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Receipt Bank Archives - The Latest on Accounting Tech for SMEs

Xero Launches Modular Practice Concept with Xero HQ

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Xero’s extensive app marketplace for small businesses now has a mirror – a curated selection of back-office apps to run accounting firms.

The back-office apps connect to Xero HQ, an interface used by accountants and bookkeepers to manage their Xero client files. Xero HQ was announced at Xerocon 2016 to replace “Green Xero”, an older interface that was based on a simple client list.   

The launch at Xerocon this week added the ability for apps to sync data with Xero HQ such as the client list, and client name and email address details from Xero files. The apps will also send notifications to an activity feed in Xero HQ. Individual accountants can customise their feed to show alerts from certain apps as required.

When a user clicks on an alert it will open the relevant app and client file.

Xero describes Xero HQ as “a multi-vendor platform for accountants and bookkeepers to run their entire back office”. The modular approach directly challenges the existing server-based practice management suites used by most conventional accounting firms.

The first nine app partners launched on Xero HQ include, by category:

Data collection

Onboarding

Reporting

  • Fathom to efficiently create forecasting reports
  • FUTRLI, to provide future insights for a business
  • Spotlight Reporting, shows how clients are performing in a single view

Compliance

  • Now Infinity to make corporate and trust compliance woes a thing of the past

File management

  • Suite Files to bring all client data and files into one place

Marketing

  • Boma for self-drive marketing

Xero will add more apps to Xero HQ over time. However, Xero will take a much more active role in “picking winners” by tightly vetting all new apps and limiting the number in each category.

 

Stay Alert

The most interesting part of the Xero HQ apps marketplace is the power of notifications. Xero already was already sending notifications to the activity feed for tasks in Xero files such as making payroll or filing a BAS report.

The expanded list of notifications turns Xero HQ into a control board for upcoming activities or important events. The quality of the notifications varies by app; some look genuinely useful while others could be more noise than signal.

The app notifications can be customised by user or switched off entirely to avoid a deluge of alerts.

Here’s an overview of the notifications by app, according to each software company.

Futrli

Futrli already has a sophisticated notifications engine for customisable events in a Xero user’s chart of accounts. An accountant can select minimum and maximum thresholds for KPIs in Futrli. For example, if the percentage of Gross Profit has dropped or is forecast to drop below a certain amount it will trigger an alert.  

Futrli will also send alerts based on three-way scenarios. Futrli could generate an alert in a best-case scenario if the Bank Accounts total is forecast to drop below $10,000 in the next quarter.

These alerts, which are usually sent by email to the whole team or individuals, can be sent to Xero HQ.

Here’s a help guide on how to create predictive alerts in Futrli.

 

Fathom

Fathom sends an alert to Xero HQ:

  1. When an advisor shares a report with a client. Anyone in the advisory team can click on the alert to view the report in Fathom.
  2. When Fathom automatically creates a scheduled report from a template. Anyone in the advisory team can click on the alert to view the report in Fathom.
  3. When a client comments on a report in Fathom. The advisor can click on the alert to view the comment in Fathom and respond.

Fathom has made a 1-minute video showing how the alerts work.

 

Spotlight Reporting

Spotlight Reporting sends an alert to Xero HQ:

  1. When an advisor hasn’t imported data for a scheduled report.
  2. To remind an advisor to work on an overdue report.
  3. To remind an advisor to finish preparing a previously started report.
  4. When Spotlight Reporting releases a new industry-specific report template.

Clicking on each alert shows the respective report. Spotlight Reporting has written a blog post and shot a 1-minute video showing how the alerts work.

 

Practice Ignition

Practice Ignition sends an alert to Xero HQ:

  1. When a proposal has been accepted. Click on the alert to view the proposal.
  2. When a client adds a comment to a proposal. Click on the alert to view the proposal.
  3. When a payment collection fails. Click on the alert to re-schedule the payment.
  4. When a credit card is due to expire. Click on the alert to update the client’s credit card details.

Practice Ignition has written a blog post showing how the alerts work.

