How To Move From Sage To Xero

Are you looking to make the switch from Sage to Xero? If you are looking to undertake this project yourself it is important that you understand what you need to have in place and the best approaches.

If you want to make your life easier, we are Xero Migration specialists so we make the whole process straightforward for you.

When Is The Best Time To Make The Switch?

Preferably and simplest time is at your company’s financial year end. This allows us to transfer the data from Sage with a defined cut off point and makes the process much easier. We understand that Sage might not be the right choice for you, so it is definitely still possible to transfer at any time during the year but just makes the switch a little more complex.

What Do I Need To Do Before Migrating to Xero?

To ensure the data transferred is correctly, it is best to make sure your Sage account is fully up to date before bring it to Xero. 

To tidy up your Sage account, it will normally include:

• Check that the bank balances in Sage match your actual bank balance
• Ensuring the sage system matches your last filed accounts
• Check that the VAT return in Sage match the VAT filed with HMRC
• Check if all invoices due are actually due
• Check that all bills due are actually due
• Check the detailed aged debtors and creditors reports in Sage. Check if any payments have been made or any unallocated payments
• Check your trial balance to ensure everything matches up

What Are The Best Approaches To Moving To Xero

There are two approaches to take to transfer your data from Sage to Xero:

1. You only enter your opening balances into the system at the financial year end. This approach will not bring forward any historical data.
2. You use a conversion software to transfer up to 2 years of historical data from Sage into Xero. 

Manual Conversion

A manual conversion is more time consuming however ensures your system is set up in the way you want it. Using a software conversion system can bring forward a lot of information however this is not always transferred correctly.

To manually transfer your Sage to Xero you would:

1. Set up your Xero subscription
2. Configure your charts of accounts (this is very important for reporting and where an accountant can provide a lot of support)
3. Configure the Xero settings
4. Set up the financial settings such as VAT scheme and year end
5. Map together the charts of accounts from Sage to Xero
6. Link your bank account so bank statements are pulled through automatically
7. Bring in the opening balances from the trial balance in Sage
8. Import any individual invoices or bills which have not been paid 
9. Once the statutory accounts are completed and filed, adjust the opening balances so that the systems matches the accounts.

Converting From Sage To Xero Using Software

Using software to complete your conversion from Sage to Xero is often the easy option and generally works quite well. There are quite a few different softwares you could use however we would recommend Movemybooks.

Xero will cover your fee for using your software conversion under Movemybooks so it makes sense to use them! The only thing with software is that not everything will be transferred over and there will be post-conversion tasks that will need to be done.

When converting software there will be process that will need to be followed:

1. Have an empty Xero organisation
2. Create a movemybooks account
3. Choose how many months of historical date you would like imported into Xero. (up to 24 months is free of charge, any additional is chargeable)
4. Set the financial year end date and the date you to bring transactions up to
5. Down the extractor tool and have the sage file open
6. Upload to Xero
7. Follow the steps to complete your Xero set up
8. The conversion is completed! 

The biggest advantage of a software conversion compared to manual conversion is the time saved and having the historical data so you can compare year on year performances.

Why Charts of Accounts Are Important?

Charts of Accounts are the foundations of your business, if you have a good charts of accounts set up this give you a great starting point for good reporting. Currently you might only have one sales code called revenue which you report everything to however this could be split into multiple revenue streams so you know exactly where your revenue comes from.

This gives your business a strong reporting structure and is a massive benefit when it comes to management accounts are your reporting will be much more detailed allowing you to make better and quicker business decisions.

SaintFG Recommendation?

We understand this could sound a little complex, this is why we recommend speaking to one of our Xero Specialists who can advise you on the best approach for your business. Our accountants have experience within the construction industry and are here to recommend the best approach for you.

If you would like that extra level of support, Saint Financial Group are Xero Migration specialists so we can complete the conversion for you and help you get fully set up.

We specialise in the construction industry so we can run through the common set ups and ensure you know exactly what is happening through the process. We are here to support your business and if you are ever unsure what your next step should be give us a call on 020 8187 4201.