Next steps after conversion to Xero

We try to make your conversion as comprehensive as possible, aiming to save you as much time as we can. However, there are some things that we are not able to do because of limitations in the software process we use.

This means that there will be some post-conversion tasks that you will need to perform and this document is provided as a guide to completing these tasks. The post-conversion tasks should be done as soon as possible after your conversion. If you encounter problems or think something might not be right please refer to our troubleshooting page.

Overview

These are the tasks you will need to perform post-conversion:

  • Tidy the VAT
  • Tidy bank reconciliations
  • Tidy foreign currency (if applicable)

Tidy the VAT

We do not set your VAT number and return periods. This is something that you will want to correct before completing your next VAT return.

Go to Settings > General Settings > Financial Settings

You can now set your VAT details as required.

Our conversion process is unable to bring over the VAT reconciled/filed status of transactions. Since VAT returns have never been filed in your new Xero organisation, Xero assumes that all the VAT you have ever recorded is still due. We need to tell Xero to mark all of the transactions up to your last VAT filing as having been filed so that Xero will only consider transactions since your last VAT return for filing next.

Go to Reports > VAT Return

You'll need to start with the oldest VAT Return already submitted to HMRC and continue to file them through to the most recently submitted VAT Return.

In the date selector, set the Ending date of the very first VAT Return submitted to HMRC within the conversion period.

For example, if your conversion covered 01/06/2015 to 31/06/2017 and the first VAT Return submitted in this period was to August 2015 then this would be the date entered as per the image above. If VAT Returns had been completed to May 2016 then those ending November 2015, February 2016 and May 2016 would also then need to be filed in Xero.

If the first VAT Return to be filed includes a date range prior to conversion you'll still need to enter the correct Ending date. For example if the conversion covered 01/06/2015 to 31/05/2017  and the first VAT Return submitted in this period was the quarter to June 2015 then this is the date that should be entered for the first VAT period.

Ensure that you tick the “Include VAT Late Claims” box then click on the Update button.

When the report has updated, click on the File VAT Now… button

You complete the filing in Xero by clicking the Publish button on the next screen

You’ll then see the report in your published reports list and you are done.

Note that it's not possible to select individual transactions (such as "late" claims) from being excluded when filiing a previous VAT period. The next VAT Return, that is required to be submitted to HMRC, may then exclude "late" transactions that have been filed in a previous return. It is worth carefully checking the figures in this first VAT Return. Where it should include "late" claims you may need to manually submit an adjusted VAT Return direct to HMRC (and file an incorrect VAT Return in Xero). This should only affect the first VAT Return to be submitted to HMRC. Subsequent VAT Returns should not require any manual adjustments. To read more about why VAT Returns may be different for the same period in the old and new software please click here.


Tidy bank reconciliations

We try our best to convert the bank reconciled status of transactions but this is not always possible. This means that you will probably need to manually mark some of the transactions as reconciled so that the “Statement Balance” in Xero is correct.

Remember, there are potentially two balances shown on the Dashboard for each bank account – the “Balance in Xero” is the “books” balance from your old system. The “Statement” balance is the total of transactions marked as reconciled in Xero.

 

To tidy your bank reconciliations click on the Manage Account button then Account Transactions

 

You now want to make sure that you enable the Mark as reconciled function via the help menu

 

We also recommend that, if you have a large number of transactions to mark as reconciled, you switch the page view to show 200 items. This will allow you to tick the top checkbox in the left column and mark transactions in blocks of 200 if you wish

 

All you need to do now is mark the transactions you want to change to reconciled and click select Mark as Reconciled from the More button.

If your bank balance was fully reconciled in your desktop software, you will want to mark all transactions as reconciled. Then your “Balance in Xero” and “Statement Balance” will be the same.

If your account was not fully reconciled in your desktop software, you will want to leave the unreconciled items as remaining unreconciled. Then your “Statement Balance” will be the same as the statement or cleared balance in your desktop software.

Tidy foreign currency (if applicable)

The recommendations below may not always be required or optimal for your user case. Please read them carefully and consider if they are relevant to you before attempting to apply them.

All bank accounts will be in base currency so create new foreign currency bank accounts. You'll need to have added your currency to Settings > General Settings > Currencies first. Once the currencies are added, navigate to Accounts > Bank Accounts and click Add Bank Account. Follow the prompts making sure to select the correct currency for the bank account.

Once you have the new foreign currency account you may wish to transfer the GBP balance into the new foreign currency account. Do this by navigating to Accounts > Bank Accounts and selecting Transfer Money. Choose to transfer from the GBP account to the foreign currency account. Enter the date to be the same as the "convert to" date selected for the conversion. Apply an exchange rate such that the GBP account will be emptied and the deposit in the foreign currency account will reflect the correct foreign currency amount.

If you have any outstanding foreign currency invoices or bills before converting then these will also have been converted at their GBP equivalent value. You may wish to edit (or void then re-enter) these to correctly reflect the foreign currency values owed or owing.