 

SuiteFiles

SuiteFiles sends an alert to Xero HQ:

  1. When a document in SuiteFiles is shared with a colleague for approval. Click on the alert to view the document in SuiteFiles.
  2. When a document is approved. Xero HQ sends the alert to the document’s originator.
  3. When a client signs a document.
  4. If a document has not been signed after seven days.

SuiteFiles has a deep integration with Xero HQ which allows it to perform several useful actions.

  1. When a user creates a new client in Xero HQ it will automatically create a new client folder in SuiteFiles from a template (with subfolders, if desired).
  2. A user can click on a link in a SuiteFiles client folder to open that client’s details in Xero HQ.
  3. A user can set up templates in SuiteFiles with “merge” fields that pull data from Xero HQ to pre-populate Microsoft Office and email templates.

 

Receipt Bank

Receipt Bank has notifications for users of its standard app and more notifications for its Practice Platform interface.

The standard Receipt Bank app sends an alert to Xero HQ:

  1. When a specific item submitted to Receipt Bank is older than a predefined time period (e.g. a three-month-old invoice or if it is older than the Xero lock date). The user can click on the alert to view the respective item. The “client delay” alert is sent to all Receipt Bank users.
  2. When the number of items waiting in a specific client’s inbox hits 100 items. The user can click on the notification to view the client’s “ready to export” inbox. The “inbox milestone reached” alert is sent to all users.

The Practice Platform interface in Receipt Bank sends an alert to Xero HQ:

  1. When a client’s account has not been worked on for a set period of time (e.g. three months).
  2. When a client responds to a message about an item. Clicking the link shows the messages tab in Receipt Bank for that item.
  3. To show the number of items which have matches with unreconciled bank statements. Clicking the link takes the user to the client’s inbox.
  4. When the outstanding workload reaches a specific threshold (e.g. 10 hours). The alert repeats daily.

 

HubDoc

HubDoc sends an alert to Xero HQ:

  1. When a document has been processed (i.e. the data has been extracted) and it is ready to be published or archived.
  2. When HubDoc has failed to process a document.
  3. When a processed document has been waiting for a set period of time (eg. two weeks). This is customisable for individual clients or for all clients.

HubDoc has explained how the notifications work in a blog post, help desk article, and an information page for Xero HQ which includes a video on the integration at the bottom of the page.

 

NowInfinity

NowInfinity sends an alert to Xero HQ:

  1. When a user adds a new entity to Xero HQ and needs to be added under the ASIC record.
  2. When a user adds a new entity to the ASIC record and it needs to be added to Xero HQ.
  3. When the address for an entity is different in Xero HQ and NowInfinity.
  4. When the name of an entity is different in Xero HQ and NowInfinity but has matching ACN or ABN.
  5. When data is missing from the ASIC register such as a date of birth.
  6. When an individual has a different name in Xero HQ and NowInfinity.
  7. When a lodgement deadline is approaching.
  8. When a document has been signed.
  9. When a payment deadline is approaching (for annual statements).
  10. When an Annual Statement has been received and needs to be sent to the client.

 

BOMA

The BOMA Marketing has only recently hit the market and it hasn’t built any activity feed alerts for Xero HQ yet. It plans to do so in the next month or so.

Five steps to automating an accounting business

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I recently saw an article on how to create a “perfect firm” if you were setting it up from scratch. It had some good points in it but other than using the term “cloud accounting” it looked awfully like something out of the 1980’s. For all the staff and overheads it espoused a perfect firm should have, there was no mention of technology anywhere in the article.

For me the perfect firm is now technology based. Yep, cloud accounting is at the core of this. But creating a perfect firm means automating as many functions as possible. This reduces the amount of time spent on admin tasks and increases the hours available for working with clients.

Automating may not necessarily mean a fully automated process. It also includes semi-automating tasks which still provides savings in the labour component of the process.

When setting up Zerobooks.com our goal was to make the business global and scalable. We couldn’t do this if we had to respond manually to every query. Hence we have two developers on our team who work to improve the efficiencies within our processes. This makes life easier for both ourselves and our accounting partners globally.

