The last key step is reviewing accounts receivable and accounts payable—especially for companies actively using Xero.
Accounts Receivable (AR)
- Check open invoices: Review all outstanding invoices to see what has been billed but not yet collected.
- Match payments: Make sure payments are properly recorded in Xero and applied to the correct invoices. Sometimes clients deposit money in the bank, but it doesn’t get linked to the invoice in Xero, leaving it open.
- Identify discrepancies: Open invoices with recorded deposits indicate a mismatch that must be corrected to ensure accurate reporting.
Accounts Payable (AP)
- Review bills and pending payments: Ensure all recorded bills are reflected in your accounts and are up to date.
- Verify balances: Make sure AP totals match what you actually owe, preventing missed or duplicate payments.
By carefully reviewing AR and AP, you catch errors, ensure invoices and bills are properly accounted for, and maintain accurate financial records. This step ties together all prior cleanup work, giving you a clear view of your company’s financial health.