In the five years Xero has been on the market it has quickly gained a reputation as being the easiest accounting system around. Xero is a cloud based system which means that you can log into it securely from any computer with an internet connection anywhere in the world. It also means you won’t need to buy costly accounting packages and upgrades ever again and it even eliminates the need for backups – if your computer crashes you won’t lose your accounting data! In addition to these practical benefits using Xero has many advantages that can give your business an edge:
Starting Up your Business
- Immediate access to your account balances and cash flow
This service is invaluable for the initial stages of your business when every financial decision you make is based on the black and white issue of “is there enough money in the account for this?”
Within a few minutes you can establish your daily balance and make decisions on the spot and with confidence.
- Daily control of cashflow
The degree of control you have with Xero gives you confidence to make important decisions about the bigger investments in setting up your business – plant and machinery, advertising etc. These costs can be tracked and kept separately to once again enable confident decisions to be reached, on-site and without delay.
- Setting yourself financial targets
At the same time you are dreaming up your targets the system is motivating you to reach them. Establishing a pattern of setting and reaching targets in the early stages of business start-up will set up an invaluable management tool for expanding and adding value to your business over time and in a controlled manner.
Running your Business
- Xero releases you from the tyranny of “doing the accounts”
Because it’s a matter of inputting and letting the system do its work you get the results you want without the workload. This freedom gives you time, time to plan and make projections about where you want your business to go.
- Managing debtors and creditors
By advising you on payment due dates and account receivable information you are able to identify and categorize your debtors and creditors and take action according to the results. You can chase the poor payers or pay your own accounts on time and know where you are with your transactions at any time.
- Planning and attracting investment
With this degree of financial control and information there is no delay in planning for capital investments, or in attracting investment. You can show your current financial statements to potential investors at meetings on screen, without any delay in preparing written reports – this degree of efficiency has the capacity to impress prospective investors with your business acumen.
- Making decisions on taxation planning
Net profit is calculated easily. Current rates of taxation can be loaded in and modeled against future earnings, giving you invaluable planning information.
- Surviving and IRD Audit
If the IRD want to audit your business, all your information is there and up to date for a smooth process. There is less likelihood of an audit being prolonged as the accuracy of your accounts is less likely to be disputed or questioned because the system’s “checks and balances” take care of the mechanical processes.
- Expanding and applying for Finance
Your financial reports are all ready for the bank or a broker to assess – the system is widely used in the financial sector and you are off to a good start with a computer system already trusted in the industry.
- Integrating with other online services to set up tailor made systems for your business.
Xero integrates seamlessly with a range of payroll, CRM, inventory management and other business systems for a variety of uses. For example taxes can be paid directly to the IRD on a regular basis to avoid one-off bills, GST is taken care of easily without fuss and the efficiency and flexibility of the Xero system means that it can be set up for your particular needs - giving you the ultimate tool for running your business.
Selling your Business
- Information is accessible to potential purchasers
Information on the position of your business is available and accessible for potential buyers. Just imagine how good it will look if you turn on your laptop and immediately show an up to the minute breakdown of the business trading account to a potential buyer, it makes you and your business look like you really know what you are doing and that this could be a great investment for the buyer.
- The business is easy to value
Valuation of your business is easier because of the financial details readily accessed. Instead of a lengthy meeting with the valuer and lots of to-ing and fro-ing to give them an overview of your business, a quick look at Xero answers all their questions.
- Online efficiency
With all financial statements online it is easier to convince an out of town buyer about the efficiency and profitability of your business - all reports and details are ready for a speedy handover.