard.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653030558/1653030617-reconcile-dashboard.png" />

 

<img alt="1653030648-reconcile-from-bank-accounts-1.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653030588/1653030648-reconcile-from-bank-accounts-1.png" />

 

There are a number of actions that you can perform from this screen and you should spend some time becoming familiar with its layout. How you reconcile each statement line depends on whether a transaction has already been created in Xero to reflect it or not.

 

<h3>Match to an Existing Transaction in Xero</h3>

When Xero believes that there is a match between the transaction and the bank statement line item, you will see that the suggested transaction presents in blue immediately beside the bank statement line item.

These matches are made by comparing the amount, then the contact name, reference details and closest due date. Sometimes there are multiple transactions for the same amount and a similar date, so the most likely transaction is suggested and a link provided to the other alternatives.

If you are happy that the bank statement transaction and the Xero transaction do match then you simply need to click on the OK button in the middle of the screen.

 

<img alt="1653030683-match-blue-ok-1.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653030623/1653030683-match-blue-ok-1.png" />

 

If you don’t want to accept the match, click [number] Other Possible Matches Found to see other options.

If Xero can’t find a match or it doesn't create a suggestion, it will leave the statement line unmatched ready for you to create or find a transaction to match to. Only create a spend or receive money transaction if there isn't a match or suggestion, and you haven't already entered the transaction in Xero.

 

<h3>Find &amp; Match a Transaction</h3>

You can use the Find &amp; Match link to see all invoices. It is useful when you have a large number of invoices for the same client, as you can find the exact invoice you want to match and highlight it.

<img alt="1653030718-find-and-match-1.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653030658/1653030718-find-and-match-1.png" />

 

Find the transaction, then select the checkbox next to it. To help you find the transaction, within the Find &amp; Match screen, you are able to sort the Date, Name, Reference, Spent and Received columns by clicking on the blue heading name. 

 

<img alt="1653030751-find-and-match-search-au-1.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653030691/1653030751-find-and-match-search-au-1.png" />

 

Then you can click Reconcile.

 

<img alt="1653030769-reoncile-au-1.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653030709/1653030769-reoncile-au-1.png" />

 

Payments made or received via credit or charge card should be recorded as at the date of the statement line. This is in-line with time of supply, as this is when the credit or charge card was tendered as payment.

<h3> </h3>

<h3>Create a Transaction to Reconcile</h3>

Where no Xero transaction exists for the corresponding bank statement item, you can create a new spend or receive money transaction, sales invoice, bill or expense claim so that you are able to reconcile the transaction. Tracking information and tax rates can also be directly entered from this screen.

 

<img alt="1653030797-create-1.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653030738/1653030797-create-1.png" />

 

Xero automatically creates contacts from data entry screens with the payee name, so you don't have to have a supplier or customer already set up. After you select Create from the reconciliation screen, complete the following:

<ul>
	<li>
	Add or select a contact in the Who field
	</li>
</ul>

<ul>
	<li>
	Add the account to allocate the transaction to in the What field
	</li>
</ul>

<ul>
	<li>
	Add the tax rate you want to apply in the Tax Rate field
	</li>
</ul>

<ul>
	<li>
	Enter a description in the Why field
	</li>
</ul>

<ul>
	<li>
	If you've set up tracking, you can select any relevant tracking options (optional)
	</li>
</ul>

<ul>
	<li>
	You can also click Add details to enter extra details like a reference, or split the transaction across two or more lines (optional)
	</li>
</ul>

<ul>
	<li>
	Click Save Transaction
	</li>
</ul>

<ul>
	<li>
	Click OK to create the transaction and reconcile it.
	</li>
</ul>

 

<h3>Create a Transfer Transaction</h3>

This facilitates the matching transaction for a transfer from one business bank account to another. This does not actually upload to the bank, it’s just an easy way of coding. Transfer is useful for business credit card payments when credit cards have been loaded as bank accounts in Xero.

<img alt="1653030844-transfer-1.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653030784/1653030844-transfer-1.png" />

 

On the bank reconciliation screen, for the bank statement line you want to reconcile, complete the following:

<ul>
	<li>
	Select the Transfer tab. Then select the bank account:

	-        If the statement line shows funds spent, select the bank account or credit card you transferred the money to.

	-        If the statement line shows funds received, select the bank account you transferred the money from.
	</li>
	<li>
	You can enter a reference for the transfer transaction if you wish.
	</li>
	<li>
	Click OK.
	</li>
</ul>

You only need to create a transfer transaction in one bank account. Xero creates the transaction in the corresponding account, so you just need to click OK to reconcile it.

 

<h3>Discuss</h3>

Comments or points to discuss can be added in the Discuss tab – this is handy if you don't know what to do with something. You can invite a financial adviser in to help you. In addition, Xero has an 'auto suggest' feature which uses the same information as the last transaction for the same payee.

<img alt="1653030913-discuss-1.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653030853/1653030913-discuss-1.png" />

 

Note: If at the beginning of the reconciliation process, ‘Reconcile [number] items’ doesn’t display, it indicates there are no bank statement lines to reconcile. If you believe there should be statement lines to reconcile but there aren’t any, it might be because the statement lines relate to dates before a bank feed was connected, or a bank feed isn’t available. If this is the case, you need to <a href="https://central.xero.com/s/article/About-manually-importing-bank-statements?userregion=true" target="_blank" rel="noreferrer noopener">manually import the bank statement lines</a>. Otherwise, it could be because your <a href="https://central.xero.com/s/article/Check-if-your-bank-feed-is-late?userregion=true" target="_blank" rel="noreferrer noopener">bank feed is delayed</a>.

  

<h3>Record a Part Payment during Reconciliation</h3>

In the Find &amp; Match link, you can split a transaction to record a part payment of an invoice, bill or expense claim when reconciling the payment in your bank account. To apply a part payment when reconciling, complete the following:

<ul>
	<li>
	In the Reconcile tab of your bank account, click Find &amp; Match for the bank statement line you want to reconcile.
	</li>
</ul>

<ul>
	<li>
	Find or search for the transaction, then select the checkbox for each invoice, bill or expense claim you want to match with the bank statement line. 
	</li>
</ul>

<ul>
	<li>
	Click Split. This option isn't available for spend and receive money transactions, or payments already applied to invoices, bills or expense claims.
	</li>
</ul>

<img alt="1653030943-split-au.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653030883/1653030943-split-au.png" />

<ul>
	<li>
	Enter the amount of the part payment you want to apply to the invoice, bill or expense claim.
	</li>
	<li>
	Click Split again to record the part payment on the transaction.
	</li>
	<li>
	Reconcile.
	</li>
</ul>

<img alt="1653030966-split-again-au-1.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653030906/1653030966-split-again-au-1.png" />

 

 

Note: you can't split payment transactions that are already recorded on an invoice, bill or expense claim in Xero. If a payment is entered for the incorrect amount, <a href="https://central.xero.com/s/article/Delete-an-account-transaction?userregion=true" target="_blank" rel="noreferrer noopener">delete the payment</a>, then enter it again. You can also record a part payment directly on the <a href="https://central.xero.com/s/article/Record-payment-of-a-sales-invoice?userregion=true" target="_blank" rel="noreferrer noopener">invoice</a>, <a href="https://central.xero.com/s/article/Record-payment-of-a-bill?userregion=true" target="_blank" rel="noreferrer noopener">bill</a> or <a href="https://central.xero.com/s/article/Record-expense-claim-payment?userregion=true" target="_blank" rel="noreferrer noopener">expense claim</a>. Xero will then suggest the payment transaction as a match when reconciling. 
 

<h3>About Matching Orders</h3>

Note the following rules about matching orders:

<ul>
	<li>
	Xero will always try to match invoice payments and/or references first, provided that the amount is the same. If a match is found, the right-hand side of the transaction in the Reconcile screen will be blue. Be careful with repeated transactions and ensure you allocate the payment to the correct bill/invoice by clicking 'other possible match' if this is showing.
	</li>
</ul>

<img alt="1674747001-match-1.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1674746941/1674747001-match-1.png" />

 

<ul>
	<li>
	Xero matches on bank rules next. If a match is found, the right-hand side of the transaction in the Reconcile screen will show a link that will take you to the rule applied. Users can click on Don’t apply rule if the wrong rule is applied.
	</li>
</ul>

<img alt="1674747037-match-2-1.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1674746977/1674747037-match-2-1.png" />

 

<ul>
	<li>
	Xero matches on auto-suggestion next, i.e. if the Payee name has been used before. Xero suggests the Who, What and Why that was previously used. This will only happen if the following box is ticked at the bottom of the page:
	</li>
</ul>

<img alt="1674747063-previous-entries.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1674747003/1674747063-previous-entries.png" />

 

If a match is found, the right-hand side of the transaction in the Reconcile screen will display the suggested details, as shown below:

 

<img alt="1674747105-match-3.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1674747045/1674747105-match-3.png" />

 

Warning: It is always recommended that you review the details before confirming. 

Remember to click “OK” to ensure you have fully reconciled the payment/receipt.

