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Sydney Small Business Accountants on Xero

Sydney Small Business Accountants on Xero

Small businesses are the engine room of our economy and we at mas accountants, as small business accountants in Sydney, take great pleasure in working with our wonderful variety of clients, working with them to find better ways of starting, managing and growing their small businesses. Every small business is different, if simply due to the fact that it has the heart and soul of its owner invested in it. Another strong advocate for small business is Xero. Xero is a market leading cloud based accounting software solution. A single ledger, accessible from anywhere you have an internet connection. We feel the true worth of Xero is in its clear, simple mantra of being small business focussed. It isn’t for everyone, yet the majority of our small business clients love using it and their small businesses are better for it. Clarity over your business finances and cash flow ultimately leads to better decision making.

Working on site this week with a client that uses and loves Xero, I came across some paperwork from one of their suppliers. It was a tax invoice for labour charges for installation of some equipment. The tax invoices in question were clearly done as a word document and were for the most part okay. It had all the right wording, had “Tax Invoice” noted at the top of the page, broke down the labour charge between days and sites and even had clear payment instructions at the bottom of the tax invoice. All good right? Well unfortunately not in this case. The summary of the tax invoice looked like this.

Sale amount
$9,760.00

GST
$97.60

Total amount
$9,857.60

BALANCE DUE
$9,857.60

Yes, that’s correct. They sent out the invoice with only 1% GST applied, instead of the 10% rate that is the law, a simple to make, but very costly, error. This is exactly why we try and emphasise the need for proper accounting systems. We had two invoices of similar amounts from the same supplier. Now if their accountant or bookkeeper just works of bank statement deposits for GST collected on sales purposes the issuer of the tax invoice is going to be out of pocket by $798.54 in this one case. Who knows how many other invoices were issued with errors? Using Xero, or MYOB or any other automated system would have stopped this error altogether.

We get that sometimes it is hard as a budget conscious small business owner to see past the costs of establishing and paying for software. However it isn’t just the benefits, often it’s the risk prevention that can save you from costly mistakes such as this by relying on thoroughly tested software to perform the calculations. Your small business accounting in Sydney will be much easier. 

For more information on how you can minimise the risks to your small business from examples like this, contact mas accountants, the original accountants for small business based in Sydney and Melbourne.

 
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