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Xero and Quickbooks main differences

What are the main differences between Xero and Quickbooks in day to day use?

I have a client who has several groups of companies which, for a number of historical reasons, are using different accounting packages. They are considering adopting the same software across the groups. Sage and QB are in the running as is Xero. I am very familiar with Sage and have a working knowledge of QB. But I know nothing about Xero apart from having an initial play with their demo data; to date, it seems very similar to QB.

I intend to try out the Xero 30 day trial but I was wondering if anybody who has experience of both QB and Xero could point out the main differences between them in day to day use, if any, and any major shortcomings.

Most of the companies are fairly simple for accounting purposes but one of the companies is in a start up phase at the moment and is likely to become quite complex including overseas operations probably with stock and possibly including manufacturing. Does this favour one of the options?

I realise this is quite a widely drawn question but a search has not really yielded anything. Any comments welcome; preferably printable but not essential.


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By mg200
24th Feb 2018 10:16

I think it will come down to any specific requirements you have as a business. I have found Xero slightly better and my bookkeepers have found it easier to adopt and get used to.

One thing that you may find interesting with Xero is the ability to automatically post invoices between your associated companies. This is called Xero to Xero and I haven't seen anyone really use this feature but if you have several groups of companies then it may be a time saver.

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to mg200
24th Feb 2018 12:31

Thank you. The Xero to Xero possibility would be very interesting if it extends to other items apart from invoices as there are a lot of intercompany funding transfers. I will explore that option.

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24th Feb 2018 11:38

Just as an aside - a client tried the QBO 30 day trial.

Actually, it's only a 28 day trial in February and she got an error message when she tried to set her fictitious company's first month to December.

So not impressed so far - fail on the first two things she tries !!

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to lionofludesch
24th Feb 2018 12:34

Not an auspicious start!

I quite like QB but there are some quite basic flaws at the moment like the use of signs and the inability (as far as I can tell) to match an invoice and a payment made in advance - it insists on a transaction amount.

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24th Feb 2018 17:52

1. QuickBooks occasionally pulls in a bank transaction twice, in error. I complained and was told they are looking into it. Still happened after that though on occasion.

2. Xero has much more aesthetically pleasing reports (the new reports). QuickBooks reports are very scrunched together and look quite amateurish.

3. Xero allows you to customise reports, not just in the way of changing layout, but you can add in formulas.

4. If attaching scanned invoices to transactions, Xero wins here. You get a mail box where you can forward emails containing invoices. The attachments are picked up and sent into Xero. You can then very easily create a transaction by clicking on each pdf that has landed in Xero. QuickBooks is very weak in this area. No mailbox and a very cumbersome way of getting bulk pdf's into the software.

5. Try to get a pdf report of a vat return summary and backup figures for an already filled vat period in Quickbooks! You can't! So unless you download the report at the time you prepare the vat return, you've no chance, should HMRC come along and ask for supporting figures for a previous vat return. It is ridiculous.
Piece of cake in Xero, as indeed it is in any other software I've used.

6. Xero is rubbish at dealing with credit notes (you can't have a general credit against a supplier account - it has to be matched against an invoice, even if it doesn't relate to a particular invoice. Work arounds exist - this is on the Xero request forum and has a lot of requests for them to sort it out, but as yet, nothing.

7. Xero can generate dividend vouchers. Don't think quick books can.

8. Xero is modern, clean looking and is user friendly. QuickBooks is the opposite, but this is my opinion. It is subjective.

This is a rough list posted from my phone which is difficult as I have wide fingers, so apologies for any errors.

I'll add more later if I can think of any.

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to Manchester_man
24th Feb 2018 18:47

Thank you. Very helpful. There is a workaround for 5 but it's tedious.

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By chewmac
24th Feb 2018 20:03

In QB I cannot display dividends against balance sheet reserves and show them on their own line. Just posting against reserves b/f at the mo. You can however do this on Xero.

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By Jim100
25th Feb 2018 11:17

Revaluations doesn't work properly in quickbooks. You can only revalue at today's date and is confusing. The Quickbooks App is appalling and difficult to use.

The one major advantage is the customer service which is very good and you can speak to them too.

Overall I like quickbooks over xero but it does have some very annoying flaws. It is also reasonably priced and offer good discounts to Accountants.

Xero would probably suit a more complex client like yours plus it integrates with more apps than quickbooks does.

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25th Feb 2018 14:07

We shifted to Quickbooks Online last year and cannot rave about it enough. We were looking at Xero and Quickbooks Online. The main differences for us was the telephone support (and it is actually helpful and UK based!) and the much nicer user interface. QBO has transformed our bookkeeping and we spent, no exaggeration, 80% less time that we did before.

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25th Feb 2018 14:47

Good that the telephone support is working out well for you. I'd rather spend my money on software that works well enough without having to contact support.

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26th Feb 2018 09:52

Thanks to all. Some very useful information and experiences.

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By johnt27
26th Feb 2018 12:33

For me it's Xero as well. Don't get me wrong QBO is a good product but not the best.

Also if you are looking at group reporting Xero matched with something like Spotlight will suit you particularly well. I have a client (6 companies) that has chopped their management reporting timetable down from 2 weeks to 2 days (every month) having switched from Sage.

In terms of integrations Xero leads the way and when you consider the history of cloud accounting it all started in New Zealand/Australia and so the vast majority of quality add-ons come from here and connected with Xero first. It's the unwritten rule in the add on world - Xero first, everyone else later.

This approach isn't immediately apparent between QBO and Xero but you certainly see when looking at Sage or Kashflow, for example. You'll also note that a lot of the add-ons for QBO have a USA slant which, personally I find a little frustrating as they need a bit more work to use in the UK.

Finally, on support, you get 24 hour support from Xero and if you want phone support, it isn't inbound like Sage or QBO, but you can request a call at any time and these are picked up within 30 minutes and often much quicker. The Xero help videos and guides are much more comprehensive plus as an advisor, your client is signposted to contact you.

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26th Feb 2018 12:52

I find that Xero is easier to use but prefer QBO for the more complex businesses as it has more segmentation of data (classes that work like departments, locations and projects), and the reporting is extremely flexible as each report can be customised in many different ways.

Bank feeds on QBO are only good with some banks and not reliable with a few banks. Natwest, RBS and Lloyds work very well, HSBC works usually but has an issue at least a couple of times a year and you get duplicate or missing transactions when the issue is fixed, Barclays seems to be very difficult and I have resorted to just importing CSVs which can be done easily.

I prefer to recommend Xero if it is the right system for the client and only recommend QBO if extra functionality is required. A couple of my complex client groups have moved from Xero to QBO because of better reporting and functionality.

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