Getting Started with Xero

The Xero Setup Guide
When you’ve created your organisation in Xero you’ll automatically be taken through a series of steps to
set yourself up. This guide explains what’s required at each step and gives you a list of things you can
collect up before you start to save time once you get going. Print it out as a reference or use the Help
menu on each screen of the Setup process for detailed assistance.
The Setup process is relevant to all of you starting out with Xero and more so if you are converting from
an existing accounting system (even if it’s a spreadsheet) – we’ll help you understand which numbers to
input into Xero so that you can start up where you left off with your previous system.
While you can fly through the Setup process by just inputting the bare minimum so you can start
downloading your bank transactions or sending out invoices straight away, we suggest that you take
the time to complete these steps to save coming back to fix things later. Especially if you’re coming from
an existing accounting system your financial reports in Xero might not be right if you don’t carry across
the right data. If you are unsure about what data to put into Xero or where to get it from, please ask
your financial adviser. Regardless of how little or how much information you have on hand you need to
complete the Setup process before you can starting using your organisation in Xero.
Where do I start the Setup process?
When you add a new organisation in My Xero (using the Start trial now button for your first
organisation or the Add an organisation button for subsequent organisations) you'll be taken through
the Setup process as part of creating your organisation.

Australia | October 2009 | 1

Australia | October 2009 | 2 .If you stop the Setup process part way through. you can still get to all of this information from the Settings menu in Xero. If you complete the Setup process without fully completing some screens. anywhere from a few minutes upwards. It depends on how much data you want to bring into Xero. Can I stop part way through? As you move on to each step. You can change anything you’ve entered along the way – nothing will be saved into Xero until you’re at the last step and click Finish. what you’ve just completed will be saved and from any step you can exit the Setup process using the Save and Quit link. You must complete the Setup process before you can use Xero for your day to day transactions. Next time you log in to Xero you’ll be taken back to the same step to carry on. your new organisation will be listed in My Xero and you can click on the organisation name at any time to return to the step in the process that you were up to. how readily available it is and whether or not you need assistance – we’ll help you work this out during the set up phase. You can invite your accountant or financial adviser during the Setup process and they can see what you've entered or complete the process for you. How long does it take? Honestly.

quarterly. 4. Account Balances – the date you want to start using Xero and the balances from your previous accounting system if you have them 9. 6. Introduction – this guide as a PDF and a couple of video tours of the Setup process 2. all this information will have been used on your Activity Statement. you should organise these things now so that you’re not scrambling when you get to that step! If you don’t have this information ready now. 5. invoice address and invoice numbering sequence 5. you can just complete what you can of the Setup process and once in Xero. and which currencies you’d like 7.the date you want to start using Xero from for your day to day business. Activity Statement Settings for the organisation you are setting up (if it is registered for GST) – Tax File Number. and balances for the accounts you’ve been using up until this date. Accounting Method (invoice or payments). Fuel Tax Credits and Excise. A conversion date and account balances . A logo and contact details for your organisation to appear on outgoing (Accounts Receivable) invoices and credit notes. Done – commit it all and start using Xero A checklist of things you’ll need In order to fully complete each step of the Setup process. Australia | October 2009 | 3 . The email address of your financial adviser or someone that you want to invite during the Setup process if you need a hand. 2. Invite Users – allow your financial adviser to log in and help with the Setup process 6. Currencies – choose if you want to use this. The legal name and ABN (Australian Business Number) of the organisation to appear on financial reports. if you use them. Financial Settings – your organisation's year end and Activity Statement settings 4. Invoice Settings – your logo. Organisation Settings – your organisation name in Xero and on reports and address 3. 3. If you don’t have a financial adviser. or annually). If you’ve filed Activity Statements with the ATO before. The organisation’s financial year end – most organisations in Australia use 30 June but you will be able to provide something different if needed. check out the Business Support section of our website for a list of advisers who are trained and ready to help you use Xero. Chart of Accounts – use Xero’s default accounts or import your own 8. PAYG Income Tax Method and whether or not you claim Fringe Benefits. revisit the Setup screens from the Settings menu as necessary to complete or change it.The steps 1. Calculation and PAYG Withheld Period (whether you file monthly. Collect or decide on the following: 1.