Reconcile Your Bank Account

After reconciling transactions you may realise you have made an error. It is easy to undo anything in Xero.

If a payment of an invoice or bill was reconciled, but it still shows as awaiting payment, it’s likely the statement line was reconciled with a receive or spend money transaction, instead of with the invoice or bill. This can cause duplicate transactions and therefore an incorrect balance in your bank account.

To resolve this, you’ll need to find the statement line for the payment and delete the incorrectly created transaction. If the statement line is reconciled with the incorrect payment, you can unreconcile the transaction instead, then reconcile it correctly or delete the payment. Once you've either unreconciled or deleted the transaction, you can reconcile the statement line again.

It is useful to remember that an invoice or bill payment will always show as “Payment: xxx”. If it's a receive or spend money transaction, the contact name will display.

Under the reconcile section you will see four tabs: Reconcile, Cash coding, Bank statements and Account transactions.

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653031127/1653031187-abkx174-05-2.png" alt="1653031187-abkx174-05-2.png" />

 

The Bank statement tab shows your statement transactions. Here you can delete an entire statement or a single line if it was imported in error.

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653031144/1653031204-abkx174-06-1.png" alt="1653031204-abkx174-06-1.png" />

 

The Account transactions tab shows all of the transactions created when you reconciled the bank lines. These include spend money, receive money, payments on an invoice (sale or bill) and transfers.

Once you locate the transaction, tick and click remove and re-do.

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653031163/1653031223-abkx174-07.png" alt="1653031223-abkx174-07.png" />

 

This removes the transaction created when you provided a payee name and chart of accounts code at the time you reconciled it. The associated bank statement line still remains.

Fixing Errors

The Bank Reconciliation Summary can be run to check if your actual bank balance and the balance of the bank account in Xero match. It is a Cash Report and it shows how your actual bank balance and the balance of the bank account in Xero reconcile by taking into account any outstanding payments, outstanding receipts, and un-reconciled items.

This report is useful if your bank account's statement balance and balance in Xero do not match, and you need to check for duplicate transactions or manually created transactions that might cause the discrepancy.

 

It is good practice to run this report every week or month to ensure that any issues can be quickly identified and corrected.

<h5> </h5>

<h3>Run the Bank Reconciliation Summary</h3>

To run the Bank Reconciliation summary, complete the following:

<ul>
	<li>
	Go to Accounting &gt; Reports
	</li>
</ul>

<ul>
	<li>
	Under Reconciliations, select Bank Reconciliation
	</li>
</ul>

<ul>
	<li>
	Choose a Pack date range and Bank Account 
	</li>
</ul>

<ul>
	<li>
	Click Update to view your report.
	</li>
</ul>

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1674747527/1674747586-bank-rec-sum.gif" alt="1674747586-bank-rec-sum.gif" />

 

The Bank Reconciliation shows Xero's balance (all transactions accounted for in Xero) plus outstanding payments/deposits not banked, as well as un-reconciled Bank Statement lines.

Xero's balance should be equal to the Bank Statement balance.

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1674747569/1674747628-report-1.png" alt="1674747628-report-1.png" /><img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1674747637/1674747697-report-2.png" alt="1674747697-report-2.png" />

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1674747659/1674747718-report-3.png" alt="1674747718-report-3.png" />

 

Within the report, you will see the option to select the Bank Reconciliation Summary as well as two more tabs you can switch to: Bank Statement and Statement Exceptions. From the Bank Reconciliation Summary tab, you can switch to the Bank Statement or Statement Exceptions tabs to compare the unreconciled items on your Bank Reconciliation Report with any outstanding, imported statement lines.

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1674747732/1674747791-switch-reports.png" alt="1674747791-switch-reports.png" />

 

The report shows what the actual bank balance is, based on the data you entered into Xero, on any given date. This figure is not taken from your online bank balance; it is calculated using the data in Xero.

The balance in Xero and your statement balance for that day should be the same if transactions and the bank reconciliation are up to date.

 

<h2>Bank Statement </h2>

The Bank Statement tab shows all imported bank statements and balances by date range. You can click on the date link to view the bank statement that was imported. It also shows the source – if manually imported or if brought in from bank feeds. If your client is receiving bank feeds, there is an imported statement each day. The end result should be a reconciled bank statement and green tick showing on the dashboard.

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1674747752/1674747811-bank-statement-1.png" alt="1674747811-bank-statement-1.png" />

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1674747796/1674747856-bank-statement-2.png" alt="1674747856-bank-statement-2.png" />

 

<h2>Statement Exceptions</h2>

The Statement Exceptions tab shows you any items that do not match the normal 'import statement to reconcile to item in Xero' process. It shows all 'exceptions' and is a useful place to look, if the actual paper bank statement balance differs to that shown in Xero. For example, if a statement is deleted or if on auto bank feeds, this will show manually imported bank statements (as they are not considered 'the norm'). It will also show duplicates.

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1674747828/1674747888-statement-exceptions.png" alt="1674747888-statement-exceptions.png" />

 

For more information on all three reports, visit Xero Central <a href="https://central.xero.com/s/article/Bank-Reconciliation-Summary" target="_blank" rel="noreferrer noopener">here</a>.

Bank Reconciliation Reports

Prepayments allow you to record payments made in advance on an invoice being raised for your customer, or before a bill is received from your supplier. They are ideal for recording deposits. Prepayments for payments received are assigned an invoice number, in the same range as invoices. They can also be edited on an individual basis.

Overpayments are transactions where a customer has paid you too much, or where you overpay a supplier. Overpayments can be allocated to another invoice or bill, or a refund can be organised. Overpayments are not payments on intended future work, therefore they do not attract tax. Once you've recorded the overpayment, you can view the transaction in your bank account in Xero.   

We will now look at how to record a prepayment and an overpayment and how to reconcile them.

 

<h3>Add a Prepayment to a Supplier</h3>

To add a prepayment in Xero, complete the following:

<ul>
	<li>
	Go to Accounting &gt; Bank accounts
	</li>
</ul>

<ul>
	<li>
	Choose the relevant bank account and click Manage Account 
	</li>
</ul>

<ul>
	<li>
	Click Spend Money.
	</li>
</ul>

<img alt="1543806346-abkx174-14.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/1214105/1543806346/1543806346-abkx174-14.png" />

 

Then select Prepayment from the Spent as drop-down menu.

<img alt="1543806412-abkx174-15.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/1214105/1543806412/1543806412-abkx174-15.png" />

Enter the relevant details and click Save.

 

<img alt="1540338368-xu-04-1.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/1214105/1540338368/1540338368-xu-04-1.png" style="height:354px;width:500px;" />

 

For more information on Prepayments, watch the below video.

 

<iframe allowfullscreen="" height="360" mozallowfullscreen="" src="https://player.vimeo.com/video/66622119" webkitallowfullscreen="" width="640"></iframe>

 

<h3>Record an Overpayment on a Bill</h3>

To record an overpayment, complete the following:

<ul>
	<li>
	Go to Business &gt;Bills to pay 
	</li>
</ul>

<ul>
	<li>
	Click on the Awaiting Payment tab
	</li>
</ul>

<ul>
	<li>
	Find the bill you overpaid your supplier for and click on it to open it. 
	</li>
</ul>

 

<img alt="1540338407-xu-05-1.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/1214105/1540338407/1540338407-xu-05-1.png" style="height:287px;width:600px;" />

 

<ul>
	<li>
	Under Make a payment, enter the amount you paid your supplier, the date it was paid and the bank account it was paid from
	</li>
</ul>

<ul>
	<li>
	Click Add Payment
	</li>
</ul>

<ul>
	<li>
	In the Overpayment popup window, enter a description for the overpayment and click OK to save. 
	</li>
</ul>

<img alt="1540338435-xu-06-1.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/1214105/1540338435/1540338435-xu-06-1.png" style="height:268px;width:600px;" />

<h5> </h5>

<h3>Reconcile a Prepayment/Overpayment</h3>

These types of transactions can be processed directly from the Reconcile screen by accessing the options available on the Direct Payment button.

From your Dashboard, click Reconcile [number] items. 

  <img alt="1543807079-abkx174-16.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/1214105/1543807079/1543807079-abkx174-16.png" />

 

From the relevant transaction's Create tab, click Add details. 

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653031970/1653032030-add-details-1.png" alt="1653032030-add-details-1.png" />

 

From the Spent as (or Received as if a customer has prepaid/overpaid an invoice) drop-down menu, choose Prepayment or Overpayment. 

Enter the relevant details and click Save Transaction.

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653031987/1653032047-save-transaction-1.png" alt="1653032047-save-transaction-1.png" />

 

The system allows you to apply part of the payment against an invoice. Any overpayment/prepayment will sit against that contact until it has been refunded/applied against an invoice.

Prepayments and Overpayments

Bank Rules speed up the bank reconciliation process as they assist the auto-matching function. Bank rules are created for regular or recurring cash transactions. Instead of dealing with these individually each time, you can set up a rule to automatically suggest how it is coded.

