Xero Accounting Review

Xero Accounting Review
4 of 5 stars 1 review
  • Pricing
  • Features
  • Support
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  • Powerful bookkeeping tools
  • Robust reports
  • Add unlimited users
  • User-friendly UI
  • Customizable automation
  • Easy and real-time bank reconciliation
  • Functional mobile app
  • 750+ integrations
  • Top-notch security features


  • Poor customer support
  • Weak starter plan
  • Pricey premium plan
  • No inventory stock alerts


They say that necessity is the mother of all inventions. This proved to be the case for Rod Drury and Hamish Edwards, the founders of accounting software providers Xero. They found that their burgeoning business needs could not be met by any traditional desktop accounting software available. This need gave the founders the impetus to create a modern online accounting product that is Xero.

From those humble beginnings in a studio apartment in Wellington, New Zealand, using free Wi-Fi from a nearby café no less, Xero has come a long way. Since its inception in 2006, the company has risen to become one of the top cloud-based accounting software providers with over 2 million users worldwide. So popular are they, that they now threaten to knock industry pantheons such as QuickBooks off the leader’s pedestal.

Interestingly, the software was first launched as ‘Accounting 2.0’. The founders, however, felt that the name wasn’t iconic enough. What followed was several brand-name reincarnations that included names such as ‘Basecount’ and ‘Pacioli’ (after Luca Pacioli, widely known as the father of accounting) before they finally settled on the name Xero.

With a brand name like Xero, the company certainly opens itself up to being punned.

However, there is nothing zero about Xero (pun intended there!). The software offers a robust set of features that will satisfy the accounting needs of most businesses and then some. Add to this, the recent addition of project management to its arsenal and an extremely user-friendly interface, and it is easy to see why so many prefer it over other similar software.

Who Is Xero For?

Strictly speaking, Xero can be used by businesses of all sizes, from solo entrepreneurs to enterprise-level corporations. This is because the software allows business owners to include an unlimited number of users and has a robust set of features. However, the app’s pricing plans could be a deterrent to small businesses with tight budgets. In the past, every pricing plan included all the software’s features. Unfortunately, this is not the case anymore. Some features such as multi-currency support are reserved for their premium plan, while others such as project management and expense management are available only as add-ons.


The software has three pricing plans. The company offers a generous 30-day free trial, an excellent way for business owners to test the software out before committing.

Furthermore, all plans come with an unlimited number of users and core features such as

  • Invoicing
  • Quote generation
  • Performance reports
  • Budgets
  • Real-time bank updates
  • iPhone and Android apps
  • Complete app integration
  • 24/7 support
  • Secure SSL encryption

Here are the details of each plan:











Unlimited Unlimited

Invoices, quotes, and bills

Upto 5 Unlimited Unlimited

Quotes and Bank transactions

Unlimited Unlimited

Handle multiple currencies



The price of software’s optional features are as follows:

  • Projects: $7/month for 1 user + $5/month for every additional user.
  • Expenses: $4/month for 1 user + $4/month for every additional user.


  1. Invoicing
  2. Purchase Orders
  3. Inventory Management
  4. Bank Reconciliation
  5. Contact Management
  6. Reports
  7. Asset Management
  8. Add-On Features

1) Invoicing

Xero has several tools that make invoicing an easy task. First, while there is only one invoice template available for users, it is highly customizable. Users can change everything from the theme to the wording of the text easily with the software’s drag-and-drop functionality. Importantly, users can add their business logo to invoices, giving it an official touch. What’s more, the software also allows users to attach documents and photos of completed projects to the invoice.

Second, the software sends payment reminders to customers at user-specified intervals. For example, users can set the software up to automatically send a reminder email to defaulting customers when an invoice is overdue by seven days and again after 14 days and so on.

Third, because of its seamless integration with payment gateways such as PayPal and Stripe along with debit and credit card portals, users can embed a ‘Pay Now’ button onto their invoices. This button gives customers plenty of options to pay instantly.

Lastly, users can save time and effort with Xero’s robust automation features. Apart from email reminders, these include setting up repeat invoices for regular customers, replicating previous invoices, and sending out bulk invoices.

2) Purchase Orders

This accounting software gives users the tools to efficiently and quickly manage their purchase orders. The software simplifies the process of creating one with its purchase-order templates. Like the invoice template, users can customize their purchase orders to showcase their brand’s color and font. Likewise, they can add their brand logo and choose what information they show along with any specific contact or delivery instructions to the document.

Another way Xero keeps things simple in this department is by allowing users to convert their purchase orders into an invoice with one click. This feature is a considerable time-saving measure for businesses looking to sell products to customers as it negates the need to create a separate invoice.

Additionally, it provides users with a comprehensive audit trail of their purchase order from start to finish. This trail includes the total cost, delivery time, and delivery location. It even allows users to keep track of and mark partial order fulfillments in case their supplier ships their order in parts.