 

How to start automating accounting

So where do you start if you want to truly automate your firm? A lot of firms think that by moving to a cloud solution and adding in a couple of add-ons they are “in the cloud”. That’s fine for the accounting functions but business is way more than that. There’s not much point investing in the front end if you then have manual processes in the back end chewing up your valuable time.

The one thing you can’t automate is the client relationship. Our industry is based on trust and the personal relationship is how our clients measure and value us. Anything that doesn’t come into the trust equation is open to automation. If we can free up time that is not valued by the client then we have more time to do the things they do value!

Here are some of my thoughts on setting up an automated practice from scratch.

The first step is obviously the client accounting function. Most firms have already adopted cloud accounting software with several options available. For me it’s Xero all the way. These guys are the leaders in cloud accounting in my opinion. Their practice-based solutions and tax offerings are the leaders in the Australian market.

The big advantage of Xero is that here are heaps of addons to help customise a solution, not only for an accounting practice but also for clients.  It also has a very open set of APIs which means that we can also design our own programs to grab data from or send data to Xero. That is how we reduce time-consuming, non-value adding tasks such as data entry and extraction.

Straight off the bat, add-ons such as Receipt Bank and Chaser are no-brainers. Receipt Bank offers the ability to semi-automate your accounts payable and reduce the number of hours spent entering supplier invoices.

Chaser automates the follow up of outstanding debtors. While Xero now offers the debtor reminders, Chaser offers a much higher level of flexibility for those clients or businesses where debtors and cashflow are major considerations in running their business.

Both the processes and tasks these addons eliminate are not part of the value-add or trust relationship and so can be automated.

 

Automating job management

There are several options when it comes to managing your jobs. We use Xero Practice Manager. Our developers have automated a number of other functions such as:

  • Automatically creating and emailing usernames and passwords for any clients that request  login details
  • Identifying if we have all details for a client recorded the first time they accept a job online. If they don’t, a pop-up window asks the client to enter data directly into Xero Practice Manager
  • Identifying if we have a client’s credit card details. If not, an automatically generated email with a secure link is sent to the client with a request for the details

The client is going to have to give you this information anyway (usually via email). Why not get them to enter it directly into your practice management system and save the time of you re-entering it?

Preparing proposals and onboarding clients is a huge time user, especially if you are a fast growing firm. There are some off-the-shelf add-ons such as Practice Ignition which are great for a quick set-up and go for the majority of firms.

But sometimes there are needs that add-ons can’t deliver everything you need or are still in development.

We wanted a number of features that were unavailable so we developed our own package. The goal was to eliminate time in preparing proposals. We wanted to grow fast and to service accounting partners globally without having a 24-hour help desk.

We have automated our proposals so that any of our accounting partners can create and accept a fixed fee proposal online without any input from our team. From our partners’ perspective they get an answer immediately without waiting for us to get out of bed. And we are servicing the clients in the minimal time.

Another advantage is that if the proposal is not accepted we haven’t wasted valuable time preparing it.

In summary the starting points to automate your business would be:

  1. Choose a cloud-based accounting platform to start working on a single ledger and automatically enter data entered from bank feeds
  2. Automate non-value adding tasks such as data entry of suppliers’ invoices and debtor follow up by using add-ons such as Receipt Bank and Chaser
  3. Look at ways to automate other data entry tasks such as client details by integrating web sites with Xero Practice Manager or your practice management solution
  4. Automate (or at least semi-automate) preparation of proposals for new clients and reissue letters of engagement each year with Practice Ignition or a similar app
  5. And if you can’t find an add-on to suit your needs then look at developing a customised solution. That will free up non-value adding time for more activities focused on the client relationship

From there you are on your way to what I would call a perfect practice. Just remember that these are only the first steps to developing an automated accounting business.

Automating bookkeeping with Receipt Bank’s Practice Platform: Q&A

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Bookkeeping is swinging from a community of sole traders serving a handful of SMEs each to highly organised bookkeeping businesses with hundreds of clients.

For both groups, it’s clear that cloud accounting and online automation are critical to providing accurate bookkeeping at scale and at a reasonable price.

