For business owners, their own time input is one of the most valuable resources and, in order to grow and thrive, this resource can’t be bogged down in day-to-day bookkeeping and administration. Growing up, my parents ran a grocery shop and so after a 6 day week of serving, delivering, unloading/loading the chiller and cashing up, the 7th day was usually spent writing the books up before rest came into the equation.
Since then, most businesses have left the days of manually writing up a cashbook on the dining room table behind them. However, with the rapid advances in bookkeeping software (and the plethora of apps which support them) there is still a lot of unnecessary work being undertaken which could be automated or outsourced to help tip the work/life balance back in favour of the latter.
In this article, I’ll be looking at several of the features which the cloud-based accounting packages such Xero and Quickbooks, offer to business owners.
Throughout the years, “I’m just waiting on the bank statement” were all-to-common words when assisting businesses with their bookkeeping. Online banking then gave instant access to these, but still needed someone to transfer the dates, details and amounts into the business’ books… and then check this was all done correctly when trying to reconcile back.
With Xero and Quickbooks, the bank feed will automatically import the transactions from your bank accounts into the software, maintaining all the narrative either the business or their customers typed when making the payment. The transactions are then presented in an easy-to-understand format, together with a prompt showing any outstanding invoices matching the amount paid or received so these can be easily matched off.
If you have numerous monthly amounts going through for insurance, loan repayments, commission charges, etc. then simple rules can be put in place to automatically allocate these to the correct headings to save you having to do this each and every month as standard.
When businesses first moved their records onto accounting software, one of the more time-consuming tasks was posting the purchase invoices, often an intimidating pile of paperwork of different sizes and formats. Numerous hours were spent duplicating all the information the supplier themselves had already spent time typing up.
Thankfully, Xero and Quickbooks have features to eliminate this exercise and capture all the details on the invoice for you. By using one of the smartphone apps such as Dext, your purchase invoices can quite literally be snapped into Xero with the press of a button. Or, if you are emailed your purchase invoices, there is no need to print these out as a dedicated email address can be set up for these to be forwarded to and the software will capture the invoice details.
By utilising these features, there needn’t be any purchase invoices gradually piling up until you have the time to process them. The software will also save copies of these invoices when they’re captured, so if you ever need to retrieve one there’s no need to look through files or boxes for a paper copy.
Within Xero and Quickbooks you will be able to create your sales invoices to either print out and post or email directly to customers. Each invoice will include a sequential reference, and the template can be set up to include all the required information such as VAT number, company registration number, registered office address, etc. as well as your business bank detail for the all-important payment. Once created and sent, these will then be posted automatically to your sales ledger.
To help improve cashflow, if your business utilises GoCardless, Stripe or similar, then a “Pay Now” button can be incorporated into an emailed invoice so that customers can settle your invoices by card. Also, with the use of mobile point of sale machines on the rise, these can also be easily incorporated with a daily sales invoice for the monies taken being posted at the end of the day.
Bringing it all Together
By utilising all the time savings available, the business owner can then focus more on the financial information itself rather than repetitive data entry. The 3 areas above are all summarised for you on the software’s home screen, or “dashboard”.
The dashboard gives a snapshot of the current bank balances together with amounts still to be reconciled, as well as the amounts owed to the business by its customers and the amount it owes to its suppliers.
With just one click of a mouse button from the dashboard, you’ll be able to see a list of all your outstanding sales invoices, who they were issued to and for how long they been outstanding. Just a couple of minutes out of the hours saved on data entry can then be utilised for credit control, chasing up late payments and being aware of how long your invoices usually take to be settled.
For businesses which are VAT registered, your VAT records for the quarter will be compiled as part of the above, meaning that putting the return together is no longer its own separate task. You’ll be able to generate your VAT return, review the individual items making up the totals and file this with HMRC all through the software. Alternatively, once all your information is on the system, let us know and we can check the return for your peace of mind and make the filing on your behalf.
Where Lovewell Blake Can Help
When our accounts staff begin working for us, training on Xero forms part of their induction and they are encouraged to become certified Xero advisers. We have therefore been utilising these features for several years in order to offer monthly or quarterly bookkeeping at an affordable price to those business who wish to outsource this.
For those businesses using Quickbooks, we also have several certified advisors who will be able to assist with utilising the time-saving applications that are available.
We are also able to set up packages and offer training to those businesses who wish to undertake their own bookkeeping while taking advantage of the time-saving features available. With the software being purposefully designed as cloud-based, any queries you have or assistance required from our advisors can be done remotely and in real time.