We suggest: • The month your current GST period starts from if you are GST registered. you’ll need to enter these as historical transactions. • If you’ve been using another system for managing your accounts up until now. or to the beginning of the current GST period. make sure your bank allows you to import data back that far. you can match them back to these invoices. If you do start with Xero several months ago. • You can also choose the start of the following month as a conversion date if you want to get Xero set up prior to the month you want to start using it on a day to day basis. When choosing a month to start using Xero – take the following into consideration: • The date you start using Xero can be different to the start of your financial year. If cash or invoice payments have been processed through your bank account you can download these and reconcile them what you’ve entered into Xero – depending on how far back your Xero conversion date is.Tips for choosing a conversion date You’ll start using Xero on the 1st of a month – which month you choose will depend on how you’re currently managing your accounts and what data you want to bring across. Australia | October 2009 | 4 . If you have a current accounting system. If you do. or • The current month if you are not GST registered. The balances should be as at the last day of the month before the month you want to start using Xero. • The balance for each of the accounts you’re currently using is entered against each account in Xero during the Setup process meaning you don’t have to enter and reconcile of all your transactions back to the start of your financial year. • If you have recorded invoices or credit notes in your current accounting system that you haven’t yet paid or received payment for as at your Xero conversion date. each account (or category) you’ve been recording your accounts against will have a balance for your financial year to date. choose one that you are happy to obtain and enter past data for. • If you choose a conversion date that is part way through your current GST period you won’t be able to use Xero to generate an accurate Activity Statement for that period because Xero won’t have all the relevant transactions to calculate the GST from. it is likely your Trial Balance will show a balance for Accounts Receivable or Accounts Payable accounts and when Xero see this. you should be able to generate a Trial Balance which will show the balances of all your accounts. Whether you go back to the beginning of your financial year. we suggest you reconcile one month at a time to save having to deal with possible large lists of statement lines. Each invoice/credit notes is entered individually so that when you receive and process the payments once you’ve started using Xero. • Whether or not you’ve got account balances to bring into Xero you’ll need to enter all your existing invoices and transactions back as far as the date you’ve chosen to start using Xero once the Setup process is complete. it will prompt you to enter the invoices/credit notes that make up these balances. you’ll need account balances and unpaid invoices up until the day before your Xero conversion date. • Whichever month you choose.

The data and reports you’ll need for entering and checking so that Xero matches what you have recorded in your current system. If you have balances to enter into Xero it’s better than you get them right at the start. All the invoices and credit notes that are outstanding from your previous accounting system when you convert to Xero i. Rent. Trial Balance or Balance Sheet. unpresented cheques) . Legal Name & organisation’s address. and one that does. Stationery. How to complete each step Introduction Familiarise yourself with the Setup process by watching the Getting Started video tours (you can just watch them on screen within Xero. Xero has a default Chart of Accounts (list of coded account categories) which you can use or customise. Organisation Settings Enter your organisation’s name and address: 1. You can also import an existing Chart of Accounts from another Xero organisation. If you don’t have any reports. Reports (if you have them) detailing balances as at the day before your Xero conversion date so that you can just copy the balances into Xero e. Note – the brief points given for each step are intended to provide you with some pointers on how to complete each step for a typical organisation. You’ll need: a. Sales. 8.g. If you’re not sure how to work out your balances. Your Chart of Accounts or a list or an idea of categories you might want to organise your accounts by e.g. and the bank account balance you have recorded in your current accounting system. c. you don’t need to download anything). use the balance of any bank accounts or categories that you have.xero. you should ask your financial adviser for help.this is essentially the difference between your actual bank account balance. Australia | October 2009 | 5 . The videos show an example of setting up an organisation in Xero that doesn’t currently have an accounting system. the amount owing to you or you owe as at your conversion date. You’ll also need the total amount of any uncleared funds (e.7. These are the items that make up your Accounts Payable and Accounts Receivable balances.com) where you can get very specific information for each screen you’ll be using which you should use if you are unsure or have a specific scenario not covered in this quick guide. b. Each step refers you to the full online help in the Xero Help Centre (http://help.e. Make sure you have on hand the bank account or credit card numbers for any bank accounts you want to set up in Xero.g. You may or may not need them depending on how complex your current accounting system is.

