Once you have set up the integration between your Retail POS store and your Xero account, you'll need to make some changes to your daily processes.
Learn how to use the Xero integration with the drop-downs below:
On account sales
Every time you make an on account sale in Retail POS, an account's receivable invoice will be automatically created and sent to Xero. The invoice will include:
- An itemized sale — list of all products (exclusive of tax), total tax amount(s), total sale amount.
- Any payments made against the sale.
- Customer details — if this customer is not already in Xero, Retail POS will create a customer record in Xero.
The invoice number on the accounts receivable invoice in Xero will match the Retail POS receipt/invoice number for the on account sale. If there is a duplicate receipt number already in Xero, an incremental -1 suffix will be added to the invoice number in Xero only. Remember, you cannot record payments in Xero on an un-approved invoice. As a result of this, we recommend you configure your settings to send all invoices to Xero as approved.
For more information on sending on account sales to Xero, refer to our Sending on account sales to Xero guide.
Once the accounts receivable invoice has been created in Retail POS, there are two ways you can take payment:
Taking payment in Xero
If you receive a bank deposit or any other online payment from a customer, you can allocate this payment against the accounts receivable invoice in Xero.
First, find the payment in your bank feed, and use the reconciliation feature to match it to the accounts receivable invoice for the on account sale. Sometimes you may receive a payment that applies to multiple invoices, for example, if the customer has multiple open on account sales in Retail POS and pays them all at once. In this case, you'll need to make sure you match the payment to all the relevant sales. For more information on how to do this in Xero, click here.
Payments applied to on account invoices in Xero will automatically flow through back to the invoice on Retail POS and record the payment
It's important to update your Retail POS sales whenever a payment is received in Xero. Otherwise, your store staff might accidentally record a payment against a sale in Retail POS that is already paid off in Xero. This is also important so that your outstanding customer balances are up to date in both Retail POS and Xero.
Taking payment in Retail POS
You should not add any more products to on account sales in Retail POS if the invoice has already been posted to Xero. Adding extra products in Retail POS does not update the accounts receivable invoice in Xero.
Your customers may wish to pay off their account balance while they are in store.
If your customer has a total outstanding balance across more than one on account sale, they can pay any amount towards their total balance owing. To pay off multiple on account sales against a single customer in a single transaction in Retail POS, click here.
To take payment against a single on account sale:
- First, find the on account sale in your Sales history (Sell > Sales history), or by searching for the customer on the Customers page (Customers > Customers).
- Next, open the sale by clicking the arrow icon. This will bring you to the current sale screen.
- Finally, click Pay and record the payment amount. If the customer is only making a partial payment, select on account again to put the remaining value of the sale back on account. Retail POS will automatically update Xero with the payment.
Voiding, cancelling or returning a partially completed on account sale
You may need to cancel an on account sale if, for example, your customer has returned the product or if the sale was made in error. The best way to do this is to put through a dummy payment on the account sale in Retail POS to close the sale.
Then, create a new sale, add all the items from the original sale with negative quantities. Pay the customer out via refund — you'll only need to return any amounts they paid. The remaining amount will balance the dummy payment you made.
You don't need to change anything in Xero as the dummy payment will close the invoice, and the refund amount, including in the day's register closure, will balance this.
Once your sale has been created in Xero, you'll need to reconcile the payments made to them with the deposits in your bank account. If the customer has paid you directly e.g. credit card payment directly for the invoice, you'll be able to locate the payment in your Xero bank feed and match it to the invoice.
However, for many customers, the payment will be included in a larger bank deposit, such as the end-of-day takings deposit. This means you'll need to match this payment to the invoice for the account sale, as well as any other applicable transactions, such as the daily register closure. Refer to the Xero help article for guidance on this.
It is essential to close all the registers in your store at the end of trading every day. If you have staff, make sure you have a closing process to follow for every register, in every outlet, each day. This should include counting the cash takings and removing them from the cash drawer, summing up your card/EFTPOS machine, if required, and closing the register(s) in Retail POS.
What information is sent to Xero when you close your register?
When you close a register in Retail POS, an accounts receivable invoice will be created in Xero. The invoice will include:
- Loyalty earned by customers: Total value of loyalty earned by customers in the register closure. This will increase the mapped loyalty expense account
- Loyalty liability created by Loyalty earned by customers: Total value of loyalty earned by customers in the register closure. This will increase the mapped loyalty liability account
- Sales Account Code: XXX: The sales total of what has been sold is broken down into relevant account codes depending on integration settings. This will increase the mapped sales revenue account
- Sales Account Code: XXX: The total value of discounts given in the register closure. This will either increase a mapped expense account or decrease a mapped revenue account
- Sales Account Code: XXX: The total value of gift cards sold in the register closure. This will increase the mapped gift card liability account
- Shortfall Cash: The total discrepancy of cash counted when closing the register and the expected cash. This will either increase or decrease the mapped expense account depending on whether the count was higher or lower
- Store Credit Issue: The total amount of store credit refunded to customers in the register closure. This will increase the mapped store credit liability account
- Closing float: The total amount of cash counted at the time of closing the register. This will increase the mapped float asset account
- Petty cash out: The total amount of cash removed from the register for petty cash. This will increase the mapped petty cash expense account.