3) Inventory Management

With purchases comes the need for inventory management. Though not as robust as its other features, Xero provides basic and competent inventory management features that will satisfy the needs of most small businesses. For enterprise-level users, the software integrates with several inventory-focused apps such as TradeGecko and Dear Inventory to get the job done.

The inventory tracking features allow users to keep track of details such as the tax status of each item along with product descriptions, images, and costs. Along with this, it tracks stock levels and values daily. The only negative is that the software does not have a ‘low stock’ or ‘out of stock’ alert like QuickBooks does. What it does effectively is to give users an overview of what their popular products are complete with the profits they make on each item.

4) Bank Reconciliation

Bank reconciliation is a must-have feature for every accounting software. Without it, there is no way to ensure that a company’s financial records match that of their bank account. Xero offers fast bank reconciliation features that turn this vital task from a monthly, multi-step chore to a smooth, one-step, daily affair. The software automatically imports bank transactions daily. Importantly, the software encrypts all transactions during transport, making it a secure data transfer.

Once imported, the AI-driven software matches the bank transactions with those recorded by the user in the app. Users can then reconcile each transaction separately or group identical transactions together and match them all with one click. Not only does this save them hours of administrative wrangling, but it also gives them a daily update on the health of their business.

5) Contact Management

This app’s customer management tools ensure that all contact information is stored in one easily accessible data repository. This repository not only makes it easy for users to find information but also gives them a 360-degree view of a customer’s interaction with them. The data collected includes a customer’s email interactions, purchase transactions, and buying history. This overview helps businesses understand and serve their customers better.

The software’s Smart Lists feature enables users to organize all collected data into separate lists based on user-specified rules such as age, location, or invoice amounts. Used this way, Smart Lists doubles up as an efficient marketing tool too. Business owners can use these lists to create targeted marketing campaigns and boost their chances of making a recurring sale. Once generated, users can export the data to any third-party email marketing app of their choice with one click and go from there.

6) Reports

Boasting of robust reporting features, Xero provides users with the tools to monitor the state of their business efficiently. The software has over 50 different reports to choose from. These include sales reports, purchase reports, tax reports, project reports, and even fixed asset reports. If that isn’t enough, the reports are customizable, allowing users to apply different filters and date ranges to generate custom reports as well. Besides, users can change the title, arrange rows and columns as required, and add pie charts or bar graphs to each statement. A report, once generated, can be archived, printed, or exported as Excel, PDF, or Google Sheet files.

7) Asset Management

With Xero, users can track their fixed assets and manage depreciation in one go. Once you upload assets such as vehicles, office equipment, or machinery into the software, you can access it through the software’s asset register. This register gives users an overview of items registered and those sold or disposed of. You can also add additional information such as the asset’s serial number and warranty expiry date here. The software has several settings that users can choose from to run depreciation evaluations on the registered items, such as time-based or tax-based depreciation values. Since the app automatically generates accounting journals for each item, selling off a fixed asset is also easy.

8) Add-On Features

Expense Management

Xero’s expense tools are an excellent addition for businesses that have multiple employees and need an automated and hassle-free expense tracking solution. The software takes the arduous, error-prone task of collecting employee receipts, approving them, and allocating payments accordingly off a manager’s hands.

The software streamlines all the expense-tracking related tasks from data entry to submitting and reconciling expenses. Employees can easily submit claims using their mobile or desktop apps. Besides that, they can also add explanatory notes, images, and receipts to back up their expense claims.

Notably, the app gives admins complete control over who can submit, view, and approve expenses. Along with that, admins can also split transactions and categorize expenses. Once you create a new expense category, the software automatically assigns new transactions accordingly. What this integrated accounting does is give users a bird’ s-eye view of their businesses’ cash flow, allowing them to identify hidden costs and plan budgets accordingly.

Project Management

This accounting software has two project management apps based on business size. The first, Xero Projects, targets solo entrepreneurs and small businesses. The second, WorkflowMax, is earmarked for medium to large corporations that have more complex project management needs.

Xero Projects is more focused on the financial aspect of project management. It gives users essential project management tools such as time tracking, budget monitoring, profit monitoring, cost estimation, and quote generation. With it, users can see which projects are turning in a profit and which are losing money.

WorkflowMax has end-to-end project management tools that can help users at every stage of a project, from planning to product delivery. Its features include client management, lead management, task management, and workflow management. This project management software has a 14-day free trial and will cost users an additional $15 – $250 per month, depending on the number of users.


For any accounting software, having the ability to integrate with other apps is a boon. Xero goes the distance in this department. It integrates with over 750 popular apps, giving users the freedom to use niche apps that serve their business needs seamlessly. To name a few, these include payment apps such as PayPal and Stripe, employee tracking apps such as Deputy and Fergus, CRM software such as Mailchimp and HubSpot, and scheduling apps such as Acuity Scheduling and TSheets.

Importantly, it integrates with Zapier, giving users hundreds of additional apps with which to run their business smoothly. What’s more, the software also offers APIs to developers along with SDKs in different programming languages. Its developer platform provides users with useful documents and how-to guides on everything from getting an authorization code to tutorials on webhooks and code migrations.

