Hello free time, goodbye data-entry

One of the differences between  cloud accounting  and regular desktop accounting software is that you can:

a) create bank feeds so that your transactions appear automatically in your accounts, without you or your bookkeeper having to enter anything, AND

b) create ‘rules’ so that these transactions are also coded automatically to the correct accounts

Now that I think about it, creating rules so transactions can be coded automatically is so blindingly obvious, why hasn’t it happened before in the mainstream accounting products? The main reason is probably historical: Before we all shifted to paying most things electronically, a cheque number was the only reference on individual transactions, and something as nondescript as a cheque number can’t be coded automatically.

So my interest is really tweaked: How can  I create ‘rules’ so that my transactions are not only imported automatically into Xero, but coded to the correct accounts also? (I’ll also be trying this process in MYOB LiveAccounts, but right now I’m still waiting for my MYOB bank feeds to be activated.)

I go to the Manage Account menu and select the Bank Rules option. I click Receive Money and I get to a window that looks like this:

Receive Money Bank Rules in Xero

Adding Bank Rules in Xero

Now I have a really simple setup with my holiday house business in that every deposit that comes into my bank account is for rental accommodation. The only exception is the $500 contribution I make from personal funds on the first day of every month. So I’m going to set up a rule (hope it works!) that every deposit that’s $499.99 or less, or $500.01 or more, gets coded automatically to Income – Accommodation.

Here’s what my rules window looks like now:

Xero Receive Money Bank Rules

Creating a Rule for all Deposits

Now the proof of the pudding is going to be whether this rule works, or not. I’m new to this game, so maybe I’ve made a mistake somewhere along the line. However, if my rule does work, the next time someone makes a deposit to my bank account, it’s going to appear in Xero automatically via a bank feed, and get coded automatically to income. Sounds almost too good to be true.

That’s less time doing books, and more time to spend on my business.

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About veechicurtis

a one-woman geekspeak to plain-english converter
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2 Responses to Hello free time, goodbye data-entry

  1. I’m not sure if you’ve tweaked your rule already but in your following post about bank rules you reported that the Receive Money rule you describe above for your accommodation income hasn’t worked – and I can see why!

    It’s the ‘All’ option in step 1 that’s messing things up – the way the rule runs in your screenshot above is that Xero is looking for transactions that meet all the conditions i.e. the transaction must be greater than 0.01 and less than 499.99 and greater 500.01 – but no number can be all those things (sorry maths isn’t my strong suit so hopefully I’m explaining this right … I can see it in my head!) So to fix it – change the rule at step 1 so that Xero can look for ‘Any’ transaction that is less than 499.99 or any transaction that greater than 500.00 – don’t worry about the entry for 0.01, that’s not needed.

    Hopefully in your next batch of transactions your rules will run just fine!

    Catherine

    • veechicurtis says:

      Hi Catherine
      Thanks for your tip! It worked a treat. Something else I found confusing when creating rules is that although all lines on a bank statement LOOK the same, deposits correspond to Descriptions on my bank statement, but withdrawals (which I make electronically) correspond to References on my bank statement. The text that I define in a bank rule (i.e. allocate to xx account if the Reference includes ‘Eurobodalla’ also seems to be case sensitive, which tripped me up a little. But I think I’m getting there.

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