Everyone in the industry knows Receipt Bank, a bookkeeping tool which automatically adds supplier invoices and receipts to cloud accounting programs. The company launched a dashboard for bookkeeping businesses last year called Practice Platform.

The dashboard tracks metrics for a team of bookkeepers. It shows how many unreconciled transactions are sitting in a client file, the length of time since the last reconciliation, and the percentage of transactions that have been automated.

It also includes stats on the clients. For example, it shows the average time elapsed between the creation of a receipt and when it was entered in Receipt Bank. Clients who take too long to enter their receipts may need a little help with their processes. (Upsell to training on accounts payable management?)

I was curious about how well this dashboard worked for a bookkeeping business. So I met up with Tim Hoopmann, CEO of Cornerstone Bookkeeping , a Gold Xero partner and QuickBooks Online bookkeeping company.

 

Sholto: What’s been the impact of Practice Platform in your business?

Tim: We got involved right at the beginning of its launch. Like any other dashboard it pulled all of our clients’ information into one environment, and gave complete visibility and accountability back to the team.

 

Sholto: How often do you use it?

Tim: I use it on a regular basis. In five minutes I can see the status for all the clients’ receipt processing and Xero bank education. It allows me to sit in the staff meeting quite well educated. I know the status of each job and whether we are waiting on clients to provide information or my team to complete processing. It helps you predict issues before they happen.

 

Sholto: How does it help?

Tim: We can’t really do anything in our business when it comes to BAS, compliance reporting and financial reporting without having all the information in the system and reconciled. We can predict that we’re not going to hit a BAS deadline if there are 350 unreconciled lines.

I can see that staff will be complaining because they are behind and will need to scramble to get things done.

 

Sholto: What do the staff think of it?

Tim: There are tools that make lots of things visible to the business owner. Some people love that, some people are afraid of it.

I couldn’t understand years ago why one employee acted and behaved like he did. He didn’t really like Xero – he said, “It makes me too visible.” With desktop software there is no visibility, you could catch up when clients asked for it.

 

Sholto: How do you use Practice Platform?

Tim: The way I look at it is different to my team. How are we tracking with reconciliation? Do we have the bills and receipts that we need? How is the client using it? You can compare them. If there are unreconciled lines in Xero then assume that 50 percent are expenses, so there should be roughly that number in Receipt Bank. Others would be sales invoices and transactions from bank feeds.

 

Sholto: And if there aren’t 50 percent of those bills and receipts in Receipt Bank?

Tim: If they’re not in Receipt Bank then the client hasn’t done what they’re meant to do. We have expectations that the client needs to meet for us to do our work. The customer service team has the responsibility for obtaining the information from the client. It then becomes an education process as well. We talk about the benefits and time saving for all parties including the clients.

 

Sholto: How frequently do you have to contact them?

Tim: We would give them a week and after that we would contact them and say we haven’t reconciled. We reconcile fortnightly for the bulk of our clients. But we still want the documents daily. Receipt Bank is compulsory.

 

Sholto: Why do you make it compulsory?

Tim: There are several reasons for making Receipt Bank compulsory. One is that we talk about using a filing cabinet. We move them from document storage on a server to an online filing system that’s easily searchable.

Another is to save time and hassle. If they can remove paper from their business they will save lots of time and lots of headaches. How many times have any of us searched for copies of bills or documents?

Finally by provided the bills and receipts they reduce the number of queries and questions back from the bookkeepers. Less interruptions and more time for focus on real business matters like sales.

We have to sell the benefit for them not just us. If they don’t like answering queries and use Receipt Bank efficiently we will waste less of their time and ultimately their bookkeeping will be cheaper.

 

Sholto: How do you get clients to commit?

Tim: We’re really clear upfront when we have our initial discussion. We quote what we’re going to do for them and when and what they need to do in return. If you provide a “what’s in it for me” that has a time and cost benefit you will often get them on board.

Once they have committed there are many ways to see the real benefits of going paperless. For example, they can contact all their suppliers including any who invoices are only available online, like Telstra, and have all bills sent direct to Receipt Bank. This cuts out double handling and is a real time saver.

There’s a cost and time benefit for you and your team. Some people take to it really quickly, from day one. Some have to be taken on more of a journey.