A logo – you’ll need to provide an image file – just follow the instructions for uploading on the Invoice Settings screen. you can access this information again to edit or complete it from Settings > General Settings > Financial Settings. 4. Australian Business Number (ABN) 3. Choose a time zone (this is for ‘time stamping’ the audit trail of changes made to invoices and determines the date for running reports. View the Organisation Settings help. 5. In Xero. 4. Financial Settings Enter financial information used in the production of invoices and reports. Your organisation name and contact details (especially useful if you want to use a different address than your main company address for invoices/credit notes). In Xero. 2.2. 3. 3. you can access this information again to edit or complete it from Settings > General Settings > Organisation Settings. View the Financial Settings help. Activity Statement Settings/GST Information (you'll be prompted on this screen to confirm if you're registered for GST). you can access this information again to edit or complete it (even if you skip this step now) and access options to customise the format of your invoices as PDFs from Settings > General Settings > Invoice Settings. 5. 6. It’s easier for them to correct what you’ve done (if need be!) before you complete the Setup steps. 2. The remaining Setup steps require some accounting knowledge (depending on how you’re currently managing your accounts) so it’s a good idea to invite your financial adviser now if you need help. View the Invoice Settings help. In Xero. 4. especially tax settings if you need to record and file Activity Statements: 1. Payment terms (or other default text you want to appear on all your invoices). Australia | October 2009 | 6 . A starting point for your invoice/credit note numbering sequence if you don’t want to use the Xero default. Invoice Settings You can skip this step if you don’t send out invoices and credit notes otherwise enter the details you’d like to appear on the invoices and credit notes (that you send directly out of Xero) that your customers receive: 1. Change the financial year end if the default 30 June is not right for your organisation. Invite Users You can skip this step if you don’t want to invite anyone else to log in during the Setup process.

1. editing (codes or account names or both) or deleting accounts. 4. MYOB Premier 12. View the Invite Users help. An MYOB Chart of Accounts exported from MYOB as a text (. Your financial adviser or accountant remains your first point of contact for how you should actually ‘do’ the accounting for your business. If you import an MYOB file. 2. you will need to change to this plan now. 4. b. stick to the same account types. View Multi-currency settings help. you’ll need just their email address and name.1. 1. Xero’s default accounts as a CSV with changes you’ve made to it if you want to create your own – this is a good place to start if you are using another accounting system and you want to recreate its Chart of Accounts. Once you are on the Large plan you can add the currencies you require in your organisation. 3. you can invite your financial adviser (if you don’t invite them during the Setup process) and all the other people you want to access your accounts from Settings > General Settings > Users. Australia | October 2009 | 7 . 5. If you want to use Xero’s default Chart of Accounts take a quick look to make sure all the accounts you need are included You can make any changes necessary so it suits your organisation by adding. 2. As long as you use the Xero default accounts as a basis i. A Chart of Accounts that has been exported from another Xero organisation. You should choose the ‘Financial Adviser’ option when entering their details so that once the Setup process is complete they’ll have the necessary access rights to correct anything that might need further adjustment. Create a Chart of Accounts Use Xero’s default Chart of Accounts or import one of your own so that you have all the accounts that you’re used to using set up in Xero to record (or ‘code’) your transactions against. and system accounts you can essentially replace all of Xero’s accounts with your own. Note that MYOB has several GST account and these (and any balances) will automatically be merged into the one GST account that Xero uses. 3. you can choose to import the accounts with balances or without. You can choose the option to ‘Invite Xero Customer Care’ during the Setup process (or any time in Xero) if you’d like us to log in to your organisation to help with an aspect of the product you’re not sure of. c. For each person you invite. If you are setting up a trial organisation or have already chosen a pricing plan that is not the Large plan. Add multi-currency option If you do business in other countries and would like to have foreign currency bank accounts or issue foreign currency invoices you’ll need to choose the right pricing plan now. In Xero. There are a couple of options to import: a.e. 2. You can import a Chart of Accounts as a Comma Separated Values file (CSV). Multi-currency is only available on the Large pricing plan. MYOB Accounting Plus 18.TXT) file. Xero currently supports importing from MYOB Accounting 18.

