In many industries, no two jobs are the same, making estimating job costs and resources tough. Job tracking is one of the best ways to develop an accurate budget and avoid blow outs.
But this can be hard work. Are the latest job costing and tracking functions in MYOB AccountRight, QuickBooks Online and Xero making life easier?
Job tracking functions in your accounting software
As its name implies, job or project tracking is a way of keeping track of, and allocating, all costs and incomes to a particular job or project.
Job tracking has numerous benefits. It allows you to stay on schedule, budget for costs and resources efficiently and work out job profitability.
Why job tracking can be difficult
Part of the challenge of job tracking is making sure that staff members responsible for invoicing, paying accounts, and payroll functions, know exactly how to allocate costs in a job. They also need to know which jobs are active at any one time.
How job tracking affects Accounts payable and receivable workers
We cover the skills needed to for clerical, administrative and accounts work in accounts payable and receivable in our Xero Advanced Certificate, MYOB Advanced Certificate and QuickBooks Online Advanced Certificate courses.
When it comes to job tracking, employees working in these accounts areas need training and awareness. If you have staff responsible for invoicing customers, they will need to know which job numbers to use.
Similarly, accounts payable staff who receive supplier bills and need to allocate the costs to the correct jobs or cost centres.
Payroll staff, too, are involved in job tracking as they receive employee timesheets and need to allocate hours worked to the correct jobs.
How the different accounting programs “job track”
MYOB AccountRight Job Tracking
You can track job costs and revenue using the Jobs function of MYOB AccountRight. This is available in the Lists menu. (Note: Job tracking is not available in MYOB Essentials.) The Jobs List in MYOB AccountRight provides a snapshot of the profitability of each job.
We cover job tracking in our MYOB BAS & Reporting online training course.
Xero Projects or WorkFlowMax
Xero, too, has its own much awaited job tracking function, called Xero Projects. The introduction of Xero Projects has been great for those wanting to make the move from MYOB AccountRight.
However, Xero Projects isn’t exactly like tracking costs by job in MYOB. The Xero Projects module tracks time and expenses and a billing process generates invoices. However, you can’t track job costs by line on each invoice.
You can overcome this by creating tracking codes in Xero which would allow you to allocate costs/income as appropriate. This only becomes a little unwieldy if you run lots of different jobs. An addon like Workflow Max may be worth considering for these kind of operators.
Read about some of the other project management tools you can use.
Overall, however, Xero’s more recent offerings, like Xero Projects, are making it increasingly competitive against MYOB. We’ve written a lot about the comparisons between MYOB AccountRight and Xero; it’s a heated topic among small business owners and bookkeeping businesses!
We’ve talked before about how QuickBooks is comparable with Xero. Like Xero, it also has a Projects feature, which is available on a QuickBooks Online Plus subscription. The QuickBooks Projects screen provides a snapshot of the profitability of each job. A project name and customer is required to create a new project.
We’re currently creating a short course on Job Tracking, Job Costing and Projects
If you are a current EzyLearn student you’ll be thrilled to learn that we have a new case study in development that will teach you how to manage projects for tradies like builders, carpenters etc.
Learn more about our latest Micro Course Case Study and make sure you subscribe to receive updates on its progress.
We are creating a new Job/Project Tracking training course for each of our Xero, MYOB and QuickBooks Online Courses.
My first thought when a software company changes its navigation (in a significant way) is that there were issues with the previous version.
THIS BLOG POST comes in the wake of Xero promising to improve their navigation in October 2018. Xero has now subsequently released those changes and our online support team are receiving lots of requests for help!
First and foremost, if you’re an EzyLearn student, please note that we’ve already created an update addressing the navigational updates and this is available in all of our online Xero Training Courses.
Cloud Accounting Software is CONSTANTLY Updated – SO IS OUR XERO COURSE
When I made the decision to convert EzyLearn from a Bricks and Mortar training centre to an online only provider of training courses I realised that we were going to have to get good at:
- online digital marketing,
- online pre-sales and student support, and
- course content creation.
EzyLearn has been in business helping job seekers, business owners, managers and clients of rehabilitation providers learn how to use software for over 20 years. Read our story here..
I’m lucky today to have a professional team who’s sole focus is on getting better at all of these tasks – every week! I guess this post is as much a thank you to all of them for their help as it is an announcement that ALL of our XERO courses have recently been updated!
