Demand And Benefits Of Finance And Accounting Outsourcing In New Zealand

The growing demand for elate business growth and efficiencies has concerned many business heads in New Zealand to look up for new and innovative ways for increasing profit levels and lowering expenses. Also, many struggling businesses were looking for a ray of hope to come out the loops and reach stability. Even the local accountants showed little interest in the core accountancy tasks and were relieved by the concept of outsourcing as it opened the doors of managerial and advisory jobs for them.

Driving productivity is an immense concern for all business heads. Finance and outsourcing relieves the key managers and business heads to work on and improve the business processes, improve control and development graphs and of course reducing costs. The current finance and accounting services are a result of constant demand of simplifying and standardizing the financial and accounting tasks. It is by all means an effective management tool.

The benefits of finance and accounting outsourcing is totally dependant on the business using them. Some use the accounting outsourcing services for a single task, like account payable. Some use it for more tasks and as per the current trend companies outsource their entire accounting operations to a remote firm. Its like the more you sow the more you reap. Exploiting the outsourcing services to the full, can make you achieve all the possible perks.

    Below are some of the benefits of Finance and Accounting outsourcing.

• Money- Money is the motive of every business. Earning, saving or investing, a business runs on the wheels of money. Outsourcing helps you to save more, the detailed reports by the outsourcing firm can help decide for wiser and long term investments. and obviously there are reduced expenses.

• Focus- Focus is essential for all endeavours. With accounting outsourcing you can get rid of all distractions and focus on what is more significant exercises.  It literally gets hard for the businesses to focus on all types of tasks while facing the tough market competence. In such cases the finance and accounting services can be made use of by focusing on the core business functions.

• Expertise- With outsourcing, you get the power to choose an expert from anywhere you wish to. This too without the hassle of training, maintenance, grievances etc. The experts you hire also are cost effective as they deliver more work at lesser cost, compared to a local accountant.

Connect Accounting is one such firm, offering you a wide range of accounting outsourcing services to choose from. Connect Accounting is an Auckland Accounting outsourcing firm catering to the accounting needs of kiwi accountants from the last seven years.

XERO Features

Xero offers a comprehensive feature set well beyond that of many cloud-based accounting systems. Here are some of Xero’s key features :

• Dashboard – An overview of accounts and upcoming accounts payable and receivable. Extremely well-organized; easy to take in the important information at a glance.
• Estimates – Xero does not have a dedicated quotes/estimates feature, though it is on the list of high priorities for development, so it’s likely we’ll be seeing it sometime in 2014.

• Invoicing – Invoices can be saved as drafts, submitted for approval, or immediately approved and sent. You can either print or e-mail invoices, and it’s easy to see what’s been sent and when. Automatic invoicing is also supported, if you have customers who you bill monthly or weekly, and you can send either activity statements or outstanding statements to all customers with the click of a button. For invoice design, you can either upload your logo to Xero’s template or custom design your own using a docx file. You can also include direct payment options for Paypal, Authorize.Net, DPS, GoCardless, Stripe, eWAY, or any other payment processor of your choice, allowing your buyer to pay immediately by clicking the link on the invoice.

• Bank Reconciliation – Xero offers live bank feeds; alternately, you can import statements manually (ofx, qif, or csv format). The automatic matching feature is on the whole very good, though I’d have liked to see a way to accept automatically matched transactions all in one go, rather than clicking the “OK” button for each of them individually. You can leave notes on transactions, create new entries, assign categories, and split entries to reflect situations such as partial invoice payments. Xero’s automatic categorization is a great time saver, and it’s easy to set bank rules for how routine transactions should be handled. There’s also a quick cash coding section with some convenient keyboard shortcuts for coding transactions which haven’t previously been entered into Xero.

• Accounts Payable – Suppliers can send invoices directly into your Xero accounts payable section, which offers an interactive timeline with a batch payment option. You can also create purchase orders, copy their contents to bills, and set automatic payments for recurring bills. Xero supports check printing with a variety of customization options.