Bank rules are a great way to stream-line the classification of transactions. You can set up bank rules for any number of common transactions by defining the conditions that need to be met, and if those conditions are met then Xero will present them in the same way that "Matched" transactions appear, i.e. the transaction will be highlighted green and you are able to click OK to reconcile. 

If you plan to import bank statements manually before the bank feeds are live, then you should set up as many of these bank rules as you can to ensure that the bulk of common transactions will be matched by Xero. Rules do not apply to sales invoices and bills.

 

For an overview on Bank Rules, watch the below video from Xero:

<iframe allowfullscreen="" height="315" src="https://www.youtube.com/embed/UkDL17hkPk0?enablejsapi=1&amp;origin=https%3A%2F%2Fthecareeracademy.mygo1.com" title="Use bank rules in Xero" width="560"></iframe>

 

<h3>Create a new Bank Rule</h3>

To access bank rules, go to the Accounting tab &gt; Bank accounts &gt; Bank Rules button.

<img alt="1674748258-bank-rules.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1674748199/1674748258-bank-rules.png" />

 

There are three types of Bank Rules:

<ol>
	<li>
	Spend Money Rule – for cash payments.
	</li>
	<li>
	Receive Money Rule – for cash deposits.
	</li>
	<li>
	Transfer Money Rule - for transfers between bank accounts. 
	</li>
</ol>

You can set as many conditions as you need on Payees, Descriptions, Amounts, References or Analysis Codes (cheques).

You can set fixed line items and/or allocate based on percentage. You can also apply a rule to a specific bank account/all bank accounts (e.g. loan interest vs. bank fees).

We find rules work best if your accountant or bookkeeper help in the first 2 months to set these up. Once the main rules are established, a lot of your cash transactions are taken care of and this saves you time.

 

<h3>Bank Rule Example</h3>

For the following example, the Spend Money Rule has been selected.   

Go to Accounting &gt; Bank accounts &gt; Bank Rules &gt; Create rule &gt; Spend Money Rule.

 
1. Apply a Bank Rule:

 
You first have to choose whether the Bank Rule will apply to Any or All of the conditions you specify:

<ul>
	<li>
	Any - The rule is applied if only one of the conditions is met. The rule won't fail just because one or more conditions do not match. This makes the rule less restrictive.
	</li>
</ul>

<ul>
	<li>
	All - The rule is applied only when every condition is met. If one condition does not match, for example, if a particular piece of information is missing from a statement line, then the rule will not run. This makes the rule more restrictive.
	</li>
</ul>

<img alt="1674748330-spend-money-rule.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1674748271/1674748330-spend-money-rule.png" />

 

In the Field where you set the condition, you can choose an individual text field (such as Payee) or you can select Any text field to search a combination of fields:

<ul>
	<li>
	If you select an individual text field, Xero will apply the rule if that particular field meets the condition.
	</li>
</ul>

<ul>
	<li>
	If you select Any text field, Xero will search the Payee, Description, Reference and Analysis Code fields on the bank statement line. Xero will apply the rule if one of the fields meets the condition.
	</li>
</ul>

<img alt="1674748374-field.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1674748315/1674748374-field.png" />

 

In the Condition drop-down box, you must choose from the following:

<ul>
	<li>
	Equals - The condition must exactly match the selected text field of the bank statement line.
	</li>
</ul>

<ul>
	<li>
	Contains - The selected text field in the bank statement line must contain the value(s) entered.
	</li>
</ul>

<ul>
	<li>
	Starts with - The selected text field in the bank statement line must start exactly the same as the value(s) entered.
	</li>
</ul>

<ul>
	<li>
	Is blank - The selected text field in the bank statement line must be blank.
	</li>
</ul>

<img alt="1674748423-condition.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1674748364/1674748423-condition.png" />

 

In the Value text field, enter the relevant value(s) to meet the condition for the equals, contains or starts with comparison options.

For example, for the condition shown below, the bank rule would be applied if Payee text field in the bank statement line equals the words Swanston Security.

 

<img alt="1674748461-swanston-security.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1674748401/1674748461-swanston-security.png" />

 

You can add further conditions by clicking Add condition and entering the relevant details. If the condition no longer applies, simply click the trashcan icon at the end of the condition line to delete it.

<img alt="1674748506-bank-rule-gif.gif" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1674748447/1674748506-bank-rule-gif.gif" />

 

2. Set the Contact

Choose from the following:

<ul>
	<li>
	An existing or new contact
	</li>
	<li>
	Entered during reconciliation
	</li>
	<li>
	The Payee from the bank.
	</li>
</ul>

 If "an existing or new contact" is selected, enter the name of the contact in the next field.

 

<img alt="1674748557-set-the-cotact.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1674748497/1674748557-set-the-cotact.png" />

 

3. Allocate line items (optional)

You can set up your bank rule to allocate one or more fixed-value portions of the transaction to an account in your Chart of Accounts. You also have the option to assign a tracking category.

After you've set up any fixed value allocations, you need to tell Xero what to do with the balance of the transaction. You can allocate the remainder to one account in your Chart of Accounts or split it between two or more, and assign a tracking category if you wish.

For example, if you make personal toll calls on your business telephone, you may want to allocate the base charge to Telephone &amp; Internet. 

Then you can separate out the personal and business calls either when you reconcile the transaction each month (by leaving section 3 unfilled) or by allocating a percentage of the remaining amount of the transaction to specific accounts in your Chart of Accounts.

 

<img alt="1674748593-allocate-line-items.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1674748534/1674748593-allocate-line-items.png" />

 

4. Set the reference...

 Select which bank statement field the rule will take its reference from. Choose from:

<ul>
	<li>
	From the Reference
	</li>
</ul>

<ul>
	<li>
	From the Description
	</li>
</ul>

<ul>
	<li>
	From the Payee
	</li>
</ul>

<ul>
	<li>
	From the Cheque No.
	</li>
</ul>

<ul>
	<li>
	From the Analysis Code
	</li>
</ul>

<ul>
	<li>
	By me during bank rec
	</li>
</ul>

<img alt="1674748631-set-reference-1.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1674748571/1674748631-set-reference-1.png" />

 

5. Add rule details

Select which bank account the rule will run on during the reconciliation process. Every bank account that has been setup in Xero should be listed in the drop-down box, as well as "All bank accounts".

 

<img alt="1674748653-bank-account.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1674748594/1674748653-bank-account.png" />

Name the rule and then click Save. Note that only letters and numbers can be used for the bank rule conditions and titles. They cannot include any punctuation or special characters.

<img alt="1674748693-name-rule.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1674748634/1674748693-name-rule.png" />

Editing or deleting a bank rule after it has been used, will not affect those previously reconciled transactions.

To delete a bank rule, go to Accounting &gt; Bank accounts &gt; Bank Rules. Tick the check box to the left of the rule you wish to remove and then click Delete.

 

<img alt="1674748724-delete-bank-rule-1.gif" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1674748665/1674748724-delete-bank-rule-1.gif" />

 

You can also re-order your bank rules (so that a more restrictive rule runs first) by dragging and dropping them in to your preferred order.

 

<img alt="1674748747-reorder-bank-rules.gif" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1674748687/1674748747-reorder-bank-rules.gif" />

 

If you need to edit a rule, simply click on Edit next to it, then make the required amendments then click Save.

 

<img alt="1674748818-edit-rule.gif" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1674748759/1674748818-edit-rule.gif" />

 

If the transaction that Xero creates based on the rule is incorrect, you may need to review your bank rules to ensure the conditions are correct and then either edit it or create a new one.

For any transactions that have been matched incorrectly using a rule, you can simply click into the "Create" tab of that transaction and enter the correct details and then select OK to reconcile.

Click <a href="https://central.xero.com/s/article/Troubleshoot-bank-rules" target="_blank" rel="noreferrer noopener">HERE</a> for help to troubleshoot bank rule errors.

Introduction to Bank Rules

The video below explains the reasons why your Xero and statement balances may differ.

<iframe allowfullscreen="" height="360" src="https://player.vimeo.com/video/161407577" width="640"></iframe>

 

To reiterate the video, when reconciliations go bad, check the following:

<ul>
	<li>
	<a href="https://central.xero.com/s/article/Enter-conversion-balances" target="_blank" rel="noreferrer noopener">Have the conversion balances been entered correctly?</a>
	</li>
	<li>
	<a href="https://central.xero.com/s/article/Enter-uncleared-cheques-when-converting-to-Xero" target="_blank" rel="noreferrer noopener">Have the uncleared funds from your previous accounting system been entered correctly?</a>
	</li>
	<li>
	<a href="https://central.xero.com/s/article/View-bank-statements-and-bank-statement-lines" target="_blank" rel="noreferrer noopener">Are there any bank statement lines missing?</a>
	</li>
	<li>
	Check for <a href="https://central.xero.com/s/article/Delete-or-restore-a-bank-statement-line" target="_blank" rel="noreferrer noopener">duplicate</a>, <a href="https://central.xero.com/s/article/Delete-a-bank-statement" target="_blank" rel="noreferrer noopener">manual</a>, <a href="https://central.xero.com/s/article/Delete-or-restore-a-bank-statement-line" target="_blank" rel="noreferrer noopener">deleted</a> bank statement lines.
	</li>
</ul>

  

Click the links below for information on situations you may encounter during the bank reconciliation process.

