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Two Months of Xero Accounting – Do we miss QuickBooks?

A few months ago, I wrote a comparison of online accounting systems that I reviewed. In conclusion, we dropped QuickBooks and decided that Xero was the right choice for Globalme. If you are wondering how Xero has been to us, read on.

Why the switch to an online accounting system?

– Too much time spent on manual work, we need to automate some accounting stuff
– Integrating QuickBooks with other systems is painful, API is too complicated
– The more on cloud the better (fits our business structure better)
– Bored of QuickBooks

In short, the main reason was that QuickBooks started feeling bulky. We wanted something that we can easily connect to our project management system ]project-open[, something fresh, something more fun. And the candidate that we found could fit the bill? – Xero!

Transfer – Move books QuickBooks > Xero

Obviously for a running business best time to switch is at the beginning of a Fiscal year. This is what we did. We created our Xero account at the beginning of December 2011. This gave us the opportunity to get ourselves familiar with the system. Mirroring our QuickBooks accounts in Xero was pretty straightforward and there is good help documentation on Xero. We did not need to transfer any customers or vendors as these would automatically be created through the integration with our project management system (more on that later). If you are cash basis, you may need to transfer receivable and payable invoices from your old system to Xero. We did not have many to transfer.

The switch was less painful than I thought it would be. And that is always a good start!

API – Integrating Xero with ]project-open[

Xero’s API is very straight forward and well documented. Lots of code samples are available for different programming languages. Support is very responsive and helpful.

We coded a connection between our project management system and Xero which lets us transfer receivable invoices and payable bills. This is a great improvement to our process which previously was manual. Accounting can now approve and bulk send bills and invoices from our project management system directly to books. New vendors and customers that we create on our project management system get created on Xero automatically.

API – easy to undestand/use and has great coverage – no complaints

Daily Use – Keeping books with Xero

Xero has a clean UI and it is a pleasure to work with it. But like with anything else, there are some things that work well and some things that are limited. Let me brake it down that way:

What works well?

  • Paypal integration works really well, including multi-currency accounts.
  • Reconciliation is much nicer than QuickBooks. You can create transactions on the fly, and auto-match saves a lot of time.
  • Bank integration is nice when it works, makes reconciliation even easier.
  • Being able to set repeat transactions is really nice. You can have an invoice or bill repeat at a given interval.
  • Multi-currency works without any problems for CAD and USD.
  • Xero support is very responsive and helpful. They responded to all my tickets in a timely manner.
  • Sales tax is easy to configure and use.

What does not work so well?

  • Bank integration does not always work. Even though the institutions are under the “supported” list, the connection with our Canadian banks do not work properly. We need to download the transactions from the bank and upload to Xero. [7/2013 update] This now works flawlessly with Vancity, no longer an issue.
  • Amount field on invoices and bills only support two decimal places. Third digit gets rounded. May not be an issue for many, but it definitely is when you operate in Translation industry as we use the 3rd digit frequently. This is currently a big pain since we manually need to fix all items that contain a third decimal digit.
  • Xero does not support importing iif files. We have been happily using Paycycle (now owned by Intuit) for our payroll for many years. You can export payroll/tax data from Paycycle to an iif file and easily import to QuickBooks. However, there is no way to do this with Xero. We have to manually enter payroll data. [7/2013 update] Still a pain and I don’t think there will ever be a solution. If this is a serious concern, you may want to reconsider Xero.
  • No multilingual support. Not a worry for us at the moment but several people mentioned this on the comments in my previous review.

Conclusion – Was it worth the switch?

All in all our team is happy with the switch so far and QuickBooks has not been mentioned much. The transition has been smooth, Xero does provide a fresh look to book keeping and integration options are great.

Do you use Xero?

If you do, please share your own “works well” and “does not work so well” items in the comments…

 

 

 

Categories: Product Reviews.

Comment Feed

15 Responses

  1. Hi Emre – I enjoyed reading your story about your journey of implementing Xero from QB.
    Nice blog. In next to no time you will find using Xero is addictive.

    Xero is wowing the end user, bookkeepers and accounting industry here in Australia.

  2. Thanks for sharing Emre – very valuable for people considering the switch! Appreciate you telling the good and not so good points, we’ve had this same feedback on your not so good points before so we do know where to take another look. It sounds like you were in touch with our support team so hopefully the automatic feed comes online soon.
    Thanks again – very useful!

  3. Nice review, but you really can’t compare Xero which starts at $19.95 / month to Wave Accounting which is free.

    If you could include a chart of features each software offers and their costs, that would be a nice touch.

    • Dave, I would expect the product teams from one of these companies do that; mine is a user review based on my experience and not a complete feature comparison.

      I did mention the cost difference on my initial review. However, Wave claims to be a fully featured accounting system with the “Everything you need, for free” line and I think that qualifies the product for head to head comparison with other offerings.

      • Hi Emre I was wondering if you had figured out how to use Xero for different projects (since you can use projects in Quickbooks but in Xero it seems you can only assign revenue and costs to your overall accounting rigth?)

        • Anthony, I don’t think Xero provides functionality to group items under projects. We never used this in QB either so I never missed it 🙂

          • There is a functionality called ‘Tracking Categories’ natively built into Xero. It allows you to assign transactions (GL entries, sales, purchases, etc) with a category that can be reported on. Each transaction can currently accomodate 2 tracking categories (locations, departments, salespeople, etc). More information can be found here (http://help.xero.com/#Settings_Tracking)

            If you’re looking for a more robust feature-set, you may want to consider one of the many job management add-ons (http://www.xero.com/add-ons/invoicing-jobs/). One of my favourites right now is GeoOp, especially their GPS integrations for tracking the location of mobile workers.

            Good luck.

  4. Thank you. A simple and to-the-point review and comparison of the two softwares. We are currently using quickbooks and have been looking for an alternative. Thanks for your feedback, this will definitely help in making our decision!

  5. We’ve been working for three weeks now trying to get Xero to connect with Citibank. Xero was no help — they didn’t seem to understand RSS feeds. (not a good sign) Now we are trying to get legacy info from QuickBooks to Xero — again Xero support can offer no advice — they can’t even do it themselves — so, I’m looking for someone in India who can do cheap data entry — Xero might be a great product one day but it’s definitely not ready for prime time now

  6. Emre, thanks for the comparison. I’m a CPA looking for a better solution to provide to startups and entrepreneurs – my client base is primarily in the non-profit, manufacturing and tech industries. I’m coming to the same conclusions as you about Xero. Particularly excited about the Dashboard and Business Intelligence bolt-ons.

    @EBCFO

    Dan Schmidt, CPAApril 11, 2013 @ 7:55 pmReply
    • Dan, I am now actively using Wave too for another business that I am running. Definitely worth a look…

      • Enjoyed your comparison article and this update. However, would love to hear another update from you on Wave in comparison to Xero since you’ve now had more experience with them both. Would you STILL choose Xero?

  7. Hi Emre.
    Great article. We’ve been working with both the FreeAgent and Xero API’s and have found their support really helpful and well documented.
    If you’re interested in forecasting – you might be interested in trying Float. http://www.floatapp.com/xero

  8. Thanks for this comparison – I’m an accountant in BC who has been looking at the various online accounting systems to recommend to my clients so this was very useful. I am impressed by Xero but wondering about the change back to GST/PST -Xero doesn’t have the “nonrefundable” option as a parameter for sales taxes- are you needing to employ a “workaround” and if so, what are your comments? Also, is the bank integration working any better now?
    Thanks



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