Xero outlines smoother NZ year-end workflow for firms

Xero has outlined a year-end workflow for accountants and bookkeepers in New Zealand using its accounting platform, focusing on pre-year-end checks, reconciliation, reporting, and client conversations.

Nicole Acott, Senior Education Specialist at Xero, said Xero's year-end approach differs from systems that require a rollover journal. In Xero, there is no need to bring profit and loss balances to zero or manually switch to a new financial year because the rollover happens automatically.

She described year-end work as a mix of client housekeeping and adviser-led checks and reconciliation. Xero provides a checklist that practices can use and share with clients.

"Year-end isn't just about closing the books, it's about helping your clients plan the year ahead," Acott said.

At the client level, she highlighted checking contact data, keeping bank reconciliations up to date, and ensuring invoices and bills are recorded in the correct period. For businesses with stock, she also flagged the importance of stock takes and inventory adjustments.

On the adviser side, she said practices should start by reviewing organisation settings and, for clients that moved to Xero during the year, checking conversion dates and opening balances. Key details to confirm include the legal trading name, NZBN, industry, and addresses, as well as report code mapping and lock dates.

Reconciliation priorities and common traps

Acott grouped year-end reconciliation into three areas: bank accounts, debtors and creditors, and fixed assets.

For bank accounts, she said advisers should ensure all transactions are reconciled and that Xero balances match physical bank statements. She pointed to Xero's bank reconciliation reports as a starting point and said discrepancies often come from missing statement lines, duplicates, or deletions. For small variances, she suggested using the search function in the Bank Statement tab to help pinpoint issues, such as a manual statement line.

For accounts payable and receivable, she said advisers should reconcile the aged payables and aged receivables reports to the balance sheet. A recurring issue is future-dated transactions, which can cause ageing reports to differ from balance sheet balances.

For fixed assets, she said practices should reconcile the asset register to the balance sheet and ensure assets are correctly registered, disposals are recorded, depreciation is run, and reconciliation reports are reviewed. She warned that manual journal edits can break the link between the asset register and the general ledger, and suggested using the asset audit log to identify changes.

Journals, lock dates, and publishing reports

Acott said year-end adjustments are often recorded in manual journals. She recommended reviewing repeating journals to confirm they remain relevant for the new financial year and checking for any draft journals. She also described filtering the journal report to show only manual journals as a quick way to audit entries that did not come from bank feeds or invoicing.

She highlighted lock dates as an important control once reconciliation and reporting are complete. Practises can set a lock date that prevents changes by non-advisers, or a full lock date that blocks all users regardless of role.

On reporting, she said practices should publish end-of-year reports and use watermarks to indicate the stage of completion. Finalised reports appear in the Publish area after the financial statements are completed and the client has reviewed and signed off.

Client discussions and payroll update

Acott said year-end is also a time for structured client conversations about performance, priorities, and plans. She encouraged advisers to use the reports as the basis for discussion, rather than simply sending statements without follow-up.

She also flagged an upcoming payroll-related change to KiwiSaver contribution rates, with the government increasing the rate to 3.5% from 1 April 2026 and allowing employees to apply for a temporary rate reduction. To support the change, she said Xero plans to release a bulk update tool so payroll users can update employee KiwiSaver contributions ahead of 1 April.