<ul>
	<li>
	<a href="https://central.xero.com/s/article/Record-an-overpayment" target="_blank" rel="noreferrer noopener">Overpayments</a>
	</li>
	<li>
	<a href="https://central.xero.com/s/article/Record-a-part-payment-during-reconciliation#Web" target="_blank" rel="noreferrer noopener">Record a part payment during reconciliation</a>
	</li>
	<li>
	<a href="https://central.xero.com/s/article/Fix-an-incorrectly-reconciled-bank-statement-line" target="_blank" rel="noreferrer noopener">Fix an incorrectly reconciled bank statement line</a>
	</li>
	<li>
	<a href="https://central.xero.com/s/article/Record-an-overpayment#Createanoverpaymentduringbankreconciliation" target="_blank" rel="noreferrer noopener">Reconcile the payment for an invoice or bill paid twice</a>
	</li>
</ul>

  

This video shows how to reconcile Transfers between bank accounts. Please note that there is no audio in this video other than background music. 

 

<iframe allowfullscreen="" height="360" mozallowfullscreen="" src="https://player.vimeo.com/video/264907093" webkitallowfullscreen="" width="640"></iframe>

 

View the short video below for instructions on how to reconcile a statement line with a transaction that doesn't quite match:

<iframe allowfullscreen="" height="360" src="https://player.vimeo.com/video/154762400" width="640"></iframe>

 

View <a href="https://players.brightcove.net/4890384886001/default_default/index.html?videoId=5131029215001">this video</a> for information on reconciling a bank statement line to multiple invoices or bills in Xero.

Troubleshooting Tips

Quiz: Xero Bank Reconciliation & Managing Accounts

Reconciliation and Managing Accounts in Xero

<img alt="1540528128-abkx194-xero-reporting-overview.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/1214105/1540528128/1540528128-abkx194-xero-reporting-overview.png" />

 

<h3>Overview</h3>

In this course, you will be introduced to the Xero Report Centre.  Generate and view interactive reports in real-time, and create and report on a budget. All the reports you can run in Xero are divided into sections of performance, position, cash and detail. Reports can be saved, published and archived.

 

<h3>Learning Outcomes</h3>

By the end of the course, you should understand how to:

<ul>
	<li>
	Describe the most common reports available in Xero.
	</li>
	<li>
	Explain the different report views in Xero. 
	</li>
	<li>
	Identify how to add a report as a favourite.
	</li>
	<li>
	Explain how to customise reports in Xero.
	</li>
	<li>
	Explain how to publish and export a report
	</li>
	<li>
	Explain how to delete, archive or restore a report.
	</li>
	<li>
	Explain how to run and lodge a Business Activity Statement using Xero.
	</li>
</ul>

In Xero you can view and share a wide range of interactive reports and budgets in real time, at any time – there is no need to wait until the end of the month. All reports are linked through to source transactions and have flexible settings, layouts and easy-to-read designs. You can’t create bespoke reports in Xero however you can customise their existing reports by adding schedules, text blocks, rows and columns of your choosing.

 

There are over 40 reports grouped into 7 groups; Financial Performance, Financial Statements, Payables and Receivables, Payroll, Reconciliations, Taxes and Balances, and Transactions.

 

The most common reports are:

<h3>Profit and Loss</h3>

The Profit and Loss report (or Income Statement) shows your organisation's net income, by deducting expenses from revenue for the reporting period. Profit and Loss is also known as the Income Statement or the Statement of Financial Performance.

  

<h3>Balance Sheet</h3>

The Balance Sheet shows a snapshot of the assets, liabilities and equity of your organisation as at a particular date. It can be described as a "snapshot" of the company's financial position at a point in time and plays a key role in understanding a business’s financial health.

 

<h3>Trial Balance</h3>

The Trial Balance shows a list of the accounts in your Chart of Accounts and their balances for a chosen month.

 

<h3>Aged Receivables</h3>

The Aged Receivables (or Aged Debtors) report shows the sales invoices that were awaiting payment during a selected month and several months prior.

 

<h3>Aged Payables</h3>

The Aged Payables (or Aged Creditors) report shows the bills and expense claim payments that you currently owe and how long they have gone unpaid.

<h3>   
Bank Reconciliation</h3>

The Bank Reconciliation Summary shows how your actual bank balance and the balance of the bank account in Xero match, after taking into account any unreconciled items. You might find this report useful if your bank account's statement balance and balance in Xero do not match, and you need to check for duplicate or manually created transactions that might be causing the discrepancy.

You can run this report as at any date. You can also view the corresponding bank statement for that date and any exceptions on the statement compared to the data you have in Xero.

<h4> </h4>

<h3>Activity Statements</h3>

Businesses use activity statements to report and pay a number of tax obligations, including GST, pay as you go (PAYG) instalments, PAYG withholding and fringe benefits tax. Individuals who need to pay quarterly PAYG instalments also use Activity statements.

 

<h3>GST Reconciliation</h3>

Shows the GST collected, GST paid, GST owing and GST Account Summary (including unfiled). 
As a business, you use an activity statement to report and pay the GST your business has collected and claim GST credits. Most businesses report and pay their GST quarterly and have a choice each year about how they do this.

 

For an overview of reporting watch this video from Xero:

<iframe allowfullscreen="" height="315" src="https://www.youtube.com/embed/J5kBKOmxcNM" width="560"></iframe>

Overview of Reports

You can access a summary of all the reports available from the Reports screen. You can save a report as a favourite and access it directly from the Accounting menu.

Go to Accounting &gt; Reports to see a full range of reports. Your user role will determine which reports you will be able to see. The Drafts, Published and Archived tabs will hold reports created by you or someone else in your organisation.

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653273333/1653273393-new-reports-centre-home-page-1.gif" alt="1653273393-new-reports-centre-home-page-1.gif" />

 

You will see that there are five headings across the top of the screen. You can select:

<ul>
	<li>
	Home to see the full overview of reports within their categories, with your starred favourites at the top. You can search for a report in the search bar, and you can also select Show descriptions to view descriptions of the various reports.
	</li>
</ul>

<ul>
	<li>
	Custom for reports that have been saved with custom settings for your company.
	</li>
</ul>

<ul>
	<li>
	Drafts to access reports that have been saved as draft. These can be edited and deleted.
	</li>
</ul>

<ul>
	<li>
	Published to view published reports. Published reports are read-only. You need the Advisor user role to delete published reports.
	</li>
</ul>

<ul>
	<li>
	Archived to view published reports that have been archived. You can restore archived reports.
	</li>
</ul>

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653273768/1653273828-new-reports-centre-1.png" alt="1653273828-new-reports-centre-1.png" />

 

Note: You can save a report as a draft only if you have the Adviser User role. For more information on user roles and access to reports, view the Xero Central guide <a href="https://central.xero.com/s/article/User-role-access-to-reports-budgets-and-manual-journals-in-Xero?userregion=true#Reportsandbudgetsuserrolecomparison" target="_blank" rel="noreferrer noopener">here</a>. 

In the Custom tab, you can click on the three dots icon at the far right of a particular report and choose from a range of options, including renaming the report, marking the report as a default or exporting it. Similar options exist for the reports in the Drafts and Published tabs.

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653273796/1653273856-custom-report-1.png" alt="1653273856-custom-report-1.png" />

 

Within these Reports tabs, you can click on the reports filter and sort the reports by various options.

For example, if you know that a report was created last month you may like to click on the Report Date option so that all reports are grouped by date.

Alternatively, if you know who created the report you could click on the Prepared By option and sort by the name of the person who created the report.

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653273822/1653273882-sort-by-1.png" alt="1653273882-sort-by-1.png" />The Home tab shows all of the available reports within their categories, including older versions of reports. You can show or hide descriptions of the reports using the Show descriptions switch at the top of the screen. Each report category also has a collapsible arrow next to the category heading. This arrow lets you show or hide the reports under the category heading. 

 

In the top right corner of the screen, you can use the Find a report search bar to search for reports. Start typing the name of the report and a dropdown list appears with potential matches.

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653273866/1653273926-new-reports-centre-browse-1.gif" alt="1653273926-new-reports-centre-browse-1.gif" />

 

<h3>Starred Reports</h3>

Within the Demo Company, the most common reports have already been 'starred' as favourite reports and they appear in the drop-down list when you click on the Accounting menu button.

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653273888/1653273948-accounting-reports-favourites-1.png" alt="1653273948-accounting-reports-favourites-1.png" />

 

They also appear as the first section on the reports Home tab. You can add another favourite report to the list by first going to Accounting &gt; Reports. Then click on the star icon next to the report you want to add. Once the star beside the report is selected, the next time you go to the Accounting tab you will see the new report in the Starred Reports section, as well as in the Favourites on the Home tab.