Almost every course has been touched in our latest updates but here is a summary:
- Xero Course 512 (Level 2 Advanced Aspects of Daily Transactions using Xero) has been updated (videos and workbook contents)
- Knowledge Review tests for Daily Transactions and End of Month & Journal Entries Courses
- Updated instructional videos for GST, Reporting and BAS using Xero (Course 514) as well as Cashflow, Budgets and ROI Advanced Xero (Course 516)
- Advanced Payroll (Level 2) for Payroll Administration using Xero (Course 515)
One reason that students choose EzyLearn for their online training courses is because they receive access to new added content and course updates.
Available to New, Current Students and LIFELONG Students
The usual time to finish the COMPLETE set of Beginners to Advanced Xero Courses is 3 weeks but one of the reasons we offer 12 months course access (and the LIFETIME Xero Course Access) is so that students can go back and review the contents when they need it in their business or job.
Current Discounts for Xero Training Courses
LAST WEEK, MYOB LAUNCHED a beta trial of its single touch payroll (STP) product, as it gears up for the July 1, 2018 compliance deadline.
Businesses with 20 or more employees need to have transitioned to the ATO’s Single Touch Payroll initiative by July.
Businesses with fewer than 20 employees have until July 1, 2019 to be compliant but for these small business owners and contractors the ATO has a new free app. Continue reading MYOB Launches Single Touch Payroll Trial Product
Bookkeeping Incumbent, MYOB Versus Cloud Innovator, Xero
MYOB HAS LONG BEEN the preferred accounting software of choice for accountants, but a lot of small business owners have now come to prefer Xero. It’s easier to use, and they can access it anywhere — their desktop PC, tablet or smartphone.
Meanwhile, the rise of cloud-based accounting software, which was pioneered by Xero, has made it a lot easier for bookkeepers to base themselves from home. Throw in other technological innovations — cloud storage, bank feeds — and a remote Xero bookkeeper has become the more appealing choice for businesses, too.
Good bookkeepers have a corporate background
Many experienced bookkeepers (around level three upwards) have a corporate background. They’ve typically worked for big accounting firms, and are possibly qualified accountants or BAS and tax agents, familiar with all the available ERP systems on the market.
As much as they know MYOB as the big robust accounting software for medium-sized businesses, a lot of these ex-corporate bookkeepers are also well aware of how Xero benefits small-to-medium businesses: It’s less confusing to use and it’s cloud based; things that make the bookkeeper’s job easier, too. But there’s no guarantee they’ll recommend Xero purely because of that.
Their experience with a range of different ERPs, makes them just as likely to have a subscription to more than one accounting software so they can recommend, with firsthand knowledge, the right accounting software for your business — be it Xero or QuickBooks or, yes, even MYOB.
Bookkeepers can grow their business
Of course, one reason Xero has become the preferred accounting software, over MYOB or QuickBooks, for a lot of ex-corporate bookkeepers is because of the Xero partner program which enables them to earn ongoing income by recommending Xero to their clients.
Billed as a way for Xero bookkeepers to grow their business, the program lists certified partners in the Xero Advisor directory, which is used by businesses looking for a Xero-certified bookkeeper to manage their accounts. To become a Xero partner, bookkeepers must successfully complete a Xero skills test. When they do, they’re listed on the directory.
The more Xero clients a bookkeeper brings in under the Xero Partner program, the higher their status and the greater their rewards — free Xero memberships, marketing help, and big discounts on subscriptions for their clients.
It’s incredibly appealing for ex-corporates who want the flexibility of self-employment, but want to grow their business with a client-base of substantial mid-sized businesses — and fast. So the more business a bookkeeper can bring Xero, the more business Xero can bring the bookkeeper. At least, that’s how it’s supposed to go.
Universal access with Xero
But Xero Partner or not, far and away Xero’s popularity is really due to its technology — and its commitment to using technology to improve the way businesses stay compliant with the tax office.
That all started with universal access. Businesses that use Xero can invite anyone in their team — their admin assistant, bookkeeper, accountant, their entire sales team — anytime they like, as part of their Xero subscription. Here are a few more reasons:
- Invoices can go out as soon as a project is finished or a sale is made; likewise for estimates and customer statements.
- It also means that a business owner can monitor their cash flow in real time, while their bookkeeper is keying transactions and their sales people are sending off invoices.
