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Make Change Blog

The #1 mistake entrepreneurs make when using Xero as a DIY solution

[fa icon="calendar"] Jul 3, 2017 3:35:36 PM / by Edwina Fairley

Edwina Fairley

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Xero recently celebrated reaching 1,000,000 customers. The unique app revolutionised online accounting when it launched ten years ago, and it’s been disrupting the industry ever since.

 

With its effortless interface and desire to make accounting “beautiful”, it’s no wonder you entrepreneurs are one of the core sectors embracing Xero and cloud accounting.

 

Using Xero is so simple, many entrepreneurs grab a subscription, reconcile their expenses, and assume their accounting work is done.

 

Hold up. Stop the press. Time for a reality check.

 

That isn’t accounting. That isn’t financial visibility. You’ve barely scratched the surface of what you need to run a successful business.

 

Xero makes everything so simple, cash-strapped businesses try to cut costs by eliminating accounting or bookkeeping services entirely, and just relying on the app. It’s a damn good app, don’t get us wrong, but an accountant it is not.

 

Of course, as a business owner, you should be looking at creating a lean business wherever possible, but trying to DIY your accounting with Xero can result in you paying more tax then you need to, or even risking an audit. That’s really going to cramp your style.

 

You might consider taking up our 30 Day Free Trial (No Strings Attached) where we manage everything for you.

 

Related: (Gain Instant Access to the tool that is saving Entreprenuers 5+ hours every week)

 


 

Why Xero can’t do it all

Here at Make Change, we freaking love Xero. We encourage all our clients to give it a go, and we love that it’s helping businesses to save money on their accounting bills.

 

However, we know better than anyone that just using Xero isn’t the only key to success. Only looking at your accounts at tax time means you’re blind to any potential issues or savings.

 

According to Xero, the most common mistakes that trigger an audit are mixing business and personal expenses, excessive deductions to your income, and not paying your tax on time. On the flip side, you could also be overlooking deductions that could potentially save you a ton on your tax bill. Xero lists the most commonly missed deductions as home office expenses, new employees, and travel expenses.

 

Xero is pretty clever, but it can’t pick up these clues. Without an accountant monitoring your finances and highlighting potential savings and mistakes, how will you know any of this, until it’s too late?

 

You’re pretty awesome, but you don’t know what you don’t know. Only an expert can spot these areas and suggest ways to improve.

 

Related: (The highly requested 30 day Free Trial and Consultation that is saving Business People like you $1,000+ every year)

 


 

Ongoing insight into finances is key for success

Xero recently conducted a survey of accountants about the mistakes their small business and entrepreneurial clients make. By far the number one mistake was not having ongoing insight into their own finances. Too many entrepreneurs were talking to their accountant only at tax time. The rest of the year, they were willfully ignorant of what was going down on the cash side.

 

Don’t make this mistake. Instead of viewing your accountant or bookkeeper as an expense to be minimised as much as possible, think of them as a key partner and advisor.

 

Come talk to the team at Make Change today. Our philosophy is “humans where you need them. Software for everything else.” We’ll give you a monthly update on the facts and show you want to do to improve your financial health. We give you step-by-step, plain english answers to your financial questions, and we give you that year-round visibility that’s so key to entrepreneurial success.

 

Go on, do it!

 

Oh also, just in case you missed it.

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Topics: business tips

Edwina Fairley

Written by Edwina Fairley

Edwina understands how hard it is to run a business: she's operated her own dog walking business in Auckland in years past. Juggling every ball to make ends meet can be stressful and frustrating, she knows! As the Make Change guru, she's now invested in helping business owners reach their goals by helping them get their accounts in order. In addition to this new role, Edwina enjoys rock climbing and small trips around New Zealand.

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