Xero

Affordable professional level accounting software for small business

Comments: It's been easier to use Xero than I expected, but I had a nasty surprise at tax time when I realized the default accounts/descriptions for expenses did not correlate 1:1 to IRS categories. (I should have checked this more closely when I set up my accounts because it's a New Zealand company, and the previous product was local.) This means I will need to double-check all my transactions for 2018 and the IRS has my vastly overestimated tax payment until I can do that and file my return on an extension. I've had a much better experience importing data from financial institutions because Xero uses a well-known importing service that is trusted by the institutions. I like being able to match multiple invoices to bank deposits because I usually don't run to the bank for each check. This will be more valuable as my company grows. I should probably find an accountant to assist me with this, but I haven't found an accountant who understands both craft businesses and Xero.

Pros:

Professional double entry software at a very affordable price Accommodates both cash and accrual accounting Links to financial institutions to get transactions Uses standard importer recognized by the financial institutions instead of just trying to log in remotely (and triggering fraud alerts) Can match multiple invoices to a single deposit transaction imported from bank Can keep using Xero as company grows

Cons:

Pre-existing expense categories/descriptions don't map 1:1 with IRS definitions, so I'm having to go back to all my receipts to make sure expenses are entered in proper accounts because I didn't realize this when I switched More difficult to focus on specific expense categories to check transactions Have not been able to import historic data from previous app (possibly because it's not double entry) so I am still paying the subscription on that software to retain access to my data No integration with Craftybase, so I have to enter supply purchases and customer invoices there independently

Alternatives Considered: Quickbooks Online

Reasons for Choosing Xero: Outright depends on importing data from financial institutions but they were extremely unreliable (apparently they don't use a standard importing service and my credit union kept flagging them as hackers for remote logins) and customer service kept giving me the runaround. It also isn't "professional" double-entry bookkeeping and can't be audited. Outright can't handle Cost of Goods Sold properly and requires manual workarounds. It can't generate professional reports needed when applying for loans.

Reasons for Switching to Xero: QuickBooks introduced a special product for Etsy integration, but early adopters had problems with data disappearing and no way to recover it. Otherwise, the cost of QuickBooks to cover the same features I use in Xero would have been very expensive; even a QB consultant told me it's overkill for a business of my size. I forget which other products I looked at, but Xero was recommended by several owners of similar businesses.

To keep track of finances, Xero is a small business' best friend

Comments: We've suggested Xero to a few clients and even forced them to switch from their current accounting software because of how much superior it is than its competitors.

Pros:

If you're not an accountant, Xero is still simple and straightforward to use. Daily operations are based on the straightforward processes of making payments to suppliers and receiving money. It's the best option for a company of that size. It's simple and straightforward to use this accounting software to keep track of your company's money. This program is something I use constantly.

Cons:

Xero is designed for small businesses, therefore it has basic restrictions (journal approvals, etc.). As a company's billing operations reach a certain mass, they outgrow a single Xero instance and require the use of many instances running in parallel to process all of the bills.

The clean and clear accounting software

Comments: Since I started using it, everything I have needed Xero for has been straightforward. It takes minutes to get a basic invoice setup and sent to a client, and not much longer to make a more advanced invoice. It is easy to connect to your bank account and reconcile incomings and outgoings. It is also easy to give your accountants access.Overall, Xero makes it easy for you to avoid mistakes, and very importantly it has plenty of functionality that will allow it to grow with a company, as you need more advanced features, they are there, often at little to no extra cost. Having Xero helped a lot when starting my business, by making handling my fiances and accounting clean and clear.

Pros:

Xero provides a clean and straightforward experience. It has plenty of features for most use cases, but provides functionality that is easy for anyone to use from small business owners up. The integrations they provide, both with Open banking, and allowing you to give your accountants access, make it a breeze to correctly handle your finances and avoid time consuming mistakes come the end of the tax year.

Cons:

Having used Xero for many years, there is not much that I have found that I don't like about the system. Sole traders may find the 20 invoice a month restriction limiting, but that only applies to the Starter subscription. The prices of the others are more than reasonable to validate upgrading which gets you unlimited invoices. On occasion there will be bank feed issues, at which point you might be left wondering why your balances don't match. Finding out there is an issue with the feed from your particular bank is not obivous, but can be found by clicking through to their "Why is this different" page. From my experience this is the only con, and it is quite minor.

Alternatives Considered: FreshBooks

Reasons for Switching to Xero: Having had a trial with both Xero and FreshBooks, I much prefered the user interface and experience of Xero. Ultimately it was the ease of use that won me over.

The biggest but not the best accounting software

Comments: We are a growth stage startup that originally used Xero because everyone else did and it was easy to integrate. We continue to do so for bank reconciliations and this is what we feel they're best at, but it's so hard to use and incredibly manual, that we've moved a lot of our other features away.

Pros:

Due to its size widely integrates with lots of other tools. Gives you a basic view of your business, and is relatively cheap, so if you're just starting out could be all you need. Provides a lot of functionality likes bank reconciliations, expenses, reporting, invoicing.

Cons:

There seems to be little attempt to improve the product or make it user friendly. Feels like it was build 15 years ago and not much has changed. When you suggest product improvements nothing happens, which is testament to this mentality. Very clunky, no ability to customise.

Great accounting package for any business

Comments: Overall Xero provides business with all the basics at a reasonable price. Support is only via online chat request and can take some time to return the answers (which you need to login to the account to see) but overall its a good well rounded program that is fairly easy to use by all.

Pros:

Bank feeds are simple and easy to use. Entry of sales invoices and sending easy. Can upload documents and evidence for almost every transaction whether in sales, purchases or journals area which is very handy - dont need to go searching for docs at EOFY for the accountants.

Cons:

Reports can be a bit restricted on what you can include or exclude so can be tricky to get the right one to pull the info you need. Sometimes setting up bank feed can be tricky. Payroll needs more features and simplified. You have lots of different tabs and areas for the information to go so its a process to ensure nothing is missed