April is the start of the new tax year for many businesses and if you are considering changing how you keep your accounts the start of your new financial year is the best time to do it.

What does changing involve?

At the beginning of this year I started working with a business which has used Sage 50 for many years but were interested and keen to move to a cloud based software.  It was good to spend three months working with them remotely on their desktop Sage because I could get an understanding of their business and use that knowledge to set up Xero in a way which will give them the information they need to run their business.  

Now their new financial year has started I have been able to set up Xero with useful account codes excluding the mass of inappropriate ones in Sage and import only the active customers and suppliers.  The bank feed was set up and opening balances added for assets, liabilities and equity.  Once Sage had been bank reconciled to the end of March I was able to identify unpaid invoices for both customers and suppliers and bring those into Xero.  

Whilst Xero wasn't fully set up for 1st April I was able to do Xero training with the team that day to show them how to raise sales invoices and record advance payments so they could carry on as normal.  They are really pleased so far and have found it straightforward to use.  By 12th April their new accounts software was fully set up and the accounts for 2020-21 in Sage just needed finalising to complete the year end.

The process seems simple but it does take planning and quite a lot of time, especially for a large business and if accounts software is used on a daily basis for sales invoicing.  However our experience of changing software  makes it a smooth process for the business.

Changing to Xero

Although we have tried other cloud based accounts software we have found Xero to be the software our clients and ourselves find easiest to work with and that is why we recommend it.

90% of the businesses we work with use Xero for their accounts.  Some of those we have set up from the start of their business as we did with a new business which started in March.  Some will have been using spreadsheets and found their business has just become to big for this to be manageable  and we will be helping a business this month who has found themselves in this situation.   Others will have just decided to change to Xero because they want a change or are not getting on with their current software and I have moved many of these over the 10 years I have been using Xero.

Initial set up

Whatever the reason for the change it makes sense to get Xero set up properly from the start and to understand how to use it for your business.  The way accounts are kept is different for every type of business, although, of course, the end result is the same - a record of income, expenses, assets and liabilities as well as a means to send sales invoices, submit VAT returns and calculate taxes.

We can set up Xero for you in a way that is right for your business and give you training to use it yourself.  And if you want to just use it to do your sales invoicing and keep track of who owes you we can show you how to do just that aspect and we can manage the rest.  Keeping your accounts in software, once it is set up properly and you know how to use it effectively, is so much easier and quicker than managing spreadsheets (which can easily go wrong).  If you are a sole trader it is what you will need to do from April 2023 when HMRC expect you to submit accounts to them quarterly directly from software.  It makes sense to start thinking about how to manage your accounts now so that you can make any change you want to at the start of a new financial year.

Contact us for help with your change to Xero

We are here to help so give us a call on 01722 341810 if you are considering a change so we can make the change smooth and straightforward and get Xero set up in the right way for your business.  We are Xero Certified Advisors, have our Xero Migration Certificates and are Silver Partners.