Enter your Conversion Date & Account Balances Conversion Date: Enter the month you’ve chosen to start using Xero on a day to day basis. You can enter balances for previous financial years after completing the Setup wizard by entering Comparative Balances 1. leave the accounts balances as 0. Any reports you generate from Xero use the Chart of Accounts as a basis so if you want particular accounts to display in your reports. this is another reason you might want to review and set up the Chart of Accounts now. If you imported an MYOB file with balances. 6. View the Chart of Accounts help or help for Importing a Chart of Accounts. You’ll need to provide the bank account or credit card number. Use ‘Add new line’ to add each account from your Chart of Accounts and input the account and bank account balances (as debits or credits). 8. 4. you simply need to enter the balances you have from your existing accounting system into the Account Balances screen.00 and move to the final step. In Xero you do not need to journal entries to create opening balances. reconciled and as at the day before your conversion date. This will save you having to come back and do this when you’re asked for your account balances during the next step.3. you can make changes to the Chart of Accounts you’re choosing now (or import again) from Settings > Chart of Accounts. Account Balances: Enter the balances you have from your existing accounting system including your bank account balances. 5. If you don’t have any balances to enter. If you imported an MYOB file with accounts you’ll skip this step because you will have already provided a date. Depending on the Conversion Date chosen Xero will prompt you with the last day of the previous month as the date you should enter balances for. If you’re importing a Chart of Accounts we urge you to check and tidy your accounts in that system (because you’ll be more familiar with it than Xero) before exporting it for import into Xero (we’ll provide guidelines for doing this). 7. Typically you’ll be entering figures straight off your Trial Balance. all the accounts and balances will already be listed for you to review. In Xero. You should include at least one bank account in your Chart of Accounts (whether you add it to the Xero default Chart of Accounts or import it) although you can proceed without one. it’s important that you make sure you have got the appropriate accounts set up now. Australia | October 2009 | 8 . If you have balances or transactions that you want to bring into Xero from another accounting system. During the import you’ll be shown a summary of what Xero will import so you’ll have a chance to change your file and import it again if necessary.

8. Once the Setup process is complete. whether these are assets you held at the beginning of your financial year or in the time between the start of your financial year and conversion date to Xero (if you're not starting with Xero at the beginning of your financial year). 3. In Xero. these assets will be automatically entered into the fixed asset register when you enter historical invoices to match your Accounts Payable balance entered as long as you choose a fixed asset account when entering these invoices. If you have used more than one GST account in your current Chart of Accounts. or Import invoices help. 7. 4. If your debits and credits don’t match. 5. Xero only has one account for GST.e. If you have a lot of historical invoice data to enter. Accounts Receivable and Accounts Payable) – Xero will prompt you to enter the individual invoices/credit notes that make up these balances so that you can reconcile them later in Xero when you receive payment.00 and import your invoices once the Setup process is complete. 6. If you don’t have the invoices and credit notes to hand.00 and complete the Conversion Balances screen in Xero after the Setup process is complete. Once you receive these funds you can create the corresponding cash transaction(s) in Xero to match this balance. If you have invoices or credit notes for which payment has not yet passed through your bank account these will already be included in the balances you’re entering (i. If you want to use the multi-currency option in Xero and have outstanding invoices or a bank balance in other currencies you can enter these balances in their original currency. add these balances together and enter this as the starting balance into Xero’s account ‘GST’. the difference will be recorded as an ‘historical adjustment’ which your financial adviser can correct during the Setup process or later.e. Australia | October 2009 | 9 . enter these balances as at the day before your conversion date in the same way as for other balances you're bringing into Xero. fixed assets and depreciation can be entered into the Fixed Assets register in Xero. If you have fixed asset or accumulated depreciation balances to bring from a previous accounting system. you’ve recorded non-invoice transactions in your current accounting system but the money hasn’t passed through your bank account yet) add a ‘Current Asset’ account called Uncleared Funds and enter the balance against it. enter this and leave the ‘other side’ as an historical adjustment for your financial adviser to redistribute later. If all you have is a bank account balance. If you have a balance for uncleared funds (i. you can get to this information again to update your conversion date or account balances from Settings > General Settings > Conversion Balances. 9. If you have imported an MYOB file the GST accounts will have been merged automatically and the individual GST account balances already totalled and entered against the Xero GST account. 10.2. If you have unpaid invoices for fixed assets. Make sure you have the exchange rate at which these balances were arrived at on your conversion date as you’ll need to enter this when you enter your foreign currency balances. you can leave the balances as 0. you can choose to leave the invoice balances at 0. View the Conversion Date and Conversion Balances help (enter Conversion Balances for foreign currency accounts).

