Xero Bank Feeds

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Xero Bank Feeds Setup and Operation

Setup Xero Bank Feeds

Requires Subscription with Xero

Xero have 2 types of Bank Feeds 1. Partner Bank Feeds – Partnership Banks with Xero (See below List for

Australia)

Important to note: Partner Bank feeds are not available for

Credit card accounts

Mortgage accounts

Foreign currency accounts

2. Yodlee Bank Feeds – are banks that are accessed via Yodlee’s online

banking solution. Therefore you may setup the bank account with Xero

Partner Bank Feeds and the Credit Card with Yodlee Online banking.

Bank Feed setup

From the Xero Dashboard select Bank Feeds and follow steps outlined

Xero Bank Feeds

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Step One – Add a Bank Account in Xero

Step Two – Download the Bank Authority Form

Step Three – Complete form with the client giving authority by signature

Step Four – Send the form to Xero

Step Five – Xero will work with the bank to start the Bank feeds (some banks have

an online authority you can provide the bank to work directly with Xero)

Xero will notify you within 10 working days

You are now ready to retrieve Bank Feeds !!!

Operating Xero Bank Feeds

Retrieving Bank Feeds is automatic on login of Xero

Process the Transactions received

o Select from the Dashboard > Bank Accounts > Reconcile

‘#’ items (“#’ is the number of unreconciled/unmatched

transactions)

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o Bank Feed Processing Screen

o Left Side shown in grey below is the downloaded Bank Feed

transactions “Bank Statement”

o Right Side shown in blue below is the entry point for “Your

Transaction”. You either; match the bank feed transaction if Xero

has not already found a possible match, or create a new transaction

or use transfer to allocate to another bank .

o Processing options include:

MATCH

Xero will automatically try and match a bank feed transaction with a

transaction already entered into Xero, according to whether it’s a customer

receipt, supplier payment, withdrawal or deposit to bank. Xero looks for

the following match within the transaction

Name – Description on Bank Statement

Date – Date is required to be exact to auto match

Amount – Amount is required to be exact to auto match

If a possible match is found Xero will highlight the match in green, ready

for “ok” approval. See below example

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CREATE

“Create” is used if Xero cannot find a match. You can create the

transaction from the Bank feed transaction.

Select ‘Create’

Add Name, account, desciption and tax rate.

Select the ‘add details’ to add further detail if required and save

transaction. Xero will then ask you to reconcile the transaction.

TRANSFER

“Transfer” is used when the transaction is a movement between bank

accounts or loans. You are required to select a bank account.

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DISCUSS

This tab allows you to add a comment about the transaction for other

users to view

o Cash Coding

To help the reconcile process, Xero has a feature ‘Cash Coding’ that

allows you to sort the transaction list, batch a group of transactions, then

flag multiple transactions at the same time if it is for the same allocation to

account, tax rate and description.

Select a header that will group the transactions ie Payee, then tick each

transaction to highlight the group of transactions and select a transaction

to allocate account, tax rate and description.

Important Note: Cash coding is only used for cash transactions and

NOT transactions assigned to invoices.

Create Rules

A rule is a set criteria that allows Xero to automatically create a cash transaction

from the imported bank feed transaction.

A rule can be either a Spend Money or Receive Money transaction and will

automatically run on selecting reconcile

Select ‘Create Rule’ from the reconcile screen or ‘manage account’ drop down

screen on the dashboard.

You have 7 options:

1. Requires you to set a “condition” for Xero to match. Xero allows up to 7

multiple conditions to help find the match. The match can be All or Any of the

conditions set. The condition has 3 sections

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Section A – Is a choice of the following fields to match with the imported bank

feed transaction ie see above payee is ‘Tax Office Payments”

- Payee

- Description

- Amount

- Reference

- Analysis Code

- Any text field

Section B – Is asking how to match the fields and this will depend on the payee

description from the bank. ‘Exactly” and “contains some of the criteria” are most

commonly used.

- Exactly

- Contains some of the criteria

- Starts with

- Blank

Section C – Is the Description to match to the imported Description. In the

example above ‘Tax Office Payments’ would be sufficient

2. This option requires you to ‘Set the Contact’ for the transaction. The following

are the choices available.

- an existing or new contact,

- Payee from the bank feed transaction, or

- enter the contact details at the time of the reconciliation/bank feed matching

3. This option is to ‘automatically allocate a fixed value.’ This would be helpful

for a Car Lease that requires set values and multiple lines.

Description, account, tax rate and amount are required.

4. This option may be used in conjunction with the above fixed. If the

transaction does not require a fixed value then you could use ‘allocate items

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by following ratios’ You are required to enter description, account and tax rate

with the option to % split over various accounts.

5. This option allows you to ‘Set the reference’ form the imported bank feed or at

time of reconcile

6. Allocated the bank account allows you to select a single bank account for the

rule to run or over all banks that have bank feed setup.

7. Xero requires you to set a ‘Rule Name’ that is unique. For example; Lease-

Car

Example:

Account Fee is a recurring debit entry from the bank therefore you would create a

rule for Xero to automatically match the bank feed transaction and assign a chart

of accounts and approve.

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Editing/Changing an APPROVED/MATCHED Transaction

You may find that you will be required to edit a transaction that has already been

approved in bank feeds.

To find the transaction; select “account transaction” from the reconcile screen or

from Manage Account on Dashboard. Select Payment Options and Edit

Transaction, see below.

Note: If you delete or edit a transaction, the transaction will return to the bank

feed screen for approval.

Bank Reconciliation

Bank Reconciliation process differs when using Bank Feeds: In the process of

allocating the bank feed transactions they are reconciled at the same time.

Therefore, you don’t need to compare against the formal bank statement as Xero is

reconciling automatically to the downloaded bank statement & balance. Xero’s Dashboard shows your daily bank Statement balance and also shows

Xero’s Balance of the bank account. This shows the difference between the

accounts and the unallocated bank feed transactions.

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After allocating and reconciling all bank feed transactions, Xero should show the

account is reconciled on the dashboard

Xero provides a reconciliation report for accounting purposes and this will show

any unpresented transactions. This report can be produced at any date.

Steps to Reconcile

1. Allocate all bank feed transactions

2. Reconcile transactions to the bank feeds

3. Check Dashboard for reconcile tick for the bank account

4. If Xero Bank balance differs from bank balance: view the accounts

transaction for any unreconciled transactions

Print, if required, Bank Reconciliation Summary