Need Xero
What do users think of the accounting software Xero?
Answers
Good question! CPAs and business owners in the United States have been eagerly awaiting reviews of Xero.com and its value proposition since recently arriving on US shores in the City of San Francisco. Founded in New Zealand, Xero has been around since 2006 and now is advancing its global strategy.
I'm looking forward to the accounting
I am not a Xero user and not familiar with their pricing or integration structure, but I am awaiting rave reviews in the next year, and I can tell you there is a lot of interest in what Xero can do from the accounting practice perspective. I would predict that if Xero has hit a home run, there will be millions of accountants jumping to convert their client accounting services for small businesses to Xero, just like firms are starting to convert their larger mid-size business clients to Intacct. Outsourced accounting practices are the new wave of advancement for
It is exciting that
Until 2010, Quickbooks has been the only reasonably priced full scale accounting software for small business. Starting in 2010 Intuit decided they wanted to capture more of the mid-market with their Enterprise version and started to realize that other offerings would soon be on the market. They currently ask their ProAdvisors to ask their clients to prove that Quickbooks cannot do the best job during the consideration of transition to an ERP system. Many companies choose to stay with Quickbooks Enterprise and with query capabilities for QB advancing along with all the 3rd party integrations, inexpensive payroll processing options, and low cost merchant services, Intuit is indeed investing in its competitive edge and making some strategic changes.
So, how do you decide which way to go?
With any software decision you will need to gather the requirements of your current processes, consider the ramifications of job or project accounting because time entry could complicate billing processes etc. Consider all the needs for
Another thing to consider is the cost of the integrated third party add ons that you will need with any of these offerings. After looking at Xero's website, I noticed their 3rd party integrations are currently limited compared to the number of offerings that are listed with Intuit. That really means nothing if the Xero add ons are more robust. There are some quite good reviews.
When you are considering Payroll, note that Xero offers only ADP, one of the highest priced services available. Because Xero is new to the United States you will want to vet their US payroll service to ensure it complies with all your needs. This could be why they are recommending ADP, because ADP serves the US market already.
I would love to hear more about your decision experience and what your decision was and why.
I question the wisdom of CPA firms getting involved in IT decisions again.
The last time (about 10-15 years ago) it was not only a disaster, where both client and firm were losers, but many state governments came down on the CPA firms.
Why will this time be different?
I've been using Xero for a while now, and have been converting my clients to it every chance I get. They love it, and are particularly enamored with the fact that they can access their data from anywhere and anytime. The mobility factor alone is almost enough to convince them, but Xero also happens to be incredibly user friendly and intuitive for most small business owners.
For those CPAs like me who have been frustrated and unhappy with Intuit's passing attempts at "cloud" with Quickbooks Online and its limited commitment to improving the QB Online product offering, Xero is the perfect answer. Xero's ecosystem of app partners is fairly robust and - because they are completely internet based - the ability to integrate with other SaaS applications is almost without limit. For example, I watched a great demo by Xero at Salesforce.com's Dreamforce event a few weeks ago that illustrated the seamless integration of accounting data bi-directionally between Salesforce and Xero. So Salesforce customers - particularly Professional Edition and below - are very likely candidates for Xero use.
Xero's monthly subscription cost is priced at or below QB Online, but there is no limit to the number of users that can access the app so - unlike QB which limits users to 3 or so without paying more - anyone in the company can access it. This is particularly useful for folks who need to submit expense reimbursements, since they can log into Xero specifically for this purpose (without seeing any other sensitive accounting data), open an expense claim, upload their receipts to the claim, and submit it for approval. Xero has an "authorize and approve" process for expense reimbursements, sales and payable invoices, and supporting documentation - including the scanned vendor invoices - can be uploaded to the payable invoice record. This makes many small business owners happy, since they can now review the details of the expense reimbursement or vendor invoice itself before deciding to approve it.
As a caveat, I will tell everyone that I've been advocating cloud accounting solutions now for over 3 years and am an evangelist for many great cloud-based apps. As a CPA, I've been in the minority for a long time :-) But companies have been demanding mobility for some time now and expect that accounting will be mobile as well, so momentum is building and it's getting less lonely in this space now!
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Can you define the parameters of the types of companies and their size that Xero in your opinion excels at?
Thanks for your great review.
Last week I attended a vendor
Job costing is not currently built out, if you need US payroll you will need a subscription to a US payroll service. They are just now setting up advanced features for inventory. They are just now building the 1099 reporting process. The cash management features are advanced so if your business is primarily a checkbook and credit card, Xero can really help to streamline.
The high value apps and cloud services that provide functionality to Quickbooks are fast developing integrations to Xero.
Early adopters will find their advisor certifications free with free accounting software for accounting professionals, whereas Intuit charges a fee for those
The way I see it, if you are a startup without complex job costing needs Xero is a great place to start. In terms of Xero vs Quickbooks, as you grow, more functionality will become available as it is developed or you might choose to jump over to Quickbooks Online Plus which is actually more fully featured with the apps integration than the desktop versions, and as you become ready to scale you might choose to jump over to Intacct for a single ledger environment that feels like a large ERP system and can be outsourced to a Client Accounting Services practice.
The cloud is good.
I migrated to Xero, and use the following apps with it: Freshbooks, Expensify and Squareup.
I like Xero, the interface between Freshbooks and Xero needs some work, as it doesn't import invoice line service code correctly and requires me to do the following edits: Put a due date in the imported invoice, and change each line item to reflect the appropriate G/L code.
Expensify works almost seamlessly (I have one small issue, but you may not care).
Squareup seems to have worked, but I believe it has the same issue as Freshbooks, you only get one default Sales account.\
The native Xero experience is very good. They are slowly adding aspects that are missing (you need to remember this product is from New Zealand, and there are differences at least in banking).
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