 

Sholto: How do you take people on that journey? Do you have to create training for your clients?

Tim: Receipt Bank has standard training documents we can send to clients showing how to use the system.

 

Sholto: What about emailed receipts? We’re seeing a lot of them now.

Tim: Emailed receipts are great. Its about immediate forward to receipt bank and problem solved. Even better is to go online and have the receipt directly sent to receipt bank. Sometimes you can also cc yourself. Uber, Paypal and even some hotels offer electronic receipts that you can set up to go directly to receipt bank. It’s bypassing the need to touch any of that paper.

 

Sholto: How many of your clients’ receipts are automatically entered in Xero?

Tim: In the Practice Platform dashboard there’s the “no-hands” column. It shows how much is automated. It is 60% to 70% on most of our clients – that equates to the percentage of receipts or invoices that are not touched in Receipt Bank. We have rules set up for the supplier so it goes straight through Receipt Bank and is posted in Xero. For example, Telstra always goes to telephone expenses and is always paid from the same bank account. We know that the information has been entered correctly and is sitting in Xero.

 

Sholto: Why create automation rules in Receipt Bank rather than Xero?

Tim: To automate any documents coming into Receipt Bank. If you don’t make the information correct in Receipt Bank then you will need to fix it in Xero.

We have small accounts where a lot of stuff is coded in Xero.

But there’s a limit to how much you can automate. If you automate 100% you will lose accuracy. My main example is Coles. Coles could be Coles Express (petrol) or Coles supermarket (office supplies).

 

Sholto: So if not 100 percent, what is your target for automating bank rec?

Tim: We have a target for 80 percent auto-syncing in Receipt Bank to Xero. if you set a target you can generally get there and it’s good for improvement in the business. One of the things we do really well is test the technology and see how far it can go and deliver a return to the customer.

Receipt Bank Launches Bookkeeping App for Apple Watch

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Receipt processing app Receipt Bank is the first out of the gate to launch a wearable app for the recently launched Apple Watch.

The watch app is an extension of the company’s new bookkeeping dashboard, Practice Platform. A manager in an accounting or bookkeeping firm can view real-time metrics on the watch for their bookkeeping team. These include an estimate of the number of hours of work to be completed, the number of outstanding items (receipts) to be checked and the number of unreconciled items across all the firms’ clients.

Users can view one level of detail on outstanding items to see how many are waiting, how many are not ready for export to the clients’ accounting program, and how many items are in processing.

Receipt Bank recently released the Practice Platform dashboard to help bookkeeping teams quantify their outstanding workload and prioritise tasks by urgency.

“Technology is constantly shaping how we do business and accounting is no exception. Wearable tech adds a new dimension – literally giving hands-on access to the key metrics of running a bookkeeping or accounting practice,” said Michael Wood, Receipt Bank’s co-founder, in a press release.

A close-up of the app is below. Click to enlarge.

Practice_Platform_Receipt_Bank_Apple_Watch

3 Easy Ways to Get Expense Data Into Xero

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One of the most excruciating pain points for small businesses is dealing with the vast amount of receipts and supplier invoices.  Jokes abound that some owners would prefer to go through a root canal procedure than focus on this area of their business.

We all know it’s vital that expenses are recorded in your accounting system completely, accurately and authorised appropriately given the delegations in your business.  But hey, you just moved to Xero and you’re supposed to be living in the cloud, right?

You need to be able to see supporting documentation for all your transactions in one place – captured online, protected from physical deterioration, and easy to find.

So how do you do this in the most efficient and practical way relevant to the size of your business?  There are a few ways to achieve data entry of expenses with supporting documentation that are easily viewable in Xero.  The method you choose will depend on your expense volume.

 

1. Create Xero ledger transactions and attach documentation

If the volume of expenses in your business is relatively low (there’s no clear cut answer here  – it’s down to personal preference and how you value your time – but let’s just say less than ten to fifteen items a month), you may find the easiest solution is to attach supporting documentation yourself.  This can be done on-the-fly as you reconcile the bank account or create a new bill.   You can also attach documents to transactions at a later date.  For bills that have already been paid and reconciled there’s no need to ‘remove and redo’ the payment to attach documentation.

