The start of a new financial year is the perfect time to reset, refresh, and build better habits—especially when it comes to your bookkeeping. If you’re using Xero for your business, a few proactive steps now can save you time and stress down the line. Here are some best practices to help you keep your Xero file tidy, accurate, and up to date throughout the year.

1. Start with a Quick Health Check

Before diving into new transactions, take a moment to review the state of your Xero file:

• Are all bank accounts fully reconciled up to 30 June?

• Have outstanding invoices and bills been followed up or written off?

• Is your payroll year finalised (if applicable)?

• Have you locked last year’s period to prevent accidental changes?

A tidy close-off helps ensure that your reports for the new year start on solid ground.

2. Set a Weekly Xero Routine

One of the most effective habits you can build is setting aside 15–30 minutes each week to:

• Reconcile bank transactions

• Send reminders for unpaid invoices

• Review cash flow and spending

• Categorise any uncoded expenses

It’s much easier to stay on top of things weekly than to play catch-up every quarter (or worse—at year-end).

3. Keep Your Records Organised

Make use of Xero’s file attachment feature—or better yet, use Hubdoc, which integrates directly with Xero—to store and manage:

• Supplier invoices
• Receipts for purchases
• Employee reimbursements
• Any supporting documentation for GST or tax claims

With Hubdoc, you can automate document collection by emailing or uploading bills and receipts, which are then pushed to Xero with the source document attached and data pre-filled. Read more about using Hubdoc here.

This keeps everything in one place for your accountant or bookkeeper and makes audit time much less stressful. for your accountant or bookkeeper and makes audit time much less stressful.

4. Review User Access and Roles

Start the year by checking who has access to your Xero file:

• Remove access for old employees or former bookkeepers

• Check that user roles match current responsibilities (e.g., payroll access, bank reconciliations)

• Add new users as needed

Only users with the Advisor role (or higher permissions) can adjust sensitive settings like lock dates.

5. Refresh Your Reports

Run and review the following key reports regularly:

• Profit & Loss – compare current performance to prior periods

• Aged Receivables/Payables – to chase payments or avoid late fees

• Cash Summary – for a quick pulse check on liquidity

Bookmark your most-used reports and save customised versions for easier access.

6. Automate What You Can

Xero’s automations can save you loads of time:

• Set up bank rules to automatically code common transactions
• Use invoice reminders to chase overdue payments

The less manual work you have, the more time you can spend running your business.

7. Lock Periods Regularly

Locking periods in Xero protects your data after it’s been finalised:

How to Lock a Period:

1. Go to your organisation name > Settings
2. Choose Advanced Settings > Financial Settings
3. Enter your desired lock date (e.g., 30/06/2025)
4. Choose who it applies to: everyone, or everyone except advisors
5. Click Save

Only users with the Advisor role can change or remove lock dates unless a full lock is in place.

When to Lock:

• After finalising a BAS or year-end
• After internal monthly/quarterly closes

Need to Unlock?

Go back to the lock date setting, delete the date, and save. Remember to relock once changes are made.

Visit Xero for more details.

8. Don’t Let “Uncoded” Pile Up

If you have staff or shared access, keep an eye on transactions left uncoded. These can quickly pile up and create a backlog. Use the “Discuss” tab or the Notes function to ask for clarification on transactions in real time.

The new financial year is more than just a date change—it’s a chance to create better habits that support cleaner data, timely decisions, and easier compliance. By investing a small amount of time each week and using the tools already available in Xero, you’ll set your business up for a smoother, smarter year ahead.

Xero is currently doing a promotion of 90% off your plan for 4 months when you sign up by 31 July 2025. Sign up now.