Converting to Xero from another accounting system
Here are a few tips to get you started if you’re converting to Xero from another accounting system. This assumes you have already set your organization up in Xero, chosen the date you want to start recording transactions in Xero, added a bank account and its balance, and that you currently don’t categorize your incomings and outgoings.
Take a look at our setup guide when creating your organization in Xero. It’ll take you through the initial steps for setting up your organization in Xero such as deciding a conversion date, entering conversion balances, inviting other users and creating a new chart of accounts.
Get data from your previous system into Xero
Next, you may want to start entering data from your previous systems. The following can all be imported into Xero in bulk via CSV files. Find out how to get started on the Importing and Exporting with Xero page. For more detailed help on each topic, try the links below:
- Import a Xero chart of accounts file
- Import contacts into Xero
- Import your invoices or bills using the Xero CSV template
- Import fixed assets into Xero in bulk
Enter some transactions
- Starting from your conversion (start) date, enter any recent sales invoices or bills which you haven't already imported in bulk into Xero. Make sure you approve the invoices and bills.
- Starting from your start date, enter any cash transactions (when there is no invoice or bill) directly into your bank account – receive money for sales/incoming and spend money for expenses/outgoing.
Process invoice or bill payments in & out and reconcile Xero with your bank account
- When you receive or make a payment on an invoice or bill that you have entered into Xero, go to the invoice or bill and enter the amount of the payment onto the invoice or bill and the bank account the payment is from.
- Go to your online banking to download the actual transactions that have been going through your bank account for the period matching the transactions you've entered into Xero, and import them into the same bank account you've set up in Xero.
- Reconcile your accounts i.e. match what has happened in your bank account with what you've recorded in Xero. In most cases Xero will automatically match a downloaded statement line to the transactions and invoice or bill payments you've entered into Xero - check off each match by clicking OK. You can change the match to something else if Xero's guess wasn't right (e.g. several transactions for the same amount but to different customers or suppliers).
- If you can’t download an electronic bank statement, you can view the transaction list for the bank account in Xero. Mark as reconciled when you see the transaction has been processed through your actual bank account.
- Later on once you're familiar with Xero and don’t want to enter items into Xero before they go through your bank account, import your bank statement first then create cash transactions on the fly in Xero to match the statement (using the 'Create' tab on the Bank Reconciliation screen). If you use invoices or bills, you do need to enter them into Xero first so you can match payments on your bank statement to them.
See how your business is doing - run a report
Some reports you might like to see to start off with are:
- Aged Payables Summary or Aged Receivables Summary – shows a list of outstanding supplier (payable/creditor) or customer (receivable/debtor) invoices or bills.
- Income Statement – shows income for a month minus the expenses for a month, giving your profit or loss for the month.
- Balance Sheet – shows what you currently own (assets) against what you currently owe (liabilities), giving your total equity (worth).
Do your taxes
Go to your Sales Tax Report. If you’ve entered your sales tax settings, it will show the current sales tax period.
- Use the Sales Tax Audit Report to scan down through all your transactions entered in that period to make sure everything you expect to be report in this period has been, and at the right tax rate.
- Copy relevant figures from your Sales Tax Report in Xero onto the form to be submitted to your tax authority. Then ‘Publish’ your report in Xero to end the sales tax period which reloads the Sales Tax Report ready for the next period.
Do you need help?
If you're unsure how to set your organization up in Xero or how to do any of the tasks described in the Help Center, our Support team can help you. Just click Contact Xero Support at the bottom of any Help Center page to let us know your issue.
Your own accountant or bookkeeper, or one of our advisors can help you with keeping your accounting records.
You can invite another user into your organization to see what you’re seeing and help you. Perhaps your accountant or bookkeeper.
Once you're underway with Xero there are lots more things you can do such as:
- Repeating Transactions – set up regular invoices or bills from or to the same people saving you data entry each time
- Expense Claims – if you or your staff buy things on behalf of the business and you need to pay them back
- Budget – create a budget and report against it
- Bank Feeds – automatically get a bank statement every day rather than downloading it
- Tracking – break your account categories up further if you have departments or branches or activities to report on
- Users – add other users to login and view or update your accounts, they can have different 'roles' (access)
- Fixed Assets – add and record depreciation on your business assets.