More About Xero Accounting


Given that Xero is feature-rich accounting software, one might think setting it up requires an expert techie’s help. Thankfully, this is not the case. Thanks to the in-software support that guides users step by step, even tech newbies can manage this task with ease.

Once a user completes the formalities of verifying their email and phone number, the next step is to input all their accounting data. Xero makes this process easy with its Conversion Toolbox feature. This feature not only allows users to import data from Microsoft Excel sheets and PayPal and bank statements but also from other accounting software. It supports file formats such as CSV, TXT, DOCX, OFX, and QIF.

Likewise, connecting payment transactions to this accounting app is a simple process. It requires coupling primary bank accounts as well as third-party accounts such as PayPal and Stripe to the software. Once all the accounts are connected, the software automatically imports transactions from the user’s bank and other financial institutions. This function eliminates the need for them to import them manually.

Ease Of Use

Admittedly, exploring all of Xero’s features takes time. However, once that is done, it is easy to use. This ease of use is in no small part due to its neoteric, clutter-free, and attractive user interface. The main dashboard is simple and aesthetically pleasing. It features several tabs running horizontally across the page, giving users easy access to their business’ core metrics such as accounts, payroll, contacts, reports, and projects.

Besides, it also displays details such as outstanding invoices, payments due, and available funds. Each tab has an easily navigable drop-down menu that allows users to dig deeper into each feature. What’s more, one can change the dashboard’s layout according to their liking because the panel is customizable. Adding to the ease is the video tutorials and help articles that greet a user every time he or she opens a new feature on Xero. These guides succinctly explain what that feature is and how to use it best. Furthermore, the software has buttons that allow users to complete tasks such as creating a bill or invoice in a straightforward step.

Customer Service

Xero’s customer service is one department that could do with some improvement. This accounting software does not have phone support, and their live chat support is mainly for sales queries. While they offer 24/7 email support, the company’s representatives are not known for being quick with their responses. Xero has several support features that can help users navigate the software easily. These include:

  • Xero Central: Xero Central is a comprehensive help center with tons of how-to articles that cover common troubleshooting problems. If perusing through these guides does not produce satisfactory answers, users can additionally interact with and post questions to the Xero community through this platform.

  • Xero TV: Xero TV is a one-stop-shop for all Xero-related video tutorials, vlogs, and tips and tricks to get the most out of the software’s features. It has an impressive repository of over 700 videos.

  • Xero Courses: The software offers a ton of online courses, webinars, and live events that educate users on diverse topics from banking basics to mastering workplace communication and a whole lot in between.

Device Compatibility

Desktop Browser App

Android App

iOS App

Windows Phone App

Apple Watch App


Xero Touch, as the mobile version is called, is an abbreviated iteration of its desktop version. The mobile dashboard has fewer tabs and only lists metrics like sales and purchase totals, account balance, and cash flow.

That said, it has several features that make it easy to operate a business even on the move. Xero Touch allows users to record expenses on the go. All they need to do is take a picture of a receipt. The app does the rest by saving an electronic copy of it in the expenses tab. With the mobile app, users can also invoice as soon as the job is done, even while on-site, ensuring that they get paid faster. Apart from these functionalities, the mobile app additionally gives users the freedom to manage their contacts and complete bank reconciliation tasks without logging onto their computer. The Apple Watch app allows users to check account balances and transactions on the go.

Online Security

Xero boasts of top-notch cloud security features. It has an Information Security Management System (ISMS) that is ISO certified and compliant with bank and data security industry standards. The software’s security features include two-step authentication, data encryption during transfer and rest, and network protection. This app stores and backs up all customer data daily at several secure data centers that have 24/7/365 surveillance. Besides, they have a robust privacy policy that gives users control over who has access to their information.



  • Powerful bookkeeping tools
  • Robust reports
  • Add unlimited users
  • User-friendly UI
  • Customizable automation
  • Easy and real-time bank reconciliation
  • Functional mobile app
  • 750+ integrations
  • Top-notch security features


  • Poor customer support
  • Weak starter plan
  • Pricey premium plan
  • No inventory stock alerts


Xero is a well-designed and easy-to-use software packed with killer features. These, in turn, make it a big player in the accounting software market. Its repertoire of features covers every aspect of accounting, along with areas such as project and contact management to boot. It also offers users tons of automated solutions that save them time, effort, and money, such as customizable templates, group invoicing options, and automatic email reminders. Also, Xero integrates with over 750 apps, giving users plenty of choices to make up for any deficiencies in their features.

However, Xero is far from being the perfect accounting software. They have a poor starter plan that one would imagine, only solo entrepreneurs will find useful. The recent increase in prices has had its users up in arms. Xero says that the increased prices reflect the improved quality of their product. Their lackluster customer service, however, is certainly not helping them prove that point.

That said, the software is an excellent solution for businesses that have multiple users and want one platform to manage all their accounting needs with ease. Given Xero’s features, taking advantage of its 30-day free trial is warranted to see if this accounting software is the right one for you.

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