Online accounting is essential to success for today’s businesses. This is the firmly held belief of Sydney-based chartered accountant Amanda Fisher who has written a book called Connected Technology: How to Transform Your Business with Online Accounting.
Fisher runs an accounting firm in Chatswood, Sydney which started using online accounting program Xero two years ago and is now a Xero Gold partner. The firm’s three accountants and one bookkeeper look after 150 clients and are just moving the last of them to Xero from desktop accounting programs. BoxFreeIT asked Fisher why cloud accounting was so important.
BoxFreeIT: Why is online accounting essential to success in business?
Fisher: When our clients switch to online accounting software they are getting more clarity over their figures. They’re finding their figures are easier to keep up to date and as a result they are making better business decisions.
It’s just a lot more user friendly than the old desktop software. For 20 to 25 years we’ve been working very happily with desktop software but for most business owners it’s the drudgery, the last minute exercise before BAS forms are due.
BoxFreeIT: Which figures are the most difficult to bring clariy to?
Fisher: They are able to pull down the profit and loss (report) very easily and see how they’re doing. Putting up key numbers on the dashboard such as sales revenue really makes a difference.
Maybe that’s something that could have been done with the old systems but it just never was. It’s easier because we can have a five minute phone conversation and we are both looking at exactly the same figures.
BoxFreeIT: But doesn’t desktop accounting software fill the same function?
Fisher: Somehow desktop software doesn’t; you need to be an accountant to understand it. Owners didn’t see it as a tool for helping them in the business.
Whereas cloud systems use bank data feeds to keep yourself up to date it’s not as time consuming. Also cloud software has a dashboard. It is staring you in the face how much money is in the bank, how much is due in and how much is due out.
As a result owners are asking more and better questions. Now they can really hone in on those KPIs. Some of my clients have just been growing exponentially since we moved across (to Xero) whereas before they just kept on doing what they were doing.
BoxFreeIT: What types of businesses are “growing exponentially”?
Fisher: One of my clients is in web design and graphic design. His turnover has grown by 40 percent in the last couple of years each year and he’s putting a lot of that down to seeing the figures and keeping him focused.
Another client is the owner of a gym. He’s looking at weekly reports to look at how many gym sessions they’re doing, how much revenue, how much is in the bank account for buying new equipment or to do more marketing, and reviewing whether the managers are hitting their targets.
BoxFreeIT: What’s the response from clients been like towards online accounting?
Fisher: It’s just fantastic technology that provides so many benefits to business owners. So many of them using desktop software are doing it late at night or last minute and they go through that stress and strain and are hating the accounting process.
But now our clients are saying to us this is actually fun. That puts a completely different spin on the clients and us because they’re keen to learn, they want to know more and they’re asking the right questions about what to do with their business. They’re not just telling us to do the tax return and not ask questions on the way.
They’re asking us questions on a daily basis and that’s the bit that we really enjoy.
BoxFreeIT: How has your firm changed since moving to online accounting?
Fisher: We’ve completely turned our business offering around. Two years ago we were principally a compliance firm with not a lot extra. We’ve always done pre-June tax planning strategy sessions for estimating the tax, making appropriate recommendations and making sure those things are in place before the end of financial year.
Now our core offering is monthly management reports, meeting quarterly or sometimes monthly to go through those figures. It’s allowing us to provide our general business knowledge to know our KPIs, do our projections, make sure we’re holding our clients accountable to where we’re going.
BoxFreeIT: How has your tax work changed?
Fisher: We can do BAS files much more efficiently in the past. We don’t have to wait for an MYOB file to come in. And we also keep an eye on what they’re doing and how they’re doing. If the figures are looking good or bad we’ll give them a call. It allows us to be much closer to our clients.
I’ve always loved what I do but it’s given me a new lease on life in business because there’s so much we can do with it.
Our revenue is up 34 percent from last year. the year before we were up 25 percent.
BoxFreeIT: Why are you 100% Xero? Aren’t there cases where a different accounting system might be more appropriate?
Fisher: If you ask me at any point in time I’ll say I’m a Xero girl through and through. But I think business owners need to be given choices and there are cases when the right answer might not be Xero. For my client base yes it is (Xero) but other types of business might find another system might be better for them.
BoxFreeIT: What are the top time-saving devices?
Fisher: The obvious one is the bank feeds which is a massive time saver. Payroll is much quicker. Once you have the system set up it’s just easier to do. If you’re invoicing the same things over and over it just seems easier.
What I love about Xero is all these other ad-ons you can add in there. We are also recommending Invitbox which helps process through the payables. We’re finding that’s a big time saver, not entering all those invoices manually.
We are using XO Cashflow to remind people to pay their bills.
Image credit: Amanda Fisher