- And because the software is in the cloud, these people don’t even need to be in the same building, never mind the same city, state or country! (Xero is the rare low-cost accounting program that supports multi-currency.)
It’s all about the Xero tech
Xero also integrates with more than 500 third-party apps. Some popular integrations include Gmail and Hubspot, the marketing and sales platform. These two integrations alone turn Xero into a complete business management platform and enable it to scale up to the services provided by mid to large sized ERP systems.
Businesses can import data to Hubspot based on customer spend or products and services sold, and send those customers tailored marketing messages. The Gmail integration gives users a complete snapshot of previous conversations with customers — salespeople can see if there are outstanding invoices, or problems with a customer’s account, for example.
Gold standard in bank feeds
Although bank feeds are accurate most of the time, they’re not perfect. MYOB has been know to be particularly temperamental, but Xero has a reliable bank feeds function. Again, that’s a lot to do with Xero’s commitment to tech.
Setting up bank feeds in any accounting software is as simple as clicking a few buttons, giving a few permissions, and voila! Your bookkeeper has just saved themselves hours each month. Bookkeepers much rather spend as little time as they can keying and coding transactions.
[box type=”info”] This time is better spent doing bigger jobs — lodging activity statements, reporting, payroll — so they’re going to recommend an accounting program with bank feeds.[/box]
Plus, business owners won’t have to wait for their bookkeeper to enter their transaction data each fortnight or month to see how their cash flow is tracking: Bank feeds give business owners a complete picture of their business’s cash flow and financial health because transactions are imported in real-time.
Xero courses provide Bookkeeper CPD points
EzyLearn gets lots of enrolments in our Xero training courses and we’re an accredited training provider with the Institute of Certified Bookkeepers. The ICB requires its bookkeepers to continue developing their skills and knowledge as a bookkeeper in order to retain their membership (this is known as continuing professional development, or CPD).
Many bookkeepers and accountants do EzyLearn’s Xero courses to earn their annual CPD points. EzyLearn offers a number of different training courses as continuing professional development (CPD) for bookkeepers, including our Microsoft Excel, Xero or MYOB training courses.
Our Bookkeeping Academy training courses start at $99 — for Xero or MYOB — and allow you to learn what you want, when you want, entirely at your own pace. Visit the Bookkeeping Academy website for more information or to enrol.
How tapping into your Smartphone can win you work
I RECENTLY WROTE about a Tradie Charging Too Little. In this I covered the four tell-tale signs, as told to me by a tradesperson friend of mine, that your prices are too low. But there are other business mistakes that owners, particularly tradespeople, make that can wind up costing them thousands in lost revenue — and when I say revenue I don’t just mean from existing clients but also past clients and new prospects!
The crazy thing is that most of this can be solved by using a bit of technology. And I don’t mean using a desktop computer; indeed, most tools you need are now available from your smartphone. My preference is Android and Google G Suite.
Lots of business owners, including bookkeepers and tradespeople, will just hand out their business card to prospects, rather than taking down the prospect’s details so they can follow up.
Sure, handing out your business card is a good start, but if you spend an extra minute or two getting contact details from the prospect as well as details about:
- the work they’d like done
- the timeframe they’re hoping for
- their budget, etc
you can follow up in a meaningful way and hopefully win some new business. The great thing is that you can add the prospects address and contact details to your contacts and even your calendar for 3 weeks into the future and just make friendly contact with them to see whether they are ready to begin!
The best time to send a prospect a quote is when you’re still at their premises. You can do this by writing them out by hand in a book with carbonated paper (but get real, you’ve got a smartphone!)
Better still is to use a cloud accounting program like Xero to email the quote through to the customer right then and there (this helps ensure you get their correct email address too).
The biggest reason to do this prep work: Because you have a prospecting list you can call on when things get quiet in your business.
If you take the time to explain the details of the quote, you might also just get an automatic acceptance, so then you can begin scheduling a start date, arranging a deposit, and so on.
This actually happened to me when I was using a glass manufacturing business in Maitland NSW for a recent renovation I was involved in — the estimator mentioned they could do it the following Tuesday and that all they needed was a 50% deposit. He asked for the business on the spot and guess what? He got it!
Learn more about our property investment micro courses and education guides.
The price of being disorganised
Don’t wait until the day before you’re due to start a job — or worse, until you arrive to commence work — to secure a deposit from your customer. Ask them to pay the deposit before you commence the work, so you’re not waiting around to be reimbursed for materials you’ve purchased out of your own pocket. This can have an adverse impact on your credit management processes.