3. View the Add Accounts Receivable Invoice help. You can change the date as long as it remains before the conversion date. If you have a Trial Balance from your current accounting system it’s a good idea to go straight to Xero’s Report menu to generate a Trial Balance – Xero’s version should match the one you already have. These are the invoices/credit notes that are currently unpaid with an invoice/credit note date before your conversion date NOT those with a date after your conversion date which you’ll need to enter into Xero after you have completed the Setup process. Xero will create all the necessary journals behind the scenes and you’ll be ready to start using Xero. Enter the outstanding amount as at the date you are converting to Xero (this might not be the original invoice/credit note amount if the invoice/credit has already been partly paid). NOTE: your accounts are automatically ‘locked’ as at your conversion date so that your Setup data can’t be inadvertently changed. If you need to make any changes to the information you added during the Setup process you can access the same screens again from the Settings menu. If you entered a balance against Accounts Receivable and/or Accounts Payable. account(s) and tax rate(s) the same as when it was entered into your previous accounting system. If you do need to change it. you won’t be asked to enter outstanding invoices or credit notes and you can move onto the final step. In Xero you will only be prompted to edit these historical items if you make a change to your conversion date or balances. You can access your own user information to change your permissions to this if necessary. Done! Before you give your Setup information the big tick you have a chance to go back and review and change anything you’ve entered and it’s not too late to invite your financial adviser in to take a look at what you’ve done. Once in Xero you’ll see these invoices and credit notes listed on the ‘Awaiting Payment’ tab in Accounts Receivable or Accounts Payable where they can be processed when payments are received or made. Xero will default the invoice/credit note date to the day before the conversion date you've chosen and you should leave it at this. from Settings > General Settings > Users. 1. 5. Once you click Finish. Add Accounts Payable Invoice help or Add Accounts Payable Credit Notes help. you’ll be prompted to enter the individual invoices/credit notes that make up these balances. 2. 4. Keep the invoice/credit note number. Enter each invoice/credit note that makes up the Accounts Receivable or Accounts Payable account balance entered. Add Accounts Receivable Credit Notes help. Australia | October 2009 | 10 .Outstanding (historical) Invoices: If no balance was entered for the Accounts Receivable or Accounts Payable accounts. only a user that has ‘Financial Adviser’ permissions (access rights) can do this.

• Set up tracking categories (cost centres). How about: • Add invoices. • Set up repeating invoices for those invoices you regularly send or receive.com Australia | October 2009 | 11 .What next? Now you are ready to start using Xero on a regular basis to record and report on normal business transactions.xero. send us feedback. • In Xero. There is full online help and tips on each screen in Xero if you need them. If your conversion date is a while ago. Your ‘Dashboard’ is the first thing you’ll see and it includes an introductory tour of the dashboard and Xero features – view the Dashboard help. • Run reports over your data. It’s really up to you what you do next. we recommend you download your transactions month by month so they’re easier to keep track of. • Create a budget. Help • At any time on any screen in Xero you can get help for that screen from the Help menu. ask a question or tell us about any issues from the Help menu using the ‘Contact Support’ option or email us at any time on support@xero. • Import Contacts or add to Contacts the people you regularly transact with. • All the screen help and more is also available on its own searchable website http://help.com – you don’t even need to be logged into Xero to have access to this. • Create a Price List of things you regularly invoice your customers for. • Use My Xero to change your password. • Set up your bank accounts (if you haven’t already). • Import your online bank statements from the date you started using Xero and reconcile them to transactions already created or create them as you go. transactions and expense claims. add another organisation or manage your billing plans.