• Reporting – Xero offers over 40 reports, from basic profit/loss and aged payables/receivables to movements in equity and foreign currency gains and losses. You can also create a budget and compare it with your actual spending and income. For the organizations using Xero for payroll, there are additional 16 payroll-related reports available. All reports can be saved as an Excel file, pdf, or exported to Google Docs.

• Expense Reports – A well-executed time saver. Employees can enter their expense reports and receipts into the system. You can then review and approve employee expenses and receipts. It’s easy to see when there are new reports awaiting your approval. Unfortunately, there is no integration with payroll. You will need to enter reimbursements manually if you plan to add them to paychecks.

• Inventory – Xero currently has little in the way of inventory management. You can create stock items, view quantities in stock, and see sales by item in Reports. However, manual journal entries must be created if you want to track inventory as an asset. According to Xero, we should see improved functionality sometime in 2014.

• Tracking – Xero allows you to create up to two tracking categories by which to sort income and expenditures. You can use this for basic job costing or to track sales by employee, location, or whatever other criteria you choose.

• Contacts – Xero offers an option for group invoicing; you can also view each client’s transaction history and analyze your client list by spending and payments. You can assign one primary and up to four secondary contacts per company, and you can configure default communications settings to cc e-mails to whichever contacts you wish. Contact entries are automatically created each time you enter a new name on an invoice; you can also import your existing client list.

• Sales Tax – Xero has excellent sales tax support. You can set taxes for as many different areas as you like (including combined taxes such as a city and state tax, compound taxes are fully supported). You can also assign a default tax rate to each customer.

• Tax Forms and Support – Xero’s 1099 Report provides you with all the information you need to fill out 1099 forms. The software also offers automatic depreciation tracking for fixed assets; enter the initial purchase and depreciation rate and the software will do the rest.

• Multi-Currency – If you do business internationally, multi-currency support will be a crucial feature. Exchange rates are updated every hour; you can invoice and set reports in any currency. Xero supports bank accounts in multiple currencies, though you cannot print checks or submit expense claims in any currency other than your base currency.

• Online File Storage – Xero offers online file storage, allowing you to import receipts, invoices, and other documents. Files can be scanned and uploaded or simply e-mailed to your Xero inbox. You can also use a webcam to photograph the files, which will then appear in your account. Files can be attached to transactions, journal entries, or accounts for paperless record keeping. Note: unattached files in your Xero inbox are visible to all users. If there are documents you wish to keep private, attach them to the appropriate entry immediately after uploading them.

• Payroll – Xero now provides payroll for US-based businesses, including direct deposit and the option to eFile and ePay taxes. This is a new feature which is not yet available in all states; read the latest information on its availability here. A light version of Payroll, for one employee only, is included in the Standard Plan.

• Employee Payroll Portal and Time Tracking – Employees on payroll can use their own logins to access a portal through which they can complete timesheets, view paystubs, and see accumulated sick and vacation time. They can also submit requests for time off and completed timesheets for approval. E-mails from Xero will alert the employee and supervisor as to the status of such requests. The time tracking function is limited. You can enter a total number of hours, but no start and end times. However, you can use the Tracking feature to assign hours to different projects or locations. Employees can also create timesheet templates to cut down on data entry if they work a consistent schedule.

• Import/Export Capabilities – Xero allows you to import and export information freely, primarily in csv format. Xero also makes it easy to switch from QuickBooks, using QuickBooks 2007 or later, just upload your QuickBooks file. Xero will handle the conversion.

Xero Review

Headquartered in New Zealand, Xero is a cloud-based accounting solution tailored to the needs of small to mid-size businesses. Its features include account management, billing, invoices, expense reporting, and payroll. Xero also integrates with over 200 other applications which facilitate nearly all aspects of business operation, including inventory management, CRM, and POS.

Ease of Use:

Xero’s interface is clean, well-organized, and easy to navigate.