Needless to say, it’s a pre-requisite to have an image of the supporting document captured and stored in electronic form.   Xero makes the document selection easy by allowing you to choose documents from your own file management system, or, their own Xero Files.

 

2. Xero Network Key

Each Xero organisation has a unique and private key – an alpha numeric identifier of thirty characters called a Xero Network Key.  Sharing this key with suppliers who also use Xero enables them to send invoice data to you that arrives almost instantaneously in a draft bill in Xero.  Whilst we think this is rather a neat feature, there are a couple things to keep in mind:

  • An email will also arrive from your supplier which may or may not include a PDF attachment of the supplier’s invoice.   You’ll need to be careful not to create another new bill.   Not all suppliers will remind you in their email that they’ve already sent the invoice to you via the Xero Network Key!
  • The supplier’s invoice does not get attached to your bill data in Xero.  We’d argue that the time spent attaching a document to a Xero bill takes longer than entering the bill data itself.  Whilst there have been recent rumblings on the Xero community forum requesting this capability, it’s not in Xero’s immediate plan to address this.

Alternatively, you can click on the Xero link in the email from the supplier which opens up your bill data online.  Click on the save button and add to your Xero organisation – all bill data loads to a draft bill with the the supplier’s invoice attached as a pdf. Nice and quick.

 

3. Using an expense management add-on

It won’t be long before you’ll need to consider faster ways of achieving data entry in Xero, particularly for new bills – not all bills will come from suppliers using Xero!  For many businesses, an expense management software is often one of the first add-on software they integrate to help them gain operational efficiency.

There are currently sixteen expense management software programs in Xero’s add-on marketplace.  Not surprisingly they all vary in the functionality they offer with different pricing brackets.   Quite frankly, it’s hard to look past Receipt Bank, Xero’s most popular add-on and a recipient of multiple Xero awards. Receipts and invoices can be submitted by post, email and mobile app.   Submitting data electronically will give you the ability to reconcile on a more timely basis, which helps you reduce the risk of fraud and get a clearer picture of performance.

Receipt Bank will convert the information in receipts and supplier invoices into data using a combination of Optical Character Recognition (OCR) and human verification.  During 2014, they made process improvements including line item extraction for booking against different accounts in the ledger.  In 2015, we are expecting to see the release of functionality allowing businesses to view multiple accounts under the one umbrella, similar to the accountant partner version.  This will assist businesses with multiple legal entities.

receipts-into-xero with Receipt Bank
receipts-into-xero with Receipt Bank

Receipt Bank exports an image of the actual document to Xero and attaches it to the transaction.  Not all expense management software does this – some just give a hyperlink back to the image on their servers.  Call us paranoid, but we feel a little more comfortable knowing documentation is stored online in two places.  And while we are on the topic of feeling comfortable, Receipt Bank does a match on date, total amount, supplier and invoice number (if applicable) to merge any duplicate documents erroneously submitted.  Nice.

Items are published (exported) to Xero when the user decides or they can be set to automatically export. The transaction type (ledger entry) in Xero depends on your business document type and your settings in Receipt Bank.  Once an item is exported to Xero, all you have to do is match it to the bank statement line in the Xero bank reconciliation.  Magic!  Employee expense claims can be submitted to Receipt Bank, but it’s also possible to give employees limited access to Xero to do this.  So just to recap on the benefit, it can take you ten seconds to submit items on the Receipt Bank app (snap a picture of bill and submit for processing), and, three seconds in Xero to match the item to the bank statement line.  Data entry complete and supporting document is attached.  Job done.

 

Managing your expenses documentation effectively will help you save both time and money.

If you are a growing business and don’t get this sorted, you’ll end up spending more money on a bookkeeper to enter data manually, which is easily avoided.  So, if you’re starting the New Year with the goal to be more organised, then Xero and add-ons such as Receipt Bank may be the tool combination for you.

About D1

Digital First covers news and opinions on accounting technology and is read by tech-savvy accountants who understand the importance of technology in establishing competitive advantage.
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