Empowering our small business clients to do some of their own bookkeeping is one of the biggest upsides to using cloud accounting software. But at the end of the day, small business owners generally are not accounting or bookkeeping experts. They can make mistakes.
Find & Recode is yet another hugely powerful feature from Xero that's putting the magic back into accounting, so professional advisors can focus on the things that matter.
We love our clients, but sometimes they get a bit click happy and reconcile transactions without review. Maybe one of your enterprising clients found the cash coding feature and accidentally categorized several hundred transactions the wrong way.
Xero Blake Oliver's Recoding 1
In the past, this would have made any advisor cringe — maybe even cry. You’d have to fix each individual transaction one at a time. But with Find & Recode, advisors have the power to fix the incorrect transactions all at once with the click of a button.
Here’s some of what Find & Recode can do for you:
- Search for all line items associated with a specific account and/or tax rate
- Ensure that all spent items over a specific amount threshold are correctly coded to assets
- Check the accuracy of items entered by overly enthusiastic clients
- Clean up contacts that have been entered in a sloppy fashion
- Add or correct tracking categories for a group of transactions
Anyone with Advisor permissions can access Find & Recode under the Advisor tab in Xero. Just enter your search parameters as filters to find the transactions you'd like to recode. You can search by date, account, tax rate, tracking, user, contacts, and more.
Xero Blake Oliver Recoding 2
Once filtered, you can select the transactions that require correcting and recode them to the correct account.
When you’re recoding, there are two options:
- Recode the original source transactions – For if you’re not concerned with the integrity of the source data, choose to recode changes directly on the original line items. Xero will still keep an audit trail for each transaction, so you can see how it was originally coded.
- Recode using a manual journal – If you’re preparing end of period reports and want to retain the original coding of source transactions, recode using a manual journal. Xero will leave the transactions alone and book an adjusting entry so your reports are correct.
Blake Oliver Recoding 3
If a journal is prepared, Xero calculates the adjustments required and populates the journal. Any changes made using Find & Recode are logged under the Find & Recode menu so users can track changes. There’s always a full audit trail.
Find & Recode is just another feature in Xero that significantly minimizes the time you spend cleaning up your clients’ books, giving you more time to provide higher value services.
Watch the Find & Code video for more information.
Blake Oliver is an independent accountant, consultant and blogger specializing in cloud accounting technology. He's also a Xero Ambassador for the U.S. West Coast Region.