Just as the real estate industry is undergoing a shift towards cloud-based solutions, the accounting industry is also progressing onwards and upwards since the introduction of Xero back in 2007. It’s time to say goodbye to server-based bookkeeping systems.
Our bookkeeper Wonderwoman and Office Manager Tracy is both Xero certified and a registered BAS agent. This month, she gives us her insights as to why Xero is the perfect solution for Real Estate agencies looking to streamline their accounting processes from 1st July 2018.
Top 8 Reasons Why Xero is the Leader in Online Accounting Systems
- Firstly, most trust accounting software packages talk to Xero. This is particularly useful for agencies and their income and reimbursement reporting. Xero also allows for better tracking as transactions are pushed across to Xero for monthly income and expenses. This includes Property Management fees, agent management fees, advertising and agent reimbursements.
- Staff can enter their own leave requests directly into Xero for Director approval. They can also download their own payslips.
- Easy to track employee working hours as staff can enter time sheets. This assists businesses to keep a track of hours their staff are working, even when on a salary.
- If a supplier you use also uses Xero, they can send invoices using Xero keys which automatically loads their invoice into your draft purchases for approval.
- Say goodbye to clunky server-based systems! You can now save all copies of invoices and align with the relevant purchase.
- Staff can load their reimbursements by taking a photo of their expenses for Director approval.
- There is no EOM rollover process and no EOFY process with Xero. The only EOFY process you need to do is employment summaries. This means no rush to ensure everything is correct and done in order to roll into the new year. This gives your accountant a few months to do your end of financial year and its as simple as locking the period to ensure no changes are done with your data. Whats great about this is it means you can always see your previous years data, invoices and reports without having to install or open backups.
- You can create bank rules directly from your business account. This saves time by avoiding manual data entry of expenses and income as well as reducing incorrect coding. Bank rules are perfect for transactions under $82.50, where the bank statement is adequate record for tax purposes.
I’m running my expenses through Excel. Why do I need a software package such as Xero?
When tracking expenses, there are many items that do not have exactly 10% GST. Unfortunately, excel cannot quickly identify these errors. Xero allows you to see each expense on the screen and the ability to code the GST accordingly. Plus Xero has a recode option if you are an advisor, this means you can recode the source transaction if you find an error, saving you time and money.
Agents need to be mindful of contractors supplying invoices without valid ABN’s. It is an Agent’s responsibility to ensure that a supplier’s ABN is checked and include GST if they are registered for GST. If you find the ABN is not registered then you must withhold 0.49c for each $1. You are then required to do a PAYG payment summary – withholding where ABN not quoted.
Some Final Pointers…
Xero accounting is a simple and easy to use system. All you need is the right training.
Using a registered BAS agent enables an extension on your lodgement and payment for your BAS.
Do you Employ More Than 20 Staff?
As of 1st April, if you employ more than 20 staff, you must enrol for single touch payroll from the 1st July 2018. This is not negotiable, it is the law. Now is the perfect time to clean up your existing database and archive old staff members to avoid getting caught out!
Have You Done Your Financial Year Prep Meeting With Your Accountant Yet?
Finally, the 30th June is fast approaching. This means it is the perfect time to look at your business at a whole, look at your income and expenses and see how your business is operating. Are you running at a profit? Are you investing that profit back into the business? Don’t forget the $20k instant asset write off for entities with a turnover of less than $10 mil finishes on June 30.
– Jane Morgan is the Director of End of Month Angels, a consultancy firm specialising in Trust Accounting. Jane knows the legislative requirements of running a successful Real Estate office through her 20 years industry experience. Don’t trust just anyone with your trust accounting. Book an appointment with an End of Month Angel today.