This tradie I was speaking to was thinking about getting a small loan for $2000, when I suggested that he just get his deposit for an upcoming job now rather than a day before he starts it!
Get a Coach or Mentor to help you through the process
Our EzyStartup Course will you teach you about pricing your services, business planning, marketing, and developing a professional network to grow your business.
Visit our website for more information or to enrol. Best of all you can engage a business coach to help you set some goals, stay on track or even project manage the using of new technology so you begin using this technology every day.
Doing what you know, and particularly, what you love doing and are passionate about, will ensure you earn money and get new clients.
Why? How? Because people see it in your body language and hear it in your voice.
Throw in some good computer skills and efficient credit and money management and you’ll be set for a great financial year profit.
People Prefer Specialists
I recently worked with a lot of different trades people on an investment property in Newcastle and found it fascinating how many trades people would promise to do a lot of things but then not be able to deliver when needed.
In particular I spoke with a painter who claimed that he was a level 3 painter (and not a level 1 painter) and then gave me reasons for it.
I soon realised that this painter simply wanted to work at a slower pace doing lots of interesting things. He didn’t want to work on intricate, complicated paint jobs — however, he was quoting on EVERYTHING in the hope of getting the work.
My strong advice: Specialise early in one or two particular areas of your field. For instance; if you’re a painter, concentrate on indoor painting, rather than spreading yourself thin doing outdoor jobs.
Similarly, don’t even bother quoting on projects that require lots of different tools and expertise you don’t necessarily have. You can branch out later, once your business is more established and you have the time and resources to take on different kinds of jobs.
Just remember, people want experts because they know the job will be be done well — and they’re willing to pay good money for that. If you’d prefer to do more basic paint jobs like renovation touch ups and/or refreshing old houses, and you are willing to accept a lower rate, there is also plenty of demand for that.
Build a network of specialist professionals
You, personally, can’t be everything to everyone, but you can build up a network of professionals so your business can provide everything to everyone.
Get to know other professionals who carrying out work in ancillary and adjacent areas to your business, and work out a mutually beneficial arrangement to pass work onto each other, where each people can earn a finder’s fee.
The painter recently went through the topics in our EzyStartup Course and realised he could earn a commission or referrals by passing jobs that were outside his area of expertise onto other painting companies. This has enabled him to focus more on the renovations and maintenance work that he prefers to do.
Be a better tradie!
WHEN YOU KNOW even just the basics of what Xero cloud accounting can do (or you have someone in your business who does) you’ll stand out from others.
You’ll earn your money faster, have better cashflow and not be left worrying about all the things you have to do in the future.
I’VE TALKED ABOUT CASHFLOW on this blog before, particularly as it relates to good credit management processes.
This time, however, we’re going to look at how profit differs from cashflow, even though the two are intimately related.
There is the perception that a profitable business can’t suffer from poor cashflow, but this is incorrect. There are plenty of profitable businesses that don’t have enough money in the bank at a given time to pay their outgoings because cashflow is lumpy.
We’re in business to make a profit, and yet the term ‘profit’ is really just an accounting concept. Profit is revenue minus expenses, but it doesn’t reflect our investment in capital assets, such as equipment or vehicles, nor does it take into account the liabilities we have funding our business (loans and hire purchases).
Cashflow is the true indicator of success
Cashflow, unlike profit, is about timing. Specifically, it’s about having money before you have to pay out money, something not identified by profit. Managing cash flow is one of the most stressful things about running a business, because many variables affect it.
Sure, not earning enough money or not having processes in place to make sure that money flows into your business in a timely fashion are part of it, but there are other factors too, such as:
- Incorrectly priced products or services
- High overheads
- Holding too much stock
- Large bills (tax bills)
- Seasonal cycles
- Large projects
- Growing pains (putting on more staff, increasing stock levels)
- Unrealistic forecasts.
P&L reports help determine causes of poor cashflow
Quite a few of the things that adversely affect a business’s cashflow can be determined by running regular Running Multi-Period Profit and Loss Statements], while others can be managed (or avoided) by implementing better processes or procedures for doing business.
Product based business which keep inventory can have their cashflow affected by:
- incorrectly priced products and services
- holding too much stock
- seasonal sales cycles
and this evidence will show up when you run your P&L reports, as well as your inventory sales and stock-on-hand reports. If, for example, you identify that May, June and July is your busiest quarter, while November, December and January is your quietest, and where you struggle to meet your outgoings, you should implement strategies to better plan for that leaner period.