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653273932/1653273992-star-reports-1.gif" alt="1653273992-star-reports-1.gif" />

 

Some reports are not able to be starred. To unmark a report as a favourite, clear the selected star icon

 

<h3>Create a Draft Report</h3>

You can create a draft report in Xero and save layout changes that are not yet finalised. Then you can publish and export it at a later day. We will look at this further in the course.

To create a draft report, complete the following:

<ul>
	<li>
	Go to Accounting &gt; Reports.
	</li>
</ul>

<ul>
	<li>
	Click on the report you want to open.
	</li>
</ul>

<ul>
	<li>
	Depending on the report, you can then <a href="https://central.xero.com/s/article/Select-contents-and-display-order-in-a-new-report?userregion=true" target="_blank" rel="noreferrer noopener">select settings </a>to apply the custom options you need (we will look at this in the next chapter of the course). In all new reports there is also the option to <a href="https://central.xero.com/s/article/Edit-layout-of-a-new-financial-report?userregion=true" target="_blank" rel="noreferrer noopener">edit the layout</a> of your report.
	</li>
</ul>

<ul>
	<li>
	Click Update.
	</li>
	<li>
	At the bottom of the report, click either Save As &gt; Draft or Save as Draft.
	</li>
</ul>

Accessing Reports & Report Views

There are many ways to customise reports that you create in Xero. Note: Not all reports can be edited. These include adding text which will appear at the top or bottom of the report, adding schedules, inserting rows, and inserting columns. In Xero's newer reports, you have the option to <a href="https://central.xero.com/s/article/Select-contents-and-display-order-in-a-new-report?userregion=true" target="_blank" rel="noreferrer noopener">refine your report settings or apply filters</a> as well as <a href="https://central.xero.com/s/article/Edit-layout-of-a-new-financial-report" target="_blank" rel="noreferrer noopener">edit layouts</a>. You can also <a href="https://central.xero.com/s/article/Arrange-columns-and-add-text-blocks" target="_blank" rel="noreferrer noopener">arrange columns and add text blocks</a>. Older reports may not have these options and the available settings will depend on the report you're running. 

 

Below are some common options available in most reports:

<ul>
	<li>
	Accounting basis (available in the "More" option at the top right):

	-        Choose Accrual to show revenue and expenses according to the transaction date. For example, the date from invoices, bills, and spend or receive money transactions.

	-        Choose Cash to show revenue and expenses according to the payment date. For example, the date invoices and bills are paid, and the date of spend or receive money transactions.
	</li>
	<li>
	Columns (available in the "Edit layout" option at the bottom left): 
	Select the checkbox for each column you want to show on the report. Clear a checkbox to hide a column.
	</li>
	<li>
	Decimals (available in the "More" option at the top right): 
	Numbers can be set to show 2 or 4 decimal places (depending on the column). To show only round numbers, clear the Show decimals checkbox.
	</li>
</ul>

<ul>
	<li>
	Layout (available in the "Edit layout" option at the bottom left): 
	Set whether transaction data is grouped or summarised on your report and what variable it's gathered by. 
	Select:

	-        Standard for no grouping. 
	-        Group By to view individual transactions by your selected variable, such as by contacts or invoice date

	-        Summarise By to display totals only for your selected variable.
	</li>
	<li>
	Apply filters: 
	Click Filter and select a column to filter by, then enter or select details. As you add more filters, the report displays results based on all your filters combined. When you update the report, the filters show at the top in a text block you can edit or delete.
	</li>
</ul>

 

After you’ve updated your settings as preferred, click Done or Update depending on the screen you are in to enable you to view the new layout of your report. Then, you can Save a draft of the report to keep it in its updated format. If you want to use your new format again in the future you can save it as a custom report (only available for new reports).

 

<h3>Save a Custom Report</h3>

To save a new report as a custom report, complete the following:

<ul>
	<li>
	Go to Accounting &gt; Reports.
	</li>
</ul>

<ul>
	<li>
	Select the report you would like to open.
	</li>
</ul>

<ul>
	<li>
	Apply the report settings you want to save for reuse.
	</li>
</ul>

<ul>
	<li>
	Click Save As, then select Custom.
	</li>
</ul>

<ul>
	<li>
	In Name, you can enter a new internal reference for the report if you wish (optional). This title will differ from the title displayed on exported versions of your report. It will be the default title when you publish reports created with the custom layout.
	</li>
</ul>

<ul>
	<li>
	If you wish, you can select Make custom report the default (optional). This gives your custom settings to this type of report whenever someone runs it from now on.
	</li>
</ul>

<ul>
	<li>
	Click Save. 
	</li>
</ul>

 

To update a custom report, open it to make your changes, then save it using the same name it was saved with previously. Alternatively, save the revised report with a new name to create a second custom report based on the first.

For more information on editing reports, please refer to the Xero Help Centre <a href="https://central.xero.com/s/article/Edit-layout-of-a-new-financial-report" target="_blank" rel="noreferrer noopener">here</a>.

 

<h3>Copy Custom Reports</h3>

If you want to create a report based on a Custom report you have previously saved, you can do this simply by opening the Custom report from the Accounting &gt; Reports &gt; Custom tab.

 

Click on the report you want to copy, then at the bottom select Save As &gt; Custom &gt; Give the report a new name &gt; Save. This will create a new version of your customised report that you can edit to suit your needs. Just remember to Save the changes when you are done. 

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653274239/1653274299-save-custom-as-new-custom-1-1.gif" alt="1653274299-save-custom-as-new-custom-1-1.gif" />

Customising Reports

After you create and customise a report, you can then publish it. This keeps a permanent record of it in Xero. Only users with the Advisor user role can publish a report. Users can run and export reports if they have the Standard + view reports or Read-only user role.

 

You can save a draft report to the Published tab as a read-only snapshot. Published reports capture your accounts the very moment you run them. For example, if you publish a report for January and then in February you enter a bill with a February date, when you run the report for the same period later, it will reflect the late bill. This doesn't affect the report you’ve already published.

 

<h3>Publish a Draft Report</h3>

To publish a report from the drafts tab, complete the following:

<ul>
	<li>
	Go to Accounting &gt; Reports.
	</li>
</ul>

<ul>
	<li>
	Go to the Drafts tab.
	</li>
</ul>

<ul>
	<li>
	Click the three dots icon to the right of the report you want to publish &gt; Select Publish.
	</li>
</ul>

<ul>
	<li>
	Click Save or Publish.
	</li>
</ul>

 

<h3>Publish a Report Directly</h3>

To publish a report from the report itself, complete the following:

<ul>
	<li>
	Within a report, click Save as &gt; Published. Or if you see a Publish button – click this instead (available in some reports).
	</li>
</ul>

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653274391/1653274451-save-as-published-1.png" alt="1653274451-save-as-published-1.png" />

Publishing a Report

You can export a report as a printable PDF, Excel spreadsheet or Google Sheets spreadsheet. Reports can be exported from the Drafts, Custom, Published or Archived tabs, or directly from a report. Once you’ve exported a report you can send it to your accountant or tax authority.

 

Check that you have the right software and Google account access to export Xero reports. You can export to PDF, Google Sheets, and the XLS and XLSX formats.

 

<h3>Exported reports in PDF</h3>

It is suggested to use Adobe 6 or above to work with PDFs. You can download the latest version on the Adobe website <a href="https://get.adobe.com/reader/" target="_blank" rel="noreferrer noopener">here</a>.

 

<h3>Exported reports in Excel</h3>

The <a href="https://central.xero.com/s/article/About-the-new-reports" target="_blank" rel="noreferrer noopener">newer Xero reports</a> are exported to XLSX. The older versions export to XLS. If your version of MS Excel is older than 2007, you'll need to install a compatibility pack to export new-style reports to Excel.

 

<h3>Exported reports in Google Sheets</h3>

You’ll need a Google account (Gmail address) to export reports to Google Sheets. You can share the report with anyone (they don't need a Google account). They can be shared as read-only or with full access.

Note: when you authenticate your connection to Google Drive and export to Google Sheets, a connection is made to your Xero account. You can break the connection at any time.

 

<h3>Export a Report</h3>

To export a report, complete the following:

<ul>
	<li>
	Go to Accounting &gt; Reports.
	</li>
</ul>

<ul>
	<li>
	Select the Custom, Drafts, Published or Archived tab to find the report you want to export.
	</li>
</ul>

<ul>
	<li>
	Click the three-dots icon to the right of the report you would like to export.
	</li>
</ul>

<ul>
	<li>
	Select your preferred export format: printable (PDF), Google Sheets or Excel.
	</li>
</ul>

<ul>
	<li>
	Save or open your exported report.
	</li>
</ul>

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653274591/1653274650-export-report-1.png" alt="1653274650-export-report-1.png" />

Exporting a Report

You can delete a report, archive a published report, and restore an archived report. Deleting a report is permanent and it is important to know that you can’t view or restore a deleted report. You need to have the Adviser user role to delete, archive or restore a published report.

