How do I set up a Xero account?

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How to setup a xero account
Cloud Accounting
Partner & Head of Tax
February 10, 2020
minute read

A complete guide to setting up your Xero account

Xero is designed to be intuitive to learn and easy to use. Setting it up is no different.

You can choose to set up a Xero account yourself, or have your accountant do it for you. Nominating your accountant to set your Xero account up for you means they not only have access to the regular business pricing plans, but they also have access to the partner pricing plans.

Here's how to set up a Xero account in Australia.

Contact a Liston Newton accountant today for support in setting up your Xero account.

How to set up a Xero account

One big benefit of having your adviser set up your account is that from time to time special offers and discounts become available. In some cases, this can provide you with three to six months’ worth of free subscription time—so check with your accountant first before setting up Xero yourself.

To set up your Xero account you can follow the step-by-step process.

Xero set up checklist

  1. Go to the Xero home page and click "Free Trial" in the top right-hand corner of your screen. This will give you a 30-day free trial period.
  2. Enter your details and read the terms of use and privacy policy.
  3. Once this is complete, click “Get started”.
  4. Open the activation email sent from Xero. Sometimes this email can get sent to your junk or spam folder.
  5. Click "Yes, it's me - let's get started".
  6. Create your own unique password.
  7. Activate your account.

The best ways for small businesses to set up Xero

setting up a xero account

For small businesses, there is some common data that you’ll need help with converting across to Xero. This includes the following main areas:

  • Invoices
  • Bills
  • Customised chart of accounts
  • Payroll information (staff names, dates of birth, tax file numbers, superannuation details etc
  • Single Touch Payroll
  • Contacts (customers and suppliers)

These areas each play a critical role within accounting software as they contain sensitive business information. So it’s important they’re set up correctly, otherwise major issues can arise.

Your Liston Newton Xero specialist can assist you in setting this information up correctly, and help you determine which other features should be utilised for your business.

Business disruptions

One common question we receive is whether there will be a disruption to business during the Xero account set up process.

The answer is yes. Setting up any new software, or migrating to a new system, takes time, particularly with user training. With Xero, some of the delay comes from converting data from one platform to another, and ensuring it’s all accurate and correct prior to the "go live" date.

But with the right guidance, support, and training from the Xero specialists at Liston Newton Advisory, this process will be made as seamless and efficient as possible.

Converting your data to Xero from another platform

converting your data to Xero

When converting your data to Xero from another platform we recommend that you engage your Xero specialist to guide you through the process. It requires all your financial information to up to date an accurate, otherwise the errors can occur which can have big impacts on your business.

Some common errors we see are:

  • Incorrect balances, which can lead to under- or overstating your income and expenses
  • Missing staff payroll details
  • Bank account reconciliation issues

To avoid these issues, and ensure your conversion remains on track, your Liston Newton Xero specialist will assist you throughout the entire conversion process.

Contact your Liston Newton Xero specialist today to begin the conversation and get the process started.

Features, connections, and add-ons

Some of Xero’s basic connections are the automatic banking and credit card feeds. These connections mean that all transactions processed through these accounts will be generated as an ‘unreconciled item’ in Xero. Then, Xero can assist you to reconcile these transactions to their corresponding account.

Xero can also connect to third-party accounts, like PayPal. Any transactions made through these third-party systems will be logged in Xero as unreconciled until you determine where it needs to be coded to.

For some industries, like the hospitality industry, the sheer volume of transactions can make reconciling a daunting task. This is where Xero really shines. They have over 500 add-on apps that integrate with the platform, many of which work to connect your Xero account to third-party point of sale systems. Apps like Vend or Deputy can be integrated with your Xero software, and then these transactions are automatically categorised into the correct accounts.

Xero also has the ability to store receipts. One of its built-in features allows you to upload photos of receipts and invoices directly to your system, or emailing them to a specific Xero email address. Xero also integrates with third-party document scanning software, such as HubDoc and ReceiptBank, to provide businesses with a streamlined way to reconcile.

One of Xero’s most useful features is My Xero. All staff will receive receive an invitation to access their own My Xero portal. Here they can enter and review their timesheets, enter past or future leave requests, and view their payslips.

Final thoughts

After you’ve set up your Xero account, you might think that’s it. But our Xero specialists here at Liston Newton Advisory see a lot of mistakes from businesses who are new to the platform.

The biggest issue we see is business owners assume their bank account reconciles itself, and no coding or transaction verification is required. This isn’t the case. To keep your business running as smoothly and efficiently as possible, we recommend either daily, or at minimum weekly, reconciliation of your bank accounts in Xero. This ensures your data is maintained accurately and up to date.

Another big mistake we see is business owners not locking dates after each month is complete. This is important, particularly when there are multiple users looking at the one account. This data can be easily manipulated or changed, even after reconciliation is complete. Locking dates ensures all information is accurate when delivered to the ATO.

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