How to set up and use Xero accounting software
Set up Xero by entering opening balances, adding a bank or card account, importing statements, and reconciling transactions.
How to set up and use Xero accounting software
Before you start
Sign in to Xero and gather the information you’ll use to set up your organisation: opening balances and their effective dates, plus the bank or credit card account you want to add. If you’re transferring records from another accounting system, Xero recommends working with your accountant to bring in account balances as conversion balances.
Xero’s getting-started page describes a 30-day trial, after which you decide which plan suits your business. Check the current plan details before relying on a particular feature beyond the trial. Get started with Xero
Set up your accounts and opening balances
1. Enter opening balances and dates
Start with the opening balances for your organisation and the dates they apply to. Xero identifies these as an initial setup step and notes that correct dates and balances help make reports more accurate.
If you’re moving from another system, don’t guess at conversion figures. Ask your accountant or bookkeeper to help determine what to bring across. Xero specifically recommends professional help for conversion balances.
Expected result: Your starting balances and dates are recorded so that subsequent reporting has a defined starting point.
2. Add a bank or credit card account
Add the bank or credit card account you want to use in Xero. Xero’s setup guidance supports adding an account and then importing statements. It also describes bank feeds as a way for transactions to flow into Xero automatically once they are set up.
The supplied Xero guidance doesn’t provide the exact menus, connection steps, or eligibility requirements for a particular bank. Follow the instructions shown in your own Xero account or consult Xero Central support for bank-specific help.
Expected result: The account is present in Xero. If a bank feed is available and connected, transactions can flow in automatically; otherwise, statements can be imported.
3. Import statements if needed
If you’re using statements rather than an automatic bank feed, import the relevant statement transactions into the account. The supplied setup material confirms statement import as part of the process but doesn’t specify file formats or detailed import controls, so check Xero’s in-product instructions or Xero Central if you’re unsure.
Expected result: Statement transactions appear in Xero ready for reconciliation.
Reconcile transactions regularly
4. Match and reconcile bank activity
Use Xero’s bank reconciliation process to keep your accounting records up to date. Work through the transactions shown for the account and reconcile them using the options presented in Xero. The source material recommends regular reconciliation but doesn’t document the exact buttons or matching rules, so don’t assume a transaction is correct solely because it appears in the list.
Example: If you import a statement for a business bank account, use the reconciliation workflow to review the imported transactions and bring the account’s records up to date. Check any uncertain transaction against your own records before confirming it.
Expected result: Reconciliation is completed for the transactions you reviewed, and the records are more current. Xero’s basic setup guide includes short support videos on opening balances, adding an account and reconciling.
Continue with the tasks your business needs
Xero’s getting-started material also covers creating invoices, adding customer and supplier contacts, inviting an accountant or bookkeeper, and setting financial details such as tax settings and the financial year-end date. It describes payroll setup for businesses with employees, but the supplied material does not give detailed payroll steps or establish which features are included in each plan. Use the instructions in Xero or consult Xero Central before configuring those areas.
For day-to-day work, Xero says its iOS and Android accounting app can handle tasks including sending invoices and reconciling bank transactions. The supplied information does not specify differences between operating-system versions or list every feature available in the app, so check the app’s current details for your device.
Verify your setup
Check that:
Opening balances and their dates have been entered.
The intended bank or credit card account has been added.
Transactions are available through a bank feed or imported statement.
You have reconciled the transactions you reviewed.
Reports or the dashboard show the financial information you expect. Xero describes these as ways to check finances and cash flow, but the supplied sources don’t specify a particular report or target balance.
If a balance or transaction doesn’t look right, pause before changing opening figures or confirming a reconciliation. Recheck the dates and source records, and ask your accountant or bookkeeper about conversion balances. For product instructions or troubleshooting, use Xero Central, which provides support articles, courses and a way to contact Xero support.