 

<h3>Delete a Report</h3>

To delete a report, complete the following:

<ul>
	<li>
	Go to Accounting &gt; Reports.
	</li>
</ul>

<ul>
	<li>
	Select Drafts, Published or Archived tab to find the report you want to delete.
	</li>
</ul>

<ul>
	<li>
	Click on the three-dot menu icon to the right of the report you want to delete.
	</li>
</ul>

<ul>
	<li>
	Select Delete.
	</li>
</ul>

 

<h3>Archive a Published Report</h3>

To archive a published report, complete the following:

<ul>
	<li>
	Go to Accounting &gt; Reports.
	</li>
</ul>

<ul>
	<li>
	Go to the Published tab to view a list of published reports.
	</li>
</ul>

<ul>
	<li>
	Click on the three-dot menu icon to the right of the report you want to archive.
	</li>
</ul>

<ul>
	<li>
	Select Archive.
	</li>
</ul>

If necessary, you can restore an archived report from the Archived tab at a later date.

<img alt="1653274761-archive-report-1.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653274701/1653274761-archive-report-1.png" />

<h3> </h3>

<h3>Restore an Archived Report</h3>

To restore an archived report, complete the following:

<ul>
	<li>
	Go to Accounting &gt; Reports.
	</li>
</ul>

<ul>
	<li>
	Select the Archived tab to view a list of archived reports.
	</li>
</ul>

<ul>
	<li>
	Click on the three-dot menu icon to the right of the report you want to restore.
	</li>
</ul>

<ul>
	<li>
	Select Move to published.
	</li>
</ul>

<img alt="1653274797-restore-archived-report-1-1.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653274737/1653274797-restore-archived-report-1-1.png" />

Delete, Archive or Restore a Report

Now that you have seen an overview of Reporting in Xero and how to create, customise, publish and export a report, let’s take a look at a very useful report which is the Business Activity Statement. 

 

If you are a business registered for GST, you need to lodge a Business Activity Statement (BAS) with the Australian Taxation Office (ATO). The BAS is a tax reporting requirement for businesses issued by the ATO on either a monthly or quarterly basis.   

 

Your BAS will help you report and pay your:

<ul>
	<li>
	Goods and services tax (GST).
	</li>
	<li>
	Pay as you go (PAYG) instalments.
	</li>
	<li>
	PAYG withholding tax.
	</li>
	<li>
	Other taxes.
	</li>
</ul>

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653274956/1653275016-activity-statement-screenshot-1.png" alt="1653275016-activity-statement-screenshot-1.png" />

 

<h3>Business Activity Statement</h3>

Your user role in Xero will determine the access level to the Business Activity Statement (BAS). It is recommended that you consult with your accountant if you're unsure how to complete and/or lodge your statement, or process the payment/refund.

 

Xero provides two options for completing your activity statement. Simpler BAS is the default method for businesses with a GST turnover of less than $10 million. Full BAS is available for businesses that have extra activity statement reporting requirements, or use the instalments method. The ATO has communicated to businesses if they are to adopt Simpler BAS reporting. If you’re unsure which method you should use, check with the ATO, or your accountant or bookkeeper.

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653274984/1653275044-bas-options-1.png" alt="1653275044-bas-options-1.png" />

 

You can change your reporting method from Simpler BAS to Full BAS at any time, by clicking Settings in the Simpler BAS. If you previously confirmed you use the Full BAS or Instalments reporting method, access Simpler BAS from Financial Settings instead.

 

<h3>Simpler BAS</h3>

The ATO doesn't support the calculation worksheet with Simpler BAS, so a worksheet isn't included when using this method in Xero. Instead, you report the actual amount of GST you've entered for your transactions. If you’re using Simpler BAS, you only need to report the following for GST:

<ul>
	<li>
	G1 Total sales
	</li>
	<li>
	1A GST on sales
	</li>
	<li>
	1B GST on purchases
	</li>
</ul>

 

<h3>Choose Simpler BAS settings for the first time</h3>

Go to Accounting &gt; Reports, and then click Activity Statement in the Taxes and balances section.

Select your:

<ul>
	<li>
	GST Calculation Period - this determines the frequency that Xero displays GST labels on the activity statement.
	</li>
	<li>
	GST Accounting Method – choose Cash or Accrual, depending on your organisation’s GST registration. Your choice determines whether transactions are included in your activity statement based on payment date (cash basis), or invoice or transaction date (accruals basis).
	</li>
	<li>
	PAYG Withholding Period - this determines the frequency that Xero displays PAYG tax withheld labels on the activity statement.
	</li>
	<li>
	PAYG Income Tax Method - this determines the frequency that Xero displays PAYG income tax labels on the activity statement.
	</li>
	<li>
	Additional obligations - select any additional labels that apply to your business.
	</li>
</ul>

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653275042/1653275101-bas-etc-1.png" alt="1653275101-bas-etc-1.png" />

 

Click Save &amp; continue.

 

Again, go to Accounting &gt; Reports, and then click Activity Statement in the Taxes and balances section. 

If it's the first time you've run your Activity Statement, you’ll be asked whether you want to <a href="https://central.xero.com/s/article/Lodge-activity-statements-with-Xero" target="_blank" rel="noreferrer noopener">connect your organisation to the ATO</a>. Click Continue to begin the setup process.

Otherwise, click the date heading to select the reporting period you want. If you haven't saved or finalised an activity statement yet, click Select reporting period to choose your activity statement. Xero displays the next period after the last finalised activity statement. To view a different activity statement, click the date heading and select the period you want.

The status of the activity statement displays in the drop menu beside the statement period. When you are satisfied with the accuracy of the report, click Finalise. This locks the statement ready for you to lodge with the ATO. Subsequent additions or changes made to transactions in the activity statement period won't be reflected in the finalised activity statement.

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653275067/1653275127-new-activity-statement-1.gif" alt="1653275127-new-activity-statement-1.gif" />

 

If you’re not ready to finalise your activity statement, you can save manual amounts entered by clicking Save as draft. You access saved and finalised activity statements in Simpler BAS only. You won't find them in the Reports screen. Click the date header in Simpler BAS to select and view a saved or finalised activity statement. 
 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653275094/1653275154-bas-draft-1.gif" alt="1653275154-bas-draft-1.gif" />

 

If the Activity Statement includes a GST calculation, two transaction reports are included with the Activity Statement:

<ul>
	<li>
	Transactions by tax rate lists all transactions entered during the reporting period. This report includes transactions that use the BAS excluded tax rate and don’t affect the totals of the Activity Statement.
	</li>
	<li>
	Transactions by BAS field groups transactions by the GST labels on the Activity Statement. This report includes any adjustments made on the Summary tab.
	</li>
</ul>

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653275115/1653275175-bas-summary-etc-1.png" alt="1653275175-bas-summary-etc-1.png" />

 

 

Xero includes transactions on the cash or accruals basis, according to your GST accounting method. The reports only include approved invoices and bills, and authorised expense claims.Xero doesn’t send either of these transaction reports to the ATO when you lodge your Activity Statement.

 

Once you’ve reviewed your Activity Statement, you can <a href="https://central.xero.com/s/article/The-Simpler-Business-Activity-Statement#LodgeyourActivityStatementwiththeATO" target="_blank" rel="noreferrer noopener">submit it to the ATO</a>. For more information on the Activity Statement visit Xero Central <a href="https://central.xero.com/s/article/The-Simpler-Business-Activity-Statement#LodgewithXero" target="_blank" rel="noreferrer noopener">here</a>. To can learn more about the Full BAS report, visit <a href="https://central.xero.com/s/article/The-Full-Business-Activity-Statement" target="_blank" rel="noreferrer noopener">here</a>.

Business Activity Statement

Quiz: Introduction to Xero Reporting

Introduction to Xero Reporting

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653276352/1653276412-8618ec6b-0451-4526-bf5f-87b3b8a83c29-1.png" alt="1653276412-8618ec6b-0451-4526-bf5f-87b3b8a83c29-1.png" />

<h3> </h3>

<h3>Overview</h3>

In this course, you will be introduced to Xero's add-ons and apps. Add-ons and apps can work in conjunction with your Xero organisation to help you run your business. You will be given a brief overview of four Xero add-ons built and owned by Xero.

 

<h3>Learning Outcomes</h3>

By the end of the course, you should understand how to:

<ul>
	<li>
	Explain what the Xero App Store is and how to access it.
	</li>
	<li>
	Provide a summary description for a range of Xero add-ons.
	</li>
	<li>
	Explain what Hubdoc is, the key features and explain how to add HubDoc to Xero.
	</li>
	<li>
	Identify the key features of WorkflowMax.
	</li>
	<li>
	Explain the key features of Xero Practice Manager.
	</li>
	<li>
	Explain what HubSpot is and the key purpose of the integration with Xero.
	</li>
</ul>

As we briefly looked at in the Introduction to Xero Online course, Xero has hundreds of apps, integrations and add-ons available to add to your subscription plan. Add-ons (also referred to as third-party software or apps) are programs from external providers that work in conjunction with your Xero organisation to improve business efficiencies, each relevant depending on a company’s operations and industry. Examples include workflow management software, CRM software, ecommerce tools, payroll and practice management.