• Setup - When you first sign up for an account, you’ll be prompted to set up your company through a series of fairly self-explanatory screens, each with its own easily accessible help section. There are also a series of “Getting Started” videos which, while some are slightly out of date, provide good, concise advice as to setting up your business with Xero. You have the option to save and quit at any point during setup.
• Organization – Once set up, navigating is a pleasure. The dashboard offers a quick overview of accounts, and it is easy to see items that need attention (overdue bills, for instance) at a glance. In addition to the dashboard, there are tabs for Accounts, Payroll, Reports, Adviser, Contacts, and Settings. Each provides access to a variety of drop-down options, and they’re organized pretty intuitively. Usually, things are found on the first place you thought to look.
• Instructions and Guidance – Xero provides a “Getting Started” text box at the top of some pages which provides handy tips; it’s easily hidden once you’ve mastered the content. How much you need to read instructions in order to use the software will likely depend upon your accounting knowledge and the complexity of the tasks you are attempting.
• Problems – Xero is very clean software. There are a few minor annoyances, as follows:
  • Lack of Time Tracking for Contractors – I am very glad to see a time-sheet function for employees under Xero’s new payroll function … but a bit surprised that the software doesn’t provide time-sheets for 1099 contractors.
  • Poor Inventory Support – While Xero says you can use add-ons for inventory, a quick glance at their forums gives you the impression, most of these don’t work well. Xero plans to offer improved inventory management this year; whether that will solve the problem remains to be seen.
  • CSV Imports – In the banking reconciliation, duplicate detection does not function across formats, so if you import a csv and later import a qif with overlapping dates, you will end up with duplicate entries. Also, depending on your bank, you may need to make significant adjustments to csv files before they will import correctly (Xero can’t import a bank statement csv with separate debit and credit columns).
  • Lack of Automated Features – Xero does not offer automated invoice reminders, overdue notices, or receipts upon payment. While it’s a minor point, it seems an odd omission for software which has such a great feature selection.

Benchmarking: 5 reasons why your business should do it

Do you know how your business is performing when stacked up against competitors? Where you could improve, what you are doing well and what you could do to steer your ship in the right direction?
The good news is, there’s no need for guesswork. Benchmarking can answer these questions for you.
Here are our top five reasons why your business must benchmark:

1. Benchmarking allows you to dive in deep to find out why top performers in your industry are so successful. You’ll be able to analyse the key behaviours and ingredients for success, so that you can emulate them.
2. Benchmarking enables you to identify the strengths and weaknesses in your own business. Without this insight, you could be travelling blind and making business decisions without the right information.
3. Benchmarking provides objectivity, so that you can take an objective view of your business. It’s difficult to do this otherwise – you may be just too close and emotionally invested in your business so making it difficult to stand back and be unbiased. The most successful businesses take off the rose-tinted spectacles and make realistic assessments about their performance.
4. Benchmarking empowers you to understand personnel productivity in detail, and subsequently, set reasonable expectations for staff productivity. There’s no benefit in setting expectations that simply can’t be met by humans. Likewise, it’s foolish to set expectations that are too low to drive real value in your business. Comparing your staff productivity to more successful players will help you identify your productivity gaps.
5. Benchmarking can also help you assess performance in the area of finance. A wide range of expenditure questions can be answered to help you make strong conclusions – on anything from average industry salaries, to the cost of office supplies.

Like any management activity that’s worth doing, benchmarking takes a little effort. But outside help is available. If done right, benchmarking holds the key to future prosperity, for you and your business.

Tax Tips End Of Financial Year

We, while working at Connect Accounting, have put up some tips for the end of financial year. We hope you will find them helpful. Tax can be a simple or difficult task depending upon the knowledge and experience of the accountants. For making it a simple job, the accountant must have up to date knowledge of tax laws. These tips may prove useful while getting your paperwork together.

Bad Debts 

In order for a bad debt to be truly “bad”, there must be no reasonable expectation of recovery. There must also be evidence that a bad debt has been written off. Normally this would involve a paper trail between you and the customer or potentially an action in the Disputes Tribunal.

In order to claim a bad debt, it must be written off during this year in order to claim the deduction. We can do this for you when preparing your financial statements.

 Inventory

You are entitled to write off obsolete stock. In order to reduce the value of items in stock, they should be disposed of physically or alternatively valued at their market selling value which will presumably be lower than cost.