A seasonal period of downturn is common among most businesses. It’s how you manage and plan for that downturn that separates successful businesses from ones that aren’t. For example, it’s unwise for a sole trader to take a holiday March, a seasonally busy period for his business, when he could wait until June when it’s much quieter.
Your bookkeeper will play a key role in how you plan and manage your cashflow. Ask them to run reports that will help you to identify any inefficiencies in your business that’s causing poor cashflow, and implement strategies to better manage it.
Bookkeeper, BAS Agent or Finance Manager
If you’re looking for a reliable bookkeeper to manage your daily or weekly bookkeeping and accounts, either remotely or in-person, Tracey from Rockingham is a highly qualified bookkeeper, who also has the practical experience of having operated her own business in the past. Tracey has a lot of experience in the day-to-day accounting functions of a small business and you can contact her directly as a fully licensed member from her profile page.
Our National Bookkeeping website has recently gone through a significant upgrade so watch out for more stories about featured bookkeepers in forthcoming blogs! Join and we can feature YOU in our articles too. Subscribe and stay tuned to learn about some new members who have moved from the corporate world to focus as Finance Managers for small to medium businesses.
Xero enables business owners and their bookkeepers and financial managers to see what is going on RIGHT NOW and because it’s popularity is growing we’ve created a NEW Xero course which goes through a great example of the business decisions that a business owner makes about buying an investment property, figuring out which products/services provide a better Return On Investment (ROI) and more.
Check it out at Xero Cashflow Course and remember that existing EzyLearn students can get access to this course by just sending an email request to student support.
Receive updated course content — for life!
ONE OF THE GREAT THINGS about Excel is that it has so many applications. It can be used to create financial budgets and forecasts, monitor stock levels in a retail shop, roster staff, and also determine how much money an investor can borrow to buy a property.
A lot of the time, however, people enrol in an Excel online training course or Xero online training course because they need to refresh a specific set of skills for their job, which means they don’t have the time to focus on other areas that don’t have an immediate relevance for their work.
Upskill at your own pace
With our Lifetime Access courses for Excel and Xero and many other online cloud accounting and business options, students can continue learning in their own way and at their own pace, either as part of continuing professional development or for their own personal interest — our course content includes real-world case studies, like building a granny flat, to give context to the functions of Excel.
Keep up-to-date across all software versions
The other benefit of our Lifetime Access for Excel online training courses and Xero online training courses is that it means you can quickly brush up on where functions have been moved to when new versions of Xero and Excel are released.
We update our course content every time a new version of software is released, and with Lifetime Access, you’ll be able to access all of this new content, along with previous versions of course — so you can keep learning on the most current versions of Excel and Xero.
Don’t miss out on our terrific Spring specials!
We are constantly refreshing the content of our online training courses so that you can benefit from all the new information that is always coming in about being in business, or running your own business as a bookkeeper or looking for bookkeeping work.
Our Xero online training courses include EVERYTHING for ONE LOW PRICE. Furthermore, if you select our Lifetime Membership option, you’ll have LIFETIME access to our ongoing course updates. All EzyLearn courses are accredited by the Institute of Certified Bookkeepers (ICB) and can be counted towards Continuing Professional Development (CPD) points. Find out more about our Xero online training courses.
How does Xero stack up in the cloud accounting game?
When Xero first entered the market, it was with a bang. You see, even though Xero and MYOB share many of the same features, Xero was cheaper and easier to use than MYOB, but perhaps even more so, it was also cloud-based. Being cloud-based meant you didn’t have to buy and install pricey software that would be out-of-date within 12 months. A huge advantage.
Since then, however, a number of cloud-based accounting applications have entered the market — QuickBooks Online (now distributed by their US-based parent company Intuit), Reckon One, Saasu, Zoho, and so on.
As business owners have more choice than ever before, it’s got a lot of people wondering about whether the two market leaders (Xero and MYOB) are really all they’re cracked up to be, Xero in particular.
Missing a dropdown menu
Even though Xero was hailed as a breath of fresh air when it first entered the market, it is still a little more complicated to use when compared with other cloud accounting apps, like QuickBooks and Reckon One. For instance, the purchase orders feature is still hidden behind bills, when it could easily be access via a dropdown menu. But it’s not a major quibble.
