It’s a classic scenario for many accountants: A client turns up at the end of the year with a literal shoebox full of receipts, hands it over, gets their accounts done, and then moves on into another financial year.
And with everything taken care of, there’s no need for reflection. Nor is there a nagging feeling that perhaps there’s a better way. No, they just find another shoebox and start filling it with receipts, destined to repeat the cycle once more.
If this sounds familiar, and you identify with the ‘shoebox’ approach, you might be wondering what the big deal is. After all, it has probably worked in the past. But the truth is, it won’t work forever. Particularly if you have plans on growing your business.
As processes become more complex, and profits increase, you’ll need to pay more attention to accurate record keeping and be able to quickly access important financial information. This means the shoebox just won’t do. You need a new box. A fancier box. A cloud-based box.
Changing Your Approach
Let’s be honest, life as a shoebox business owner doesn’t mirror your everyday life. Whether you’re commuting to or from the office, or comfortably sat on the sofa, chances are you’re on your phone or tablet. And you probably use online software for just about everything else when it comes to running your business.
So it’s time to manage your business finances the same way.
Now, the good news is, as a dedicated filler of shoeboxes, you’re at least one step ahead of those business owners who don’t have the first clue as to where their receipts are. As you’re already in the habit of filing away receipts and other important pieces of information, your approach to recordkeeping doesn’t need to change drastically.
Instead of placing each new receipt, invoice, and expense in your cardboard box, you need to start uploading them to an online accounting platform. But which one?
Introducing Your New ‘Shoebox’: Xero
If you’re not familiar with Xero, it’s one of the world’s leading cloud accounting systems. It has helped businesses of all shapes and sizes take control of their finances and allow them the platform from which to grow and develop.
So, what are the benefits of swapping your box for Xero?
Well, there are actually quite a few, but let’s focus on some of the core advantages:
- Real-time Financial Reporting – With Xero, you can login and see how your business is performing at any given time. There’s no need to wait until the end of the month or the end of the year to sort through your receipts and find out if you’re profitable or not.
- Collaboration – Imagine asking your accountant for insight or advice regarding your overheads, and then handing them a box of unsorted receipts. They’ll either laugh you out the room, or charge you quite a bit extra to dig through the mess. Being able to access up-to-date and organized information makes collaborating so much easier and effective.
- Automated Backups – Thanks to Xero automatically backing up your data, you never have to worry about misplacing important financial information. Can you say the same for your shoebox filing system?
- Vast Ecosystem – Saving perhaps the best till last, Xero has a vast ecosystem of connected apps that can work seamlessly with the core accounting platform. These include CRM systems, time tracking applications, and even receipt-scanning apps such as Receipt Bank.
We’re sure you’ll agree that for these reasons alone, Xero wins hands down. And in Part Two you’ll learn the habits you need to form to make the most of your new ‘shoebox’.
Ready to Make the Switch?
If you’re already convinced that your approach to financial management would benefit from Xero, our friendly and experienced staff are ready to help.
Click here to learn how Polay+Clark can get you up and running in no time at all.