Repairs and Maintenance

If you have repairs and maintenance that need to be done, it may be worthwhile to do these in March so that you get the benefit of a full deduction.

Home Office Expenses

A proportion of your mortgage interest, residential telephone, insurance and rates can be deductible. There is a common misconception that this amounts to a flat 25%. This is not the case. In the case of an IRD audit, the department would want to see evidence as to how the portion deducted was determined. Our advice is to get a sketch together of your home with floor areas and work our how much is actually dedicated to business use. Contact us for more information if you are unsure.

Donations

Most clients are aware that their personal donations are tax deductible but your business donations may be as well. So long as the company records a profit, you may claim any donation up to that net income figure.

Scrapping unused assets

You may write-off an asset that you are currently depreciating when the costs of disposing of it are greater than any expected proceeds from the sale.

Prepaid Expenses

You can claim the full amount of some “prepayments” regardless of the amount or period being prepaid. Items include:

• Stationery
• Subscriptions for journals
• Road user charges & vehicle registrations
• Postage and courier charges
• Rates
• Audit & accounting fees

Other expenses such as travel, rent, consumables, advertising and insurance have either dollar or time limitations so please contact us for more information.

Entertainment expenses

Most entertainment will qualify for a 50% deduction. There are a whole host of rules that apply so if you are uncertain, give us a call.

Vehicle expenses

There are a number of ways of claiming the business portion of vehicle expenses against the business. These include a mileage rate, using a logbook, actual mileage and transferring the ownership of the vehicle into the business name.

Know how to Outsource

In all businesses, accounting falls in the category of important but unexciting. From maintaining record of all the incoming and outgoing capital to maintaining proper entries in the financial records, there are many things can go wrong. And upon all of this, bearing the expenses of an in-house team adds to the headache.

But like all other problems, this too has a cure - “Outsourcing”

The option of outsourcing your accounting tasks brings peace to life as you get all the work done by professional accountants with the expenses and maintenance hassle of an in-house staff.

But before outsourcing your confidential accounting data, you have to wisely choose an outsourcing partner. For this the first step is to Track Your Business Records. By this you will get to know your requirements and outsourcing risks correctly. Secondly, understand the practicalities of outsourcing your accounting. Decide on what and how much you need to get outsourced. And thirdly, look for firms that offer you the best financial benefits. Go for firms that offer you more flexibility and trust.

Connect Accounting, New Zealand is one such firm that offers you a complete package. Connect delivers on promise, trust and credibility, making your outsourcing experiences the best one.

The Pros and Cons of Outsourcing Accounting Services

If you are running a small business, you could consider outsourcing accounting services so that you don’t have to mess with the accounting part on your own. For running your business efficiently, you should maintain your accounts properly and should keep in mind that there are several pros and cons associated with outsourcing your accounting services and one must be aware of these, for making right decision at the right time.

Pros of Outsourcing Accounting Services

One of the best pros is that if you outsource your accounting services to another firm, you won’t have to employ and pay people to work for you on a full-time basis, as part of your company. This can prove cost effective. The outsourcing firm will record and maintain accounts for your business and will deliver your work before the deadline. Accounting outsourcing firms generally hire trained professionals to work for you so that they can provide quality work on time. They work expertly on most aspects of accounting such as bookkeeping, data entry, taxation and payroll. This will save you a lot of time for attending other business requirements like growth and client relationships.

Cons of Outsourcing Accounting Services

For outsourcing accounting services, you will be revealing all your financial details to another firm, so you should think twice before you decide the firm to outsource. Before outsourcing, have a check on the firm’s reputation, their customer’s satisfaction, and their work environment. Some firms may not cover all areas of accounting for you, especially if you haven’t listed them on the contract. You may therefore feel like you’re being cheated somewhere. Some services may come at an extra charge and this may work out to be an expensive proposition on the whole.

You must definitely remember these pros and cons so that you know what’s best for your company and its overall success. One of the best options is to choose the services of Connect Accounting, New Zealand, which ensures quality and timely results. You are charged as per predefined terms and your data is secure under confidentiality agreements.