There are a variety of reasons why a firm, its bookkeeper, or its tax preparer/accountant would desire to switch from the Xero platform to the QuickBooks Online (QBO) platform. I will not attempt to explain the probable benefits or drawbacks of doing so here. I’ve done a lot of these conversions, both in one direction and the other. The sole goal of the purpose Convert Xero to Quickbooks is to go through the fundamentals of conversion. Whether it’s the proper thing to do or not is a topic for another day.
The first step in converting a company file from Xero to QuickBooks Online is to determine if historical transactions will be included in the new file and, if so, how far back to include them. It’s undoubtedly easier to have previous transactions in the file than to seek an archived record, scanned papers, or, worse, paper records if a query arises. Incorporating them, however, raises the conversion cost and effort. The amount of extra effort and expense is determined by some criteria. This includes the quantity and diversity of transactions, the number of accounts with cash transactions, inventory management, payroll, and so on.
Convert Xero to Quickbooks Online
There will very certainly be some transactions to convert from the Xero file to QBO unless the conversion is done at the start of the fiscal year. Save a copy of the balance sheet and income statement reports (which Xero and most of the accounting world refer to as the profit and loss report) for all dates, using both cash and accrual techniques, as well as the full Accounts Receivable and Accounts Payable reports, before converting. Also, lock the Xero file for dates before the conversion date so that no one makes modifications after you start.
Anyway, without wasting a single second let’s check out the steps to convert Xero to Quickbooks.
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Solutions to Convert Xero to Quickbooks
Step #1 – Convert the Account Chart
- The chart of accounts (COA) in QBO must match Xero’s first stage in the conversion process. Some people will find it simpler to link accounts in QBO to those in Xero, but there is another option.
- The COA may be exported from Xero by heading to Settings>Chart of Accounts and then selecting the “Export” button, which will download a CSV (comma-separated value) file that can be edited in Excel or any other spreadsheet software. The file’s first three columns correspond to the first three columns of the needed format for QBO import, making it extremely handy.
- Account numbers in Xero are three numbers, and no subaccounts are permitted, although a typical technique of grouping accounts on heading is to add hyphen digits such as 620-01, 620-02. As subaccounts cannot be imported into QBO, leave them so that sub accounting in QBO later is easy. To facilitate transaction importation in later phases, I propose making NO modifications to account numbers. So, erase all columns following the first three in the Xero COA file. A great method for resolving issues like Quickbooks Error 1935.
- Account information may only be imported into QBO in four columns: Account Number, Account Name, Type, and Detail Type. Make the necessary adjustments to the headers that should appear in the first row of the import file. Account Kinds mainly match up as well, although it is useful to filter the list by type and compare it to the possible account types in QBO, making any necessary modifications to match them up.
- It’s also a good idea to provide relevant account detail types from QBO in the fourth column. It’s unnecessary because QBO will allow you to pick them from a dropdown list during the import if you don’t, but doing it for dozens or even hundreds of accounts can be time-consuming. Save your edits to your Xero COA file before importing it into QBO.
- Any account numbers, account names, or account kinds/detail kinds that do not match will be highlighted in red, allowing you to make modifications before importing them. When the import is finished, you may want to tidy up the QBO COA. Refrain from giving in to the impulse! It should be done AFTER the transactions have been imported.
Step #2 – Import Data Of Customers & Vendors
- When converting from Xero, this might be time-consuming. This is due to Xero’s lack of a difference between customers and vendors. They are all categorized as contacts and can be both a client and a vendor at the same time. As a result, I propose exporting them all as one and then manually splitting them into vendor and customer lists.
- The produced Xero file has a lot more information than you can load into QBO. The Xero file, for example, has both postal and shipping addresses, but only one address may be imported into QBO.
- Attempting to cover all possible modifications and how to implement them in Excel or another spreadsheet tool is beyond the scope of this article.
- To begin, download the appropriate format for import to QBO by selecting “Import Data” from the Gear Icon>Tools and then selecting the type of import you are performing. Click on the link to download a sample file in the box where you may input the file name for import.
- We highly advise you not to use the open balance amounts in the import files.
Step #3 – Import Services & Product Data
- The export file from Xero, like customers and vendors, will require extensive alteration to fit the format for import into QBO, and that format may be identified via the same processes explained above.
- If the inventory is being monitored, the import list might be quite extensive and time-consuming to prepare. In this situation, ensure that the purchase price and quantity on hand are right for those goods having inventory on hand.
- All goods must also have an inventory, non-inventory, or service option chosen.
Step #4 – Invoice & Bill
- After that, the transactions may be imported into QBO. At any given moment, up to 500 invoices or bills can be exported. If there are more than 500 of either in the file, I recommend sorting them by date.
- There are other options available to achieve this, but Transaction Pro Importer has been my experience. It is a robust importer of all transactions to which Intuit has granted API access. The specifics of how to use it and how to convert Xero transactions to use it are beyond the scope of this article.
Step #5 – Payroll Transactions Import
For many providers, importing them as invoices due to each employee (creating a vendor with the employee’s name) is an easy solution. This makes it possible to allocate funds to all of the necessary cost and obligation accounts.
Step #6 – Bank Transactions Import
- Finally, you may import your bank transactions. This is, nevertheless, the most difficult phase. This is because, like many accounting applications, I have yet to find a way to export transactions that include information from both the credit and debit sides.
- Transactions from the general ledger can be exported, but they are in a format that needs a lot of work to convert into a format that can be imported using Transaction Pro Importer. Instead, I’ve found that harnessing the power of the bank feed tool in QBO, as well as Xero and other accounting software, is more effective for this phase. It enables the classification of hundreds of transactions at once, as well as the matching of items such as bill and invoice payments.
- We prefer the alternative of considerable effort in Excel to prepare the transactions because of the robust sorting functionality. As a result, we propose exporting all transactions from each bank account as CSV files and importing them as if they were bank downloads.
- If there are a lot, divide them into files with no more than 1,000 transactions each. It’s merely a matter of correctly categorizing and admitting them into their relevant registries from there.
Step #7 – Results
- The file should now be complete when that step is completed. Before you check, go to the Chart of Accounts and change any accounts with hyphens and digits following them to subaccounts of their header account. Then I propose doing two steps to ensure that the QBO and Xero files are the same.
- Begin by reconciling your financial accounts. It’s up to you whether you want to accomplish it all at once or in smaller chunks. I generally do these in a year’s time, but if there are any issues, I’ll break it down per month.
- You have to compare the balance sheet. Then just compare the profit and loss reports for all dates using accrual and cash methods in QBO. Also, double-check that the detailed AR and AP accounts are identical. If everything goes according to the plan then the conversion will be complete.
- There are some exceptions from what Xero offers. Such as tracking, which is a categorization level comparable to class tracking in QBO. Of course, you have to set up many QBO parameters. Just as you would do for any new business file. Forms, third-party apps, and bank feed connections have to be established. You also have to set up to be able to access the file.
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Hopefully, this post will assist anyone considering switching from Xero to QBO in comprehending the obstacles and challenges. It is surely feasible to achieve if one possesses the appropriate abilities and perseverance.
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