Small and medium sized (SMEs) companies use a number of different ways to record their accounting transactions:
1. Manual books of account: ok, not many do nowadays but I could introduce you to some who do.
2. Spreadsheets are often used and I am always amazed by the mistakes they contain. There are often formula errors, the formatting could be improved etc.
3. Accounts packages which rely on backups being emailed to the accountant.
4. Cloud accounting packages.
We think the last one is the best solution. We can see your records and how your business is doing simply by logging on to the internet. We see live data and there is no reconciliation needed between the year end accounts and your records.
You can process your bookkeeping transactions or keep a check on your business' finances wherever you are – imagine reconciling the bank account whilst on a train!
It also means we can have an intelligent conversation about your finances as we are both instantly seeing the same live data.
There are many cloud solutions available: FreeAgent, KashFlow and Clear Books amongst others but the one we prefer is Xero. It is straightforward to use and causes us to get passionate about it. It looks very smart as you can see from the dashboard above and the bank reconciliation below.
And talking of bank reconciliations: they are very simple. You can either have live feeds from your bank or you can download bank statements into Xero and then you simply click away. Rules can be set up so Xero remembers where to post the transaction but always allowing you the final authorisation.
Xero takes away the problem of paying for upgrades – they are all included in the cost so you and I are on the same version and there are no compatibility issues. And whilst there is a small monthly fee to operate it you can have as many users as you want at no extra cost.
So we love cloud accounting and especially Xero and look to assist more SMEs in their move across to the future of bookkeeping and accounting.