Disadvantages of Xero Accounting Software - ASK CIB All About Accounting

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This video is a review of Xero accounting software; this is part of a series of videos on Xero accounting. Hi, my name is Joel and I'm an accountant at CIB Accountants. In this video I'll be talking about Xero and what are some of the disadvantages of using Xero. This video is part of the ask CIB series. By the end of this video you will have a better idea on whether Xero is the program for you. Although overall I believe that Xero is a great program there are some areas that I just wanted to highlight so that you can make a well informed decision about whether Xero is the software for you. The first disadvantage I will discuss is the monthly fee. If you stop paying the monthly fee then you can't process any more transactions and you can't access the file to view prior year reports. From a taxation perspective most companies need to keep their records for at least 5 years or more in some cases. One way to overcome this challenge is to export particular reports from Xero before finishing your subscription. Other software programs, such as the offline version of MYOB allow you continue using the program without limit for a single upfront fee. One of the great features of Xero is automatic bank feed data from your bank account. Unfortunately these feeds aren't perfect and sometimes there are errors in the bank feed and transactions are duplicated. So if you're not careful bank statement transactions can come through twice and then it will take a little bit of time to fix them up. One way to overcome that is at the end of say each month when you get your actual bank or credit card statement check the Xero balance versus the actual statement. Another potential downside of Xero is the online security risk of your computer getting hacked and your passwords being comprised, in particular if you don't upgrade your virus protection or firewall software frequently. I would say this is a more general risk and the same sort of risk would occur if are using internet banking. One other small disadvantage is that some of the reports you can generated from Xero aren't quite as comprehensive as other programs, such as the offline MYOB products. For example in MYOB you can generate a balance sheet report at a particular date whereas in Xero those reports can only be generated at month end. Usually there are types of reports that you can generate to get that information. The last downside of Xero that I will mention is that although Xero has good customer Service from the perspective of if you have a query you can send an email request and they will get back to you in a reasonable time frame. However if you are the type of person who likes to pick up the phone and speak to someone their phone support isn't as good as say MYOB Online. Those are a some of the dis-advantages of using Xero and as mentioned there are usually ways to overcome those issues. If you would like to talk to someone about using Xero in your business please contact us at CIB Accountants. If you would like additional tips or ideas for your business please subscribe to our channel or send us an email via ask@cibaccountants.com.au Alternatively tweet to us using the hash tag #askCIB. Thank you. website: http://askcibaccountants.com.au twitter: http://twitter.com/askcib