<a href="https://apps.xero.com/au/collection/xero-apps"><img alt="1653276479-au-worksplace.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653276419/1653276479-au-worksplace.png" /></a>

<h3> </h3>

<h3>Xero App Store</h3>

To view the vast selection of apps available, take a look at the <a href="https://apps.xero.com/au/collection/xero-apps" target="_blank" rel="noreferrer noopener">Xero App Store</a>. You can search by keyword, category or for industry specific solutions to find the most appropriate add-on for your business.

 

Watch the below video for an overview of the Xero App Store:

<iframe allowfullscreen="" height="315" src="https://www.youtube-nocookie.com/embed/BugSdG5OE6A" width="560"></iframe>

 

Anyone can view these apps in the Xero App Store but to connect, access and disconnect apps in Xero, you need to log in to Xero and have the advisor or standard user role. Once logged into Xero, you can search for apps and view and manage apps connected to your organisation.

 

You can also view and s<img alt="1653276678-app-store.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653276618/1653276678-app-store.png" style="float:right;height:557px;width:300px;" />earch for apps in the App Store directly from your Xero account, by going to the company menu and then selecting App Store. From here you can also see your active app connections and <a href="https://central.xero.com/s/article/Getting-started-with-Xero-Connected-Apps" target="_blank" rel="noreferrer noopener">manage their set up</a>. Each app has instructions on how to connect to Xero. For most apps, you log in to the app and follow their instructions to authorise access to your Xero organisation.

 

In Xero you can view app recommendations from Xero by going to Featured apps under the Collections tab in the App Store. Xero recommends these based on your business or industry type as set up in your <a href="https://central.xero.com/s/article/Update-your-organisation-s-settings?userregion=true" target="_blank" rel="noreferrer noopener">organisation details</a>.

 

In the following learning material, you will gain a basic understanding of each of the below add-ons built and owned by Xero, and how they integrate with Xero:

<ul>
	<li>
	<a href="https://apps.xero.com/au/collection/xero-apps/app/hubdoc" target="_blank" rel="noreferrer noopener">Hubdoc</a>: A Xero product and data capture tool. Captures information from bills and receipts and publishes it to Xero; making it easy to match transactions to the Xero bank feed.
	</li>
</ul>

<ul>
	<li>
	<a href="https://apps.xero.com/au/collection/xero-apps/app/workflowmax" target="_blank" rel="noreferrer noopener">WorkflowMax</a>: A Xero product specialising in project management offering all-in-one workflow.
	</li>
</ul>

<ul>
	<li>
	<a href="https://apps.xero.com/au/collection/xero-apps/app/xero-practice-manager" target="_blank" rel="noreferrer noopener">Xero Practice Manager</a>: A tool for tracking time, managing workflow and billing, all built in the cloud.
	</li>
</ul>

<ul>
	<li>
	<a href="https://apps.xero.com/au/collection/xero-apps/app/hubspot" target="_blank" rel="noreferrer noopener">HubSpot</a>: A CRM, online marketing, sales and customer service growth platform that integrates with Xero for end-to-end visibility into the customer’s journey.
	</li>
</ul>

 

Please note that The Career Academy is unable to offer support to work within the Apps and Add-on solutions, should you choose to create a trial for them. The information provided in this course is purely for review purposes only.

Introduction to Xero Add-Ons

<a href="https://www.hubdoc.com/" target="_blank" rel="noreferrer noopener">Hubdoc</a> is a document management solution for small businesses. You can use it to capture data from financial documents and convert it into transactions in Xero. It is included in the Xero Starter, Standard and Premium plans. You can also test out Hubdoc’s features by setting up a new trial Hubdoc organisation from Xero.

 

Hubdoc reduces data entry by accurately capturing information from bills and receipts and publishing it to Xero; making it easy to match transactions to the Xero bank feed. This also gives you a better idea of how your business is doing.

 

<img alt="1653276821-hubdoc-a.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653276762/1653276821-hubdoc-a.png" />

 

<h3>Key features and tools in Hubdoc:</h3>

<ul>
	<li>
	Easy capture of receipts and bills by mobile, email, desktop or scanner so they are stored in one place online.
	</li>
</ul>

<ul>
	<li>
	Automatic data entry – Hubdoc extracts the key information from each bill or receipt so it’s ready to copy into Xero with the original document attached.
	</li>
</ul>

<ul>
	<li>
	Data is synced from your bills and receipts to Xero as accurately categorised transactions that can be easily matched with your bank feed.
	</li>
</ul>

<ul>
	<li>
	Verified data – every reconciled Xero transaction has a source document attached so you can verify the data and know the financials are accurate and up-to-date.
	</li>
</ul>

For an overview of Hubdoc + Xero, watch the following video:

<iframe allowfullscreen="" height="315" src="https://www.youtube.com/embed/-PGPZdW10sk" width="560"></iframe>

 

Hubdoc is part of the <a href="https://www.xero.com/au/partner-programs/partners/partner-program/?escape=true" target="_blank" rel="noreferrer noopener">Xero partner program</a>. This means you earn 5 partner points for connecting and actively using Hubdoc with your Xero practice organisation. If you are a Xero partner, you get access to a free Hubdoc account for your practice.

 

<h3>The Xero-Hubdoc process</h3>

During the connection process, Hubdoc imports all contacts, chart of accounts, bank accounts, and tax rates already set up in Xero. Once documents are added to Hubdoc via automated connection, email or manual upload, key data such as supplier name, date and total amount is automatically extracted (if you’ve turned on <a href="https://central.xero.com/s/article/Turn-off-data-extraction-in-Hubdoc?userregion=true" target="_blank" rel="noreferrer noopener">auto-extraction</a>).

The documents are then organised using tags and folders. Once the document is processed, you can complete any missing details and publish the document to Xero. If you’ve enabled Push to Xero Files in Hubdoc, a copy of the document is also sent to your <a href="https://central.xero.com/s/article/Manage-your-file-library?userregion=true" target="_blank" rel="noreferrer noopener">Xero file library</a>.

 

<img alt="1653277039-hubdoc-1-1.jpg" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653276979/1653277039-hubdoc-1-1.jpg" />

 

Once documents and their data are published to Xero, it’s matched to the corresponding transaction in the bank feed and can be reconciled with the original document attached.

You can invite your accountant, bookkeeper, or team members into your Hubdoc organisation and assign them a suitable user permission. You can also sync your documents and extracted data to your Xero organisation, or third-party systems such as Dropbox.

 

<h3>Add Hubdoc to your Organisation  </h3>

You must be the subscriber of your Xero organisation to set up Hubdoc. To add Hubdoc to your organisation, complete the following:

<ul>
	<li>
	Login to Xero
	</li>
</ul>

<ul>
	<li>
	Select your company name at the top left and select Hubdoc
	</li>
</ul>

<ul>
	<li>
	Select Set up Hubdoc.
	</li>
</ul>

<img alt="1653277088-hubdoc-au.gif" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653277028/1653277088-hubdoc-au.gif" />

 

For more information on how to activate your Hubdoc organisation, visit this <a href="https://central.xero.com/s/article/Activate-your-Hubdoc-organisation" target="_blank" rel="noreferrer noopener">Xero Central</a> page.

Overview of Hubdoc

<a href="https://www.workflowmax.com/" target="_blank" rel="noreferrer noopener">WorkflowMax </a>is a project management software specialising in quotes, timesheets, financial project management, reporting and invoices. This helps to increase project profitability, improve project budgeting and gain critical insights into your business. This add-on is popular in the professional services, engineering, and building/construction industries. It is similar to <a href="https://www.xero.com/au/features-and-tools/accounting-software/projects/?escape=true" target="_blank" rel="noreferrer noopener">Xero Projects</a> but a more in-depth, customisable project management solution.

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653277961/1653278021-workflowmax.png" alt="1653278021-workflowmax.png" />

 

 

Key features and tools of WorkflowMax include:

<ul>
	<li>
	Sales invoices created in WorkflowMax are automatically pulled into Xero.
	</li>
</ul>

<ul>
	<li>
	Once an invoice has been reconciled in Xero, it’s marked off as paid in WorkflowMax, giving you an accurate picture of profitability on each job.
	</li>
</ul>

<ul>
	<li>
	You can track your leads, proposals and sales projections all in one place.
	</li>
</ul>

<ul>
	<li>
	Send professionally branded, highly customised quotes in minutes.
	</li>
</ul>

<ul>
	<li>
	WorkflowMax purchase order receipts can be pulled into Xero as accounts payable.
	</li>
</ul>

<ul>
	<li>
	You can raise purchase orders and receipt supplier invoices in WorkflowMax. Once receipted, the details are automatically pushed to Xero for payment of the invoice.
	</li>
</ul>

<ul>
	<li>
	WorkflowMax can be integrated with accounting, payroll, customer support, CRM software and over 30 other add-on apps.
	</li>
</ul>

<ul>
	<li>
	Track and report on every minute with over 8 different ways to enter time.
	</li>
</ul>

 

In WorkflowMax you have a ‘Lead Manager’ and a ‘Client Manager’. The Lead Manager tracks yours leads, proposals and sales projections all in one place, and the Client Manager helps you to manage your client relationships and information from one dashboard. 

