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Investmentsworking.co.uk has the sole purpose of helping people understand how their investments are performing. No investment, can be successful if that data is not managed properly. Xero is one of the many tools available that can help you achieve the goal of data management of your financial records. We hope this article helps you better understand how Bank Accounts work in Xero and how you can use its many features to your advantage.
Xero Accounting Software enables you to monitor your bank accounts and their activities all in one place. If you wish to see the transactions every day, add the bank account to your dashboard. Being able to manage and look at multiple accounts on one screen is very efficient. Putting your details anywhere requires a lot of attention. As there is room for error and mistakes can lead to bigger problems in financial matters. However, Xero is one tool that can help you a lot with saving time and effort. By doing so, you can send money, receive money, get a bank statement, reconcile your transactions and much more. You can manage your business as well as savings accounts.
With the help of this tool you can generate detailed, well structured reports. You can also maintain a list of accounts as well as bank accounts. So let’s take a look at how you can add any bank account in Xero. We will also talk about all the amazing functions you can perform through this tool.
Add Bank Account in Xero
To be able to monitor your bank accounts on the Xero dashboard, first, you have to set up an account here. For this, go to the menu bar on top of your screen and click on ‘Accounting’. Then click on ‘Bank Accounts.
After clicking here, you will land on the main page of Bank accounts where you can multiple possible features available. The page looks like the figure given below;
You can see multiple functions that can be performed here in order to get a snapshot of what is actually happening. You can see the current balance of your account and even a bank statement showing transactions. The user who has multiple bank accounts can take advantage of this tool as you can keep track at one place.
Find Bank Account
After you land on this page, click on the ‘add bank account‘ writer on top of the page. Once you click here, you will be directed to the next screen asking for your bank name.
Search for your bank name by writing in this search bar. Multiple options as bank names will open down in the menu from where you can select. The best part about adding a bank here in Xero is that it will get sync to your account. Hence, all the transactions will automatically update here and so will the bank balance and statement. If you are unable to find your bank here then click on ‘add anyway’ to enter the bank information. Remember that in this case, the transactions won’t be updated here automatically. The search bar would look like this;
Add Bank Information
After you are done entering the name of your bank you will be directed to the next screen asking for the account name and account type. In account type you will get an option of choosing from every day, load, saving, credit card and others. If you select every day, loan or other, the software will ask you to enter account number and currency. While, if you select a credit card then you need to enter your card number, secret code and currency. After adding the required details, click on ‘continue’ to save and move to the next step. The screen will be showing like this;
After saving the information, you will be taken back to the main screen of bank accounts. Here, you will see that the latest added bank details are now added at the bottom of the page. You can change the order of your bank accounts if there are more than one by selecting ‘ change order’.
So, that’s how you add your bank account to Xero accounting software, Simple right?
The next thing to be noted is that you would want the software to pick up your bank picture from you actually left. In other words, the old data of your bank balance and transactions must be copied by Xero in order to give you an updated situation at all times. For this make sure to add in closing bank statement one day before and for doing that, click on ‘accounting’ from the main menu. Go to ‘advanced’ and select select’ conversion balances’. By doing so, you will be landed here;
First of all, you have set the conversion date. Conversion date stands for the date on which you started using Xero. You can do so by clicking on the ‘conversion date’ tab and you will be taken to the next screen which is shown below.
Now add the amounts in debit and credit columns and save to see your total balance in the set bank account.
Using Xero accounting software, you can also transfer money from one account to another. You don’t have to manage multiple bank applications on phone. This tool lets you perform transactions from multiple bank accounts from a single portal. So, if you wish to transfer money, click on ‘transfer money’ right next to ‘add account. After clicking here, a text box will appear on the screen as shown in the fig down below;
Here, you will be asked to insert the information of sender and receiver. The required details include the bank account from which you want to send money and the account on which you want to send money. Then add the current date and the amount you want to transfer. Finally, click on the ‘transfer’ button to complete your transaction.
Uncoded Statement Lines
Uncoded statement lines are those transactions that you haven’t reconciled yet but are imported from the bank to your Xero software. In order to generate a list of uncoded statement lines, Go to ‘ bank accounts’ from ‘acounting’ menu. You will see a tab of ‘uncoded statement lines’ on top. You will directed to the page as shown below
First select bank account. Here you have options including all bank accounts, any specific bank account or bulk download across all organisations. Then select to and from dates, add filters such as order by and sort order. Finally run the function to view the list of uncoded statement lines. You can also export is CSV, PDF and excel sheet.
After setting up your bank accounts in Xero you are ready to perform different functions that are embedded in this amazing software. For each bank account that you have added, there is a drop down menu ‘ manage account’ which will give you further options such as spend money, reconcile, import bank statement and much more. The figure is shown below;
Entry of Receiving Money
If you want to add a transaction of receiving money then select ‘ receive money’ to enter a new payment in your bank account. Now, you can choose to receive as direct payment, prepayment or overpayment. Along with that, enter details including from whom you are going to receive this payment, date of entering and any reference. Then select whether the amount is tax inclusive, tax exclusive or no tax. The screen will be as follows;
Here, you will have to add from, date and then in the table below add item, its description and other information as shown in the figure above. Once the line is completed, save your information and it will show your total balance. To add another line, click on ‘add a new line’ for the next entry.
You can also add a new item by clicking on the down arrow in the item column where you will have add information like item name, unit price, description and tax related information. You can save these items and can later use in the future by simply selecting the item and rest of the information will get filled automatically.
We have tried to demonstrate the process of setting up your bank accounts in Xero through the simplest way possible. If you have read the article thoroughly, you must have notices that Xero accounting software has a very easy-to-go design with user friendly layout. This helps in maintaining your financial data in an organised manner resulting in time saving and eddiciency. In our next articles, we will be explaining some other important feature of Xero on the Investment Working Group.