- Cash Out: The total amount of cash removed for the purpose of banking. This will increase the mapped cash out asset account.
- Opening float: The total amount of cash counted at the time of opening the register. This will decrease the mapped float asset account
Cost-of-goods-sold ("COGS"): If you have cost-of-goods-sold enabled in Retail POS, the cost associated with the products sold will be added up and sent as part of the register closure. These will be posted to Xero as a COGS bill invoice and will also appear as a sum on your register closure sales invoice. To learn more about this or about COGS in general, refer to our Cost of Goods Sold in Retail POS (X-Series) guide. COGS calculated on open on account sales will also post to Xero at the time the sale is made, irrespective of whether payment has been taken.
What happens if I deposit my payments weekly (into my bank account) or for more than one register at once?
For many customers, the register closure payments will be included in a larger bank deposit, such as a weekly deposit or settlement from credit card processors. This means you'll need to match this payment to the invoice for all the applicable register closures. Refer to Xero's help article for further information about this.
Accounting for inventory costs is important to help you understand whether your retail business is making money. Your accountant will need to understand how much your stock costs you, and how much your inventory is worth.
It is essential that you use the order stock feature in Retail POS when adding new product inventory. If you do not, your product costs will be incorrect.
When you're processing your stock orders through Retail POS, you'll need to send these to Xero to create an accounts payable invoice in Xero. Unlike the rest of the integration, this does not happen automatically.
To post a received stock order to Xero, follow the steps below:
- Navigate to Inventory > Stock control in Retail POS
- Filter the stock order page by Received orders
- Click on any order and then Send to Xero to create the invoice in Xero
- You can now click View on Xero to load the invoice in Xero
When you pay your invoice, you can match the outgoing payment transaction in your bank feed to the accounts payable invoice in Xero.
The information sent to Xero is:
- Date the order is fully received in Xero
- Supplier name
- Products ordered
- Quantity ordered
- Order name and Supplier Invoice Number is sent to the reference field in Xero
- Supply cost (exclusive of tax). Tax is applied by Xero according to your settings.
The due date is NOT sent to Xero, as this is the day you expect to RECEIVE the order, not the date payment is due.
Remember, if you want certain products to be recorded in different expense accounts, you can customize this on the product page.
Shipping costs are not automatically included. You might like to create a shipping costs product with no tax, no price, and no inventory tracking in Retail POS, and add it to the order when it is received to track stock costs for each order.
Stock Adjustments - breakage, wastage, shrinkage and inventory counts
It's also really important to track adjustments to your stock levels, whether they are damaged or broken stock, wastage — such as food at the end of the day, or shrinkage (stolen items). Sometimes, you'll know about the loss when it happens — damaged stock, wastage — and other times, you might not realize until you do an inventory count.
All of these different types of adjustments can be recorded in Retail POS. To quickly adjust individual products, refer to our Processing an Inventory Adjustment guide.
To adjust stock on a larger scale, we recommended carrying out an inventory adjustment. Refer to our What is an inventory count and how do I complete one? guide for further information.
Stock adjustments, including inventory counts, cannot be sent directly to Xero from Retail POS. These require a manual journal to be completed in Xero to account for these.
Troubleshooting Xero Integration
I am seeing a red Xero logo; how do I fix it?
- Click on the red Xero logo.
- Did the transaction send (indicated by a change to a blue Xero logo)?
- Yes: You're all good! Sometimes transactions take longer to send and clicking it forces Retail POS to retry sending it.
- No: Go to step 3.
- Did you receive an error message?
- No: Go to step 4.
- Yes: Click here to learn how to fix the most common error messages.
- I didn't receive a Xero error message?
Sometimes, you'll get a register closure or account sale that does not give you an error message when you attempt to send it.
There are two common causes of this:
You have set up invoices to be sent as awaiting approval or draft, and haven't approved the invoice in Xero before taking payment. You need to approve the invoice in Xero, and either remove or reapply the payment. We strongly recommend setting all invoices to send as approved.
You have set payments to send to an account other than your bank account, and haven't enabled payments to that account in Xero. Enable payments in the Xero Chart of Accounts, and then click the Xero logo in Retail POS to resend the transaction.