 

There are also a number of performance reports available, so you can view your most profitable employees, understand profitability across different client categories and know which services make you the most money. Accurate job profitability reporting in WorkflowMax is integrated together with accurate company profitability reporting in Xero, into a single seamless process.

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653277998/1653278058-workflowmax-au-1.png" alt="1653278058-workflowmax-au-1.png" />

 

<h3>Add WorkflowMax to your Organisation  </h3>

WorkflowMax is powered by a Xero login to better protect data online. You can use your Xero credentials to access a 2-week WorkflowMax trial. To connect WorkflowMax to your Xero account you will first need to create a WorkflowMax account – you can do this <a href="https://www.workflowmax.com/start?utm_source=Xero.com&amp;utm_medium=referral&amp;utm_campaign=Xero%20Marketplace&amp;utm_content=free%20trial" target="_blank" rel="noreferrer noopener">here</a> and create a free 2-week trial account.

 

You will then need to establish, then activate, the connection between WorkflowMax and your Xero account. An activation email will be sent to you with a link that will take you to the Xero login screen where you will enter your normal Xero login credentials. It’s important that you click this link as it will take you directly to your new WorkflowMax account. Unfortunately logging in from Xero won’t work. You can learn more about this <a href="https://www.workflowmax.com/xero-login-2sa" target="_blank" rel="noreferrer noopener">here</a> and <a href="https://support.workflowmax.com/Content/Workflowmax/Setting_up_the_Xero_Interface.htm" target="_blank" rel="noreferrer noopener">here</a>.

 

To learn more about how to set up WorkflowMax, visit <a href="https://www.workflowmax.com/xero-login-2sa" target="_blank" rel="noreferrer noopener">this page</a> on the WorkflowMax website. You can also take a look at their <a href="https://www.workflowmax.com/project-management-software/xero-integration" target="_blank" rel="noreferrer noopener">Xero integration page</a> and watch the video.

 

<a href="https://www.workflowmax.com/project-management-software/xero-integration"><img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653278048/1653278108-6-reasons.png" alt="1653278108-6-reasons.png" /></a>

Overview of WorkflowMax

<a href="https://apps.xero.com/au/app/xero-practice-manager" target="_blank" rel="noreferrer noopener">Xero Practice Manager</a> (XPM) is built specifically with accounting and bookkeeping partners in mind. It's a comprehensive tool for tracking time, managing workflow and billing, all built in the cloud. Xero Practice Manager is suitable for practices that have 3+ staff and more than 200 clients.

Watch the following video for an overview of Practice Manager:

<iframe allowfullscreen="" height="315" src="https://www.youtube.com/embed/9jisiKhAMJs" width="560"></iframe>

 

Xero Practice Manager has a seamless integration with Xero. Key features and tools include:

<ul>
	<li>
	Monitoring jobs in real time – manage workflow and recover costs quickly with the real-time view of ongoing jobs and work in progress.
	</li>
</ul>

<ul>
	<li>
	Quickly convert work-in-progress records to invoices and send them directly to clients within the one tool.
	</li>
</ul>

<ul>
	<li>
	Create tasks and monitor staff performance, client profitability and other relevant measures.
	</li>
</ul>

<ul>
	<li>
	Create customised reports specific to each client including client jobs and timesheets.
	</li>
</ul>

<ul>
	<li>
	Use the built-in timer to record time against client jobs and tasks, reducing overheads.
	</li>
</ul>

<ul>
	<li>
	Integrate client details and invoice information with other Xero tools.
	</li>
</ul>

 

Practice Manager is designed to help practices with their business operations and needs. It's also highly configurable, so you can set it up to closely match your practice’s needs.

<img alt="1653278409-xpm.png" src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653278349/1653278409-xpm.png" />

If you’re a <a href="https://www.xero.com/au/partner-programs/partners/?escape=true" target="_blank" rel="noreferrer noopener">Xero partner</a> at silver status or above, Xero Practice Manager is free. You can also view a Xero Practice Manager demo video <a href="https://www.xero.com/au/features-and-tools/practice-tools/practicemanager/demo-request/?escape=true" target="_blank" rel="noreferrer noopener">here</a>, as well as try out a free 14-day trial account.

To set up Practice Manager you can go to <a href="https://practicemanager.xero.com/Access/Signup/Index" target="_blank" rel="noreferrer noopener">this link</a>, fill in some practice details and create your trial. You can then set up the Practice Manager <a href="https://central.xero.com/s/article/Connect-Practice-Manager-to-Xero" target="_blank" rel="noreferrer noopener">connection to Xero</a>. Once the connection is set up, you can configure the information that passes between Practice Manager and Xero, and customise how data syncs between them. You can then <a href="https://central.xero.com/s/article/Add-staff" target="_blank" rel="noreferrer noopener">add staff to your practice</a>, manage <a href="https://central.xero.com/s/article/Client-settings" target="_blank" rel="noreferrer noopener">client settings </a>and <a href="https://central.xero.com/s/article/About-jobs#2Setupyourjobsettings" target="_blank" rel="noreferrer noopener">job settings</a>, and set up <a href="https://central.xero.com/s/article/Set-up-your-tasks" target="_blank" rel="noreferrer noopener">tasks </a>and <a href="https://central.xero.com/s/article/Set-up-your-standard-costs" target="_blank" rel="noreferrer noopener">costs</a>. 

 

For more information on Practice Manager, visit Xero Central <a href="https://central.xero.com/s/topic/0TO1N0000017kmNWAQ/practice-management#practice" target="_blank" rel="noreferrer noopener">here</a>.

Overview of Xero Practice Manager

Xero and HubSpot integrate together for end-to-end visibility into customer engagement. The Xero to HubSpot integration ensures your Xero contacts are available in HubSpot CRM for all your inbound sales processes, and keeps them up to date if anything changes in Xero. Using Xero and HubSpot gives you insight into how your website attracts customers, so you can start building better relationships with your prospects and customers through personalised marketing.

HubSpot offers the following tools and features:

<ul>
	<li>
	Marketing Hub – marketing tools such as email marketing, live chat, Facebook, Instagram, Google, and LinkedIn ads, traffic and conversion analytics, SEO tools, social media tools, blog &amp; content creation tools.
	</li>
</ul>

<ul>
	<li>
	Sales Hub – sales CRM tools such as contact, deal and task management, email tracking, templates and scheduling, document sharing, sales automation, quoting and eSignatures, Gmail and Outlook integration, meeting scheduling, customisable reports.
	</li>
</ul>

<ul>
	<li>
	Service Hub – help desk tools and customer service software such as ticketing, email templates, ticket creation bots, customer service automation, video creation etc.
	</li>
</ul>

<ul>
	<li>
	CMS Hub – content management software for websites such as blog and content creation tools, SEO and content strategy, security monitoring and threat detection, smart content etc.
	</li>
</ul>

Connecting HubSpot with Xero integrates your contacts between the two, ensuring your Xero contacts are available for all of the above HubSpot tools.

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653278489/1653278548-hubspot.png" alt="1653278548-hubspot.png" />

 

HubSpot uses the email address as an identifier on your Xero Contact to create a new (or update an existing) contact within HubSpot. Once this initial integration has completed, any change to your contacts in Xero will be reflected in HubSpot CRM automatically, including the primary contact phone number and if the contact is a customer or supplier. A set of default mappings ensures that the information contained within your Xero contacts is set to the correct place in HubSpot.

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653278530/1653278590-hubspot-x.png" alt="1653278590-hubspot-x.png" />

 

<h3>Connect with HubSpot</h3>

You need to be on a Premium plan to use HubSpot. To connect your Xero account with HubSpot, complete the following:

<ul>
	<li>
	Log in to your Xero account with <a href="https://connect.xero.com/hubspot" target="_blank" rel="noreferrer noopener">this link</a>. 
	</li>
</ul>

<ul>
	<li>
	If you already have a HubSpot account, click Connect app, otherwise click Sign up.
	</li>
</ul>

<ul>
	<li>
	Log in to your HubSpot account and click Grant Access to give HubSpot access to your user and contact data in Xero. If you don’t give HubSpot access to your data, the integration process is cancelled.
	</li>
</ul>

You can then go to your Company menu &gt; Settings and click on Connected Apps to find HubSpot in your list of connected apps.

 

<img src="https://s3.ap-southeast-2.amazonaws.com/s3.go1.service/thecareeracademy.mygo1.com/apiom/5936305/1653278572/1653278632-hubspot-xero.png" alt="1653278632-hubspot-xero.png" />

Overview of HubSpot

Quiz: Introduction to Xero Add-ons

Introduction to Xero Add-ons

The Career Academy

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This course is for bookkeepers, small business owners, accountants and others who want to gain a strong practical foundation with Xero accounting software.

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