HOW TO: Add a Bank Rule in Xero
As expert financiers, we like to help you out wherever we can. From sharing information about accounting best practice, or hints and hacks for clearer financial planning, to active in-house financial planning.
As life gets busier, and you extend your business to incorporate new clients from further afield, many of us are dealing with transactions from across several platforms: cash, bank transfer, PayPal and others, to name a few. As such entering transactions into Xero can mean facing hours of returning to cross reference different input.
Many clients deal with cash transactions or don’t enter all transactions in Xero before importing bank statements. This is where Xero’s bank rule feature comes into its own. It provides a speedier and simpler way to merge imported bank statements, saving time.
Implementing bank rules allows you to delimit the conditions for each rule so as to ensure a match with your imported statement. Once you have imported a bank statement and then go to reconcile your account, your implemented rules will have effect and start running.
Our expert financiers have started this Xero tips and are here to guide you through this process to help make your accounting easier. With this guideline you can aggregate transactions and implement deductions as part of Xero’s performance.
- Go to Manage Account on the dashboard and click the tab named Bank Rules
- Click on create rule
- Select the option Spend Money
- In the 1st column you will see ‘payee’. Select this option.
- In the 2nd column select ‘contains’ and in the 3rd column type in the name of the place name you want to add as a condition to this rule. (e.g SWFD, Costa Coffee)
- Be sure that you select ‘any’ as opposed to ‘all’ at the top of bank rule screen
- In the description, enter client meeting and create a code for entertainment (deductible) and put 50% in the percent box
- Add a new line and repeat adding client meeting but this time code to entertainment (non-deductible) and again enter 50% in the percent box
- Don’t forget to save what you have done by clicking the save button at the bottom of the screen
Sophisticated and advanced use of Xero allows you to take hold of you accounting. You can continue adding to this bank rule as required. This means that whenever more of these transactions are imported, Xero will do the split and implement the code automatically for you. You’ll just have to hit the OK button!