Xero’s contact profile misses a beat
Although Xero allows you to assign customer numbers for your suppliers or customers in the contact profile, it doesn’t have the functionality to record customer numbers assigned by supplier or customer.
If you’re trying to get in touch with Telstra, for example, with whom you’ll have been assigned a customer or account number, you’ll have to dig around for the paper bill to find that customer or account number.
It’s easy to file bills, though
This feature is available in QuickBooks, and it’s also available in MYOB, but as is often the case with MYOB, it requires more steps to do what you can in Xero in just a few clicks. Rather than keep paper bills on hand, Xero allows you to attach them to you transactions, so you never have to go hunting around for a bill again (very useful given the contact profile issue mentioned above).
In MYOB, you must upload your bills to your in-tray, and then link them to your transactions. This is annoying, because it requires you to leave the transaction window and open the in-tray one.
Remember that when you select a cloud accounting package for your business, do not choose solely based on price. Make a list of the needs of your business and the functions you’ll require, and then select the accounting package that suits your needs the most. Ask your bookkeeper and other business friends for their recommendations as well.
Announcement: Microsoft Excel 2016 Beginners’ to Advanced courses now available!
At EzyLearn we include all versions of a software program in our training courses. That means when you enrol into Excel you get 2016 — AND — the older Excel courses which include version 2013, 2010, 2007 and even 2003 (if you really need it).
When you enrol in Lifetime Course Access you get access to ALL versions and ALL FUTURE VERSIONS as we continually update them — at no extra cost!
The power of using Excel and Xero combined
THERE ARE MANY UPSIDES to buying a commercial property for your business and if you’re able to buy an industrial unit like a Cubbyhole, it can also be a lot cheaper than renting premises.
If you’re in the financial position to buy your business premises outright, it may seem like a no-brainer to do this instead of getting a mortgage. However, there are some things you need to consider:
- You’ll lose liquidity on the assets in your property, which means you won’t be able to tap into any equity in the property, unless you take out an equity loan against the property.
- You’re tying all your cash to one asset class, which may limit your ability to make other investments and prevent your business from expanding. This could run counter to your reasons for making the property purchase in the first place.
Getting a mortgage
When you get a mortgage, you have the benefit of being able to access equity in the property, which will enable to invest elsewhere. Of course, there are still factors to keep in mind:
- You’re spreading the payments over many years, which ties you to paying down that asset for the foreseeable future.
- You’re paying interest, which although it’s a tax deduction, will significantly inflate the price of the property.
Work out the best way in Excel
Using the data from your Xero accounting software package, Microsoft Excel can help you determine whether your business will be financially better off buying its premises outright or getting a mortgage.
You can also create a financial forecast in Excel. Using Excel, you can calculate the depreciation amounts, which can then be entered into Xero. We cover how to deal with aspects like depreciation in our Xero Bank Reconciliation Course, because many businesses own, or will own, a capital asset at some point.
Check out our new Cash Flow Reporting, Budgets and ROI Course for Xero which shows you how to deal with an asset purchase like a business premises in Xero. Remember, you get access to ALL our Xero courses for ONE LOW COST. Visit our website for more information on our suite of online training courses or enrol today!
Importing from Xero to Excel and back again is included as part of our Advanced Microsoft Excel training courses — and you receive access to ALL OF OUR COURSES, including ALL skill levels for ONE LOW PRICE. You can even start your Excel journey with our FREE Beginners’ Excel Course Workbook. Read more about our beginners’, intermediate and advanced Excel training courses on our website, or enrol to start learning by 5pm tomorrow!
The pros of buying a business property
IN OUR NEW CASH FLOW reporting, Budgets and ROI course for Xero, we delve into the purchase of real estate for your business, which you may use as office space or as a warehouse or as a storage facility and workshop, depending on your line of work.
Why some businesses don’t like buying
Lots of businesses avoid buying premises for their businesses, because you’ll need to have a large capital injection right off the bat, and you may also incur land tax obligations, building insurance, and also be liable for maintenance and repairs.
Renting gives businesses, especially new ones, flexibility, as you’re only locked into a short term lease — not a multi decade mortgage. And if you decide to move or find new premises before your lease term is up, you can often minimise the costs by subletting the premises.
Buying as an investment strategy
However, buying your premises is a good investment strategy, as you’ll be able to access the equity and capital growth in the premises as property prices rise.
