Xero fixed assets depreciation with AssetAccountant

Xero Logo and Connected App Logo

One-click journal posting
Tracking category support
Draft assets pull-through

AssetAccountant have clients who work with all sorts of accounting systems where the depreciation requirements have outgrown the native functionality of their platform.

Because of the scale of their market penetration (and we use it ourselves), one of the most common of these is Xero.

As with all the systems AssetAccountant can work alongside, there’s nothing fundamentally “wrong” with the depreciation and fixed asset management features in Xero, but rather there are cases where a business or accounting firm’s needs aren’t met by what’s included.

We have developed a remarkable integration between Xero and AssetAccountant to provide support for this.

Before we get to the details of how the integration works, let’s have a look at some of the use cases that our Xero-first users have and why they choose to use AssetAccountant.

The two main reasons businesses come to us to augment their experience using Xero:

The first of these (and the most straightforward) is that they have a large number of assets to manage which exceeds (and in some cases far exceeds) the soft cap limit of around 500 assets that Xero has with their Fixed Asset solution.

The second reason is where you may have some more complex technical requirements that Xero fixed assets does not handle because these are not required by much of its core user base. Some examples of this include:

  • Management of BBI incentives – AssetAccountant manages tax content and rule changes so you don’t have to. This extends to building in specific support for government rule changes as a result of Covid-19.
  • Partial disposals – Some businesses have a requirement to manage partial disposals or write offs of assets (eg if you were selling part of a block of land or writing off a proportion of assets with short lives).
  • Revaluations and impairments – Sometimes you will need to revalue or impair an asset. AssetAccountant has functionality that automates this and keeps track of revaluation reserves which are journaled back to Xero.
  • Components – AssetAccountant allows you to mark assets as components of other assets for convenience.
  • Assets under construction (WIP – or Works in Progress) – AssetAccountant allows users to add multiple purchases to a single asset delivering a rich user experience for assets being built or purchased piecemeal.
  • Adjusting private/taxable use from year to year – often the taxable or private use percentage of an asset can change from year-to-year. AssetAccountant has this feature built in as native.

Why our clients love AssetAccountant

So how does AssetAccountant actually integrate with Xero?

Fortunately Xero has a great set of Application Programming Interfaces (APIs) that let AssetAccountant and Xero exchange selected data.

AA has invested significant resources to that allow you to take advantage of some of the features in Xero’s fixed asset system as follows:

  • Draft assets – AssetAccountant interrogates the Xero draft fixed asset register for new items bought by the business.
  • Classify in AssetAccountant – Once the asset has been imported to AssetAccountant, the user selects the correct tax and accounts depreciation treatment (or can use the standard method for that asset type).
  • Tracking Categories – AssetAccountant supports use of tracking categories and this information is included in journals back to continue to provide granular reporting in Xero.
  • Journals – AssetAccountant then depreciates these assets for both tax and accounts and gives the required information to the user as well as allowing for automated journals back to Xero.

Xero <--> AssetAccountant Features

  • Automated depreciation calculations and one-click journaling to Xero GL
  • Sophisticated modelling of accounting AND tax rules (AU & NZ) including Div43, Luxury Vehicle, Blackhole Expenditure, Backing Business Investment (BBI), Instant Asset Writeoff, Taxable Use, Intangibles and more
  • Detailed support for Small Business Pools, Low Value Pools and Software Pools
  • Effortless depreciation calculations and forecasts for tax and accounts over any timeframe: past, present or future
  • Automated lookup of ATO and IRD tax rulings to save you thumbing through the guide
  • Tracking category support
  • Draft assets pull-through from Xero to AssetAccountant
  • Elegant user interface designed to minimise the time you spend on compliance
  • On-demand reporting and data exports
  • Effortless onboarding
  • ISO27001 certified
  • Unlimited users, entities and assets

AssetAccountant – saving you from spreadsheets since 2019