MYOB vs Xero: Which Accounting Software Is Best for Your Business?

As your business grows, tracking your revenue and expenses in a spreadsheet is time consuming, limiting and quite inefficient.

And guess what?

Using accounting software will help you do a whole lot more within one system, and save you or your admin person a lot of time.

In this post, we’ll compare MYOB and Xero which are the two most popular packages in Australia.

But first… 

Why Accounting Software is Important For Your Business

First, let’s look at some of the reasons why your enterprise needs accounting software.

1. Saves time

As a small business owner, you may have to wear different hats. One minute you’re in marketing, then you’re sending out invoices, then you’re managing operations, and then you’re doing the books. It can be stressful at times, right?

The good news, accounting software frees up some of your time by simplifying some tasks such as tracking expenses, processing transactions or even sending invoice reminders to your clients. As a result, you will have more time to spend on growing your business.

2. Improves accuracy

Whether it’s spreadsheets or paperwork, incorrect input of financial data will result in an inaccurate picture of your business’s financial health. With accounting software, you can track your company’s expenses and have a clear picture of where your money is going.

3. Report generation

Sometimes as a small business owner, it’s easy to feel like you’re flying blind. You have too much on your plate and yet can’t see how it all fits into the bigger picture.

Enter accounting software. At the click of a button, you can generate crucial reports such as the balance sheet, cash flow statement and the profit and loss statement to gauge your financial health. In short, you have the information you need to make faster business decisions.

What Should You Look For When Shopping For an Accounting Software

There are a number of things to consider before investing in accounting software. Some of these factors are:

1. Fees

Please remember there’s a fine line between cost and value. It’s important to do your homework and make sure you choose the accounting package which provides the best value, now and as you scale.

2. Ease of use

The software should be user-friendly. For instance:

• Is it easy to set up?
• Does it integrate other systems you use?
• What kind of training and support is provided?

3. Features

Various accounting software packages have common features, and unique features, and your choice will depend on which one best suits your type of operation. 

MYOB vs Xero: Head-to-Head Comparison

First, MYOB offers over 50 business management solutions ranging from accounting, payroll, CRM, payments, professional tax solutions to retail point of sale.

On the other hand, Xero connects with more than 1000 third-party apps and offers cloud accounting across Australia, New Zealand and the United Kingdom.

Here’s a useful comparison of the two:

	MYOB	Xero
Monthly fee	Lite: $12Pro: $25 AccountRight Plus: $60 AccountRight Premier: $80   *Fees are subject to change, please visit here for the current prices	Starter Plan: $13.50 Standard plan:  $27 Premium 5 plan: $35 Ultimate 10 plan: $55   *Fees are subject to change, please visit here for the current prices
Number of company accounts	The AccountRight Premier package allows up to 2 company accounts	One per subscription
Payroll	Lite: Optional payroll at $1.50 per person monthly and a maximum of two employees   Pro: Optional payroll at $1.50 per person monthly and pay unlimited employees   Account Right Plus: Includes payroll at no extra cost and pay unlimited employees   Account Right Premier: Includes payroll at no extra cost and also pay unlimited employees	Starter: Payroll for 1 person Standard: Payroll for 2 people Premium 5 plan: Payroll for up to 5 people Ultimate 10 plan: Payroll for up to 10 people
Bank reconciliation	Lite package allows 2 accounts while the rest of the packages offer an unlimited number of accounts	Starter package doesn’t provide for reconciliation but the rest of the packages do
Invoicing	Create and send unlimited quotes and invoices	Starter package limits the number of invoices
Reporting	Lite package offers only tax and basic management reports while the rest of the packages provide advanced reports and analytics	You can generate a short-term cash flow and business snapshot report
Inventory management	Available in the  AccountRight Plus and AccountRight Premier packages	Includes basic inventory management
Tracking Expenses	You can track income and expenses	Free for the first 2 months then $5 for one user per month
Foreign currency	Available in the AccountRight Premier package	Limited to the Premium 5 plan and the Ultimate 10 plan
Automated superannuation contributions	Available in all packages	Limited to the Premium 5 plan and the Ultimate 10 plan
Scan and store receipts	Available in all packages	Done through a third party app

Lastly, to help you pick a winner in this MYOB vs Xero match, let’s jump into the advantages and disadvantages of each.

Pros of MYOB

• Easy to learn how to use.
• More competitively priced for smaller businesses.
• Offers more competitively priced payroll options.
• Built in receipt scanning, not reliant on a third party app.

Cons of MYOB

• There are fewer add-ons.
• Only one package supports foreign currency.

Pros of Xero

• Offers multiple report options.
• Integrates with a number of popular apps.
• It’s user-friendly.

Cons of Xero

• Payroll costs can get expensive as you grow
• Time-tracking isn’t available in starter and standard plans.
• Addons come with an extra cost.

So which one is the best for your business?

As shown above, both packages have their pros and cons. The choice you make depends on personal preferences such as the kind of business you run or your budget.

Want to know more about MYOB for your business? SouthEast IT are experts in MYOB migration and support. Call us today and learn more about MYOB and how it can streamline your administrative functions and scale with you as you grow.