You’re also afforded greater freedoms and stability when you own your business’s premises — in particular, protections from rising rents — than you would have if you rented your premises. If you outgrow the space, you can always access the equity and may be able to buy adjacent premises, or rent out your existing ones while you upgrade, providing another valuable income stream.
Running the right reports to help you decide
Of course you can use a cloud accounting program like Xero to run reports that will help you decide whether to buy or rent your business premises and how such a decision will impact your cash flow. There will naturally be capital gains tax considerations and associated deductions. Our Xero training courses go through how to run these kinds of reports to ascertain the financial health of your business.
Low cost pathways to ownership
Industrial units are a good pathway into ownership for your business. If you don’t need to be right in the heart of the city or major town centre, you can often purchase an industrial unit for under $100,000.
In Newcastle in the Hunter region of New South Wales, you can purchase an industrial unit called a Cubbyhole, which can be used as a workshop, storage unit or office space for tradespeople, small and online businesses. These come with amenities such as toilets and showers, car parking (including visitors’ and disabled) and CCTV security, among other things and are worth checking out if you want to buy and only need a smaller business space.
In our Cash Flow Reporting, Budgets and ROI course for Xero, you’ll learn how to deal with the purchase of business premises just like a Cubbyhole in Xero. Visit our website for more information on our variety of online training courses or enrol today!
Our Xero online training courses include EVERYTHING for ONE LOW PRICE. Furthermore, if you select our Lifetime Membership option, you’ll have LIFETIME access to our ongoing course updates. All EzyLearn courses are accredited by the Institute of Certified Bookkeepers (ICB) and can be counted towards Continuing Professional Development (CPD) points. Find out more about our Xero online training courses.
Show me the money!
IN OUR BRAND NEW Cash Flow, Budgets and ROI Xero Training Course, you’ll learn how to generate a cash flow report for your business.
Cash flow reports show the money going in and out of the business, so they’re better indicators of a business’s overall financial health than a Profit and Loss statement (P&L).
A cash flow report enables you to make forecasts and budgets for your business based on previous trends — recurring expenses, average time to get paid, seasonal quiet periods, and so forth.
The 3 cash flow categories
Cash flow reports are typically broken up into three categories:
- Operating activities: cash flowing in and out of the business from revenue-generating activities
- Investing activities: cash flowing in and out of the business from the acquisition and sale of long-term assets
- Financing activities: cash flowing in and out of the business from borrowings and changes in equity.
Items in a cash flow report
In our Cash Flow, Budgets and ROI Xero Training Course, you’ll learn how to generate a cash flow report in Xero. That report will show every transaction that’s run in and out of your business, divided among one of the three categories.
In the operating activities category, you’ll typically find things like costs associated with any training courses or seminars, advertising and marketing expenses, income or commissions from your business, subscriptions to any magazines or periodicals, etc.
Under the investing activities category, you’ll find the cost of purchasing office or warehouse space and the capitalised borrowing cost, for example.
The financing activities category will show the loan you’ve taken out to purchase your business’s office or warehouse space.
You’ll learn how to generate and work with cash flow reports in our new Cash Flow Reporting, Budgets and ROI Training Course. ENROL now or read more about the benefits of cash flow reporting to your business. Are you a sole trader or contractor needing to record your ongoing expenses? We cover that too!
Our Xero online training courses include EVERYTHING for ONE LOW PRICE. Furthermore, if you select our Lifetime Membership option, you’ll have LIFETIME access to our ongoing course updates. All EzyLearn courses are accredited by the Institute of Certified Bookkeepers (ICB) and can be counted towards Continuing Professional Development (CPD) points. Find out more about our Xero online training courses. Or learn more about our entire suite of online software training packages and social media training packages.
Making bookkeeping easier, faster and more accurate
WE HAVE CREATED A brand new Cash Flow Reporting, Budgets and ROI Course for Xero and one of the things you’ll learn is how to import your bank statements into Xero.
The sales spiels of many of the notable online accounting software packages like QuickBooks, Wave Accounting, Outright, Kashoo, LessAccounting, Clearbooks and even Xero, claim that this feature will save you time and effort as it imports your bank transactions. The truth is, this is not foolproof and won’t work 100 percent of the time (even if it’s just a matter of not being able to get your software and your bank to “connect” just as your mobile phone connection inexplicably doesn’t work sometimes).
