Xero as the main hub of the new firm

When Alex Shall, Pete Heslington and I set up Praxis back in October 2020, we had a very clear goal for the firm. We’re all driven by providing the best client service, and technology is such a big part of that client service these days. We’d all seen how easy cloud has made it to collaborate with staff and with clients, and as young and tech-savvy professionals, we were keen to embrace this. So, with Praxis, we wanted to take those cloud tools and apps and use them more efficiently – and Xero was always our choice of platform for doing this.

Wen we first set up Praxis as a firm, we knew that Xero had to be the central hub. We’re using a suite of cloud solutions which are all integrated with Xero, and that’s making it easier to work anywhere and to engage with clients. There are so many benefits of being in the cloud, once you get through the initial teething issues. I would say that maybe 90% of our clients are now on Xero, and we’re already a Silver Partner with Xero, which is pretty good for a new startup firm.

Running the practice on the Xero platform

When we started looking at practice management solutions, we knew that one must-have was that it must integrate with Xero and the wider ecosystem. 

As a firm, we use Xero Practice Manager for our work in progress (WIP) and billing, and Accountancy Manager for our practice management, with everything integrated with the main Xero accounts. Accountancy Manager is the best practice management offering out there, in my opinion, and works perfectly with Xero. If we raise a bill in Xero it appears in Accountancy Manager and you have that brilliant integration between both solutions. 

We had a lot of initial questions and feature requests for the Accountancy Manager team when we first started, but ‘out of the box’ it can do all the things we need as a practice. We use it mainly for holding client data and sending out things like engagement letters. All our engagement letters go out electronically – there’s no paper or printouts of old-school signatures – so it’s a fully digital process. Accountancy Manager is also linked to our HMRC account and you have a Companies House link in there too, so there’s a huge amount of connectivity there.

The benefits of integration and an open API

Having the Xero open API makes such a difference. It’s created a huge ecosystem and it’s been invaluable for us when choosing our apps and cloud tools.

We use Receipt Bank and HubDoc for the automated bookkeeping side of things, and we also use Silverfin for the workflows internally. Silverfin pulls the data straight in from Xero, which is a huge help, and you can also get quite sophisticated reporting out of Silverfin too. Because of that direct Xero integration, the data doesn’t need any filtering or mapping to make it usable, and that saves us such a lot of time.

Everything branches out from Xero and that’s meant our clients getting used to working in the cloud too. Most of our clients are relatively tech savvy, but Xero is so intuitive and easy to use, so most clients have no real issues getting up and running.

Streamlining and automating the key processes

We use Xero for our own practice accounting at Praxis, and we raise all our invoices in Xero too, with our WIP in Xero Practice Manager. Everything gets pulled into the accounting software, and that means that invoices don’t get missed, are easier to track and are easier to pay for the client. It makes our lives much easier and improves the client service side of things. We have more time to talk to clients and do the advisory pieces because we aren’t wasting time on low-level admin anymore.

Previously, it was a much more laborious process to raise an invoice, with lots of different steps to complete. Now, I can raise the invoice myself in a couple of minutes. In Xero, the invoicing is so well formulated, so I can send the bill straight out and speed up the payment process. The little automated nudges for overdue invoices are also great, and you generally only have to get manually involved in a few minor things.

One of the great things about Accountancy Manager, from a workflow perspective, is all the potential for automation. We can automatically remind clients about tax deadlines, or the need to sign outstanding paperwork etc. We can even generate a tailored tax reminder email with all the tax numbers in there and with the tax manager’s name in the email. It’s very much a tailored, personal email – but automated. The software does all the hard work for you and that’s an incredible timesaver.

The future path for Praxis

We’re still only a few months old as a firm, so we’re still bedding things in and looking for other ways to save time and effort. If you’re going to make automation work, you have to set these processes up, get it right once and then reap the benefits forever. 

There are lots of things we can still automate, so those efficiencies will just get better and better. We’re really starting to see the benefits of the automation, but we’ve probably only scratched the surface, to be honest. There’s always an opportunity to replace a manual process.

Where will we be in a year? In terms of being a cloud practice, we want to get to a point where we have a proper cloud tax offering. That’s out of our control as there isn’t anything that completely fits the bill on the market at present. We’re keeping our eye on Xero Tax, as that could be a perfect add-on for limited companies where we already do the accounts in Xero. 

Silverfin is allegedly launching a corporation tax function, linked to Xero, and we’ve found a good company secretarial cloud offering too, which will make a big difference. We want to get to a point where we can run the entire practice in the cloud, with software that integrates with Xero. We’re doing pretty well for four months in and we’re harnessing everything that we can do in terms of achieving that cloud goal.

It’s been hard work getting Praxis off the ground over the past few months, but it’s also been a lot of fun too. I think we’re well on the way to becoming the lean, efficient Xero-based cloud practice that we set out to be – so we’re excited to see where things will go from here.