Therefore, always double check your bank transaction data has been imported accurately. This said, importing your bank statement into Xero (or whatever accounting software you use) is a really important step in the bookkeeping process that a lot of business owners forget or don’t know how to do. And the technology is only going to get better!
Using the correct format
To import your bank statement into Xero, you must ensure it’s in the correct format. Xero can only work with a CSV file of your bank statement. Depending on your bank, you might be able to download your bank statement as a CSV file from your internet banking, or you will have to create one from scratch.
Creating one from scratch isn’t too difficult. If your bank doesn’t give you the option of downloading a bank statement as a CSV file, you can create one yourself in Microsoft Excel.
You can download an Excel template from Xero. It includes the recommended fields and is already set up as a CSV file, so all you need to do is add in your data.
Set transaction rules
Once you’ve created and uploaded your bank statement to Xero, you’ll need to set up transaction rules for recurring expenses. You’ll learn how to do this in our Cash Flow Reporting, Budgets and ROI Xero Course.
Setting rules for recurring transactions helps speed up the reconciliation process, which depending on the type of business you operate and how often you reconcile your account, can be the most time-consuming part of the process.
Importing your bank statement and creating rules for transactions that occur each week, month fortnight, year, etc, greatly speeds up this process.
No CSV? Use bank feeds
If your business has lots of expenses every week, and your bank doesn’t let you download your bank statement in a CSV format, you may find that manually creating one in Excel each month is too time consuming.
Set up bank feeds instead. Bank feeds is the process of linking all of your business accounts, whether they’re credit cards or bank accounts, to your accounting software, so that each time you make an electronic purchase, it’s automatically imported into your accounting software.
This will allow you to reconcile your account each fortnight, week or more frequently, if you desire, than once a month when your bank statement comes in.
Bank feeds save your business time and money. Find out more about setting up automatic bank feeds in Xero and importing bank statements into Xero. You can also read more about our new Cash Flow Reporting, Budgets and ROI Course for Xero, visit our website or enrol today!
Learn Microsoft Excel from scratch or brush up your Excel skills, at your own pace, with our affordable Excel online training courses — where you get THE LOT (that’s 9 courses in total) for ONE LOW PRICE — everything included! Volume corporate discounts are available and our courses count towards CPD Points. NOW is the time to learn to use Excel, one of the most-used software applications in the world.
Business owners and job seekers take note!
MICROSOFT EXCEL IS THE most widely used spreadsheet application in modern computing. That said, it’s also one of the more difficult programs of the Microsoft Office Suite to learn, which is why we recently updated the content of our Excel training courses.
A lot of people do our Excel training courses to help them “skill up” to find a job, find a position better suited to them, or develop their career path. However, Excel is a fantastic tool for small business owners as well.
1. Vertical align: always centre
Always align the text in the cells of your Excel spreadsheet to the centre, or the top in certain circumstances. But never, ever align it to the bottom. It’s hard on the eyes and, when you’re looking at lots and lots of data in lots and lots of cells, it becomes difficult to know which row, column, etc, you’re looking in. Centre alignment, always.
2. Build error-checking into formulas
There should never be an instance where one of your workbooks is showing a #DIV/0, #N/A, #REF, #NAME?, #NUM!, or #NULL! error. This is especially true if you’re sharing these workbooks with your business partners or accountant or whomever.
Seeing an error in a financial report may cause the reader to doubt the accuracy of the entire workbook, so ensure your workbooks remain error free by using the simple IFERROR() error-checking function in Excel.
3. Print preview your work
Again, if you intend to share workbooks with other people, you should always ensure that your Excel workbooks can be printed nicely and easily, even if you don’t intend to ever print the document yourself. This is easy enough to do via File > Print Preview and adjusting the print margins before sharing (or printing) the document.
However, judging by the number of times I’ve printed an Excel document only to collect 87 sheets of paper off my printer to read the contents one 4×4 table, the function is seldom used by anyone else but me!
For more Excel formatting tips and tricks, download our FREE Beginners’ Guide to Excel, or enrol in our intermediate or advanced online Excel training courses to learn how to create databases, pivot tables, charts, graphs, and much more…
At EzyLearn, we’re committed to helping students of our MYOB, Xero and Quickbooks courses gain employment as a bookkeeper or even start their own bookkeeping business; it’s why we provide you with lifetime access to our online cloud-accounting training courses as part of our commitment to continuing professional development.